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Single-payer healthcare would save $450B and 68k lives a year: study (thelancet.com)
353 points by bjourne 39 days ago | hide | past | web | favorite | 390 comments



I'm paying nearly 20k (parents+child) on insurance I don't have time to use (and luckily no serious need) and once my son went to see his pediatrician and our 'private' insurance company (that i'm not going to name) sent us bill of $500, for a check-up. We disputed the charge with the insurance and they agreed to wave the payment next month. Next month comes and guess what? The same letter comes in mail. We disputed it again and again the month after when the bill was sent to us the third time. This is been happening for 6 months and don't take it seriously anymore, I don't have time to waste. I realize that a lot of money goes to waste on a system that is not working even if you're paying a lot. It is utterly broken. Downright revolting. And on top of it I get a better deal if I use no insurance at all for prescriptions. Then what am I paying for? Emergencies? I am paying nearly 20k a year for possible emergencies? It's become so complicated that nothing can be reasoned about it, this is a monster that has to be killed with fire then drowned in deep waters.


For a family of 4, I pay total of about 20K per year as well (employer + employee cost) and even after that, we have a $5000 deductible AND on top, we have to be concerned about in-network/out of network bullshit. So for me, unless $25,000 has been spent, insurance company would not even come in the picture AND I am always scared if I wil get a bill that was out of network.

This madness has to end and I don't give a shit that we are trying Single Payer. Everyone talks about Cost but what about Administrative issues ? Fighting incorrect claims, billing errors and what not. As far as I am concerned, this is one area where I am totally against Profit making motive. Let me correct myself. I am totally ok with Doctors and Hospitals directly making some profit but not insurance companies. Private insurance companies can go suck it. I am sick and tired of paying for their profits. Status quo has to change, that's it.

EDIT: I am not against Insurance of some sort but they should only exist for Catastrophic illnesses. I need to go see my doctor for preventive care ? No need to involve Insurance company and wasting time on filing a claim that by definition requires more money to pay for the people involved unnecessarily.


I'll chime in with my anecdata on US health insurance:

My SO has a condition that requires a pill to help out with. My SO has some trouble working regular hours due to this condition and takes one pill per day. Depending on the insurance, we have paid between $1 and $5 per pill in the past. This particular chemical is a part of horse feed. Like, how we just put Vitamin D in Milk, or Iodine in Salt; they put this chemical in horse feed. It does not change the cost of the horse feed appreciably, just like with human additives.

I was once offered a job. When we dug into the insurance that the job had, it would have cost us ~$100 per pill, or ~$3k/mo. It was an otherwise dream job, perfect for me. But a ~$36k/year increase in our yearly cost of living. We had to turn the job down, of course.

For a substance that they put in horse feed for basically free.

The last time that I posted this issue on HN, a VERY kind person pointed me to a way to buy this chemical online and in bulk. It comes to your door in volumes of about ~$100 per CUBIC METER. They ship by volume, not weight.

US Healthcare is totally, completely, utterly, broken.


Wow. At that point it makes more sense to fly out to another country, see a doctor there, pay for the medication in cash, and take a vacation at the same time with money left over.


Some already are:

https://www.youtube.com/watch?v=7Z2XRg3dy9k

~ the 7 minute mark


The seemingly (to me) crazy thing is that private insurance in places with single payer healthcare aren’t like this at all. Our entire insurance bill for everything from healthcare to house insurance for a family of four is less than a quarter of that. There’s even pretty affordable private GP clinics where I’d never even think about using my insurance.

It’s reasonably common to have private healthcare insurance for unexpected events even in places with national health services. I’ve had it variously through work, unions and now as a private individual. Typically you want it to make up the difference between the level of provided state support and what you’d lose by not working.

Personally I’d rather than private insurance and healthcare industry wasn’t necessary but the American debate seems polarised into either/or rather than realising that it’s very common for private healthcare to coexist and be part of nationalised healthcare systems.


Part of the administrative savings though is the fact that $0 dollars is spent to essentially what amounts to 'billing' agencies. Every $ spent on medical billers in hospitals, lawyers contesting claims, etc... can better be spent inside hospitals and research labs, etc.. John Oliver said basically our plan does go above and beyond all other plans, covers more, etc... so it's basically the utopia of plans.

Of course it's probably better to start at utopia and get semi-utopia than start at the public option and only get the public option.

I can see maybe something bigger to cover things like maybe subsidies for fertility which my wife's really concerned about - because there's a LOT of emotional depression related to that, and maybe even adoption which sort of ties into fertility.

Though, I'd definitely be happy w/ lesser I mean what we have now is murderous.


Holy crap. I am in the process of "fighting" with insurance over meds we paid out of pocket even though they were supposed to cover it.. long story. We thought we hit a wall and we contacted one of the enforcement agencies. All of a sudden, we get an individual refund form and a place to mail it to. The amount was not astronomical ($1.5k), but not something I can just ignore.

And that happens all over the country. Not everyone has my time to call, write and complain. Those are the moments I am ready to change the system. It is not really working for me. It is merely acceptable to a few.


My friends hired a consultant to reconcile pregnancy related bills coming from all angles from a half dozen entities. The consultant corrected things from over $17,000 to “only” four figures of copays and balance billing.

That is nuts. The fact that a consultant with expertise in this “skill” exists and is required is also a sign of a supremely broken system.


yep. Dont even get me started on how many times I had to fight with the insurance/billing/admin departments to even understand why I received a bill and for what. They must have a team of smart cryptographers to generate those crazy bills and invoices /s


And after you think you have it all figured and and properly paid, a new bill appears out of the blue 6 months after your visit.


Bingo.


Are admin issues guaranteed to be better under a single payer system? Don't people run into all sorts of problems with Medicare - what it will pay vs. what it won't?

I give you though that at least it is one set of admin rules than N.. which might be better.


Depends how it's organized, but it could be much better. In Canada, physicians don't need to get approval before they do everything, admin overhead for a physician to bill is a matter of a few minutes a week. Not two full-time staff members just for that.


definitely not guaranteed. But I am so sick of status quo that I am willing to try ANYTHINg different. It just happens to be Single payer option at the moment.


This is where I think political leaders (Democrat or Republican) could do really well. It's not just making sure people are covered. It's the existential dread of dealing with opaque, unpredictable, and incomprehensible bureaucracy that can make life-and-death decisions or drop financially crippling bills in your lap, even if you have good insurance. The American health care system isn't just bad for the poor. It's bad for everyone. We just can't deal with it, because we are exposed directly to unnecessary complexity.

But the fact that the people with money and good insurance are suffering from the system as well as the poor seems to be lost on Democrats, and the Republicans are just paralyzed by the whole idea of fixing health care. It's a massive political failure for both parties.


"isn't just bad for the poor. It's bad for everyone"

Thank you for saying that. I am amazed at how so many people don't see and understand this. It is not just about Cost which is insane alright. It is about the BS we have to go through after a visit to a doctor or hospital. I am scared about the type of bills and claim fights I have to do if I visit a doc. Not because I cannot afford it necessarily. But because I have to spend may be like 5 hours calling doctor's offices, insurance admins, billing departments and what not.


I went through a billing/process dispute with a provider last year after a change in their process led to a 30x increase in out-of-pocket costs for necessary treatment. It ended with them flatly lying to me that the changes were for my "safety". When I first dealt with all the new process, I asked my doctor why they were doing it, and he said "I think they just want to charge more money".


One problem is that a bunch of folks have gold platinum private insurance. Things like $0 copays, no co-insurance etc... A lot of that was union negotiated. Some high end jobs have similar perks.

Regular rank and file workers use to have HMOs but those plans have given way to HSAs and PPOs. PPOs were advertised as doctor choice but that's really misleading, all they really do is increase your out of pocket. For a condition that can't be handled in network within a reasonable distance of your house then the HMO insurer has to allow out of network access. HSAs are a great deal if you don't get sick, are rich or can put money in them... but if you need health care they aren't so good since the out of pocket is high.

If we don't get a public option or Medicare for all then I think HSAs will be the future, basically pushing insurance as catastrophic care with some legally mandated primary care covered by default (with a copay).

At least with a $25k deductible you generally won't go bankrupt and you just have to imagine paying off that imaginary new car for 5 years.


I'm on a PPO right now, new to me this year, and it's great. I have a chronic condition that requires surgery about three times a year, so I'm used to just maxing out my costs. There are two levels of the surgery, and the higher level is full general anesthesia, with all that entails.

In practice, it was less expensive out of pocket for the intensive surgery (a bit over $1000) than it was two months ago for the low-intensity local anesthesia surgery ($1300), even though the initial bill was over twice as high.

At any rate, because of my chronic condition, I'm very sensitive to costs. I'll take the good insurance, thank you!


I am curious, why does the PPO make a difference here? Is it vs the HSA or vs HMO or in network? Is your provider in network?


Basically, I have one provider, except for emergency care - a large local network. It's fine for me, because my family doctor and both the specialists I need regularly for chronic conditions are in that network.

For my condition that requires regular surgeries (like 3x/year), there are two levels of surgery - one local anesthetic, one general anesthetic. The first time I got the general one done, the bill to my insurance was $35k. This time, with the new insurance, the bill was $19k. So I think the PPO relationship is making a huge difference in how the internal billing works.

At a higher level, the full hospital general anesthetic surgery in January on new insurance cost me less out of pocket than the much less complex local anesthetic surgery cost me in December, on previous insurance.


Most political leaders both dems and reps are in bed with the insurance companies who are heavily lobbying to keep things as they are. But why not, they're cashing in big and the system is so convoluted that you cannot point any fingers.


It's the same thing with taxes: we can debate about what the right level of taxes should be for this person or that, but all the effort and money spent filling out tax returns is pure waste.


Yes, and the tax labyrinth is kept artificially complicated due to lobbying, too!


This is literally the argument that Liz Warren and Bernie have been making, not to mention other Democrats.


Eh. I'm watching it pretty closely, and I don't hear them talking in detail about how difficult it is.



My favorite story to tell (favorite in a horrible way) about these kind of issues is this: After an accident ~15 years ago, I had an open wound that wouldn't close because it was infected with MRSA which had lodged itself in the hardware that was screwed to my tibia. I was wearing a wound vac--a device that was attached to the open wound and maintained a constant suction to pull out any bad stuff. It was there to keep the infection from spreading long enough for the bone to heal so they could remove the hardware. I had a weekly doctors appointment at the local hospital check on the condition of the wound and change the dressing on the vac.

I was very careful. The doctor was in network, the hospital was in network, and my copay was, I believe, $30 for each visit, covered under my insurance. One day I showed up for my appointment, they led me to a room where I waited 10 minutes. Then the doctor came in, and it wasn't the guy I had been seeing for the last three months. He told me my doctor had taken ill and he was covering the appointments. He asked me how I was doing, and had the nurse redo the dressing on the wound vac. Then we were done.

A month later I received a bill from this doctor for $1900 because he was out-of-network, and while my insurance covered out of network at 80%, they covered it at 80% of the in-network rate. The doctor billed out of network patients at about twice the negotiated in-network rate (a fairly common occurrence), so the 80% coverage was actually 40% coverage, and I owed the other 60% which came to about $1900 for 5 minutes of work (the nurse who changed the dressing worked for the hospital so her work and materials were covered in network.) And the kicker was that I didn't know a different doctor was going to be attending me until he walked in the door.

If you think that maybe your "max out of pocket" will save you, it won't. If the insurance lists a "out of network max out of pocket" it only covers expenses at a negotiated in network rate. Any amount your out-of-network doctor bills that is over the insurance company's in network rate is effectively unlimited. Despite having a $2500 in network max, ad a $5000 out of network max, and a very good health plan. I left that accident with about $35k in medical debt.

(An interesting side note, when it came time to remove the hardware, I went back to the same hospital/trauma center and doctor who had installed it--though a different hospital from above. A day before the surgery I went to the hospital for the pre-op stuff. At the end of the process, the hospital admin met with me to take my payment. I was expecting a $30 copay or similar, but I found out that while the hospital was in network six months before, they had dropped their contract with my insurance company a month prior and the pre-op was going to cost me $800. So of course I cancelled the surgery, but I was still on the hook for the pre-op work. Today every time I visit a medical professional of any kind, no matter how many times I've visited them before, I ask about in network coverage.)


And the really crazy and stupid thing is why are we burdening our doctors with knowing whether someone's insurance plan covers their services? Doctors ought to focus their time and talent on treating people and illnesses, not trying to calculate bills for patients.


on its face, I don't think this is as crazy as you make it seem. it's just that the complexities of medical billing has become too much for the doctor to understand and convey to the patient.

can you think of any other role where a professional interfacing directly with customers wouldn't be expected to at least estimate how much the service will cost them?


I think I understand your point.

However, a car body shop can estimate how much it will cost to fix up my vehicle after a collision with a deer. Those professionals can provide an estimate based on the amount of effort and materials they believe are required. But they don't sit there and try and tell me how much my insurance will pay and how much I will have to pay out of pocket or if my insurance will cover any of the bill.

Obviously in the situation above, time isn't of the essence as much as it might potentially be for a medical issue.

Knowing the "hourly" rates and what treatments may be needed can allow a doctor to estimate the total cost range from a low end to the high end (might be $200 for simple diagnostic and we find nothing more to treat to $2,000,000 if as we progress done the rabbit trail we find evidence that leads up to more tests and it turns out to be cancer). Medical issues are like software development. You don't know what you don't know so God only knows how much effort (cost) will be involved. We can give estimates but the doctor and the software developer shouldn't be trying to figure out if the work involved is covered by external requirements (what and how much will medical insurance cover or does this development qualify for some tax credit or is considered sufficient to fall under some contractual constraint/requirement higher up). Should we expect software developers to know and understand tax laws? Should we expect doctors to know everyone's insurance plans and coverages?


that's a good point. I guess healthcare has a uniquely complex interplay between insurance payout and actual billed cost (eg, your car insurance does not negotiate with the mechanic for you).

I'll rephrase my statement. medical insurance/billing is too complicated to reasonably expect a doctor or patient to fully understand. this being the case, there should be someone working at the hospital/practice whose job it is to actually understand this shit and give me an estimate at each step of the process. doesn't really fix the underlying problem, but at least then I could make an educated choice between receiving care and being able to afford retirement.


> We just can't deal with it, because we are exposed directly to unnecessary complexity.

I'd argue though that those best adept at handling the complexity are actually winning in this model. If you are reasonably healthy already and can navigate HDHP/HSA rules, you can have a much higher take-home income + savings than in other countries with government run healthcare systems.


You are missing the point. It is not about being healthy. You are always worried about the "what if I have to go see a doctor" situation in America because you don't know what it will cost and you definitely don't know what kind of issues you will have to fight through with incorrect claims, incorrect bills and what not. If someone can address that here in US, I am willing to keep the current system as is.


I agree there is complexity cost, but that doesn't mean you can't benefit from it if you generally can navigate said complexity. I've never had issues getting reasonable price estimates from independent doctors (large systems refuse to reveal their negotiated rates) - emergency situations are certainly costly, but under a plausible worse-case scenario I'm still solidly saving having an HDHP.

Ironically, the whole point of HDHPs was to put downward pricing pressure on the medical system by encouraging people to price-shop. Alas, due to a variety of market/regulatory factors, that hasn't happened.


My max out of pocket spending is $2,600 a year and I can put $3,500 pretax money into my HSA every year which I do. What I am supposed to worried about?


And it always covers everything?

We have a pretty pricey insurance plan: family of 4, 36k/year. When my wife had a gall bladder attack and had to get it removed, the insurance company quickly paid the surgeon's bill, and followup doctor visits.

But the insurance company denied the anesthesiologist bill, the hospital surgery room rental bill, and the hospital recovery room bill all as "medically unnecessary", also known as: they won't be covering it.

We tried talking to the original doctor and surgeon but of course they got paid and their offices said the rest of this wasn't their concern. We weren't really sure who we should be talking to to help us show the insurance company that anesthesia is fucking necessary when someone cuts you open.

After about 8 months of stress it was all eventually resolved for a fraction of the original price. In those 8 months though everyone who wasn't getting paid were sending us notices about how we didn't pay yet and how we could set up a payment plan. We talked to hospital billing and they said they usually just drop bills insurance doesn't cover. Usually. And that we shouldn't worry since this happens all the time and that it usually isn't resolved until lawyers get involved.


I have a similar plan and a good income. I am in good health and I make my yearly budget assuming I might have to pay the out of pocket max if I have a health problem.

the usual "gotcha" that people mention is going in for a planned procedure and accidentally receiving care from an out-of-network physician. this makes your out of pocket max irrelevant. I've never had this happen to me and I have no idea how often it actually occurs (outliers are always the loudest on the internet), but it still worries me.


One thing that helps is call your insurance ahead of time to verify the facility and all physicians are in network.

They’ll put a note in your file.

If someone else gets swapped in when your in the table, call back and bitch to them. I’ve had that eliminate the out of network charge.

Is it still a massive pain in the ass we shouldn’t have to deal with? Yes.


> I've never had this happen to me and I have no idea how often it actually occurs (outliers are always the loudest on the internet),

I've never been to a doctor without a ridiculous "outlier" scenario following the visit for months.


worry about the fact that your health insurance company can change or they can change the terms on you. That a starting point. Plenty more to worry about but I have typed enough on other threads here.


I'm not sure that's fair. There is only one party that has ever put forth serious health care legislation in this country. I wish we had two parties policies to debate but we don't.


I live in Canada, and haven't even earned $20k of income in a few years, but I still have excellent cover.

I broke my nose, was seen within 5 minutes and it was straightened (after anaesthetic).

I got hit by a car on my bike, was seen in 5 minutes, no worries.

Needed and x-ray for my lugs to get residency. Took 10 minutes. Free.

My brother broke his leg horribly. Multiple surgeries, a month in hospital, etc. etc.

There are no bills, just taxes - though it's very manageable.


Don't forget 6 months waiting time for breast cancer diagnoses.

Don't forget over a months waiting time for a simple antibiotic shot, which my friend died while waiting.

Don't forget, can't see a doctor for two freaking weeks for a simple stomatitis.

Don't forget 3+ months and waiting for a freaking endoscope procedure.

For everyone not in critical situation, your country's health care is shit. Don't even deny that it's fucked up.

Thanks god I moved out of that country after my friend died due to sepsis because of the fucked up system that made him wait months to get his antibiotic shot.


Another Canadian here - this is not my experience at all. I have lived both in the east and west of Canada. Health services are excellent. Any issues and I just visit the hospital and they take care of it promptly and walk out not having paid a cent. Oh I think I do have a monthly charge for our entire family - something like $75 per month.


Sadly, the coverage does seem to vary widely.

I heard the absolute horror stories, and the opposites, too.

What province/territory/city were you in?


It depends entirely on where you live. Out West there is no waiting and I've never experienced any of what you're talking about.

I've only heard stories about how it is in the East, I've never met anyone first hand that has experienced it, or really hates it.


Because you haven't experienced a problem in your body that is rotten deep inside but shows little to no symptoms. My friend died in Alberta. It took two weeks to even see a doctor and more to wait for antibiotic shots.

Doctors try hard to not make problem a problem because the system is fucked in a way that doctors benefit from less patients. They don't try to cure. They wrap up the symptom and makes patients think it's a small problem.

Oh yeah, there is a way to be cured without waiting in Canada. When you're on the verge of death.

I despise hypocrites praising health-not-care in Canada. It just makes me sick.


I lived in Alberta for 2 years, I've got many friends living there still. I have never heard of what you're talking about, and certainly never experienced it.

I can't help thinking you over exaggerating the issue to avoid single-payer heathcare in the US at all costs.

Also, I lived in Australia for 23 years. It works great there.


I live in Uruguay, and my mother in Canada.

I agree that for those fringe cases, healthcare in the U.S. might be better (Uruguay is also bad with tough to diagnose diseases).

But for 99.99% of the remaining cases, Canadian or Uruguayan health system is way better.

And I think there has to be a way to reconciliate the very good U.S. top of the line healthcare with the way better general healthcare most of the rest of the world has.

My sister lives in San Francisco and there are several benefits I regularly use which you basically can't access in the U.S. except if you're a millionaire - like doctor visiting your house when you're sick, and I mean things like a fever or a flu, and ambulance coverage included in basic healthcare.


If you make that little you may actually be covered in the US, too.


> I am paying nearly 20k a year for possible emergencies?

Kind of, yes. The vast majority of healthcare spending is, unsurprisingly, on very sick people.

Insurance is for the outlier cost. The difference from other insurances is that almost everyone faces that outlier cost eventually in their lives, assuming they don't get hit by a bus in their 20s.


Yeah, they face that outlier cost when they're on Medicare and the government is paying anyway...


My SO has insurance through/at her med school and has to dispute bills every time she goes in because they bill them as non-covered. Oh and imaging in the same building / under the same hospital wasn't covered. It's crazy that even medical professionals can't get good/clear services.


> And on top of it I get a better deal if I use no insurance at all for prescriptions.

Interesting. So is it also the case that you can "negotiate" medicine prices? Is the actual price then different from what is on the tag?


Drug companies are using price discrimination to maximize their profits. Charge a lot to the insurance companies but less to others with no or poor insurance. If a drug only costs $10 to make, they can mark it up to $100 for the insured people. Then insurance charges a $20 copay. The drug company now gives a $20 copay assistance card to make it "free". The net profit is $100-20-10=$70.

This is why California recently made is illegal to provide copay assistance to drugs where generics are available. I have a drug which cost $800/month to the insurance. My copay was $80/month. The manufacturer was so helpful to give me a $75/month copay card to cover this. Around some point the patent expired but the manufacturer continued to give that card out. Eventually the drug became generic and my pharmacy offered the generic version at $10/month. So my copay is higher but insurance cost is much lower. In fact the original manufacturer bugged me to petition the state legislature to change back that law.


It also can go the other way. I was once quoted two prices for a CT scan because they weren't sure if my insurance would cover it. If it did, they'd bill one amount to the insurance company. If they didn't cover it, I would be billed directly for an amount that was somewhere around double what the insurance would have been billed.

I got the CT scan somewhere else.


Insurance companies negotiate down prices so the hospitals jack up the sticker prices to give room for negotiation. I've read that hospitals typically get 20-30% of what they bill.


I'm sure I'm not 100% accurate on the numbers here because I don't feel like finding the receipts, but close enough. Here's another anecdote from the US.

My dog has a pulmonary condition that requires him to take Sildenafil daily (yes, generic Viagra). We got the prescription filled at a local pharmacy for a 90 count, they charged us something around $280 for. We were not expecting that high of a prescription, for a dog, for a generic medicine. Of course, since this is for a dog, we can't get our human health insurance rate for it, but the pharmacy is operating primarily for humans rather than animals. The person at the counter said that if we look at coupon sites like GoodRx, we might be able to save some money.

A coupon we pulled up on our phone while standing there brought the price down to something below $30 for the same 90 day supply. Roughly 1/10 of the price.

Clearly, the pharmacy must still be making some money even at $30. In what universe is it acceptable to charge a 900% markup above profitability on medicine? Yes, some people use this drug "recreationally", but it's also a lifesaving medicine for other humans and animals. I can't imagine what people must go through that need more expensive medicines for themselves or their families without insurance. And even with insurance, it's not much better.

And that's just one of many anecdotes. I have others, like a relative being charged hundreds of dollars per Tylenol they received while in the hospital, only for insurance to "adjust" that down to something more "reasonable" like a couple of dollars per pill.

This system is broken and needs monumental, uncomfortable, complete and total rebuilding, not repair.


Yes, IIRC there was a thread talking about this GoodRX thing. When I was uninsured, it brought the price for a month's supply of generic Singulair from ~$60 to ~$9. Very convenient for me, but where does that money come from? Does GoodRX get paid for that data, that I'm a 30-yo man in x-state who needs x-medicine? Very sketchy.


The money comes from the money that would normally be kicked back to the pharmacy benefit manager[0] as a “rebate” from the pharmaceutical company. The retail prices are jacked up—at least in part—for the benefit of PBMs to extract money from the system[1]. My understanding is that GoodRX gets the negotiated “discount” price from a PBM like every other insurer and then makes a profit from the kickback.

[0] https://en.wikipedia.org/wiki/Pharmacy_benefit_management

[1] https://armandalegshow.com/episode/why-are-drug-prices-so-ra...


The price, at least in the US is as much as they could ask for. If they could get from you $1,000,000 on aspirin they would, trust me. It's called free market. They say that the market will fix any problem. But in reality it's not really free market.

The manufacture price is insignificant but the bulk of the price is pinned on other things like R&D and other costs the pharmaceuticals claim. There are costs but there's also a huuuuuuuge profit to be made.


I assume you are in a high deductible plan (HDP)? They don’t pay anything until you hit ~$4k/person, then 80% until OOP maximum of $7k for a family. But yes, a physical should have been 100% covered.

Yeah, so between my employer and I, it is $20k for my HDP for family of 4. Then I sock away the HSA max of $7k every year to pay for the actual costs (including dental, which I don’t have).


They will send you to collections w/o warning. Good luck getting the credit hit removed.


Why would the insurance company send you a bill? The healthcare provider sends the bill, as they are the party that is owed.


The trap to be aware of here is that the fact that the current system sucks is no guarantee that any proposed alternative will be better.


You could put on a blindfold and then throw a dart at a map of the of first world countries, and if we just adopted whatever system is used where that dart lands it almost certainly would be a big improvement.

If making a better health care system was a problem that everyone else sucked at also then I'd be more inclined to worry that trying to improve ours could make it worse, but with so many good examples--using a variety of different approaches--of how to do it better I'm not worried that trying to fix ours would make it suck even more.

Even if, somehow, we actually do manage to make it suck more we can just try again. Eventually we'll have run out of new ways to suck and will have to stumble onto one of those good approaches that the other first world countries use.


Good point. Wherever the dart falls is not corrupted yet. A new system comes into existence, it is efficient for a while then gets corrupted again and the cycle repeats


Unless the alternative includes forks to the eyeball, it could hardly be worse.


I was in the hospital over Christmas because of a very severe infection. I was there for 2 weeks, and am lucky to be alive. The costs were over $150k, but I ended up paying $1500 in various deductibles to Kaiser, etc. I was happy to pay $1500 and am alive because of the care that I got. I pay about $6000 a year in medical insurance per year through my employer and it ended up being totally worth it. Not a few weeks previous, one of my children was rushed via ambulance to the same hospital because of an anaphylactic reaction.

So yes, much of your costs are for possible emergencies and especially as you get older, your costs increase.


$6000/year sounds very low for healthcare in the U.S. When you say "I pay" are you really only counting the employee contribution? For purposes of analyzing aggregate healthcare costs for a whole country, we ought to be using combined employee+employer costs (W2 DD) and not just the (usually small) employee portion highlighted by HR at benefits season.


I prefer to look at per capita cost, especially when comparing with other nations. It's appalling that we pay twice as much as anyone else, and that almost everyone has better care than we do in terms of outcome.


Not op, but you got me curious so I checked my W-2. $8,800 for me and I think mine is top notch (2,600 is my max out of pocket per year limit)


fwiw mine is about $20k with a $5k oop max, for a family of 2 in California. This compares to a worst-case ACA cost of about $65k.


Yes, I know and that's why I am still paying. But seriously, we are paying for emergencies, this should be stated when paying for the insurance. Second, why were the costs $150000?


It’s right in the name. It’s called Insurance, not Healthcare as a Service.


Kaiser platinum is pretty close to Healthcare as a Service.


Can confirm I love Kaiser but both the best and worst parts for me are the bureaucracy -> time/$ savers. Great when it's fast and cheap, can email Dr to get meds/treatment, get meds mailed 3 for 2 price - but frustrating when wait to see a specialist is more than a month or being rushed through in person visits like cattle. And I feel well taken care proactively with multi-DR/NP team.

Plus they actually did a good job reimbursing me for costs when I had to get care in a non-kaiser state no hassle or haggling.


Just curious, what are your total yearly expenses on Kaiser? And how much does the employer pays on top of that, do you know? Thanks


I own our company with a partner, so it's me paying for it either way. I buy on the market but company pays for it.

I think the overall costs are lower for Kaiser, I think I have one of the gold plans and it's only like $20-40 copay for fairly specialist visits and most medicine is really affordable. I pay labs costs and I think looking at bill I remember them being more than the actual Doctor and they seem fairly expensive.

In past years I've found I barely have any costs or recently with a 'high health' year a few of the more rate big costs helped me the out of pocket pretty quick.

Just googling found this: http://info.kaiserpermanente.org/healthplans/colorado/indivi...


The bill might have shown 150k, but costs to a hospital for 2 a weeks stay due to an infection should be a long way from 150k.


In the study, nearly all the computed savings comes from two sources.

1. Decrease in pharmaceutical costs as a result of better bargaining power.

2. Decrease in administrative overhead, calculated by extrapolating the overhead in medicare to the entire US healthcare economy.

I don't have an informed opinion on either of these estimates, but my intuition is that #1 seems reasonable while #2 seems unlikely. The justifications they give include lower executive salaries and decreased fraud. From what I have been told by healthcare professionals, medicare has less incentive to negotiate cost, less incentive to investigate fraud, and therefore lower administrative cost.


I worked in the EMR software industry and have certifications that involve hospital & lab billing, among others. I've been on site with healthcare providers, and there are entire buildings full of people whose job it is just to code and scrub claims, and cover disputes/negotiations with private insurance providers.

Consumers do not see it because it's typically off-site from the main hospital care facilities, but believe me, the administrative savings potential is real.


I once worked at a US biotech startup getting paid by insurers where we would build ML models just to reverse-engineer the inconsistencies of CPT coding & claim reimbursement by insurers & hospitals so we could get paid. Basically trying to automate "learn that Karen at insurer X processing claims wiht code Y from hospital Z usually decides to reimburse $XX". This whole idea of "free market is more efficient for healthcare" has to die. All the incentives are backwards. For example: insurers don't want efficient claim processing because that means less revenues for them.


> * This whole idea of "free market is more efficient for healthcare" has to die*

The current US healthcare system has very little to do with "free markets"!


"The current US healthcare system has very little to do with 'free markets'!"

Sure, the US health care system is certainly not governed by wide open competition, transparent pricing or similar things. But it certainly has something to do with the "free markets".

The system is basically "what you get when you realize you have to insure and regulate but you never, ever do it in a centralized rational way, 'cause that would be socialism - plus you never, ever separate an 'entrepreneur' from a real or potential stream profits". Which indeed, builds the worst of all possible systems, sending risks to the consumer and profits to the investor/rent-seekers.

And from here, we could go forward to actual socialized, state-run medicine as functions adequately in most industrialized economies or back to a "wild west" system, where costs are lower, treatment is often OK and the heroin runs in large rivers as due the fatal scams(as was the US' 19th century health care reality).


Medicine changed so much after ~1880 (or maybe ~1900) that there's little to learn from the prior era.


Yes! Perverse incentives are what is making it like this. And the incentives cross boundaries - relationships between providers, insurers, regulators, legislators, and consumers. There's no single guilty party that we can blame and fix. (Since insurance companies are such a target for blame, I've started to say blaming insurance is like yelling at the cashier.)


You realize the market is highly regulated and fully captured by the insurance companies? Not to mention the doctors guild that limits practitioners. The current system is not a free market. It is highly distorted and gamed.


About 10 years ago, I was a freelance consultant for clinics, hospitals and insurance companies (EMR, billing, claims, practice management, etc.). I've also been a volunteer EMT for about 20 years and have many friends who are clinicians.

The amount of administrative overhead is just absurd: a common and believable number is about 15%. This does NOT include the "shadow labor" that everyday people have to deal with, like being on hold with a billing department or insurance company, the merry-go-round of "prior authorization hell" for procedures or prescriptions, etc.

It's TERRIBLE that someone like me--conversant in business practices, ICD/CPT codes, and clinical practice in general--struggles to interpret a bill. It's literally worse than buying a car.

I can make lots of choices in life, but one of them isn't health care: if I need it--especially urgently--I'm not in a position to game out every scenario possible to minimize costs because the ecosystem is non-transparent and labyrinthine.


IIRC, coding is on the order of a million jobs across insurance, hospitals and doctor offices. Then there's all the other non-value-add activities of negotiating of prices, authorizing/denying treatment, billing and management. Oh and there's going through bankruptcy while you have cancer... I forgot that one.


Nobody is saying there aren't real administrative savings to be had, but the amount we spend on administrative costs is something close to an empirically observable fact, and you can do the mental exercise of taking any credible number and zeroing it out to see how big an impact it would have on overall health spending. It's not huge.

Which is to say that even in the most optimistic case, where single-payer forces everyone into a perfectly efficient system where nobody has to waste any time on coding or paper-shuffling and everything is perfectly streamlined, we still won't have meaningfully fixed the problem. The amounts we'd save would be a grocery-store-sale discount.


According to this study healthcare administration costs account for the bulk of the difference between US and Canada healthcare spending. 34% of 18% of US GDP (=6% GDP) vs 17% of 11.6% of Canada's GDP (=2% of GDP). https://www.healio.com/primary-care/practice-management/news...

Other studies looking at only hospital costs put it at 1.43% of GDP. https://www.commonwealthfund.org/publications/journal-articl...


That is a much higher estimate of admin overhead than other sources, covers both payer and provider administrative expenses, and implicitly attributes all provider administrative expenses to billing/coding.

But we don't have to litigate this in the context of the Lancet article. That article derives much higher savings from pharmaceutical price reductions than from administrative savings. We know with some certainty what percentage of overall spending comes from pharmaceuticals, and it is a low number.


> It's not huge.

It's massive. Healthcare is byzantine on purpose. It's opaque to patients so that providers can prevent shopping around and adjust charges per patient, and it's opaque to providers from insurers to help prevent having to pay claims.


You're saying "it's massive" and, in, like absolute terms, sure, it is; everything we do is massive, we're a huge country. But in relative terms? No. It's not massive. It's a small fraction of our total costs. The total benefits we can reap from minimizing it? Not that great. Ambitious plans based on minimizing those costs? You should be skeptical. You should be asking: how are we going to solve this huge problem by zeroing in on such a small fraction of the total problem? Maybe the answer will surprise you, but you should start by needing to be surprised by the answer.


Yes, in relative terms it's a large percentage. I work in this business, I see it every day. It's a HUGE chunk. Nationwide out of the 3.5 trillion we spend on healthcare, it's about 800 million.


Medicare billing isn’t any different, it’s just a different payer.


Medicare and Medicaid are different though.

The fee schedule and structure is much more defined, simpler, and easier to abide by. So much so that software can calculate it out of the box at the time of ordering. There isn't the negotiation and level of dispute handling that private insurance companies create in their profit-maximizing behavior.


Yes but at least, Govt. is not looking to make record profits.


No, but government has strong incentives to deny claims to control costs. At least at the state level, governments have gotten extremely aggressive about money collection. E.g. $50 administrative fee for not paying a $4.00 toll.


Personally, I would go for ANY system right now other than what we have. I am too pissed off at how our healthcare system is. Single Payer may or may not have the same issues but I am ready to take my chances. Status quo is not good enough for me.


What problems have you had with the current system?


Many problems.

- Every visit to a doctor is a game of cat and mouse. I am never sure what bill to expect and how many bills to expect.

- Price is always inflated due to the fact that insurance company has to make money on every visit to the doctor.

- Every visit requires a Claim. Claims get filed incorrectly. Fun and games trying to call a bunch of different "departments" trying to understand the claim and why am I being charged ?

- In network/out of network game. Ohh, I am sick and unconscious but I have to make sure that the person seeing me is "in network" so that I don't get a million dollar bill. Sorry, bad luck. While you were unconscious, we called a doctor who was "out of network" and not our problem. Have fun fighting wit the insurance company.

- Why does every visit require me to show insurance ? I just wanna talk to my damn doctor. Can I not just give you some money directly ?

- I visited the doctor. Doctor has to file a claim for $x while the insurance company only allows $y. So the doctor inflates the amount of initial claim knowing that they will be reduced anyway by the insurance company. Cat and mouse game continues and finally, poor me is left with a bill that I now have to figure out. Have I already paid enough (copay, deductible, out of pocket limit) ? Lucky me.

- My employer changes my insurance company. Oh, I have to redo the entire paperwork with al my doctors. Ok I did it. Oops the doctor office still filed a claim with my previous company. I am now fighting to get that sorted.


Two other problematic things.

- Doctors have no idea how much anything costs.

- Pricing has nothing/little to do with the actual cost of providing a service.


How is that different from insurer incentives to deny coverage or to ask crazy copays because insured people can only switch plans once a year and select from a tiny menu of options that their employers have negotiated on their behalf with an oligopolistic industry? And do you honestly prefer the shady debt collectors industry to the current government money collection mechanisms ?!?


This is not a thing and if it ever became a thing it would be challenged in the courts. What is covered is all determined by the CMS and the medical associations. I would imagine some red states would try to do it. But to deny claims for cost control would be akin to the "experimental" treatment BS that insurance companies try to do. Insurers who deny for cost control reasons get hammered in the courts.

In fact medicare/medicaid have an even better mechanism to route out fraud. They can jail the medical provider for doing so.

Your last claim about fees for collecting tolls is unrelated.


>government has strong incentives to deny claims to control costs

Which is still less incentivization than what profit-maximizing insurance companies have.

The nice thing about the government is they are completely open and transparent with what they will pay and for what, so disputes are much less common.


In 2017 retail prescription drug expenditures were $333 billion, accounting for just 10% of total healthcare expenditures.[1] I realize prescription drug prices are insane, the patent regime is broken, and the industry is generally messed up. But at 10%, relying on lower cost prescription drugs to save the day isn't going to help. People feel it's a bigger issue than it is (relative to the overall problem), because it's one of the few aspects with which most people have regular and direct experience, including with pricing.

Likewise, total billing and insurance related (BIR) administrative costs are ~$500 billion.[2] (Year unknown.) Or roughly 15% of total healthcare expenditures. And that's up from $471 billion in 2012[3], even though the ACA capped insurance provider administrative overhead and instituted many other reforms intended to address these costs.

Plus, it's odd that people on both the left and the right who are convinced that lobbyists control Washington will simultaneously hold the notion in their head that either a public option or single-payer would be able to consistently cap reimbursements and contain costs. If they're right then it's a miracle Medicare and Medicaid do as it as much as they do, and impossible for it to do so once the Federal government is directly reimbursing the majority of healthcare expenditures. Indeed, if it were possible then defense expenditures would be more efficient and a fraction of what they currently are.

These rosy estimates are ridiculous. We have over 10 years of direct experience with substantial and serious healthcare reform. Obamacare attempted and does enact a variant of almost every concrete reform imaginable. Whatever you think of Obamacare, you can't deny that it has provided mountains of empirical data about the difficulties and promises of containing costs. And yet Obamacare opponents on both sides--those who want to return to the pre-Obamacare system, and those who want a public option or single-payer--willfully ignore the evidence, unchastened by reality.

A California congressional committee looked at the potential costs for single-payer in the state and it would have required an additional $200 billion/year in tax revenue even after accounting for diverting existing private and Federal expenditures. That's what a cold, hard, realistic examination of the facts looks like even by those predisposed to enacting it. Maybe that $200 billion would be worth it; from a moral perspective it certainly seems so. But to deny the costs is to invite failure and financial ruin as not even a majority of Californians, let alone Americans, are willing to make that sacrifice.

We need to figure out how to better solve the cost problems before we continue to wade further into the waters. Otherwise we're just going to drown. If you look at all the other healthcare systems around the world with both better outcomes and lesser costs, neither single-payer nor a public option are defining characteristics. Rather, they run the gamut from mostly private to mostly public. It we can't lower costs with Obamacare, which has both substantial public and private components (and thus opportunities for exploring structural efficiencies across the spectrum), switching to single-payer or a public option won't move the needle.

[1] https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...

[2] https://www.americanprogress.org/issues/healthcare/reports/2...

[3] https://www.ncbi.nlm.nih.gov/pubmed/25540104


> those who want a public option or single-payer--willfully ignore the evidence.

What you say is true about the public option, because it incentivizes insurance companies to dump expensive patients onto the public dole, while charging ever increasing premiums for those who either don’t need healthcare or are self-rationing because of things like co-pays or high-deductibles. Obamacare and Medicaid in tandem also don’t work for the same reason.

It’s not true for single payer systems, who across the world pay less than what we pay in the US. Without special pleading, you have to explain why they’re able to do it and we cannot, otherwise it seems that you’re ignoring the evidence. State-level examples don’t really count here either, because their underlying costs are being determined by prices pressures in the entire US market.

(Also, CAP takes money from pharma, the insurance industry, and hospital conglomerates, so they’re not a reliable source on any of this).


> It’s not true for single payer systems, who across the world pay less than what we pay in the US.

It's also not true for systems with public options, like Germany. You're making a hypothetical claim about the abstract economic incentives of a public option. But like many such economic arguments, without accounting for the technical realities these arguments have exceptionally poor predictive power.

The cost problem isn't about public or private. That much should be clear. Even domestically, if you look at the best run and widely loudly HMOs (e.g. Kaiser, Mayo), which also are more heavily burdened by low-income and sicker patients, their costs are still much greater than what optimists claim can be achieved.

Prescription drugs and administrative fees account for at worst 25% of expenditures. The real costs are in the practice of medicine in America: compensation, structure of surgical units, organization of hospitals, treatment recommendations, manufacturing industry, FDA regulations, etc. Single-payer doesn't address any of this directly--at best indirectly, and only if you're really optimistic. Obamacare reforms did try to address some of this (it's why it's gargantuan), but with mixed and often poor success. If you want to fix healthcare, it's these unsexy, complex, and hidden things that need to be addressed.

The debate over single-payer is a debate among armchair pundits, which often includes healthcare professionals. (Just like software programmers cargo cult poorly supported ideas about improving the software industry.) Maybe, after accounting for technical realities, an all-private, public option, or single-payer system may be marginally more efficient in the United States. But nobody is making such arguments. The debate is far too abstract, with unsupported, sweeping claims about comparative efficacy.


> The debate is far too abstract, with unsupported, sweeping claims about comparative efficacy.

It’s not at all abstract, you’re just obfuscating. If your concern is costs, we should have a fully nationalized model like the UK because that has lower expenditure per capita than single payer or mixed public-private systems. Or, if we can’t have that, have single payer, because it too still has lower costs than the mixed systems in the developed world.

It’s not cargo cultism by way of arguments from analogy. It’s Americans irrationally clinging to their exceptionalism in the face of stark counter examples while their people die in the streets, ration care, and go bankrupt.


> The real costs are in the practice of medicine in America: compensation, structure of surgical units, organization of hospitals, treatment recommendations, manufacturing industry, FDA regulations, etc. Single-payer doesn't address any of this directly--at best indirectly, and only if you're really optimistic. Obamacare reforms did try to address some of this (it's why it's gargantuan), but with mixed and often poor success. If you want to fix healthcare, it's these unsexy, complex, and hidden things that need to be addressed.

THIS. I don't know why this isn't being said more openly, more often and more widely. It's absolutely the crux of the matter. Yes, it will be great if we get M4A or somethng similar, but it's not going to solve the cost issues, which are bigger (or under any conditions, at least as substantive) than the insurance system itself.


> What you say is true about the public option, because it incentivizes insurance companies to dump expensive patients onto the public dole, while charging ever increasing premiums for those who either don’t need healthcare or are self-rationing because of things like co-pays or high-deductibles.

Can you explain why this is supposed to be true? The benefit of a "public option" is supposed to be that it would theoretically reduce costs by eliminating insurance company profits. The government insurer would presumably still charge premiums and set them based on actuarial risk, so why would it disproportionately attract high risk patients? It's not as if private insurers would be allowed to cancel your policy after you get sick and dump you on the public insurer.

> It’s not true for single payer systems, who across the world pay less than what we pay in the US. Without special pleading, you have to explain why they’re able to do it and we cannot, otherwise it seems that you’re ignoring the evidence.

The explanation is simple. With single payer the government is a monopsony buyer, so it "negotiating prices" is really just equivalent to price controls. Price controls can certainly lower prices, but they do so by creating shortages.

In medicine the primary cost isn't the unit cost of manufacturing the pill, it's the R&D cost of developing it and performing clinical trials. So the shortage is of medical R&D. Price controls reduce the supply of new medicines -- that is what other countries do to have lower costs. They piggyback on all the money paid by patients in the US and used to develop new medications that are then used all over the world.

So the US pays more for drugs because the rest of the world isn't paying their fair share of the R&D and we're subsidizing them.


I agree, so many of these studies are not very high quality, and there is so much money behind the scenes trying to push agendas -- between pharma lobbies, hospital lobbies, payer lobbies, and politicians capitalizing on public anger at pharma and high healthcare costs in general -- that most of what we read seems to reflect political agendas more than facts

Many drug prices are too high but 80% of rx in the US are generic, and US is middle of the pack in terms of drug spend as a percent of HC spend compared to OECD countries

Drug prices "feel" higher bc copays are higher for drugs than office / hospital visits. If the goal is to reduce actual costs rather than perceived costs, we should look at hospital and provider costs, not just drug costs. But hospitals are huge employers with lots of political power, not to mention large lobbying budgets


>> Obamacare attempted and does enact a variant of almost every concrete reform imaginable. Whatever you think of Obamacare, you can't deny that it has provided mountains of empirical data about the difficulties and promises of containing costs.

Is there a summary of the findings that gets to the root causes of why healthcare is so expensive in the US? And likewise for the difficulties? It would be a useful read for me. :-)


Lower administrative costs? In the US, doctors need at least one or two full-time admin staff to negotiate with a variety of insurance providers, argue for approval of every line item, etc. Here in Canada, I spend about 5-10 minutes per week dealing with all aspects of billing for my wife's medical practice.


Back when I was a teenager my doctor was part of a four doctor practice. They had a nurse and one of the doctors wives handled everything else.

Compare with a doctors office today.


My doctor does not have any full time staff. He does not accept health insurance directly though is in many networks so you can submit claims for reimbursement.

I tend not to because he’s so cheap it’s not worth the hassle.


There's a third major cost-saving which is preventative care.

I have a family friend who lost his job, lost his insurance and couldn't afford to take his meds which would have prevented the massive stroke that paralyzed him 3 weeks later.

This was 10 years ago and his rehabilitation is still ongoing. His wife can't work and is his full-time caretaker. Multiple lives destroyed because we as a society can't get a system together where it makes rational sense to provide this man with the couple cents worth of pills that would have prevented this calamity.

It's the same story with every other chronic disease and health care issue - just massive amounts of human suffering that could be avoided.


Not to mention the societal costs incurred by failing to provide mental health services to everyone.


Just look what a lack of mental healthcare has done to the country...


We do a lot of development work for client's in the medical and medical billing department.

> Decrease in administrative overhead, calculated by extrapolating the overhead in medicare to the entire US healthcare economy.

That doesn't strike me as unlikely at all. Maybe their extrapolation is aggressive, but there are people at nearly every practice who spend a large portion of their day just managing the billing of cases to insurance companies.

The amount of work that goes into billing a case to insurance companies is really insane. It tends to be a very manual process, because every insurance company is different.


i've done medical billing systems too and it is, indeed, crazy but what's make you think the gov. would be any better?

I wrote a specialized service dealing with Medicaid in a handful of states and it was even worse than normal. The incompetence at Medicaid is dangerous. Formularies, eligibility, reimbursements changed randomly with reimbursement changes retroactive to some random date. I have zero faith in any part of gov to get it close to right.


> i've done medical billing systems too and it is, indeed, crazy but what's make you think the gov. would be any better?

Well, first of all, because there's no medical billing in M4A. It's free at point of service, so I'd hope they do better at billing considering they don't need to bill at all.


Billing is how the doctors and hospitals get paid.

If there is no billing, do they work for free?


Medicare requires billing, but Medicare 4 All does not require billing?


All you need to do is look at the health care costs per citizen of other developed countries to understand that the US is paying way too much in their current healthcare system. I'm aware that the US's healthcare system is unique in many ways, but so are all the other countries on that list and they made it work.

https://en.wikipedia.org/wiki/List_of_countries_by_total_hea...


The problem is that when you break those costs down into buckets and then compare the buckets with other countries, we're overspending in all of them, by very large amounts. Pharma and admin is nibbling at the edges of the problem. We pay way more for inpatient and outpatient procedures than other countries do. We prescribe more procedures than other countries (possibly as a consequence of how well we've gotten at delivering procedures on an outpatient basis; the UK, for instance, apparently fixes fewer hernias, but that's probably a result of the fact that they do a lot more of then on an inpatient basis). Our doctors also just make substantially more money.


> less incentive to investigate fraud

From the paper: "In addition to savings on overheads, a comprehensive database of health-care charges would facilitate detection of fraud, which extracts $85·7 billion every year. Following the transition to a single-payer system in Taiwan, an 8% reduction in overall national expenditure was attributed to the reduction in fraud. By moving from a fragmented health-care payment system to a unified system, irregularities in provider claims can be more easily detected. For example, under the fragmented system excessive claims for physician time can be spread across patients with several different insurance providers. However, acknowledging that improvements have been made in fraud detection since Taiwan's transition, we conservatively assume that the improved fraud detection would garner savings amounting to half that observed in Taiwan, corresponding to 4% of total health-care expenditure."

https://www.thelancet.com/journals/lancet/article/PIIS0140-6...

Aside from decreased executive pay and decreased fraud, many jobs will be eliminated.

From the paper: "Improvements in system efficiency, such as reductions in billing tasks, will involve a contraction of the workforce. Although the country will benefit from lower costs, 936 000 administrative positions and 746 600 positions in the health-care insurance industry are estimated to become redundant. However, detailed transition plans have suggested either funding for early retirement options, extensive severance, retraining programmes, and relocation expenses for all workers in these sectors. Implementation of such a plan is estimated to cost $61·5 billion annually over 2 years, a sum which would be recouped within the first year by the health-care savings estimated here."

https://www.thelancet.com/journals/lancet/article/PIIS0140-6...


>many jobs will be eliminated.

I just wanted to emphasize this point from your quote:

>funding for early retirement options, extensive severance, retraining programmes, and relocation expenses for all workers in these sectors. Implementation of such a plan is estimated to... a sum which would be recouped within the first year by the health-care savings estimated here."

Even if we provided a generous 2 years of severance for people to transition into other roles, we still save in the long term.


Is that saying that we could give 2 years of severance to all displaced insurance workers for less than what we would save in the first year? That's incredible, and a great argument against the cries for lost administrative jobs.


I wrote this comment before reading the excellent comment 'wahern wrote, so I'm getting rid of my redundant point about pharma and admin as a percentage of overall spending.

Rather, I'd like to point out something that I haven't seen discussed. Maybe someone here can knock it down.

Health care spending increases drastically and nonlinearly after age 55. Medicare's admin overhead is in part a consequence of the cohort of patients it serves: they receive more medical services than everyone else, and so more of their medical spending goes to services relative to administrative costs.

Conversely, younger patients receive relatively few medical services, and the services they receive are much less expensive. Compared to that lower amount, fixed administrative costs are a higher percentage of their medical spending. Some admin costs scale directly with the costs of services rendered, but others don't.

As a result, it seems pretty clear that Medicare's admin overhead ratio would necessarily be higher if it covered everyone, and that any result taken by extrapolating current administrative overhead to the whole population would be dubious.


>From what I have been told by healthcare professionals, medicare has less incentive to negotiate cost, less incentive to investigate fraud, and therefore lower administrative cost.

I don't think that's more likely to explain the cost saving than the sheer scale advantages of having a unified bureaucracy rather than countless of small insurance agents.

I will dig the source out when I'm home but (I think it was Paul Krugman) who went over the administrative overhead in one of his blog posts. Medicare and Medicaid both have administrative costs of less than 1% of their budget, the private industry clocks in at more than 15-18% IIRC. I have trouble believing that this is mainly fraud detection considering that it's consistent across other countries with consolidated healthcare sectors.

A single large administration can simply streamline these processes better than thousands of individual companies. To be frank the insurance industry seems mostly like an employment program for the middle class white collar sector.


I watched a long-form interview with one of the PI's. They used very conservative estimates and didn't estimate additional savings and benefits from uncountable knock-on side-effects that would increase lives saved. M4A would save additional lives per year over double that of the ACA. That's a minimum additional twenty-three (23) 9/11's of people saved every year like clockwork while saving money on a net basis.


I worked ops support at a local heath insurance group of maybe 250 people. We had an entire floor the building next to us dedicated to billing and 30-40 billers with some of the older employees making upwards of $75k a year not to mention the infrastructure and systems to support that department.

With a universal system, those costs (and jobs) would evaporate to the tune of millions per year in salaries alone.

For the employees, each of them could quickly retrain or just shift into other departments as needed as most staff did when the company was acquired and IT admins moved to PM or lead roles in other departments.

#2 exists and would have a huge impact not only on the industry but your time and mine. I've spent maybe 8 hours this year already just working with medical billing groups to pay up and already spent close to $2000 between my partner and I with an estimate $4-6000 before the end of the year without doing a sleep study which I greatly need.

Universal is definitely cheaper. All we have to do is compare ourselves to just about every other western democracy to see ow.


> calculated by extrapolating the overhead in medicare to the entire US healthcare economy

Many friends in healthcare have pointed out (correctly it seems) that medicare has lower overhead because medicare shifted that cost onto the existing admin, and many places lose money on medicare, but are forced to take it. So it's simply not possible to extrapolate that to all hospitals without bankrupting many.

Here's a WaPo article with ample links to peer reviewed papers on the issue. (Note the part WaPo rates as false is that ALL hospitals would close; WaPo does admit with cited sources that there is ample evidence Medicare pricing would cause less service and less capacity from many fronts).

https://www.washingtonpost.com/politics/2019/07/03/would-med...


There's US insurance companies that enroll about as many people as live in Canada. The negotiating power Canada has comes from "take it or leave it", not from scale.


I work in healthcare as a CIO. I interact with all of our billing systems, processes, and departments. Frankly, I think the estimate of a 14% savings due to reduced administration to be low. Single payer would eliminate 30% of non-medical jobs in my company.

Teams eliminated or dramatically reduced:

* VOB, verification of benefits, they fight with the insurance company just to determine what coverage the patient has, and it is purposefully not automated. If it were automated, it would be easier for us to know what they'll pay. By making it a manual process (or at least only partially automated) we have a greater chance of making a mistake they can reject a claim over. We also have a greater chance of simply getting someone on a bad day and refusing to cover things preemptively, required it to be elevated to our Appeals department.

* Coding, people whose jobs it is to make sure the notes left in the record by medical staff (doctors, nurses, techs, etc) is properly translated to ICD10 codes.

* Billers, people whose job it is to bundle up claims and records, make sure they're properly sorted for each insurance company, and submit the claims.

* UR, utilization review, the group that reviews how accurately we're tracking the treatment guidelines of the INSURER so they don't deny the claim for missing a comma. Our UR group missed a small technicality on some claims and we had to submit paper copies of every claim for 6 months to the insurer, in addition to the electronic requests as a "remediation and verification step", aka, punishment. We would literally print out the electronic claim, and mail it, so it's going to be identical to the electronic claim, but we had to do it for 6 months for one facility to one insurer.

* Collections, the people who call up the insurance company to demand payment for claims they approved but haven't paid on. This is a much larger group than you'd think, as most insurers will happily make you wait for payment until you complain.

* Appeals. They address complains made by insurers over rejected claims, either fixing the issue with the charge, or going to the insurers appeals department to tell them why it's correct. They also talk to insurers over patients that are rejected at the VOB stage.

* Out Of Network, these folks do nothing but deal with insurers we're not in-network with, collecting payments, negotiating Single Case Agreements, etc.

VOB and OON would be gone completely. Coders, UR, Bilelrs would have a lot less to do because there would be one insurer to deal with, so we could have fewer people. Medicare pays promptly and without hassle on approved claims, so does Tricare, so we'd need a lot fewer people in collections. We'd need fewer appeals people too due to one set of rules for everyone.

Healthcare in the USA is REALLY messed up, it's the worst sausage I've ever seen being made.


i said this in another thread but you're assuming the single paying entity gets it even close to right.


Considering how many other industrialized nations have it, we'd have to try incredibly hard to get it wrong. Plus, it's not like we can't make changes later.

Plus we already have Medicare, and do that pretty well.


One architectural difference is that the single-paying entity's job would be primarily to pay. The job of the many current entities is to not pay -- and to develop labyrinthine, nondeterministic, unknowable structures of great complexity to that specific end. Payments for care under our for-profit system are actually called "medical loss".


May be it doesn't. So should we just accept the Status quo ? I personally cannot and this issue is very important to me.


I believe they say $100 billion will come from the lower average reimbursement rates, something that is also pretty unrealistic to think will continue.


Does the study also look at lower provider and hospital costs? Spending on hospital and providers makes up ~50% of US healthcare spend according to CDC. Rx spend is between 10-20% and admin overhead is 30% or so

I wonder why this paper didn't contemplate effect of Medicare for all on hospital and provider spend?


Unfortunately most innovation in the medical insurance industry is a detriment to insurance consumers i.e. innovation in how to better screw the customers by not paying out. Profit in such insurance companies comes out of consumer's pockets.


This study however, doesn't seem to account for the dramatically increased usage of the system. If medical care were "free" -- the demand would quickly outstrip supply -- there's a real cost to that.


That's an interesting point and I completely agree, but wouldn't America's already real lack of "supply" buffer this a bit? I have to wait several weeks to get into my personal family doctor, and it took over 4 hours to be admitted during our last visit to the ER (we went in because of a suspected ectopic pregnancy, which it turned out to be).

It seems like the physician shortage will only continue to worsen. https://www.aamc.org/news-insights/press-releases/new-findin...

Edit: Basically, I think a lot of people will still be left without adequate health care in minor cases, but at least the most urgent cases will be taken care of without leaving people bankrupt.


Most of these shortages are regional. That will probably continue, but at least it would be possible for people to get reimbursed for travel expenses, etc. At least that's what other countries do.


The net savings would be $450B, but the total cost would still be in the 10s of trillions of dollars (Edit: 30-50 over 10 years), bigger than all of our federal spending combined. It's one thing to have as an objective, and another as a plan for getting there. The proposal they cite would make federal healthcare expenditures 69%(!!!) of the GDP (Edit: total federal expenditures). It's simply not realistic to convert our entire economy into a government and healthcare first system within only 4 years.

These calculations also ignore any affects of changed consumer preferences if you eliminate copays and deductibles, something no other universal healthcare system has done.

This is one of those calculations that is entirely accurate, but also entirely misleading.


The "10s of trillions of dollars" estimates you see are for 10 years of projected spending, not for one year.


Thanks. Good correction.


> but the total cost would still be in the 10s of trillions of dollars

Source? The linked study gives it at $3.034 trillion/year. That's on the lower end, but consistent with all other studies for single-payer healthcare I've seen, which price it in the $3-$5 trillion/year range.

Note that the US is already spending $3.5 trillion/year on healthcare.


> The proposal they cite would make federal healthcare expenditures 69%(!!!) of the GDP

That's not remotely true. I'm mystified how you could even type such a sentence without realizing its obvious falsity.


"eliminate copays and deductibles, something no other universal healthcare system has done."

Scottish NHS has no deductibles or copays in general, dentist has an fee for some people though. English system has a flat prescription fee of £9 or so for a minority of the population up to £100ish a year. It's very close to free at the point of use, however.


Canada has no co-pays. The topic of payments never even comes up, unless you're not a resident. Prescription drugs and dental care are generally not covered, however.

In fact, I still struggle to understand the concept of a co-pay. Is it like a deductible for automobile insurance?


it's not really like a deductible. it's a small fixed cost you pay every time you see a doctor or fill a prescription. it creates a small amount of friction, presumably to prevent frivolous use of resources.


There is also "co-insurance", which can be in the range of 20 to 50 percent of the billed amount, depending on one's plan. It should go without saying that 20 to 50 percent of the bill on almost any substantive medical problem can be a financial extinction-level event for many American families.


Let me give an example of the billing issues American's face.

Last employer I paid around $9,100 annual ($350 every 2 weeks). This plan had a $6k deductible with no coverage until that was met, then a $6500 OOP (out-of-pocket) max. So the insurance company was guaranteed to get $15,600 before they paid anything outside of "preventative care".

Now, unfortunately, the insurance company had me under a totally different plan, with a 7300 OOP max. Since I don't pay them, I pay my employer, I have to deal with my incompetent HR dept to get this fixed. They not only don't fix it, they somehow split my family so the member with the majority of expenditures is now on the correct plan, but everyone else is on a different plan. This causes the insurance company to claw back payments to doctors and bill me for old services, around $400.


If the doctor bill is $100 and your co-pay is $20 then you pay the doctor $20 and the insurance pays the doctor $80. Co-pay because there are two payers.


Ignoring the math error (it's not 69% of GDP), I don't understand this argument.

We would save money. Why does it matter if that money is spent publicly vs privately?


Because public is only OK if it's done by Republicans. I know this sounds flippant and partisan, but what's the serious counterpoint? Spend publically on war, on tax cuts (1), on anything favored by conservatives: it's a natural function of government. Spend on anything else: it's usurping taxpayers rights to make their own choices, and reducing efficiency because everybody knows that individual Americans spend their money more wisely than the government.

(1) yes, i know that the riposte: "tax cuts are not expenditure, they are giving money back to tax payers, where it originally came from".


"The net savings would be $450B, but the total cost would still be in the 10s of trillions of dollars"

US health care spending for 2018 alone was $3.65 trillion.

10 years of that sort of spending would result in $36.5 trillion.

So we're already talking tens of trillions of dollars, even if nothing changes.


This is the issue. The assumption that it’s somehow better for this to be handled as a consumer expenditure versus a tax is the actual debate.


That’s a very simplistic view. There’s also the question of how those numbers will change over time in each system, and how both care and cost will be distributed.

There’s also the political factor: how would we actually enable this? How do you get it passed? How do you ensure the SC doesn’t strike it down? How do you ensure it’s not just rolled back in 4 years when the presidency flips after the inevitable backlash?


"any affects of changed consumer preferences if you eliminate copays and deductibles"

I am curious on what you think are the effects.


More people will get the care they need than currently. Right now, there's a real dis-incentive to going to the doctor or to hospital for non-critical care/injuries.


And that's a good thing I would say.


Definitely.


The costs are already in the trillions!

I absolutely see your point, though, this idea that we can give everyone in the United States access to health care is revolutionary! Exciting, compassionate, and revolutionary!

We have the opportunity to clear some of the institutional sclerosis that weighs at our society and economy. I really hope it happens.


The 69% figure doesn’t sound right.


It wasn't. Fixed.


That also doesn't factor in the indirect benefits to the economy, like all the people who can't start a new business (etc.), being stuck in jobs they don't want because if they left they'd lose their benefits.


Or the boon from not having one of the highest infant mortality rates in the developed world.


The US also has the highest rate of maternal mortality in the developed world.

https://www.propublica.org/article/lost-mothers-maternal-hea...


Yeah that's because a lot of US obgyns don't follow standard checklist protocols. They don't even study it properly. I think the UK has the best one and I know California uses it. Is it a question of treating the birth as a medical event or as something else? I've read about doctors who have given birth at a hospital and died and the death was preventable.

Other possible factors could be a lack of prenatal care or (and this is separate) births outside of a hospital / medical setting.


I'm not defending the US healthcare system, which is deeply broken, but the particular statistic on infant morality rate can be deceiving. For example:

"...very low-birth-weight infants who are at high risk of dying within the first day tend to be counted as live births. In countries where the health care system does not place the same emphasis on neonatal intensive care, the outcomes of such pregnancies are not likely to be recorded as live births. Hence, it appears that the more resources a country's health care system places on saving high-risk newborns, the more likely its registration will report a higher IMR" [0]

[0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4193257/


> Employer contributions to health insurance currently average $10446 per employee and cover 71% of a household’s premium. These employer premiums are equivalent to a 12.29% tax on payroll exceeding the first $2 million... Therefore, any payroll tax less than 12.29%, our upper bound in the SHIFT interface, would result in savings for employers.

This excerpt makes it glaringly obvious that no economists were consulted when writing this paper. Checking the list of authors confirms this. While they may be experts in public health, they're making one of the most elementary errors in Econ 101. That is they're assuming that a private expenditure (employer provided healthcare insurance) can be transformed into a public tax with no loss of efficiency.

Deadweight loss[1] is the very first consideration in tax policy analysis. The reason it exists is very simple. Private actors have an incentive to minimize taxes in a way they do not with private expenditures. If you cut your company's health insurance plan, your employees will be unhappy and you'll either lose workers or have to raise compensation in other forms. If you restructure your company to avoid payroll taxes, your employees still enjoy the same access to single-payer healthcare.

Many M4A advocates try to hand-wave away this problem. It's the equivalent of declaring "Then a miracle occurs". In this case the authors assume that the current employer-paid premiums are equivalent to replacing with a uniform payroll tax matching this aggregate. While 12.29% is the average across the entire economy, there's still wide variance between employers. Approximately half of employers are currently paying less than this. A significant proportion are paying substantially less than this.

If the current system was replaced with a uniform payroll tax, the cost of labor for employers falling into this category will rise. In response that means those employers will lower their demand for labor, which results in either both economy-wide reductions in employment, wages and ultimately investment and GDP. Those results will mean that not only will the hypothetical new payroll tax not raise the revenue the authors are projecting, but current pre-existing taxes, like income and capital gains, will also see revenue shortfalls relative to baseline.

[1] https://en.wikipedia.org/wiki/Deadweight_loss#Tax


Health care costs are one of the largest year-over-year increasing costs employers have to pay. This eliminates that risk (which could rise to 6% next year) from the cost calculations every business currently has to make.

From https://www.shrm.org/resourcesandtools/hr-topics/benefits/pa...:

>"Health benefit costs are still rising at two times the rate of wage increases and three times general inflation, "making this [cost] trend unaffordable and unsustainable over the long term," Brian Marcotte, NBGH president and CEO, said at an Aug. 7 press conference in Washington, D.C.

Medicare is one of the most efficient ways of delivering healthcare we have in this country. With overheads of 2-5% compared to the 10+% of the private industry[2]

2. https://www.americanprogress.org/issues/healthcare/reports/2...


> In response that means those employers will lower their demand for labor, which results in either both economy-wide reductions in employment, wages and ultimately investment and GDP.

Unless there's another equilibrium at the new demand which neither you nor I can state that there is or isn't.


Why won't the rising cost of labor for the employers that currently pay less be offset by the falling cost of labor for the employers that currently pay more?


To a certain extent that would have an effect. However there are strong asymmetries between the two countervailing forces.

First labor isn't perfectly fungible between sectors and firms. Moving workers will result in significant productivity lowering frictions. The clearest example of this is that the group most likely to have low insurance outlays relative to wages are high income workers. When the denominator's larger, the fraction's smaller

For example a worker making $500,000 a year, even with a platinum plan $25,000 a year plan is only outlaying the equivalent of a 5% payroll tax. They'd get hit very hard under single-player payroll tax. In contrast a worker making $25,000 with a $6000 employer-insurance is paying 20%. Unfortunately the typical $500k/year high skilled job can't easily be replaced with twenty $25k/year workers.

Second, you have to consider not just the reshuffling of demand between employers. You all also have to consider the tradeoffs potential workers make between paid labor and leisure. Universal single-payer will cause some workers to drop out of the labor force, scale back their hours worked, or take less stressful but lower productivity jobs. When everyone has access to the same healthcare regardless, the incentives between those options becomes less differentiated. People retiring early or spending more time as homemakers could be a good thing or a bad thing. But without a doubt it lowers economic output, and therefore the tax base.

Finally raising payroll taxes creates incentives for workers to reclassify in a way that shields their income. One form is outright evasion. More jobs will pay cash under the table, more "employee leasing" schemes, or just simply not declaring income. The higher taxes are the more incentive there is to take the risk. But there's also many perfectly legal ways to dodge payroll taxes. Cash compensation can be shifted to exempt benefits like life insurance, employee discounts, and meals. Employee compensation can be reclassified as director fees. American Workers can relocated to foreign offices, where they're exempt from payroll taxes. Self-employed people can re-incorporate as an S-corp.

This just scratches the surface. Once you double the effective payroll tax, expect a lot more effort and money invested in strategies to evade it. This not only means the proposed payroll tax rate captures less revenue than projected. It also means the pre-existing payroll tax now collects less revenue.


If an employer decides to cut 30% of their workforce for tax resasons, who is going to do the work? Do they make the rest of the staff work overtime to cover for the people they fired? Are they just going to produce 30% less product/service and let the market sort it out?


There are several things businesses can do:

1. Automate, invest in capital equipment to reduce labor. Instead of manually boxing a product, they can buy an automated packing machine. Or a restaurant can buy tablets to automate ordering.

2. Buy more "processed" input materials, effectively shifting labor to another country. Instead of buying raw lumber to create table legs, a furniture manufacturer would buy pre-made table legs from China.

3. Subcontract to an outside company. Under the ACA, only employers with 50 full time employees are required to provide coverage. So a larger company can effectively divide labor amongst several small companies.

4. Shift to lower labor products. Instead of a sit down restaurant, the restaurant can change to "fast casual", with no waiters.


Pretty disingenuous study.

If you move to a Medicare for All policy it would shift employer health care costs to the government. Which they would never be able to financially support especially with the challenges of an ageing population and excessive debt. And so when they say it saves $450b it's not taxpayers. It's mostly employers.

There is a reason that countries that started with M4A e.g. Australia, UK have all transitioned to a public-private mix because it's simply not sustainable otherwise.


That's why the Medicare for all will still be funded, in part, through a business tax. The difference being you've removed the for-profit middlemen, so the healthcare costs are less for businesses than the privatized hybrid version we have now.


The important issue with Warren's "plan" is that it's essentially a $8,000 per year per employee head tax, so it's a regressive tax. An afterthought in the expense of hiring a very highly-paid employee, but a not-insignificant expense of hiring a lower-paid employee.

Not to mention that her plan exempts contractors and business under 50 employees, so it incentivizes businesses to to lean on contract labor or reorganize themselves into smaller sub-companies - a small paperwork expense in the scheme of things.

The business tax should be universal to stamp out avoidance and scaled to all payroll spend so it's at least not regressive, even if it's not a progressive tax.


The problem with a new business tax is that it doesn't come for free.

Increasing businesses taxes reduces international competitiveness which can reduce taxation collected in other areas. Also politically it's an incredibly hard thing to implement.

And remember you have to do this at the same time as you're implementing Medicare for All. Making it a pretty radical transition by any measure.


Oh I agree it's a radical change from what we have now (Although the resulting system is one many countries have already succeeded with). I was merely pointing out how if the program - and the tax to support it - is not truly universal, you have created incentives for businesses to weasel out of it.

The exemptions are billed as being "pro-small-business" but that's a BS talking point. Universal medicare for all would take away all that healthcare-plan-administration overhead that small businesses already have to deal with and pay for. Plus the extraneous benefits of having employees and customers who aren't pressured to avoid basic health care and preventative care and then go bankrupt when they need a larger procedure.

But I think only a radical change can have any real effect. You have to get the denying-care-for-profit insurance bloodsuckers out of the system completely; any concessions to them should be viewed with extreme suspicion.


Mandating businesses to pay health insurance costs for employees under the current system is already reducing international competitiveness.

Medicare-for-all makes the U.S. more competitive by making healthcare similar to other developed nations.


Exactly the health care costs are less for businesses. But that's not coming through efficiencies but largely through the US government picking up the tab for it.

Which is completely fine because it's what happens elsewhere in the world. But there is no discussion around the impacts to budgets and taxpayers which is the challenge the faced Australia and UK for example.


You are underestimating the record profits that insurance companies make. Those will not be needed since Govt. is not in it to make money. That is another efficiency.


Government is anything but efficient, or cheap.

You will end up with multiple redundant bureaucracies overlapping the same areas, spending tax money and blowing up budgets like it's going out of style, skyrocketing our already skyrocketed national debt, and you will lose any choice in the matter.

Good luck trimming those departments and fixing the bloat once it's implemented, because our federal government cannot do that even now.

This article is pie in the sky, it doesn't reflect the realities of the bloat and cost already present in our government.

The most efficiently ran part of our government is the military, and the amount of black holes in the accounting, the cost, it makes your eyes simply boggle.


>The most efficiently ran part of our government is the military

I mean that's just objectively wrong. The US Postal Service is likely the most efficient among government agencies. Medicare is also very efficient even compared to private insurance.

So I'm not sure where this fear of inefficiency is coming from when we're going to leverage one of the most efficient government programs in the US. And I'm more curious as to why people even care about the national debt bullshit anymore considering we've seen one side be completely willing to blow up the deficit for the sake of giving the rich socialism.


> a business tax

Businesses have proven themselves to be very clever in finding ways to avoid paying taxes. They’ve had a harder time figuring out to avoid paying salaries and benefits.


The UK system is still the same from the user point of view as in 1944? It's now somewhat stretched but fundamentally you don't need to deal with insurers, billing, etc.


No, it's because big interests have paid them to decrease taxation on the top earners.

There is a reason the income gap between different classes of the population is growing larger. That income gap is what should be funding these.

Policies of austerity are a direct result of the rich getting richer, not that it's not sustainable.


It’s a complete scam run by insurance companies who operate with ostensibly a government mandate (although with seemingly zero oversight). I work for myself and and have historically been paying about 20k per year in premiums for my family with a family deductible which I’ve never gotten remotely close to hitting. I have an hsa which I use to pay for out of pocket expenses pre tax and there is a tax deduction for health care premiums. This year I decided to test the system.. and didn’t purchase health care for myself. It turns out that many of the services and drugs we all pay through the nose for are so much cheaper If you ‘self pay’. I spoke to admins at both my doctor and the affiliated hospital and they all have programs to help alleiviate payment hardship if you don’t have insurance (translation: you’ll just have to pay the actual cost of the procedure. Not the bullshit one that the insurance company tells you that you saved a bunch on by overpaying for their insurance). Ridiculous. Inevitably someone will figure out that it’s the insurance companies ripping everyone off and do something that removes their intermediation state-sponsored fleece-job. Ultimately you’re actually paying for catastrophic insurance, oh and Medicaid and long term elderly Medicare, but the rip off of your standard, healthy consumer is a travesty. Maybe someone should be reviewing the actuarial models (or whatever they are) to determine an apporopiate cost for someone who’s ‘heathy’. Me? I’ll just continue to pay like I’m poor... and save some cash.


I wish i could upvote you 1000 times. Why is it so hard for many people to understand all of this ?


Part of the point of insurance is to offset risk. He says that he doesn’t have insurance for himself. While he is probably fine, he is taking the gamble that he will not require any expensive procedures.

Depending on your risk tolerance, it could pay off for people to do this... But it’s certainly not for everyone.


Because it takes advantage of risk. OP's gamble pays off if he never has an emergency, but if he ever pays more than 20k on doctors visits he's fucked.

Granted, that doesn't often happen. But it's a risk that most people can't afford.


> but if he ever pays more than 20k on doctors visits he's fucked.

I agree with the general point that there's more risk, but it doesn't logically follow that if you pay more than 20k in a given year you are ruined, compared to if you'd taken the insurance policy. Suppose you were paying 20k / year minimum for "insurance", needed some healthcare, and ended up paying 25k = 20k for the cost of the "insurance" and another 5k out of pocket that wasn't covered. Does that mean you're ruined even if you do take insurance?

To make a better argument we'd need to understand how much wealth & income & expenses someone has, and if they're able to set aside spare cash (perhaps in an investment account) that's saved in the good years by not paying for insurance, that can be used to cover or partially cover expenses in the years where healthcare expenses are high.


“I stopped paying all the premiums on my car insurance! You wouldn’t believe the savings! Why hasn’t everyone figured out this hack?

Why no, I haven’t had an accident...why do you ask?”


I am sure, on paper, it is a brilliant plan. Unfortunately, reality and human behavior almost never follow the plan.

Is waste, fraud, and abuse taken into account at all in this study? What about the inevitable changes to consumers' motivation, behavior, and decision making around healthcare? It will change drastically as the cost of their care is even further removed from them than it is now.

People who have a proclivity to go to the doctor too much will go even more when its 'free'. Younger people who eschew doctors because it interferes with their current lifestyle will feel even safer continuing bad health habits because free care will be there for them later in life.

Why should I subsidize other people's bad decision making?

EDIT: All healthcare is really too broad of category for government funding. Obvious things like cosmetic surgery and others are already excluded from consideration because they are not necessary. But IMO even when medical care is necessary I don't think it always falls into the category of something society should pay for. How many ER visits, ambulance rides, and surgeries a year can be attributed to purposeful recklessness by an individual? If someone decides it is a good idea to stand on a motorcycle's seat on the freeway and then crashes, why should the public pay for that? On the other hand people who have medical issues that are no fault of their own do deserve care.


Did you read it? Also, are you familiar with any modern nations where a single-payer healthcare system has been tried? Perhaps we could use them to predict the effects.

> Is waste, fraud, and abuse taken into account at all in this study?

From the paper: "In addition to savings on overheads, a comprehensive database of health-care charges would facilitate detection of fraud, which extracts $85·7 billion every year. Following the transition to a single-payer system in Taiwan, an 8% reduction in overall national expenditure was attributed to the reduction in fraud. By moving from a fragmented health-care payment system to a unified system, irregularities in provider claims can be more easily detected. For example, under the fragmented system excessive claims for physician time can be spread across patients with several different insurance providers. However, acknowledging that improvements have been made in fraud detection since Taiwan's transition, we conservatively assume that the improved fraud detection would garner savings amounting to half that observed in Taiwan, corresponding to 4% of total health-care expenditure."

https://www.thelancet.com/journals/lancet/article/PIIS0140-6...

> People who have a proclivity to go to the doctor too much will go even more when its 'free'. Younger people who eschew doctors because it interferes with their current lifestyle will feel even safer continuing bad health habits because free care will be there for them later in life.

Is this a significant problem in countries with single-payer systems?

> Why should I subsidize other people's bad decision making?

You already are? That's how health insurance works. What this study is showing is that you'll have to subsidize other people less, because the whole system will be less expensive.


> You already are? That's how health insurance works.

I am not a defender of the insurance system. It blows. But single-payer is not the only other choice.

I want a freer healthcare market where prices are known before consuming services. Real market competition could actually occur to bring down prices. For drugs, research and development for less profitable cases could be a very worthy target of government funding. I don't have all the answers but neither does single-payer.


Healthcare is not and cannot ever be a free market. You cannot have price transparency when a buyer may be unconscious at the time of "purchase". You cannot have price competition when buyers are frequently forced to immediately purchase a good or service if they don't want to die. Hospitals are chosen by proximity, not price. These are the consequences of being mortal human beings. If we were all immortal, and "healthcare" was nothing more than voluntary cosmetic surgery, a free market might make sense.


> You cannot have price competition when buyers are frequently forced to immediately purchase a good or service if they don't want to die.

The number of instances where this dire case occurs is minimal compared to every other instance. Sure, when its life and death its not practical. Perhaps those sorts of situations is where single payer or insurance makes sense.

For humdrum things like physicals, wellness visits, cold and flu checks, vaccinations, routine labs and imaging, etc. a free market could work very well.


Hospital care is the largest spending category by far: https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...

While the other things you list are technically not immediate life-or-death decisions, they still are not voluntary purchases. The presence of any kind of coercion distorts a free market.

Also, I don't want to live in a society where individuals must decide between vaccinating their newborn children or paying their electricity bill that month. Or between getting a flu shot and buying groceries for the week. The externalities of these "individual" decisions are obvious, and a free market has no answer.

Finally, let's imagine a system where emergency care is covered by a national single payer, but "humdrum things" are available in a free market. Now the poor can't afford basic physicals and flu shots, so we all end up paying more into the single payer system to cover such people being hospitalized for conditions that could have been prevented by regular medical checkups.


It doesn’t matter if it’s better. It’s fundamentally impossible to get to there from here directly. You can’t do it politically or economically, and honestly, given how much of our economy is built on healthcare spending, it’s pretty stupid to try. But again, it doesn’t matter, you can’t do it in a democracy. Just like a carbon tax, if you make too much of the population hurt in the short term, they’ll just replace you with someone who won’t.

The public option is the only thing that has a snowballs chance in hell of working.


How did FDR accomplish the New Deal in a democracy? How did the UK implement the NHS in 1948? How did Canada pass the Canada Health Act in 1984? How did Taiwan institute National Health Insurance in 1995?


Somehow, the current US health system is the most expensive on the planet [0], for outcomes that aren't better (and in some cases worse) than the rest of the developed world. Have you considered the possibility of waste, fraud, and abuse being high in the present system?

[0] https://en.wikipedia.org/wiki/List_of_countries_by_total_hea...


I am not defending the current system. My point is that insurance and single-payer are not the only 2 possible models. A freer healthcare market, not encumbered by the inefficiencies of insurance, could actually put market forces to work in the industry. If prices were known prior to service competition would begin and people could vote with their feet. Right now we have a overly consolidated monstrosity in the insurance and drug industries sucking profits out of the public, and these guys just want to switch it out for a different monstrosity.


> Somehow, the current US health system is the most expensive on the planet

You know why? Because we pay for most of the R&D, done by industry, that the rest of the world benefits from. For example, other developed nations like Canada have been able to benefit from new drugs invented in America's more capitalist system by restricting prices in their country even though we don't.


US pharmaceutical company R&D spending is ~80B per year [0]. Healthcare spending is ~3.6T, making pharma R&D about 2% of overall healthcare spending.

Based on the above back-of-the-napkin math, I'm inclined to think pharma R&D isn't really the main factor.

What is your support for believing it is the case?

[0] https://www.biopharmadive.com/news/phrma-research-developmen...


"Why should I subsidize other people's bad decision making?"

You already are through record high premiums, deductibles and what not to private insurance companies. The problem is that those companies are in it to make money which means everything is inflated and not to mention the bullshit of in-network/out of network and fighting with billing/administration to get bills corrected. No. I am sick of that and I would gladly pay to subsidize other people's decision making because we all already are.

If you really don't want to pay for other people, then no insurance should exist and everything should be out of pocket straight. Free market baby. But not gonna happen in the US when it comes to healthcare.


Let's take smoking as an example.

You think there are people out there who will smoke, knowing that it causes lung cancer, because they figure government will pick up the tab for the chemo? Bizarre, but ok, if so, why doesn't having insurance give them the same incentive?


My wife's aunt has been on disability for years because she hurt her back and refuses to quit smoking. The doctors said the smoking is preventing her back from healing correctly, and 3 back surgeries later, she still hasn't quit. Because she's poor and on disability, she doesn't have to pay for any of it, and is pefectly content sitting in her trailer watching TV and taking pain killers as her health deteriorates.


This is simply not a compelling argument against reform. It is a sad story and surely there will be people like this abusing any system, but making people face down bankrupts and death of loved ones is not the correct incentive against abuse of socially funded systems in my book.


And you think if she wasn't allowed to either have private health insurance (which is subsidized by others with health insurance) or have government-paid insurance, that she would suddenly stop smoking?


I think she'll keep smoking as long as she doesn't face any repercussions for it. Right now, she keeps getting free medical care to fix anything wrong with her, so she has no incentive to get better. If she didn't have that, then she'd have to make the choice between continuing to smoke, or having to be immobile and in pain because she couldn't keep getting medication and surgery to mask the health problems she's bringing on herself.


Speaking as someone who has parents whom smoke a lot, I think you don't understand the mentality of smokers or the addictive behavior of smoking.

Nothing is going to stop her from quitting smoking, even if she was denied pain medication or surgery. They'd find other ways to numb the pain and just walk straight into an early grave.


But... she does have repercussions? She has chronic back pain and deteriorating health...

Pain pills are either A) not going to be strong enough B) harshly addictive. Probably opioids.


Insurance and single-payer aren't the only two choices. It is possible to not like either.


Wow, she is living the dream.


You must live in a pretty blissful bubble. I have known or known of many people who continue bad habits in their life (e.g. excessive drinking and smoking) using government provided subsidies like disability, medicaid, and local programs.

Besides, if the prospect of lung cancer was enough to scare everyone off tobacco there would be no one smoking still. People are not always rational and yes I can see someone rationalizing their decision to smoke, in part, on the fact that if they do get sick they won't have to worry about paying for it. Or from the other direction if you know doing something could make you sick the prospect of simultaneous health and financial problems will be enough to push a larger portion of the public into making the healthy decision.


My wife is a pediatrician and sees about 80% medicaid patients. People absolutely go in more often than they need to because they don't pay a single cent. I'm talking going to the ER because their kid has a cough or is running a fever. These are usually also the most demanding patients.


I found this part of the paper to be unreasonable:

Available ER visits and hospitalizations can be avert through improved access to primary care


Have you ever gone to a busy urban ER? It is absolutely full to the brim 24/7 with people visiting with chronic ailments that don’t have health insurance, which is literally the most expensive possible way to treat something like asthma or chronic emphysema.


Look up the Oregon Medicaid study. Basically did a lottery, half get Medicaid, half don’t.

No change in outcomes, it just cost more.


Medicaid is not the same as Medicare. Medicaid is literally Free stuff so yea, it can be abused. Medicare is not free. People pay into it through taxes. 2 different things.


Free at the point of sale is what’s important. The fact that I know I theoretically pay for it with my taxes does nothing to curb abuse.


> Why should I subsidize other people's bad decision making?

This is what you already do when you live in America. Other people made a bad decision to make healthcare a private industry, creating a billion dollar insurance business, and you are writing their paycheck out of yours.


And how is writing paychecks for government bureaucrats any different? I would like to pay my doctor, and my hospital, and my pharmacy for my healthcare costs not some borg.


> And how is writing paychecks for government bureaucrats any different?

It's (supposedly) CHEAPER. That's right in the title. If you want to argue whether it's actually cheaper or not, that's another thing, but this kind of feigned ignorance is really not helping the debate.

> I would like to pay my doctor, and my hospital, and my pharmacy for my healthcare costs not some borg.

In South Korea, with its universal healthcare system, I always visited a hospital and paid them directly right there. Usually a few to a dozen bucks for common cold, inflamed ears, that kind of stuff. Here in the free world of America, I go to hospital and three weeks later a faceless insurance company sends me a ridiculous bill and I don't even understand how they arrived at such a price.


I don't know why the idea of a "public option" fell out of favor with Democrats. It's a good stop along the way, and doesn't risk completely destroying an industry overnight...and therefore has a much higher chance of passing. Eventually employers would push people onto the public option plan, but it wouldn't be overnight. Bernie's plan, imo has so much room for error, it's not even worth considering without a stop along the way. It's also ironic he wants to ban private insurance completely (I assume that even means supplemental) when pretty much every single country he cites as a model doesn't do that.


the end result of the public option is employer-based plans offloading their least valuable (and most vulnerable) customers onto the public option, leading to much higher costs for everyone. the abolition of private insurance is necessary for the efficiency and bargaining power of a maximalist medicare-for-all system.


100% agree. People are totally delusional to think that there’s a snowball’s chance in hell of single payer happening from where we are. And given that healthcare is like a fifth of the economy, it’s completely reckless anyway! Plus, if nothing else, it’d never get through the Senate, and that’s unlikely to change for decades.

Public option, it’s by far the best path forward.


Is this Bernie's plan? I know there are subtle but important differences between all the different varieties of "universal healthcare" that exist in the world.

The Twitter account @BadEconTakes enumerated something about this in a recent post: https://twitter.com/BadEconTakes/status/1228143455399858176/...

Excuse their obvious bias against it; I wonder what the difference in expected savings (money + lives) might be between all these different variations on the same theme.


The fundamental challenge of any universal health care system is that to cut our spending on health care to the level of other western industrialized countries will take $1 Trillion of annual revenue out of the existing system. There's going to be a lot of disruption and people who need new jobs when that revenue goes to other things in our economy.


Real question, not snarky:

Why is this sort of downsizing always wrong for white-collar workers when blue-collar workers have been dealing with it for decades?


There’s a huge difference between downsizing caused by economic forces of the private sector and downsizing caused by outright elimination of an industry by elected officials.


Healthcare (as some other sectors) is full of inefficiencies and removing or, at least, reducing them cannot be seriously labeled as "elimination of an industry". I don't see how job market restructuring in healthcare industry due to proposed transition to the single payer model is different in its essence from potential significant job market restructuring across various industry sectors due to automation trend.


But that line is massively blurred when said downsizing of blue collar workers is a direct (and known) result of free trade agreements made by elected officials. You're adding one step to the chain, but the chain is still there.


Sometimes you need the public government to step in and shut down malignant private industries.


> There's going to be a lot of disruption and people who need new jobs when that revenue goes to other things in our economy.

From the paper: "Improvements in system efficiency, such as reductions in billing tasks, will involve a contraction of the workforce. Although the country will benefit from lower costs, 936 000 administrative positions and 746 600 positions in the health-care insurance industry are estimated to become redundant. However, detailed transition plans have suggested either funding for early retirement options, extensive severance, retraining programmes, and relocation expenses for all workers in these sectors. Implementation of such a plan is estimated to cost $61·5 billion annually over 2 years, a sum which would be recouped within the first year by the health-care savings estimated here."

https://www.thelancet.com/journals/lancet/article/PIIS0140-6...


Roughly, that is 20 million jobs lost. (assume $50,000 each)

Cutting $1 trillion is a change that affects 5% of GDP.

This issue is part of why Obamacare kept the insurance companies. Killing jobs didn't go over well.


Looks like 1.7m jobs, not 20. I guess some folks make a whole lot more than 50k.


i'm not american, so excuse me for the lack of knowledge, but i've heard that bernie plans to ban private insurance.

is that right? i mean, that seems like a really bad idea -- if you have money, why wouldn't you get better health care?

edit:

btw i live in a country with the largest public health care system in the world https://en.wikipedia.org/wiki/Sistema_%C3%9Anico_de_Sa%C3%BA... and we never banned private health care because... well, even with the best public health care system, you will still have to wait a lot to get any procedure done. so if you can afford, you can pay for private health care and get stuff done faster.

it doesn't mean that public health doesn't work -- it works quite well, it's just that you have to wait a lot sometimes for some procedures.


I don't believe he'd ban supplemental insurance, just insurance that covers the same services the State option covers.


but... why? i mean, if i can afford it, i would want private health care because it's usually less crowded and you can have stuff done a lot faster.

for example: a friend of mine had to wait 6mo to do a vasectomy through our public health care system.

another friend waited 2w to do his (through private health care)

if you could afford it, wouldn't it be better to pay for it?

for me (and maybe i'm completely in the wrong here) it's like public transportation vs cabs/uber. i know i can take public transportation everywhere, but sometimes i'm in a hurry so i just get an uber. it doesn't mean other people can't use public transportation, it's just that i'm in a hurry and i need to get somewhere faster.


You are confusing Private Health "Care" wth Private Health "Insurance". The issue with Private health Insurance in US is that they have too much power and strong hold on doctors/hospitals etc and for them to make profits, EVERYTHIng is priced too high, EVERYTHING. So private health "insurance" has to die for this to be effective. They can exist only for supplemental stuff. No one is talking about taking away private health "care". You can still go to whoever you want.


i'm not! where i live, we have public health insurance and private health insurance (if you don't know, wikipedia has a good summary https://en.wikipedia.org/wiki/Sistema_%C3%9Anico_de_Sa%C3%BA...).

i can go to a public hospital and get most procedures done -- the problem is, a lot of them, specially electives, take a LONG time (sometimes, over a year). but i can do them, and i'm not going to get bankrupt if i get bitten by a snake.

but i also have private health insurance -- i pay it myself for me and my wife. why? because sometimes, i don't wanna get into insane lines and wait for hours on ER. also, i can get elective procedures done a lot faster -- which means i'm not crowding our public health care system.

what i mean is: everything i can do with my public heath insurance system i can also do with my private health care system. it's just a matter of how fast it is.


For the single payer system to work as Bernie has set it up, everyone must be within coverage.


i mean, i'm within coverage of brazil's public health care. i can go to any public hospital right now and get whatever care i need. no extra payment required. (you can read more here https://en.wikipedia.org/wiki/Sistema_%C3%9Anico_de_Sa%C3%BA...)

but i also pay for private health care -- because it's... well, better. and fortunately, i can afford it.

so i can go to a private hospital and also get whatever procedure i need.

if you think about it, i'm basically paying in double because my taxes go to the public health care system AND i pay for private insurance -- but i honestly don't care, because i want other people, that have no insurance, to have health care.


Pretty sure thus is the way everywhere here in Europe too, you still pay the huge compulsory insurance but no one forbids private insurance or private out of the pocket. In fact many private places also offer things covered by national insurance if they agree to prices set by the gov.


that's basically my question: can you, within bernie's proposals, do that or not or not?

if not, i think his proposal is not that great.

if you can keep your private health insurance? well, that is a great plan and i would 100% agree with it.


Yikes, so you have higher taxes to cover universal healthcare AND you have to pay insurance premiums, deductibles and copays on top of that? That's exactly what we libertarian types are afraid of...


i don't pay premiums, copays or deductibles. maybe our system is super different than yours?

i just pay fixed fee per month and i can go to any doctor i want, do any procedures... i mean, i had to do a lot of stuff (including heart exams, endoscopies, blood pressure stuff) and i never had to pay anything out of pocket.


Yes. The summary explicitly references the "Medicare for All Act", which is technically Pramila Jayapal's bill in the house[1]. That is the specific legislation Bernie is campaigning for when he says "our plan". It checks all four of those boxes in your linked tweet. The study also directly cites Sanders twice (to explain where they get their parameters).

[1] - https://www.congress.gov/bill/116th-congress/house-bill/1384


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