You can find a lot of transparent medical costs, if you go to a private care clinic in "socialist" medical systems like in France or Italy. They can't compete with "free" medical care on price, so the private practices need to compete on quality and convenience.
So, stuck on a mountaintop was nowhere close to an appropriate description.
I would bet money that the parents of the unfortunate snakebitee were Democrats. They have an agenda and will waste no opportunity to destroy America's Health Care system... and turn it into...
Here in Quebec, like most of Canada, we pay nothing... except taxes. The high cost of healthcare is spread among the entire tax-paying population, so it _seems_ free. Actually the per capita cost is $8,500 CDN. That's probably a lot more than private health care insurance.
Finally, although our 'free' healthcare system may seem functional for those with medical emergencies, the waiting lists for non-critical operations and routine exams can me measured in years.
Thanks! Interesting about Richardson and helicopter. The coverage at the time, and the provincial government’s statements, suggested that a helicopter might have made a difference. No partisan judgment offered here, but to answer your query, the mother was a two-time Democratic nominee for Congress and now serves in the State Senate.
The same in the UK. Waiting times have been getting longer and longer. Americans who want socialized healthcare (more than we already have) should look at those wait times. The amount of suffering they cause is horrible.
Another unasked question is whether it would be feasible for the camp to keep a couple of vials (with the cost included in the camp fees) that could be administered by a nurse. Assuming that a hospital visit would still be necessary, the overall outgoings would be considerably lower all around.
Interesting question. There are a lot of camps, and one patient can require a lot of vials. I have no idea of what expertise is required to administer it or which auxiliary services are essential to its administration. So, I have no expertise in your question, but I’m guessing that it wouldn’t be economically feasible—and perhaps not medically feasible, either. Experts are welcome to weigh in on the question.
A good thought. However, giving antivenin requires labs before administration (to establish baseline bleeding risks from the venom) and close monitoring for allergic reactions and other side effects of the medication. It really wouldn't be feasible for camps to do that. It probably does depend on the venom, however, based on location. There has been a lot of work on finding antivenin for exotic snakes around the world, where bites may occur in remote areas and cause rapid death due to paralysis/respiratory failure (think Black Mamba, etc.). In those cases giving it quickly really matters. Typically US pit vipers (copperheads, rattlesnakes, cotton mouths) give you a bit of window to work with before the rare death, so transfer is reasonable. Thanks again for a great discussion!
Pharma companies typically do not price drugs to recoup sunk costs. They price drugs to fund the next new drug. BTG Pharmaceuticals develops drugs that treat rare, emergent problems such as poisoning from other drugs (eg, digoxin) and exposure to high doses of radiation. As you say, thank God a company has developed such treatments.
I wonder if the hospital had antivenin sitting around. Perhaps--copperheads are not rare in Indiana. But perhaps not--many rarely used drugs can be obtained very quickly from wholesalers.
Air ambulances: I run in the Sierra Nevadas and other mountain areas. Air ambulance insurance is both cheap and essential. Rescue costs are $45-60,000. This isn't a hop from one hospital to another.
Drug price controls: Tom Sowell says always ask "and then what?" When no one can make a profit on a drug, the drug doesn't get made. Some vital meds --such as chemo drugs-- are in short supply, in part because the reimbursement for them is not profitable. Imagine that. 2nd and 3rd order consequences.
Thank you for some excellent points! I'll just add a take on your first take: If they're not recouping this drug's sunk costs, then they're recouping the next drug's sunk costs. Or the one after that.
If someone is planning to hike or travel to an area with greatly increased danger or a place lacking in nearby medical services, it should be (and often is) possible to buy special insurance. At least, it used to be -- I haven't looked into it in a long time. In 1991, I went on a trip about a 1000 miles south from LA into Baja in Mexico. On the way back, our vehicle went off the road. We were all injured although I (having been asleep in the back) someone landed on my feet and was barely hurt. My friend in the passenger seat had his fingers pulled out and his head bashed in so that his brain was exposed. Someone took us to a "clinic" in Guerro Negro. I would describe it as a dirty hut. They wanted to operate on him. Fortunately, we had purchased medical trip insurance from AAA and he was airlifted to San Diego. Without the insurance, it would have been tens of thousands in today's dollars. He had his finger tendons reattached and his skull repairs and is still happily alive today.
This put me off any road trips to Mexico (also because the machine gun toting police simply drove by and didn't help). If I were to go, I would definitely buy that insurance, if you can still get it. The same if I were to go on a long hike into the wilderness, etc.
I bought similar insurance policies when I traveled for business in Kazakhstan in 2000 and 2007. I traveled extensively in Sub-Saharan Africa in the 1980s. I didn't buy any such policy, but my employer, Chase Manhattan Bank, made clear that they'd fly us out if the occasion merited it. And I did know of a couple of cases where that happened. I had one road trip into Mexico planned around 2003. As I picked up the car, the Avis rep told me the insurance would only cover problems that occurred within 14 miles of the U.S. border, because beyond that, the risks were simply too high. We switched our plans and went to Northern Arizona.
Many years ago I "negotiated" for months with a hospital over paying for an unnecessary appendectomy my wife received. (The doctor who apparently misdiagnosed, in good faith, dropped anything our limited student insurance didn't pay.) Despite me providing lots of proof of our inability to pay the 'requested' amount, only a real threat of bankruptcy even got them to reduce the amount they wanted. We finally reach an agreement that took us a bit more than 10 years to pay off.
Thanks for the harrowing story! Nothing in my article is meant to imply that the payment system we have is coherent or efficient. Or that there aren't people like you who fall between the cracks of a jury-rigged, jerry-built system.
I totally agree. I taught Health Policy to grad students for around 20 years. There are lots of ways, I think, to make the system 'better' in many ways, but the politics and rent-seeking combined with typical bureaucratic politics make them essentially impossible.
And for many years now we have had an HSA and catastrophic policy that we just love. I was pushing it on the union I was forced into, and they avoided it for years. They evidently didn't think it 'punished' the University enough. Stuff like that just abounds.
Jun 29, 2023·edited Jun 29, 2023Liked by Robert F. Graboyes
Catastrophic policies make a lot of sense. Somehow, we have gotten used to the idea that insurance should pay for everything. That's not what insurance is for. Catastrophic coverage would be much less expensive and covering more moderate costs directly would reduce unnecessary or cost ineffective practices.
We have had separate policies at one time, but are now on the same one. Out of the last 12 years or so, in only one year have we "spent down" our deductibles and co-pays. Our insurer probably loves us. (And we're fairly old.)
Not really. My wife had a very tough case to diagnose. The doctor made a mistake. I suppose any suit could have gotten some sort of settlement, but I dislike that sort of thing.
It turns out that my wife had a very rare form of pancreatitis, and that wasn't diagnosed for quite a while after the appendectomy. She had all of the symptoms of chronic (not acute) appendicitis EXCEPT an elevated WBC count. Most doctors, I think, would have made the same mistake.
And there was nothing to sue the hospital for.
It was nearly 10 years later that my wife (a non-drinker, non-drug user) was diagnosed with pancreatitis caused by pancreas divisum (a condition believed at the time to be found in about 10% of the population but which results in pancreatitis less than 1% of the time -- now it is believed to be found in 5-15% of the population and leading to "recurring bouts" of pancreatitis about 30% of the time, and to chronic pancreatitis about 5% of the time). Also, it usually doesn't "present until a person is 40+. It was not at all well understood back in 1990.
We spent a lot of time with various doctors and other medical professionals repeatedly explaining that she wasn't an alcoholic and didn't do drugs. She was young (under age 30 when the symptoms got really bad) and they couldn't fathom any other cause.
Anyway, it made us stronger, and led me to study US health policy and later teach it, so it wasn't all bad.
And once, after it had been diagnosed, we had driven some 300 miles to attend a wedding, and on the way back she had a violent attack. We immediately got as fast as we could to the nearest hospital. It happened to be a teaching hospital connected to the University of Illinois medical school. We told the ER doc what she had, he started the proper treatment immediately, and the next day, after asking permission, dragged every med student in the place (about 20 or so) in to see her in groups of 4-5. He said something like, observe very carefully because you'll probably never see a case like this again. But if you do, know what it is and what to do. So maybe she helped some others.
Sally, I can vouch for your points. Since 2021 our family has had numerous surgeries, lots of chemotherapy, physical therapy, in-office procedures, tests, you name it. We never receive bills before Medicare (for my husband and me) and Blue of CA ( for all of us) has a go at reducing the numbers. And reduce they do! Like the family in this story, we’re lucky to have good insurance, but I doubt anyone is paying “list prices.”
The FDA is a huge part of the cost problem although regulations also explain many other cost problems in the medical system. The FDA needs to be abolished or reformed. Reform would start with cutting its powers back to what it had until 1962. Another sensible reform would be to automatically approve a drug or medical device that has been approved by a comparable agency in developed countries.
Reducing the enormous costs imposed by the FDA's monopoly power would mean that you could shorten the period of patent protection and still enable pharma companies to make money. Economically, it makes no sense to have the same period of patent protection for different products (e.g. drugs vs. computer software).
Great! I'll read this. Recently, I became aware of Adam's work, which is extremely consistent with my Proactionary Principle and goes into depth on practical applications. A paper by you with Adam will be a winner.
A normal American business performs a service, and then produces a bill that it expects will be promptly paid without any arguments.
Hospitals are not normal businesses. After performing a service, they produce a statement that will be negotiated. The patients are terrified and angered by the obvious price-gouging in most of the initial statements.
If the patient has the smarts and self-confidence to go to the press, the bill will be minimized or even forgiven. If the patient can rouse their insurer into action, that too will save the patient financially.
How did this deeply stupid process become entrenched?
One culprit is the desire of insurers to get big discounts. Say that the accurate price of a medical procedure is $1,000. The insurer demands an 80% discount. But the hospital still needs the $1,000 revenue. So, the hospital raises the price to $5,000. After an 80% discount everyone is even.
In theory a single payer system could cut through all this waste. Maybe.
As David Goldhill wrote in “Catastrophic Care: Why Everything We Think We Know About Health Care Is Wrong,” “[H]ealth care is indeed different ... but primarily because we insist on treating it as different.” A hospital is not a "normal" business because, beginning in the 1940s (or, really, the 1910s), the US began passing a long list of harebrained laws that made hospitals and insurers behave otherwise. Their perversities do not result from laws of physics and are not immutable through time. The whole fake prices followed by discounts thing is not a result of capitalism or greed or competition or any such thing. It's the result of incoherent incentives that have been stacked on top of one another.
Yes, a single payer system would likely eliminate this particular problem--while creating its own perverse incentives. As I noted in my article, a single payer system spares Quebeckers the agony of getting gigantic helicopter bills. It also enables them to die in situations where Americans would survive, thanks to our helicopters. Similarly, Canada's single payer system spares Canadians the agony of high bills for drugs--and quite often, it spares them from having access to said drugs that we in America expect. In a recent case that made the rounds, a paralympian in Canada requested a chair lift and was offered euthanasia as a substitute. In 2005, Canada's Supreme Court slammed Quebec's single-payer system on the grounds that the province provided equal access to waiting lists--but not to care. In 2007, I was under consideration for a professorship in Canada but, after reviewing the practicalities of wait lists in British Columbia, concluded that I could not take the job. (Question was moot, as it was not offered.) I could rattle off similar cases in other single-payer systems. But to your original point, the idiotic numerical gamesmanship that hospitals and insurers play is a real problem, but it is such because we DECIDED that we should have such an idiotic system.
Part of the mess surrounding hospital bills is due to our national generosity.
(hang in there, I will get to the point.)
Let's say we treated all hospitals as essentially unsupervised free-market institutions.
(say, like the Surgery Center of Oklahoma).
There would be straightforward bills, payable when you entered the facility just like you pay or charge your hotel bill when you check in. There would be no medical debt and much less medical inflation.
But a large number of Americans have no savings, and so they could not enter the hospital. (Or they would wait until their relatives had scraped together the fees, as happens throughout parts of Africa and Asia.)
But we want any American to be be able to enter any hospital. So we regulate and subsidize insurance , and this is what leads to the billing mess.
Those parts of health care which have remained voluntary purchases do not have a great deal of inflation. Walgreens has hundreds of products on the shelves (NOT in the pharmacy) that have seen no inflation. Laser eye surgery has seen no inflation.
But hospitals are mainly involuntary, and that is where the problems start.
Problem with this line of argumentation is that you're trying to envision what would happen if we pulled one piece out of the jenga tower that we've constructed over the better part of a century. Or, in an analogy I have often used, Soviet citizens wondering, "But if the government didn't run grocery stores, where would we buy food? There are no other grocery stores." Of course we need a system of health insurance. But since the 1940s, we have mashed together insurance with Rube Goldberg-style prepayment plans, entitlements, and prohibitions on sensible behavior. How to get out this mess is a fetching problem.
You can find a lot of transparent medical costs, if you go to a private care clinic in "socialist" medical systems like in France or Italy. They can't compete with "free" medical care on price, so the private practices need to compete on quality and convenience.
Thanks for another interesting article.
As a Canadian and Quebecer, I wanted to add the following: At no time did Mrs. Richardson seem to require the need for a helicopter. She was seen by staff at 3 hospitals. She fell on a beginners slope at one of the biggest ski resorts in Quebec. https://www.cbc.ca/news/entertainment/natasha-richardson-dies-after-quebec-skiing-accident-1.814244
So, stuck on a mountaintop was nowhere close to an appropriate description.
I would bet money that the parents of the unfortunate snakebitee were Democrats. They have an agenda and will waste no opportunity to destroy America's Health Care system... and turn it into...
Here in Quebec, like most of Canada, we pay nothing... except taxes. The high cost of healthcare is spread among the entire tax-paying population, so it _seems_ free. Actually the per capita cost is $8,500 CDN. That's probably a lot more than private health care insurance.
Finally, although our 'free' healthcare system may seem functional for those with medical emergencies, the waiting lists for non-critical operations and routine exams can me measured in years.
Thanks! Interesting about Richardson and helicopter. The coverage at the time, and the provincial government’s statements, suggested that a helicopter might have made a difference. No partisan judgment offered here, but to answer your query, the mother was a two-time Democratic nominee for Congress and now serves in the State Senate.
The same in the UK. Waiting times have been getting longer and longer. Americans who want socialized healthcare (more than we already have) should look at those wait times. The amount of suffering they cause is horrible.
Another unasked question is whether it would be feasible for the camp to keep a couple of vials (with the cost included in the camp fees) that could be administered by a nurse. Assuming that a hospital visit would still be necessary, the overall outgoings would be considerably lower all around.
Interesting question. There are a lot of camps, and one patient can require a lot of vials. I have no idea of what expertise is required to administer it or which auxiliary services are essential to its administration. So, I have no expertise in your question, but I’m guessing that it wouldn’t be economically feasible—and perhaps not medically feasible, either. Experts are welcome to weigh in on the question.
A good thought. However, giving antivenin requires labs before administration (to establish baseline bleeding risks from the venom) and close monitoring for allergic reactions and other side effects of the medication. It really wouldn't be feasible for camps to do that. It probably does depend on the venom, however, based on location. There has been a lot of work on finding antivenin for exotic snakes around the world, where bites may occur in remote areas and cause rapid death due to paralysis/respiratory failure (think Black Mamba, etc.). In those cases giving it quickly really matters. Typically US pit vipers (copperheads, rattlesnakes, cotton mouths) give you a bit of window to work with before the rare death, so transfer is reasonable. Thanks again for a great discussion!
Enjoyable read--and a couple of points:
Pharma companies typically do not price drugs to recoup sunk costs. They price drugs to fund the next new drug. BTG Pharmaceuticals develops drugs that treat rare, emergent problems such as poisoning from other drugs (eg, digoxin) and exposure to high doses of radiation. As you say, thank God a company has developed such treatments.
I wonder if the hospital had antivenin sitting around. Perhaps--copperheads are not rare in Indiana. But perhaps not--many rarely used drugs can be obtained very quickly from wholesalers.
Air ambulances: I run in the Sierra Nevadas and other mountain areas. Air ambulance insurance is both cheap and essential. Rescue costs are $45-60,000. This isn't a hop from one hospital to another.
Drug price controls: Tom Sowell says always ask "and then what?" When no one can make a profit on a drug, the drug doesn't get made. Some vital meds --such as chemo drugs-- are in short supply, in part because the reimbursement for them is not profitable. Imagine that. 2nd and 3rd order consequences.
Thanks for the article.
Thank you for some excellent points! I'll just add a take on your first take: If they're not recouping this drug's sunk costs, then they're recouping the next drug's sunk costs. Or the one after that.
If someone is planning to hike or travel to an area with greatly increased danger or a place lacking in nearby medical services, it should be (and often is) possible to buy special insurance. At least, it used to be -- I haven't looked into it in a long time. In 1991, I went on a trip about a 1000 miles south from LA into Baja in Mexico. On the way back, our vehicle went off the road. We were all injured although I (having been asleep in the back) someone landed on my feet and was barely hurt. My friend in the passenger seat had his fingers pulled out and his head bashed in so that his brain was exposed. Someone took us to a "clinic" in Guerro Negro. I would describe it as a dirty hut. They wanted to operate on him. Fortunately, we had purchased medical trip insurance from AAA and he was airlifted to San Diego. Without the insurance, it would have been tens of thousands in today's dollars. He had his finger tendons reattached and his skull repairs and is still happily alive today.
This put me off any road trips to Mexico (also because the machine gun toting police simply drove by and didn't help). If I were to go, I would definitely buy that insurance, if you can still get it. The same if I were to go on a long hike into the wilderness, etc.
I bought similar insurance policies when I traveled for business in Kazakhstan in 2000 and 2007. I traveled extensively in Sub-Saharan Africa in the 1980s. I didn't buy any such policy, but my employer, Chase Manhattan Bank, made clear that they'd fly us out if the occasion merited it. And I did know of a couple of cases where that happened. I had one road trip into Mexico planned around 2003. As I picked up the car, the Avis rep told me the insurance would only cover problems that occurred within 14 miles of the U.S. border, because beyond that, the risks were simply too high. We switched our plans and went to Northern Arizona.
Just to recap:
1) “Statements” are not bills.
2) “Charges” are not payment due. They usually contain a huge amount of markup and gobbledygook.
3) Payment is based on negotiated rates. No one pays the “price” of a car.
4) Nonprofit hospitals often greatly reduce or write off large amounts due — especially for children. They consider it charity care.
Many years ago I "negotiated" for months with a hospital over paying for an unnecessary appendectomy my wife received. (The doctor who apparently misdiagnosed, in good faith, dropped anything our limited student insurance didn't pay.) Despite me providing lots of proof of our inability to pay the 'requested' amount, only a real threat of bankruptcy even got them to reduce the amount they wanted. We finally reach an agreement that took us a bit more than 10 years to pay off.
Thanks for the harrowing story! Nothing in my article is meant to imply that the payment system we have is coherent or efficient. Or that there aren't people like you who fall between the cracks of a jury-rigged, jerry-built system.
I totally agree. I taught Health Policy to grad students for around 20 years. There are lots of ways, I think, to make the system 'better' in many ways, but the politics and rent-seeking combined with typical bureaucratic politics make them essentially impossible.
And for many years now we have had an HSA and catastrophic policy that we just love. I was pushing it on the union I was forced into, and they avoided it for years. They evidently didn't think it 'punished' the University enough. Stuff like that just abounds.
Fun with zero-sum games. :)
Catastrophic policies make a lot of sense. Somehow, we have gotten used to the idea that insurance should pay for everything. That's not what insurance is for. Catastrophic coverage would be much less expensive and covering more moderate costs directly would reduce unnecessary or cost ineffective practices.
We have had separate policies at one time, but are now on the same one. Out of the last 12 years or so, in only one year have we "spent down" our deductibles and co-pays. Our insurer probably loves us. (And we're fairly old.)
OMG - That’s horrible! Did you think about suing?
Not really. My wife had a very tough case to diagnose. The doctor made a mistake. I suppose any suit could have gotten some sort of settlement, but I dislike that sort of thing.
It turns out that my wife had a very rare form of pancreatitis, and that wasn't diagnosed for quite a while after the appendectomy. She had all of the symptoms of chronic (not acute) appendicitis EXCEPT an elevated WBC count. Most doctors, I think, would have made the same mistake.
And there was nothing to sue the hospital for.
It was nearly 10 years later that my wife (a non-drinker, non-drug user) was diagnosed with pancreatitis caused by pancreas divisum (a condition believed at the time to be found in about 10% of the population but which results in pancreatitis less than 1% of the time -- now it is believed to be found in 5-15% of the population and leading to "recurring bouts" of pancreatitis about 30% of the time, and to chronic pancreatitis about 5% of the time). Also, it usually doesn't "present until a person is 40+. It was not at all well understood back in 1990.
We spent a lot of time with various doctors and other medical professionals repeatedly explaining that she wasn't an alcoholic and didn't do drugs. She was young (under age 30 when the symptoms got really bad) and they couldn't fathom any other cause.
Anyway, it made us stronger, and led me to study US health policy and later teach it, so it wasn't all bad.
And once, after it had been diagnosed, we had driven some 300 miles to attend a wedding, and on the way back she had a violent attack. We immediately got as fast as we could to the nearest hospital. It happened to be a teaching hospital connected to the University of Illinois medical school. We told the ER doc what she had, he started the proper treatment immediately, and the next day, after asking permission, dragged every med student in the place (about 20 or so) in to see her in groups of 4-5. He said something like, observe very carefully because you'll probably never see a case like this again. But if you do, know what it is and what to do. So maybe she helped some others.
Sally, I can vouch for your points. Since 2021 our family has had numerous surgeries, lots of chemotherapy, physical therapy, in-office procedures, tests, you name it. We never receive bills before Medicare (for my husband and me) and Blue of CA ( for all of us) has a go at reducing the numbers. And reduce they do! Like the family in this story, we’re lucky to have good insurance, but I doubt anyone is paying “list prices.”
The FDA is a huge part of the cost problem although regulations also explain many other cost problems in the medical system. The FDA needs to be abolished or reformed. Reform would start with cutting its powers back to what it had until 1962. Another sensible reform would be to automatically approve a drug or medical device that has been approved by a comparable agency in developed countries.
Reducing the enormous costs imposed by the FDA's monopoly power would mean that you could shorten the period of patent protection and still enable pharma companies to make money. Economically, it makes no sense to have the same period of patent protection for different products (e.g. drugs vs. computer software).
Agreed. I wrote about this (along with Richard Williams and Adam Thierer): https://www.mercatus.org/research/research-papers/us-medical-devices-choices-and-consequences
Great! I'll read this. Recently, I became aware of Adam's work, which is extremely consistent with my Proactionary Principle and goes into depth on practical applications. A paper by you with Adam will be a winner.
A normal American business performs a service, and then produces a bill that it expects will be promptly paid without any arguments.
Hospitals are not normal businesses. After performing a service, they produce a statement that will be negotiated. The patients are terrified and angered by the obvious price-gouging in most of the initial statements.
If the patient has the smarts and self-confidence to go to the press, the bill will be minimized or even forgiven. If the patient can rouse their insurer into action, that too will save the patient financially.
How did this deeply stupid process become entrenched?
One culprit is the desire of insurers to get big discounts. Say that the accurate price of a medical procedure is $1,000. The insurer demands an 80% discount. But the hospital still needs the $1,000 revenue. So, the hospital raises the price to $5,000. After an 80% discount everyone is even.
In theory a single payer system could cut through all this waste. Maybe.
Thanks for the comment! Glad to have you aboard.
As David Goldhill wrote in “Catastrophic Care: Why Everything We Think We Know About Health Care Is Wrong,” “[H]ealth care is indeed different ... but primarily because we insist on treating it as different.” A hospital is not a "normal" business because, beginning in the 1940s (or, really, the 1910s), the US began passing a long list of harebrained laws that made hospitals and insurers behave otherwise. Their perversities do not result from laws of physics and are not immutable through time. The whole fake prices followed by discounts thing is not a result of capitalism or greed or competition or any such thing. It's the result of incoherent incentives that have been stacked on top of one another.
Yes, a single payer system would likely eliminate this particular problem--while creating its own perverse incentives. As I noted in my article, a single payer system spares Quebeckers the agony of getting gigantic helicopter bills. It also enables them to die in situations where Americans would survive, thanks to our helicopters. Similarly, Canada's single payer system spares Canadians the agony of high bills for drugs--and quite often, it spares them from having access to said drugs that we in America expect. In a recent case that made the rounds, a paralympian in Canada requested a chair lift and was offered euthanasia as a substitute. In 2005, Canada's Supreme Court slammed Quebec's single-payer system on the grounds that the province provided equal access to waiting lists--but not to care. In 2007, I was under consideration for a professorship in Canada but, after reviewing the practicalities of wait lists in British Columbia, concluded that I could not take the job. (Question was moot, as it was not offered.) I could rattle off similar cases in other single-payer systems. But to your original point, the idiotic numerical gamesmanship that hospitals and insurers play is a real problem, but it is such because we DECIDED that we should have such an idiotic system.
Thanks for comments.
Part of the mess surrounding hospital bills is due to our national generosity.
(hang in there, I will get to the point.)
Let's say we treated all hospitals as essentially unsupervised free-market institutions.
(say, like the Surgery Center of Oklahoma).
There would be straightforward bills, payable when you entered the facility just like you pay or charge your hotel bill when you check in. There would be no medical debt and much less medical inflation.
But a large number of Americans have no savings, and so they could not enter the hospital. (Or they would wait until their relatives had scraped together the fees, as happens throughout parts of Africa and Asia.)
But we want any American to be be able to enter any hospital. So we regulate and subsidize insurance , and this is what leads to the billing mess.
Those parts of health care which have remained voluntary purchases do not have a great deal of inflation. Walgreens has hundreds of products on the shelves (NOT in the pharmacy) that have seen no inflation. Laser eye surgery has seen no inflation.
But hospitals are mainly involuntary, and that is where the problems start.
Problem with this line of argumentation is that you're trying to envision what would happen if we pulled one piece out of the jenga tower that we've constructed over the better part of a century. Or, in an analogy I have often used, Soviet citizens wondering, "But if the government didn't run grocery stores, where would we buy food? There are no other grocery stores." Of course we need a system of health insurance. But since the 1940s, we have mashed together insurance with Rube Goldberg-style prepayment plans, entitlements, and prohibitions on sensible behavior. How to get out this mess is a fetching problem.
Ah, but the glass-half-full story never airs. Except the one about socialism, where the glass doesn’t really need *anything* in it.