America’s Unique Medical Debt Problem
We charge patients way more than other counties.
Longtime healthcare reporter Noah Levey* offers “Lessons from Germany to help solve the U.S. medical debt crisis.” The tl;dr version is: don’t charge people much for healthcare. But the longer version is interesting to those who don’t understand how unusual our system is.Levey begins with an anecdote, which I normally despise, but it’s at least useful:
Almost every day, Dr. Eckart Rolshoven sees the long shadow of coal mining in his clinic near the big brownstone church that dominates this small town in Germany’s Saarland.
The region’s last-operating coal shaft, just a few miles away, closed a decade ago, ending centuries of mining in the Saarland, a mostly rural state tucked between the Rhine River and the French border. But the mines left a difficult legacy, as they have in coal regions in the United States, including West Virginia.
Many of Rolshoven’s patients battle lung diseases and chronic pain from years of work underground. “We had an industry with a lot of illnesses,” said Rolshoven, a genial primary care physician who at 71 is nearing the end of a long career.
The Saarland’s residents are sicker than elsewhere in Germany. And like West Virginia, the region faces economic hurdles. For decades, German politicians, business leaders and unions have labored to adjust to the mining industry’s slow demise.
The degree to which Saarland is really Germany’s equivalent to West Virginia likely wouldn’t stand much scrutiny but the parallels are interesting.
But this is a healthier place than West Virginia in many respects. The region’s residents are less likely to die prematurely, data shows. And on average, they live four years longer than West Virginians.
There is another important difference between this former coal territory and its Appalachian counterpart: West Virginia’s economic struggles have been compounded by medical debt, a burden that affects about 100 million people in the U.S. — in no state more than West Virginia.
In the Saarland, medical debt is practically nonexistent. It’s so rare in Germany that the federal government’s statistical office doesn’t even track it.
And, no, the answer isn’t the obvious one:
The reason isn’t government health care. Germany, like the U.S., has a largely private health care system that relies on private doctors and private insurers. Like Americans, many Germans enroll in a health plan through work, splitting the cost with their employer.
But Germany has long done something the U.S. does not: It strictly limits how much patients have to pay out of their own pockets for a trip to the doctor, the hospital or the pharmacy.
Rolshoven’s patients pay nothing when they see him. That not only bolsters their health, he said. It helps maintain what Rolshoven called social peace. “It’s really important not to have to worry about these problems,” he said.
That’s a pretty sweet deal, obviously. So how does it work?
The typical individual health plan an American gets through work now comes with a more than $1,500 deductible, a particularly big sum in a state like West Virginia where residents often earn less than residents of other states.
That, in turn, is driving medical debt. A quarter of West Virginians with a credit report have medical bills in collections, almost twice the national rate, according to data compiled by the nonprofit Urban Institute. In several counties in the state, the rate is about a third.
In German health plans, known as sickness funds, there aren’t typically deductibles.
Physician visits are almost always free for patients. Copays for most prescription drugs are capped at 10 euros or less, about $10. And people admitted to the hospital pay only 10 euros a day.
“Access to medical care with minimal costs for patients has been essential,” said Armin Beck, regional director of the Knappschaft Bahn See, of KBS, a health insurance plan whose roots stretch back to the 13th century, when miners set up a mutual aid society to protect one another in case of injuries or accidents. “This has been a foundation of our community,” Beck said.
What’s not exactly clear from the report is: Who pays the difference? Either the insurance has to be more expensive to cover this, doctors and hospitals have to make less money, or both.
International surveys underscore the difference Wagner observed between her experiences and those of American families.
In one recent study of health care in 11 high-income countries, the nonprofit Commonwealth Fund found that 44% of Americans had out-of-pocket medical expenses that topped $1,000 in the previous year. Just 16% of Germans reported paying that much. The rates were even lower in France, at 10%, and Great Britain, where only 7% reported similar medical expenses.
U.S. patients were also more than twice as likely as patients in any of the 10 other countries studied to say they had serious problems paying medical bills.
“Many Americans may not understand how affordable health care is for patients in other countries,” said Reginald D. Williams II, who oversees international research at the Commonwealth Fund. “Medical debt is a largely U.S. phenomenon. It just doesn’t happen in other countries.”
Most wealthy countries in Western Europe, East Asia and elsewhere limit patients’ out-of-pocket costs.
In the Netherlands, where patients enroll in private health plans as they do in Germany, insurers typically cover all medical expenses after patients pay a standard deductible of 385 euros, or about $400. Physician visits are fully covered.
In Great Britain, where medical care that is “free at the point of service” has been a foundation of that country’s government-run National Health Service for almost 75 years, there are rarely any doctor or hospital bills.
Crucially, though, NHS and its Canadian analog, which is what most Americans think of when they conceive of as the natural alternatives to our healthcare systems, are the outliers. Most developed countries have some sort of insurance model but ones that limit costs much more than ours.
Germany’s strict limits on medical bills have periodically stoked concerns about patients overusing the health system.
But when health plans tried implementing a copay of 10 euros for physician visits, it was quickly rolled back amid criticism from patients and frustration among doctors, who didn’t like chasing after their patients for bills.
At the hospital in Püttlingen, which is operated by the Knappschaft, Dr. Marion Bolte said asking patients to pay more isn’t worth the risk, even if it might bring in more money.
“It’s better to have 20 unnecessary visits than to have one patient get harmed because they didn’t come to the hospital because they were worried about how much it would cost,” said Bolte, the chief medical officer. “We don’t want patients to worry about money. We want them to worry about getting better.”
Nationally, German patients are less likely than Americans to die from conditions that can be treated with good access to medical care, such as heart attacks, diabetes, pneumonia and some cancers, according to regional data compiled by the Paris-based Organization for Economic Cooperation and Development.
Germans are also less likely than Americans to say they had to wait to see a doctor, surveys show.
I suspect the last is a function of much more specialization here—as well as many more rural areas far from a major hospital. Regardless, it’s hard to argue that our system is superior to Germany’s.
Maintaining this system has required that Germany do something else that U.S. policymakers have historically eschewed. Germany, like most wealthy nations, regulates the prices that hospitals, doctors and drugmakers can charge. This regulation occurs through a highly structured system in which insurers negotiate collectively with physician and hospital groups to set prices.
American hospitals and other medical providers for decades have fiercely resisted limits on their prices, spending millions to fight government regulation.
Price regulation can put more financial pressure on providers, who, unlike their American counterparts, can’t just demand higher prices from insurers to bolster their bottom lines.
Mario Schüller, the hospital administrator who runs the Knappschaft hospital in Püttlingen, said hospitals must instead compete to attract patients with better care and better customer service. Those that can’t compete may close, he said.
But Schüller said he wouldn’t want to charge patients more, even if he could.
“If I had to bill patients and then try to collect from them, I’d have to pay for all that,” he said. “We’d need new staff, who would have to get paid. And if we used collections companies, they’d have to be paid, too. It becomes a devil’s bargain.”
Obviously, the administrative burden of our system is higher than that of most others. But the key seems to be in limiting payouts. That’s easier to do in a system where the state absorbs the cost of university and professional schooling than one where becoming a medical doctor requires incurring massive debt for years on end.
*I found the story at NPR but he’s employed by Kaiser Health News, an arm of the Kaiser Family Foundation; NPR apparently syndicates his reports. Before coming to KHN in January 2021, he spent 18 years with the Los Angeles Times, the last 17 of which as a national healthcare reporter.
“Either the insurance has to be more expensive to cover this, doctors and hospitals have to make less money, or both.”
Or the government pays the cost, and raises taxes to pay for it.
It’s a matter of belief. If you believe that every person has the right to healthcare you will have a different system than one which is based on idiots talking about trade-offs and markets and prophesizing doom over any government intervention. Making things which are public goods scarce private commodities has done its damage.
The US spends more on healthcare by a lot. We are spending $11,000 per person; the Germans $6,000. We are getting mediocre results. No one inside a system that charges for steak and delivers hamburger is going to be motivated to change things. That is just the way things work. The electorate doesn’t care, and the political leaders have no motivation to rock the boat. Until ordinary voters become concerned, nothing will change.
James, you’ve highlighted a few of the complexities of our system, but there are enough additional complexities that contribute to the failure of our system that we could go on for days. Just a few:
– The $1500 deductible is probably not the major cause of medical debt. The reality is that the co-pays, and the after-the-fact determinations that a procedure isn’t covered under a plan, and the unavailability of the generic medicine that is covered so a very expensive equivalent is substituted so the patient is 100% on the hook for the wildly inflated “list” price, and, well, the list is nearly endless
– Obfuscation is a business plan. For instance, that local non-profit religious hospital isn’t what you think it is. It’s actually a shell, with dozens of outside for-profit vendors providing many of the services, often owned by the same people that control the hospital. MRI’s, X-rays, CT Scans, Lab services colonoscopies, anesthesia, on and on are probably all for-profit companies operating on hospital grounds. You don’t know ahead of time who these companies are going to be and you don’t get to pick alternatives. And the NYTimes (I think) had an expose a few years ago that pretty much proved that certain hospitals were deliberately picking companies not covered by many plans, so they could charge the insanely inflated “list” prices directly to the patient.
– Every major insurance company has an entire department devoted to finding reasons not to cover submitted expenses, and their personnel is often awarded bonuses on how much money they save the company.
– At the last Health Informatics conference I attended, some of most nicely appointed small booths were listed under the “big data” umbrella, which I was interested in. It took me a while to understand what they did because it was hidden among a flurry of buzzwords. But basically, hospitals hire them to mine their billing data and determine the types of patients and diagnosis that make them the most money, and the ones that are least profitable. They then help them design plans to attract more of the profitable patients or steer diagnosis into more profitable areas, and to keep out the less profitable ones.
– My wife follows up on every single bill that comes to us. Over the years we’ve had many different employers (this is more important than you think) and plans and providers but one thing is consistent: a good percentage of the time we are incorrectly charged for something. A long time spent on hold, followed by a detailed discussion requiring she fully understands what the insurance representative is saying and can understand why it is usually incorrect or incomplete, often results in the charge being dropped. I strongly suspect that this is part of their business plan and they send out charges knowing that a large percentage of people will just accept them, and another chunk of those that call in will be intimidated or confused by what they are told. But even if I’m wrong, there is certainly no incentive to bill correctly the first time and many incentives to default to overbilling
I could go on and on. We truly have the worst medical SYSTEM in the world, despite the fact that top-tier medical treatment is available here (just as it is in virtually every Western European country and dozens of others). You need no more proof of that than visiting your personal physician and counting the number of people working there whose main function is billing and insurance related. In other countries that is a trivial part of the system. And that is despite the fact that, yes, as you point out, private insurers, albeit very tightly controlled ones, have major roles in most countries.
And for that cost the Germans cover everybody with stellar care, while the US doesn’t cover a significant part of our population and under-covers more than half. (And if you don’t think your provider is aware of what your insurance will cover and adjusts treatment accordingly, you are living in a dreamworld. Or Germany, Belgium, The Netherlands, South Korea, Japan, Singapore, etc, etc, etc…)
I know of four people who have lost homes due to medical debt. Another friend considered a strategic divorce so they could qualify for medicaid.
@MarkedMan has hit on a number of the problems within our system. I hate hate hate how it’s tied to employment in this country.
At least some medical debt is tied to the bizarre system we have–one in which if you are rushed to the hospital in an emergency and have to undergo tests, your surgery might be covered, but not the administration of anesthesia, and the ambulance trip may or may not be covered–all dependent on whether those providers (that you had no choice or time to research because, EMERGENCY) are part of your plan or not.
It’s a stupid, stupid system that desperately needs to be overhauled.
We spend about 20% of our healthcare dollar pushing paper most of which is non value added. For every bill demanding a payment, there is money wasted in the collection process. I disagree with the proposition that demanding a small payment is incentive to restrain the consumption of medical services. The vast majority of people don’t want to go to the doctor unless required. Doctors’ offices have large staffs just to deal with insurance and paper.
Every time there is a debate, the opponents of universal healthcare call out instances of the difficulty of getting care in other countries conveniently forgetting our own long wait times for appointments and care. They bring up the bugaboo of rationing care as if we don’t ration care based on ability to pay.
It would take a lot to blow up the whole system but it should be done.
@Scott: BTW, off topic. Why do we charge for all kinds of government provided services? Why would NYC spend money on collecting money to ride the subway or bus system? It really doesn’t make sense to me.
Or the generic has driven the original out of the market and is now charging 3 times as much as the original originally charged. I have paid anywhere from $8 to $280 for 30 pills of Cholchrys (a fairly old drug for gout). Once insurance refused to pay for anything but the generic and refused to pay more than $10 (for reasons). So the pharmacy tried to charge me over $200. I asked how much the original was and it was only $15, but because the prescription was written for the generic, they said they couldn’t fill it. So I had to get the doctor to change it and paid the $15 out of pocket. Asinine.
Pretty much no Americans understand how health insurance works in other countries. Hell, most don’t even know how it works HERE.
I took a look at the German system. Employee contributions are handled just like we do Social Security here–the total contribution is 14.6% of salary, with 7.3% paid by the employee and 7.3% by the employer, up to a ceiling (currently 58,050 Euros/year). So the maximum a German will pay is about 353 Euros/month.
That is half of what I pay for health insurance. And that’s the MOST a German would pay, many pay less. Many Americans pay even more than I do, IF they have coverage at all.
Americans seem to think they’d keep paying exorbitant sums for health insurance PLUS a big new tax for universal coverage. Maybe we should emphasize that pretty much everyone will pay much less, and the tens of millions with crappy or no coverage will have access to the care they need.
@Mikey: Something else to consider: the cost of my health insurance is not indexed to income as it is in Germany. I’m a relatively high earner, so $700/month isn’t great but isn’t breaking the bank. But someone who earns half what I do would really get hit hard by what I pay.
Which of course leads to the under-coverage so many Americans deal with.
Also look at the flows of money. I suspect that a lot of so-called “non-profits” in the US medical ecosystem have found lots of ways to milk money out of the system, and let’s-not-even-start with what the “for profit” companies do.
I also suspect that German health insurance companies are far less profitable, percentage-wise.
The Marketplace (AKA Obamacare) is indexed to income, and is open to everybody. I was on it for about 2 years. I was making roughly $31k (and living in small-town Wisconsin), and got a “Silver-level” package from a major provider in the area (tied in with the University Hospital system) for $100/mo, with a tiny deductible, and almost nothing for c0-pays (I think a doctor visit was $10, and meds were $5). If I hadn’t been teaching on the side (or hadn’t admitted to the cash payments I was receiving), I would have had the package for free.
I’m curious why every time people talk about insurance coverage, they completely ignore the fact that we have a government-subsidized insurance program (outside of Medicare/Medicaid) that is low-cost (or free), and open to everyone.
Two anecdotes which, since there are two of them, become data 😉 :
I got a referral to a hematologist who had office hours at several different locations. I picked the closest one, inside of a Catholic, not-for-profit hospital. A couple of weeks before the appointment I received a letter from the hospital stating that there could be a “site charge” of up to $500 or more, it could not be determined ahead of time whether it would in fact be charged, how much it would be, or if my insurance would cover it, and they wanted to be sure I understood I would be personally responsible if the insurance declined. This was for a 20 minute face to face consultation, no procedures, not tests, no nothing. Needless to say, I rebooked for a suburban location and wasted an hour and half driving back and forth.
At dinner the other night a friend was going off on her health coverage and how she had struggled with getting prescriptions covered. The web site would say they were covered and tell her participating pharmacies. The agents on the telephone would tell her they were covered. But the pharmacies were getting “not covered” messages. Long, long story short, after six months she discovered that her record was associated with the second pharmaceutical plan covered under her medical plan which covered very very little, and not the first one which was normal. Why does her medical plan have two pharma plans? Well, she works for a large Catholic educational institution and they are allowed to provide a medical plan based on their religious beliefs (remember, we are a nation of employer provided coverage so they get to pick) and their beliefs preclude birth control. But the insurance provider is obligated by statute to cover it anyway so they provide a secondary plan that covers birth control and nothing else.
When I was looking into it the best estimate is north of 30%. The 20% number is often cited but leaves out a lot of stuff that wouldn’t exist but for the way we fund medical care. And even that 30% number doesn’t include the hundreds of millions of hours a year that employees spend pursuing billing issues during working hours at their employers expense. Legitimately justified, of course, because the employer picked the plan.
Having been at least peripherally involved in three different companies struggles with picking a health care plan, I am pretty confident that no company WANTS to be responsible for their employees health care.
@Mu Yixiao: Yeah, pretty cool, but not nearly what it could have been without Republicans.
Also the adjustment for income only applies to those whose income is low enough to qualify for a subsidy. At my income level a marketplace plan with similar coverage to what I have now would cost twice as much as I’m paying because I don’t qualify for a subsidy.
@MarkedMan: I see I neglected to say what was wrong with the 20% number Scott cited. Looking only at the private insurance system (Medicare, Medicaid and Veterans is much, much more efficient) 20% is roughly what insurance companies take in versus what they pay out. In 2017 for every dollar health care companies took they paid 79.7 cents to providers, 17.8 cents on overhead and 2.7 cents on profits. To give you an idea for comparison, most countries entire overhead and private insurance profits together would be about less than 5 cents, most are in the 3 cent range.
But what this leaves out is all the expense not covered directly by the insurance companies. All the people handling billing, pre-approvals, etc in physicians offices, hospitals, clinics and every other location that accepts private insurance. And of course all of these employees must be housed in offices, given computers, time off, and so forth. Also, every employer spends time on selecting plans and intervening for employees when things go awry. So the 20% represents only the insurance companies overhead and profits, not the burden on everyone else.
Also worth noting that before Obamacare, the amount that insurance companies retained was significantly higher. Some of the improvement has come from actual reductions but some of it has been done by reclassifying insurance expenses as patient education rather than overhead. It is hard to believe the explosion of rather trivial “health education” efforts we have seen in the past decade have really cost what the insurance companies claim.
Other countries have administrative costs too. They’re not as high as our but they’re not dramatically lower (last I saw for Canada was high teens). What other countries do that we don’t is limit costs. They do it in different ways — some through government limits, some through consumer pressure. But we’ve managed to set up a system where no one has a direction interest in keeping costs down.
-the patient doesn’t have an interest because they only have co-pays. Most of the time they don’t even know how much their healthcare costs. Yes, it increases their insurance rates, but they don’t see that, because their employer pays most of it.
-the insurance company has a vague interest but ultimately they can pass it onto the employer
-the employer has a vague interest but ultimately they can take it out of the employee paycheck without the employee even realizing it because it’s not directly out of their paycheck for the most part.
(Similar problems apply to higher ed, which is also spiraling in costs. I’m sure it’s just a coincidence that the two sectors with the sharpest rises in costs are also the two where the government is most involved.)
This is why I don’t think a solution is coming soon. The GOP doesn’t think costs should ever be limited because that’s rationing care. The Dems have pie-in-the-sky plans that rarely include cost controls. Even when the government does “cost controls”, it often makes things more expensive (see, e.g., drug price negotiators who pass up generics so they can get discounts on name brands and look like they’re saving money).
A few small things I would do: revise the law so drugs go generic when they’re supposed to instead of having it dragged out for decades as the company makes tiny tweaks to the medicine; end accepting assignment for routine care so that patients know much care costs and providers have to compete (Australia does this); take the Republicans up on allowing insurance to be sold across state lines so that companies don’t have effective monopolies in many states; make Medicaid the baseline bargain-basement insurance that everyone can get, regardless of income.
That won’t solve all the problems, but it will fix some of them without radically overhauling the system, which is politically impossible.
Where are you getting 3-5% for other countries? They’re more like 15-20%.
@Mu Yixiao: My youngest son gets his healthcare off the exchanges for $0 because of his income level. If something serious happened, he’s facing a $9000 deductible. He can cover it but he would rather have the money for something else (like a car less than 15 years old). Of course, if something really serious happened, he’s backed up by the Bank of Dad.
A lot of undesirable behaviors are driven by our medical system. One example, a couple of years back, my DIL was due to be induced the first week of January. Then my son and DIL realized they had already maxed our their deductibles and out of pocket expenses. As a result, my granddaughter was born 31 Dec at around 1530.
Another aspect is the impact of employer based health insurance on the employment market. People may not leave their jobs because they need coverage putting a lot of friction into labor markets.
@Modulo Myself: On the other side of that particular equation, public goods become public because the society decides to make them so.
[CRT Trigger Warning!!!]
A fair number of decisions in our society have been made based on notions of people as chattel property and keeping those who at the bottom “in their God Ordained places.”
Wait. Are you saying the people shouldn’t lie to sell stuff/services? This is gonna put a dent in lots of business plans/political policies/campaign strategies out there. 🙁
Congratulate them on their tax deduction too! Overall, an excellent financial decision, and a great story for the kid when she gets older.
@Hal_10000: “The GOP doesn’t think costs should ever be limited because that’s rationing care.” Or more specifically, rationing care in the wrong direction. Controlling demand by raising prices is rationing care just as much as any other method. Specifically, rationing by raising prices is the demand-side market-based solution for distribution of goods and services for which demand outstrips supplies that cannot be increased quickly or efficiently (as measured by ROI).
@Scott: WA! Quick thinking on son’s and DIL’s part. Offer my congratulations. And kudos to the hospital staff that worked with them to fit the procedure into the schedule.
@Mu Yixiao: I suspect that your experience is very state dependent. I was on the cheapest plan available in SC for about 2 years just after the exchanges came out, and I am now saving over $200 a month with lower deductibles by going on my wife’s plan. Both plans were from the same company.
@Scott: Paid transit is a little peeve of mine. especially on the LRT system we use in my city where there’s little to no enforcement anyway (and it is free in the downtown core). It should be free, and the benefits remain (and will increase)
Are you sure you are not confusing hospital and clinicial administrative costs and those incurred because of private insurance administration? Because the 30%+ that I mentioned above is only about payment and insurance. Everything I learned about other countries ten years ago indicated their cost of administration for their equivalent was in the 3-5% range. The costs of administering everything else (building maintenance, scheduling, HR, etc) would be roughly equivalent.
Ah, I see from your article that’s it exactly
All due respect but if you think cost control wasn’t a significant part of ObamaCare then you’ve been reading misleading sources. There are a myriad of very significant and effective cost control measures in it.
Because it’s NOT open to everyone. I had to move almost 1100 miles and lose almost all of my income before I was able to get on medicaid…
That’s why 43% of Americans have no insurance or are under-insured. Those people are one medical event away from bankruptcy…
@MarkedMan: I can’t decide what cost controls he’s talking about that increased costs. If he’s talking about the GOP medicare prescription stuff then that’s completely irrelevant as no one with a clue saw that as a good idea for cost control. If he’s talking about the inflation reduction act then he’s talking about something that hasn’t even been implemented yet. IF he’s talking about the ACA then he’s talking out his ass. It’s entirely mind blowing as this blog post showed through multiple examples how price controls have caused other countries to end up with superior care for a fraction of the cost we pay in the USA. Yet he argues that government price controls always increase prices. I mean if it’s a GOP plan I’m sure they’d manage that but the rest of the world has done the opposite…
Hal is an example of the type of person who when forming opinions starts from the perspective that the government never does anything right.
You have to remember that, AFAICT, ‘Merika has the only 1st world health system with out-of-control insurers lining their pockets.* Having seen this issue from two sides (bankruptcy paralegal and cancer survivor), I’ll kick in again with my $0.02 worth:
1. I worked largely in bankruptcy practice (debtor and creditor) in the late oughts. At that time (IIRC) roughly 70% of all consumer bankruptcy in the United States had uninsured/uncovered medical debt as a primary factor in Chapter 7 bankruptcy. Fred and Wilma were both working, with barely there insurance. Fred blows his back out at work; all of a sudden the two of them have $150k in debt they have no way to pay. Hospital/clinic/ambulance all sell to a debt collector. I’d see this 10-15 times a week, and this is one office out of 70 pages of lawyers in Pdx. This hadn’t changed by the time I was teaching paralegal studies 5 years later.
As a cancer patient, SWMBO would carefully review every bill. Original treatment included hospital, anesthesiologist, surgical team (from several offices, and more hospital. Weekly visits to chemo included hospital, chemo clinic, oncologist, oncology nurse, and drugs. And as I’ve previously discussed, while the Catholic hospital was willing to write off/write down $$$, anesthesiology/labs/ambulances NEVER write off. Never ever ever. And on the lawyer side, I’d frequently have discussions with their billing offices that boiled down to “no, they filed bankruptcy. you can’t have any money. now stop it.”
* If you don’t believe this, remember that in 2008, Liberty Mutual bought Safeco Insurance. For $6.2B cash. https://www.bing.com/ck/a?!&&p=ee769b247423ef56JmltdHM9MTY3MDk3NjAwMCZpZ3VpZD0xYmFmYTBjZC1iNWEwLTZmN2EtMWNlNS1iMmEzYjQwODZlOGEmaW5zaWQ9NTQ0NA&ptn=3&hsh=3&fclid=1bafa0cd-b5a0-6f7a-1ce5-b2a3b4086e8a&psq=what+did+liberty+mutual+pay+for+safeco+insurance&u=a1aHR0cHM6Ly93d3cuc2VhdHRsZXRpbWVzLmNvbS9zZWF0dGxlLW5ld3MvbGliZXJ0eS1tdXR1YWwtYnV5cy1zYWZlY28taW5zdXJhbmNlLWNvbXBhbnktZm9yLTYyYi8jOn46dGV4dD1MaWJlcnR5JTIwTXV0dWFsJTIwYnV5cyUyMFNhZmVjbyUyMGluc3VyYW5jZSUyMGNvbXBhbnklMjBmb3IlMjAlMjQ2LjJCLEpvYiUyMGxvc3NlcyUyMHdpbGwlMjBjb21lJTJDJTIwYWNjb3JkaW5nJTIwdG8lMjBMaWJlcnR5JTIwTXV0dWFsLg&ntb=1
@Hal_10000: I hate to keep pounding on you but if the sources you’ve been reading have you believing that the Republican plans to allow cross state sales of insurance is about increasing competition then, again, those sources are misleading you. Insurance is regulated almost entirely at the state level and states have widely varying regulatory regimes, ranging from patient-first regulatory regimes (primarily but not exclusively blue states) to ones that favor providers and insurers at the expense of patients (primarily red states). The insurance companies want the Federal government to force the patient-first states to accept the pro-insurer policies. That’s why they are lining the pockets of Federal Senators and Reps. Do you think say, United Healthcare, who already offers multiple insurance plans in virtually every state, is contributing to Republican PACS because they want to invite in more competition?
@Hal_10000: As I mentioned above, you are confusing hospital administrative costs with insurance costs. But the article you cite is interesting. I assumed that hospital administrative costs would be about the same. But what the article showed is that the most free-market system, the US, was the least efficient. At the other end, Canada, was twice as efficient as the US and is the least free-market. Huh. Imagine that. Maybe the free-market isn’t the best solution to every problem? Maybe what the US discovered a century ago has value, that leaving to the free market the things that people must have and that have huge barriers to entry is a gateway to predatory monopolies and rent seeking.
Facts and lived experience can never overcome religious beliefs…
Tying health care insurance to employment status was (and still is) a very bad choice.
Our three premises are that, one, you have quasi-decent health insurance because you have a full-time job. Two you qualify for Medicaid. Or three, you qualify for Medicare.
The gaps in that premise are vast.
Amongst developed Western democracies we have, by far, the most fucked up and dysfunctional medical system. Probably the most regressive – the poorer you are, the more you are systemically fucked.
The entire system is built around vastly inflated and purpose built systems to obscure transparency. We charged your insurance $17,000 for a series of x-rays because we can and know for certain some entity will pay for it. It cost us labor, electricity, and some amortization – all told maybe 600 bucks. We are charging the insurance provided $17,000 because we can and no one challenges that.
It is a method of health care that encourages systemic fraud and grossly inflated prices for routine procedures.
Ever check your medical bills? Hospitals will charge $20 per Tylenol to your insurance provider. The price gouging is insane!
It is a massive scam. It is deploable. It is foolish.
If you went out of your way to design the worst heath care distribution system you could possibly think of, the current US system now is demonstrably worse than that. Rampant fraud is baked in and encouraged.
Amongst our peers we have shitty to average outcomes and pay an 8x premium price for it.
We have, by far, the first world’s worst medical services delivery system.
@Mu Yixiao: I’m curious why every time people talk about insurance coverage, they completely ignore the fact that we have a government-subsidized insurance program (outside of Medicare/Medicaid) that is low-cost (or free), and open to everyone.
Things are certainly better since ACA passed for someone not covered by an employer to buy a plan. But low cost? It varies. While insurers can’t change more for preexisting conditions or being female now, they can charge older people and smokers (guilty here) more. I turned 65 last year so I’m on Medicare now. Before that I bought the cheapest plan I could find, $7,500 deductible. It cost $1,050 a month just for me, I’m single. I qualified for partial subsidy so I was paying about $550 of that.
My last doctor visit pre Medicare was a minor checkup before he would renew a prescription. 15 minutes. He also ordered some blood tests. It cost me about $600 out of pocket. Since getting on Medicare I’ve had a few visits and procedures without paying a dime.
Certain preventative procedures are covered pre deductible under ACA. I had a colonoscopy done when I was 62 at no cost to me. I was amazed when I saw the bill, all covered fortunately, about $3,800 IIRC. How could it possibly cost that much?
I wonder how much worse our health statistics vs other countries would be without Medicare. How many retirees could afford private health insurance? Not many I bet.
Actually, there is an interesting but tragic proxy for that: maternal and infant mortality. We are 45th in maternal mortality. Countries that do better than us include Turkey, Uruguay and Tajikistan. We are 53rd for infant mortality.
@MarkedMan: Thanks for the reply. The links are a bit confusing. I assume you’re saying we’re 45th or 53rd from the bottom? I’ve heard some these statistics before about infant and maternal mortality. We do poorly in those numbers. I don’t doubt that.
US life expectancy is close to other industrialized nations but without our totally socialized health care for seniors I think we would fare much worse in that statistic.
None of this is new. We spend more – a lot more – per capita than any advanced nation in the world – and end up with worse healthcare outcomes than in most of those same advanced nations. Last I looked at OECD statistics on this we spent about 40% more per capita than Norway and Switzerland, the 2nd and 3rd most expensive healthcare systems and we end up with tens of millions of uninsured citizens along with those mediocre outcomes.
Many years ago I attended a discussion presented by a then well known scholar and academic in the field of healthcare economics, Uwe Reinhardt of Princeton University. Reinhard said that fundamentally we’re different than most advanced nations because we value choice in healthcare more than they do. All other advanced nations view health care as a social good, while we view it as a consumer good.
In America your healthcare is a good as the insurance you can afford. For better or for worse, your private insurance company is your ‘death panel.’
@Scott O: We have been seeing a rather sharp decline in life expectancy relatively recently. A Canadian is currently expected to live about 4.5 years longer than an American..