Cheap medical care.

[John Baker]

Here is an idea that I hope catches on. Two doctors have opened a medical clinic that charges it's patients only $49.00 per month and ten dollars a visit for office visits. They do it by eliminating health insurance.

It has been working so well for them, they have opened a second clinic. They have worked deals for large discounts on tests and other services.
Here is a video about the concept. http://www.bing.com/videos/watch/vi...cpkey=15a43741-0651-4846-8942-755ded9f3435|||

I don't know how they handle hospitalization though, nevertheless, whatever they are doing, it seems to be working for them.

John

 

[OkieFlyer]

Me Likey.

 

[Gary F]

I think it is a good thing. This is a novel form of insurance for primary care services. The big problem is that most states mandate very comprehensive coverage including mental health services and chiropractic which results in high premiums. This program would not cover hospitalization which is where things can get really expensive. This plan coupled with a high deductible catastrophic hospitalization insurance policy might work well. Unfortunately, I don't think you can buy catastrophic coverage anymore due to government mandates.

 

[OkieFlyer]

Unfortunately, I don't think you can buy catastrophic coverage anymore due to government mandates.

Yes sir, you can, and I did.

 

[Gary F]

Yes sir, you can, and I did.

It varies by state and things will change in 2014.

 

[murphey]

I have only major medical (catastrophic) and pay cash for everything else. The dog's vet is the only physicial that doesn't give me a discount for cash. Depending on the specialist, I get 10-50% discount for cash. Not check. Not credit card. Cash. Even the MRI last year on the knee (surgery was covered but not the MRI). 30% discount.

 

[iflyforfun]

You are paying a 30% or so premium if you pay cash and have a major medical policy. Set up a Health Savings Account (HSA) and you can contribute something like $6,000 per year pre-tax. You then have a debit card with the pre-tax monies in YOUR account. If the doctor won't give a cash discount with a debit card, you can get cash from the debit card and then pay with cash ... just keep the receipts so you can show your expenses where equal to or greater than the cash you withdrew from the HSA account.

Think about this ... if you're in a 25% tax bracket and using an HSA.
* Initial bill - $100
* Negotiated cash bill - $70
* Negotiated cash bill using pre-tax money - $52.50

At the end of the year, if you have money left, it is yours. You can keep rolling it over until retirement (or until government changes the game). In the mean time, get an HSA and cut Uncle Sam out of tax on all that money.

I have only major medical (catastrophic) and pay cash for everything else. The dog's vet is the only physicial that doesn't give me a discount for cash. Depending on the specialist, I get 10-50% discount for cash. Not check. Not credit card. Cash. Even the MRI last year on the knee (surgery was covered but not the MRI). 30% discount.

 

[murphey]

You are paying a 30% or so premium if you pay cash and have a major medical policy. Set up a Health Savings Account (HSA) and you can contribute something like $6,000 per year pre-tax. You then have a debit card with the pre-tax monies in YOUR account. If the doctor won't give a cash discount with a debit card, you can get cash from the debit card and then pay with cash ... just keep the receipts so you can show your expenses where equal to or greater than the cash you withdrew from the HSA account.

Think about this ... if you're in a 25% tax bracket and using an HSA.
* Initial bill - $100
* Negotiated cash bill - $70
* Negotiated cash bill using pre-tax money - $52.50

At the end of the year, if you have money left, it is yours. You can keep rolling it over until retirement (or until government changes the game). In the mean time, get an HSA and cut Uncle Sam out of tax on all that money.

Fascinating explanation but entirely irrelevant to my situation.

I'm in the 0% tax bracket .

 

[EdFred]

Fascinating explanation but entirely irrelevant to my situation.

I'm in the 0% tax bracket .

What is your secret? I would like to be able to be in the 0% tax bracket and still be able to do everything I do now.

 

[murphey]

What is your secret? I would like to be able to be in the 0% tax bracket and still be able to do everything I do now.

Trust me, you do not want to be in my situation - unemployed software developer. Problem is that my background is fairly specialized and there's not much call for it in Colorado and I'm not interested in moving.

Full coverage for me is almost $600/mo. Major medical is $260/mo. That $4080/yr difference was still more than what I spent last year with 2 hand and a knee surgeries. From my POV, I'm ahead of the game. Last year was the first time I ever used up the deductible. If you consider I haven't been paying that $4K over the past 10 years, I'm way ahead of the game.

 

[denverpilot]

You then have a debit card with the pre-tax monies in YOUR account. If the doctor won't give a cash discount with a debit card, you can get cash from the debit card and then pay with cash ...

Don't even the HSA account debit cards have cash-withdrawal fees or charge for cash withdrawals on a percentage basis? (Never had one. Had a debit card from a "cafeteria plan" which is different but similar to an HSA. It didn't allow cash advances.)

That card was a total PITA to use. It was "locked" to only work at businesses that were listed by their owners as being "medical" in nature, only. Eye docs' office, no. Any pharmacy where other items were sold, no. Any Doc who'd filled out the forms to their bank wrong about their business type, no. Chiropractors, no.

In fact it's easier to list the places it would swipe and be accepted than where it wouldn't. Big group doc's offices, yes. Urgent care facilities or hospitals, yes. Some large eyeglass chain stores, maybe.

It was supposedly to reduct fraud where United Healthcare would have to go hunt someone down who'd purchased a new washer/dryer set "by accident" with their card from the plan. Mostly it just meant that I would swipe a different card and go straight home and put the receipt and paper reimbursement form in the mail that same day so the reimbursement would arrive in time to pay the other card bill.

 

[iflyforfun]

Don't even the HSA account debit cards have cash-withdrawal fees or charge for cash withdrawals on a percentage basis? (Never had one. Had a debit card from a "cafeteria plan" which is different but similar to an HSA. It didn't allow cash advances.)

That card was a total PITA to use. It was "locked" to only work at businesses that were listed by their owners as being "medical" in nature, only. Eye docs' office, no. Any pharmacy where other items were sold, no. Any Doc who'd filled out the forms to their bank wrong about their business type, no. Chiropractors, no.

...

Mostly it just meant that I would swipe a different card and go straight home and put the receipt and paper reimbursement form in the mail that same day so the reimbursement would arrive in time to pay the other card bill.

Well, I must admit that I've never used it for a cash withdraw ... I set up a pin when the account was set up, but I haven't pulled cash. I have checks that go with the account. I get the statements and direct how the money is held. For example, anything over $4k can get swept to a money market account and it is possible to invest in stocks / bonds via a brokerage account if you deposits grow to the point that makes sense.

With an HSA, it is your money in your account and you can spend it as you like - there are rules that you must abide by (and that are supposedly enforced via audit), but it pretty much is another bank account. We regularly use ours at Walmart, Target, etc. The HSA rules allow pretty broad use and include MANY things that won't count against your catastrophic deductible (think saline solution, disposable contacts, etc). It doesn't count elective surgery or medicines.

Since it is your money, it is possible to have expenses occur before you have built up your account. For example, the first year or two, it is common for of our employees deposit $500 / month into their account. If you have a major occurrence in the first 6-8 months, you may have a $5,000 bill and only $2,500 in the account. If this occurs, you pay with after tax money, save the receipt showing the $5,000 expense and then write yourself a check for the difference once you account balance allows.

Talk to the tax and retirement experts and they'll tell you to pay for medical expenses with after tax money if you can, and use the HSA account as another retirement account. At retirement, the rules for use of HSA change pretty significantly, so there is a real benefit in building a balance.

To me, the HSA coupled with a catastrophic policy is the future of how to control medical costs. When you are spending YOUR money out of YOUR account, you watch every penny, question every charge, ask for every discount and have serious discussions with your doctor about the necessity of the next test he want to run ("do I really need this or are you worried about getting sued doc, remember this is MY money we're spending here"). You want to fix medicine, make the end user spend THEIR money on medical care. Nice thing about catastrophic coverage is that when you hit the high deductible, dang near 100% is covered. Thus, you watch every penny of YOUR money, but if it is major (think cancer) you blow through you deductible and then can focus on getting the right treatment by the best doctor and you are not worrying about every penny spent.

 

[jtheune]

Well, I must admit that I've never used it for a cash withdraw ... I set up a pin when the account was set up, but I haven't pulled cash. I have checks that go with the account. I get the statements and direct how the money is held. For example, anything over $4k can get swept to a money market account and it is possible to invest in stocks / bonds via a brokerage account if you deposits grow to the point that makes sense.

With an HSA, it is your money in your account and you can spend it as you like - there are rules that you must abide by (and that are supposedly enforced via audit), but it pretty much is another bank account. We regularly use ours at Walmart, Target, etc. The HSA rules allow pretty broad use and include MANY things that won't count against your catastrophic deductible (think saline solution, disposable contacts, etc). It doesn't count elective surgery or medicines.

Since it is your money, it is possible to have expenses occur before you have built up your account. For example, the first year or two, it is common for of our employees deposit $500 / month into their account. If you have a major occurrence in the first 6-8 months, you may have a $5,000 bill and only $2,500 in the account. If this occurs, you pay with after tax money, save the receipt showing the $5,000 expense and then write yourself a check for the difference once you account balance allows.

Talk to the tax and retirement experts and they'll tell you to pay for medical expenses with after tax money if you can, and use the HSA account as another retirement account. At retirement, the rules for use of HSA change pretty significantly, so there is a real benefit in building a balance.

To me, the HSA coupled with a catastrophic policy is the future of how to control medical costs. When you are spending YOUR money out of YOUR account, you watch every penny, question every charge, ask for every discount and have serious discussions with your doctor about the necessity of the next test he want to run ("do I really need this or are you worried about getting sued doc, remember this is MY money we're spending here"). You want to fix medicine, make the end user spend THEIR money on medical care. Nice thing about catastrophic coverage is that when you hit the high deductible, dang near 100% is covered. Thus, you watch every penny of YOUR money, but if it is major (think cancer) you blow through you deductible and then can focus on getting the right treatment by the best doctor and you are not worrying about every penny spent.

You might want to check the rules and the use of your HSA. As of the first of this year you can no longer use the HSA for over the counter medicines only prescribed items.

 

[Dr. O]

The office call is the least expense...
If you need some blood tests it can be a couple hundred bucks...
If you need an ultrasound of your gall bladder and the upper abdomen to determine if that pain is something serious or simply waaay to much pilot's lounge coffee, now you are talking 500 to 700 dollars...
If you need a CT scan or MRI, Katie bar the door...
Then there is your friendly pharmacist who will cheerfully count out a bottle of 90 pills at ten dollars a pop...

Deciding to go without health insurance is like flying around the world - do a lot of preflight planning...

denny-o

 

[iflyforfun]

You might want to check the rules and the use of your HSA. As of the first of this year you can no longer use the HSA for over the counter medicines only prescribed items.

That is a good catch and a recent change. I believe what you say is mostly correct. I think OTC medicines are still covered if you have a prescription from the doctor ... but I'll double check. Employee with child has serious skin condition. She has several controlled prescriptions as well as prescription for OTC ointment, I THINK the ointment is covered.

You are correct about saline and other items though and I appreciate the reminder.

 

[weilke]

My worry about hoarding money in a HSA as a retirement vehicle is that once the new 'exchanges' and all the other massachusetts style goodies run out of money, the temptation will be great to expropriate those monies and exchange them for a coupon redeemable for one of those new subsidized policies. Yes sure, you can claim that it's 'your money', but as we learned recently that means nothing once they whip out the commerce clause.

 

[murphey]

To me, the HSA coupled with a catastrophic policy is the future of how to control medical costs. When you are spending YOUR money out of YOUR account, you watch every penny, question every charge, ask for every discount and have serious discussions with your doctor about the necessity of the next test he want to run ("do I really need this or are you worried about getting sued doc, remember this is MY money we're spending here").

Sorry, but it's always been your money, not the insurance company's money. Remember, you've been paying premiums all this time.

The way to control medical costs is to control the insurance companies. As I said, other than the dog's vet, every physician I deal with is very willing (even overjoyed) to give me a substantial discount for cash. Why? Because they don't have to deal with the insurance company! Take a look at a large practice, even an HMO. Find out how many people do nothing but handle insurance paperwork. Talk to a small office with 1 or 2 physicians and ask them how much time (and how many people) it takes to deal with the insurance companies. This is overhead dollars. This is what's jacking up the cost of medical care.

Every one of the insurance carriers negotiates (dictates is more like it) the dollar value the physician receives for a procedure (the line item on the super bill). Does the insurance company tell you that number? Nope. So either you or the physician's office files a claim.

You get back a statement saying you are insured with them, hence the cost of the procedure was Y because they've negotiated a Really Fantastic Deal with Dr. and 75% of Y is being paid by the insurance company, so you only need to pay Z which is 1/4 of Y.

But what you don't know is that the Dr is only getting X, which is substantially less than 3/4 of Y. So not only does the insurance company get the 25% of Y, it gets a % of what allegedly goes to the Dr.

This isn't managed care, it's managed profit.

 

[Everskyward]

I think the problem is that the hospitals and insurance companies are playing a game. I recently got a look at the statement for outpatient cataract surgery (for my mom). Hospital billed the insurance company $25,000. Negotiated settlement was $2,500 which is about what I would have expected.

There was someone else in this thread that paid for a $4,000 colonoscopy. I had one a couple years ago and before they found out I had insurance they said it would be $1,200 if I was paying for it myself. That also seemed somewhat reasonable. I think that hospitals come up with these pie-in-the-sky charges hoping that someone in the insurance company will screw up and pay for them.

 

[EdFred]

The hospitals try to get the money from insurance because they can't refuse services to people that have $0

 

[Everskyward]

The hospitals try to get the money from insurance because they can't refuse services to people that have $0

But that's only for life-threatening situation. I'm sure you can't go in there and demand a cataract operation or a colonoscopy for $0.

 

[EdFred]

But that's only for life-threatening situation. I'm sure you can't go in there and demand a cataract operation or a colonoscopy for $0.

Not even for life threatening. Hospital ER's get filled by poor people with nothing more than common colds. I was chatting with one nurse that says certain days are busier when the poor come in complaining of "severe pain" so they can get a 'scrip for HC.

 

[Everskyward]

Not even for life threatening. Hospital ER's get filled by poor people with nothing more than common colds. I was chatting with one nurse that says certain days are busier when the poor come in complaining of "severe pain" so they can get a 'scrip for HC.

But this does not account for a large proportion of health care costs, as much as people want to blame it on "the poor".

According to this study.

CONCLUSIONS: ED use accounts for a small share of US medical care costs, and cost shifting to the insured to cover free ED care for the uninsured is modest. Constraining ED use cannot generate substantial cost savings but may penalize minorities and the poor, who receive much of their outpatient care in EDs.

 

[EdFred]

But this does not account for a large proportion of health care costs, as much as people want to blame it on "the poor".

According to this study.

Sure it does. If you walk into a place as a poor person and pay them $5 for whatever treatment it is, but the hospital bills my insurance $5000 for the same treatment, that study is going to show that the costs for billable insurance were higher. Well duh. Plus those numbers are 20+ years old. 1987 data?

 

[Gary F]

But this does not account for a large proportion of health care costs, as much as people want to blame it on "the poor".

According to this study.

This is misleading. The ER is the gateway to the hospital and many people are admitted and receive very expensive services for which they do not pay. Medicaid payments are so low they often do not cover the costs of providing care and Medicare payments have been falling dramatically. Lower reimbursements and increasing costs, how long do you think this can continue?

 

[Everskyward]

This is misleading. The ER is the gateway to the hospital and many people are admitted and receive very expensive services for which they do not pay. Medicaid payments are so low they often do not cover the costs of providing care and Medicare payments have been falling dramatically. Lower reimbursements and increasing costs, how long do you think this can continue?

That doesn't answer the question why the hospitals and insurance companies both play games with the billing.

 

[weilke]

I think that hospitals come up with these pie-in-the-sky charges hoping that someone in the insurance company will screw up and pay for them.

Yep.

Once in a blue moon, you will have a patient who carries an indemnity policy that pays whatever the hospital charges. The only ones that I have run accross so far are the self-funded plans that some arab oil companies provide for their executives in the US and some of the foreign service plans. The hospitals want to be ready to skin that cat if it ever wanders into their alley.

As you noted, the negotiated fee of $2500 is far more typical for this type of outpatient procedure.

There is a quirk in New Jersey insurance law that compels some plans to pay whatever the provider charges. Enter the world of the $60,000 ultrasound exam .

 

[Gary F]

There is a quirk in New Jersey insurance law that compels some plans to pay whatever the provider charges. Enter the world of the $60,000 ultrasound exam .

A cardiologist in New Jersey charged and was paid obscene amounts for his services.

Aetna is suing six New Jersey doctors over medical bills it calls “unconscionable,” including $56,980 for a bedside consultation and $59,490 for an ultrasound that typically costs $74.

http://www.bloomberg.com/news/2011-...s-outrage-in-aetna-claim-against-doctors.html

 

[weilke]

A cardiologist in New Jersey charged and was paid obscene amounts for his services.

I will firmly defend the right of any provider in an elective setting to charge whatever he believes to be worth. Yet I believe that what these 6 did was deceptive and abusive and I have little sympathy for their position in this dispute.

I do believe that anyone who charges more than 150% of 'usual and customary' should be required to disclose this in a clear-language table to be signed off by any prospective patient.

 

[iflyforfun]

That doesn't answer the question why the hospitals and insurance companies both play games with the billing.

The ENTIRE system is driven with other peoples money - OPM.

Everybody is playing games because the patients, the doctors, the hospitals and the insurance companies are all playing with OPM.

The Patient - I want the best dang service available. I've been paying $800/month for this insurance policy, I've got a problem and YOU, the health care provider are going to run what ever test you need to make sure I get fixed. I don't care what it costs, I've paid an obscene amount of money to the insurance company and I want the service NOW. Don't give me what I want and you run a risk of me suing your sorry behind if anything statistically unlikely happens to me.

The Doctor - I'm 99.5% sure that this is condition A, but there is some possibility that it could be something else. Better run the whole battery of tests. Heck, this way I get paid for the additional service and cover my behind in case something goes wrong ... "well Mr. Attorney, I did everything possible including running tests B, C, D and E".

The Hospital - We need to charge every penny possible for every service because most charges get negotiated too low, we've got 3-4 constant legal suits against us that need to be covered, last month was a doozie in the ER and NOBODY paid for anything, and the doctors are complaining about the lousy lounge ... we need to upgrade that next year.

The Insurance Company - This is a great gig, if I can skim a few percent off the top of this billion dollar pool of cash sloshing around, I can upgrade the company King Air to a Citation X, lock in that new Country Club membership and we can also switch the company team building lodge from that conference room down stairs to a Lodge in Aspen. I'm REALLY important and need to be able to meet clients there we we can discuss critical business issues without daily interruptions ... and I can use the Citation to pick them up and really wow them.

The patient has every short term reason to demand everything ... there is no short-term marginal cost. The doctor has every reason to grant everything because they make more money and reduce the likelihood of being sued. The hospital has every reason to charge whatever they can get away with because the system is so hosed up that they're just hoping to get a few more $500 aspirins through so they can keep the door open (or put up a fancy new wing depending on how big they are). And the insurance company is just another really big firm where the execs aren't REALLY responsible to anyone as long as the stock price doesn't get too hammered ... they just want to keep the company perks.

When you take the consumer out of the equation, you are absolutely, positively going to screw everything up. We are getting EXACTLY what we are incenting people to do.

 

[Gary F]

The ENTIRE system is driven with other peoples money - OPM.

Everybody is playing games because the patients, the doctors, the hospitals and the insurance companies are all playing with OPM.

The Patient - I want the best dang service available. I've been paying $800/month for this insurance policy, I've got a problem and YOU, the health care provider are going to run what ever test you need to make sure I get fixed. I don't care what it costs, I've paid an obscene amount of money to the insurance company and I want the service NOW. Don't give me what I want and you run a risk of me suing your sorry behind if anything statistically unlikely happens to me.

The Doctor - I'm 99.5% sure that this is condition A, but there is some possibility that it could be something else. Better run the whole battery of tests. Heck, this way I get paid for the additional service and cover my behind in case something goes wrong ... "well Mr. Attorney, I did everything possible including running tests B, C, D and E".

The Hospital - We need to charge every penny possible for every service because most charges get negotiated too low, we've got 3-4 constant legal suits against us that need to be covered, last month was a doozie in the ER and NOBODY paid for anything, and the doctors are complaining about the lousy lounge ... we need to upgrade that next year.

The Insurance Company - This is a great gig, if I can skim a few percent off the top of this billion dollar pool of cash sloshing around, I can upgrade the company King Air to a Citation X, lock in that new Country Club membership and we can also switch the company team building lodge from that conference room down stairs to a Lodge in Aspen. I'm REALLY important and need to be able to meet clients there we we can discuss critical business issues without daily interruptions ... and I can use the Citation to pick them up and really wow them.

The patient has every short term reason to demand everything ... there is no short-term marginal cost. The doctor has every reason to grant everything because they make more money and reduce the likelihood of being sued. The hospital has every reason to charge whatever they can get away with because the system is so hosed up that they're just hoping to get a few more $500 aspirins through so they can keep the door open (or put up a fancy new wing depending on how big they are). And the insurance company is just another really big firm where the execs aren't REALLY responsible to anyone as long as the stock price doesn't get too hammered ... they just want to keep the company perks.

When you take the consumer out of the equation, you are absolutely, positively going to screw everything up. We are getting EXACTLY what we are incenting people to do.

You nailed it.

 

[weilke]

The ENTIRE system is driven with other peoples money - OPM.

Everybody is playing games because the patients, the doctors, the hospitals and the insurance companies are all playing with OPM.

The Patient - I want the best dang service available. I've been paying $800/month for this insurance policy, I've got a problem and YOU, the health care provider are going to run what ever test you need to make sure I get fixed. I don't care what it costs, I've paid an obscene amount of money to the insurance company and I want the service NOW. Don't give me what I want and you run a risk of me suing your sorry behind if anything statistically unlikely happens to me.

The Doctor - I'm 99.5% sure that this is condition A, but there is some possibility that it could be something else. Better run the whole battery of tests. Heck, this way I get paid for the additional service and cover my behind in case something goes wrong ... "well Mr. Attorney, I did everything possible including running tests B, C, D and E".

The Hospital - We need to charge every penny possible for every service because most charges get negotiated too low, we've got 3-4 constant legal suits against us that need to be covered, last month was a doozie in the ER and NOBODY paid for anything, and the doctors are complaining about the lousy lounge ... we need to upgrade that next year.

The Insurance Company - This is a great gig, if I can skim a few percent off the top of this billion dollar pool of cash sloshing around, I can upgrade the company King Air to a Citation X, lock in that new Country Club membership and we can also switch the company team building lodge from that conference room down stairs to a Lodge in Aspen. I'm REALLY important and need to be able to meet clients there we we can discuss critical business issues without daily interruptions ... and I can use the Citation to pick them up and really wow them.

The patient has every short term reason to demand everything ... there is no short-term marginal cost. The doctor has every reason to grant everything because they make more money and reduce the likelihood of being sued. The hospital has every reason to charge whatever they can get away with because the system is so hosed up that they're just hoping to get a few more $500 aspirins through so they can keep the door open (or put up a fancy new wing depending on how big they are). And the insurance company is just another really big firm where the execs aren't REALLY responsible to anyone as long as the stock price doesn't get too hammered ... they just want to keep the company perks.

When you take the consumer out of the equation, you are absolutely, positively going to screw everything up. We are getting EXACTLY what we are incenting people to do.

And there you have the current malaise of healthcare finance in a few concise paragraphs.

Now for extra credit: Will the recently enacted changes to healthcare finance increase or decrease the role of the concept 'OPM'. What effect will those proposed changes have on global cost structure. Discuss

 

[Bob Noel]

The ENTIRE system is driven with other peoples money - OPM.

Everybody is playing games because the patients, the doctors, the hospitals and the insurance companies are all playing with OPM.

The Patient - I want the best dang service available. I've been paying $800/month for this insurance policy, I've got a problem and YOU, the health care provider are going to run what ever test you need to make sure I get fixed. I don't care what it costs, I've paid an obscene amount of money to the insurance company and I want the service NOW. Don't give me what I want and you run a risk of me suing your sorry behind if anything statistically unlikely happens to me.

The Doctor - I'm 99.5% sure that this is condition A, but there is some possibility that it could be something else. Better run the whole battery of tests. Heck, this way I get paid for the additional service and cover my behind in case something goes wrong ... "well Mr. Attorney, I did everything possible including running tests B, C, D and E".

The Hospital - We need to charge every penny possible for every service because most charges get negotiated too low, we've got 3-4 constant legal suits against us that need to be covered, last month was a doozie in the ER and NOBODY paid for anything, and the doctors are complaining about the lousy lounge ... we need to upgrade that next year.

The Insurance Company - This is a great gig, if I can skim a few percent off the top of this billion dollar pool of cash sloshing around, I can upgrade the company King Air to a Citation X, lock in that new Country Club membership and we can also switch the company team building lodge from that conference room down stairs to a Lodge in Aspen. I'm REALLY important and need to be able to meet clients there we we can discuss critical business issues without daily interruptions ... and I can use the Citation to pick them up and really wow them.

The patient has every short term reason to demand everything ... there is no short-term marginal cost. The doctor has every reason to grant everything because they make more money and reduce the likelihood of being sued. The hospital has every reason to charge whatever they can get away with because the system is so hosed up that they're just hoping to get a few more $500 aspirins through so they can keep the door open (or put up a fancy new wing depending on how big they are). And the insurance company is just another really big firm where the execs aren't REALLY responsible to anyone as long as the stock price doesn't get too hammered ... they just want to keep the company perks.

When you take the consumer out of the equation, you are absolutely, positively going to screw everything up. We are getting EXACTLY what we are incenting people to do.

You forgot the lawyers and the lawsuit lottery.

 

[Gary F]

You forgot the lawyers and the lawsuit lottery.

He covered the defensive medicine aspect of it but not the cost of payouts and defending against lawsuits. That money has to come from somewhere.

 

[Everskyward]

The patient has every short term reason to demand everything ... there is no short-term marginal cost.

I think you are wrong about the patient always demanding everything. I have known many people who have declined procedures, not so much because of the cost but because they didn't want to go through with it.

 

[denverpilot]

And there you have the current malaise of healthcare finance in a few concise paragraphs.

Take out the word "healthcare" and make it "all finance" and you've nailed it.

Some people knowingly signed on the dotted line, then stopped paying their mortgages knowing banks wouldn't foreclose if everyone was doing it. (yes there were unscrupulous banks - but there's a gruop of unscrupulous mortgagees too)

It's called a "Moral Hazard" for a reason.

It doesn't take a majority of the people who were lent fake money in a lending system built on 9:1 or higher assets to liability ratios to topple the entire house of cards. It's just math.

It's how 8 out of 10 people can have jobs and the entire banking system worldwide remains on the brink of disaster. Because it's all funny money. Fake as the summer days are long.

 

[Doggtyred]

But that's only for life-threatening situation. I'm sure you can't go in there and demand a cataract operation or a colonoscopy for $0.

If you present to the ER with gi bleeding you will usually get admitted and very likely get scoped top and or bottom. Insured or not. Gi bleeding is one of those emergencies. Just one example.

 

[Gary F]

If you present to the ER with gi bleeding you will usually get admitted and very likely get scoped top and or bottom. Insured or not. Gi bleeding is one of those emergencies. Just one example.

You do not even need to have GI bleeding. In some cases people get scoped for unexplained anemia.

I think you are wrong about the patient always demanding everything. I have known many people who have declined procedures, not so much because of the cost but because they didn't want to go through with it.

That is true in some cases but I see the disconnect between cost and benefit almost every day. One example, other docs often want to send a demented nursing home patient for a very expensive procedure even though they are not likely to have an improved quality of life since a family member "wants everything done". The best option would be to keep the patient at the local hospital and treat conservatively but you can't refuse accepting the patient without risking a lawsuit.

 

[Doggtyred]

But... But.... Life is PRECIOUS.!!! Where there is life there is hope for a miraculous recovery!! So please do everything you can, because I can't fathom life without (insert name here)....

Even though they can't feed themselves, turn themselves, recognize anyone, and are stroked out and contorted and contracted into a pretzel.

(I swore long ago I would never put my loved ones quantity of life above their quality of life.... I just wish more shared that view)

 

[iflyforfun]

Now for extra credit: Will the recently enacted changes to healthcare finance increase or decrease the role of the concept 'OPM'. What effect will those proposed changes have on global cost structure. Discuss

As to the "global cost structure" question, it is just the wrong question ... or too short term in scope to be addressed. The global cost structure won't change a bit in the near term because the path we've picked simply does not structurally change the demand profile or the incentives.

The recent changes to healthcare will, eventually, put an upper cap on the spending of OPM. Think Medicaid ... limited budget and, at the individual level, unlimited demand. The result is that it is becoming ever more difficult for Medicaid patients to find service providers (there can be no arguing this point). If you take this to a national system, you get the exact same results.

So as our debt approaches 100% GDP and are taxes become "too high" (whatever we collectively decide that is), we will be FORCED to answer the ultimate question - HOW WILL WE RATION MEDICAL CARE?

Today:
* The wealthy - I'm going to see my doctor for this problem and then find out who the best damn specialist is and see him/her!
* The middle class - I hope I don't canned at work because the treatment cost for my daughters (insert problem) is expensive, but at least she's being cared for well.
* The poor - I've got blood in my urine again, but this time it looks bad, maybe I should go to the ER because I never got around to seeing that doctor who accepts Medicaid 30 miles away.
* System - health care by lottery

Tomorrow (after the new system is in place):
* Everyone - Yippee, I get to see the doctor, get the best medical services and it's free!
* System - damn the torpedoes (budget, debt), health care for everyone!

Day After Tomorrow (after new system in place for a few years):
* Everyone but the rich - What do you mean, a CAT scan is going to take 4 months to get scheduled! I'm sick, I need help!
* The rich - Wow, this new private hospital concept in Cancun is great. A vacation and a tune-up. I really like the idea of the concierge health care plan administered out of the Cayman Islands. It's expensive, but everything is covered, I have access to the worlds best doctors with nothing more than a call and a brief flight on the private jet and I can afford it.
* System - health care rationing by queue (unless you are rich)

So the inevitable is clear:
1) We will ration health care.
2) The rich will always get the best service.

When we collectively accept that reality, we as a nation can finally have an intelligent discussion.
* Do you want to trust the people who brought you trillion dollar deficits, the TSA and the Bob Hoover incident, or do you want to harness the innovation that made this country great.
* No matter what, the rich will get richer, and you and your family won't get all the medical services you want.

What path forward - government bureaucracy or capitalism driven solutions with all its unfairness and inequity? Answer that question and we can discuss global cost structure.

P.S. - The US drives the global health care cost structure. We're the innovators and the consumers. That great red menace China did 200,000 orthopedic operations last year. The great state of IN did more than that last month.

 

[Everskyward]

If you present to the ER with gi bleeding you will usually get admitted and very likely get scoped top and or bottom. Insured or not. Gi bleeding is one of those emergencies. Just one example.

Obviously I wasn't talking about that situation. I was talking about a screening colonoscopy.