Why Is Healthcare so Expensive?

[DOquestions]

f you want to have any insight into how complex and horrible the medical system is, then you need to set aside 24 hours and read this.

If you pay someone to create these sorts of manuals, you should be paying someone to read them.....otherwise, who will follow the rules?

The short answer. No One.

That is why President Obama is auditing doctors at an alarmingly higher rate than has occurred in the past. No one is following the rules......even the insurers that make the rules.



How in the world do we expect to fix a system mired in this much red tape?



Oh.....don't worry. The INTERNET will fix it........yeah right......

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[coldweatherblue]

http://content.nejm.org/cgi/content/short/349/8/768

administration.

Very simply: people with business/marketing degrees need jobs to eat/pay rent. Thus fairly pointless jobs in healthcare are created to form positions. Once people's livelihoods depend on some form of employment it is very difficult to deprive them of their work.

 

[honker]

The reason healthcare is so expensive is because of third-party payer systems. Any entity using third-party payers has inflated costs because people aren't aware of how much it costs, since they don't pay the entire cost themselves. Have you had to pay for auto collision repairs? That is another third-party pay system when insurance is involved. The cost of a fender bender repair is ridiculous. The costs associated with healthcare really took off when the government got involved. The problem is self perpetuating. The costs are so high that you need insurance to help pay for it, which in turn inflates the cost.

 

[kingofthehill]

http://content.nejm.org/cgi/content/short/349/8/768

administration.

Very simply: people with business/marketing degrees need jobs to eat/pay rent. Thus fairly pointless jobs in healthcare are created to form positions. Once people's livelihoods depend on some form of employment it is very difficult to deprive them of their work.

No, this is incorrect. The positions aren't created to make jobs, they're there because of the complexity of giant programs like Medicare.

 

[kingofthehill]

The reason healthcare is so expensive is because of third-party payer systems. Any entity using third-party payers has inflated costs because people aren't aware of how much it costs, since they don't pay the entire cost themselves. Have you had to pay for auto collision repairs? That is another third-party pay system when insurance is involved. The cost of a fender bender repair is ridiculous. The costs associated with healthcare really took off when the government got involved. The problem is self perpetuating. The costs are so high that you need insurance to help pay for it, which in turn inflates the cost.

Yeah, when the government is paying for it (Medicare/Medicaid), you get higher demand for healthcare services because people aren't paying as much for their medical care as they would if they had private insurance plans with high deductibles. True, those on Medicare require more services simply because they're older and sicker on average, but this would still hold true for the rest of the population if it were available to them.

This increase in demand allows providers to charge high fees (physicians in the US are some of the highest paid in the world), which in turn increases overall costs.

 

[coldweatherblue]

yeah yeah etc.. it's circular.. what you said is true re: medicare but there are definitely tons of positions in health-care (and the rest of the economy) that exist mainly because it would be unpopular/ethical to get rid of the position. are you disagreeing with the study in NEJM? why is medicare so complex? Why is bureaucracy so inefficient? cause there are tons of people who don't really *do* anything in their jobs but they're educated and well-established in their profession so it's impossible (and perhaps unethical) to deprive them of their livelihood.

 

[kingofthehill]

yeah yeah etc.. it's circular.. what you said is true re: medicare but there are definitely tons of positions in health-care (and the rest of the economy) that exist mainly because it would be unpopular/ethical to get rid of the position. are you disagreeing with the study in NEJM? why is medicare so complex? Why is bureaucracy so inefficient? cause there are tons of people who don't really *do* anything in their jobs but they're educated and well-established in their profession so it's impossible (and perhaps unethical) to deprive them of their livelihood.

Whether these people every do anything is anyone's guess, but I'd be willing to bet that they aren't allowed to keep their jobs simply because they need to live. What about all those who are getting laid off now that the economy is bad? Sure it might be unethical to fire someone who did not do anything wrong, but layoffs do happen.

I didn't read the whole NEJM article, but I gather it talks about why our healthcare is more expensive than Canada's. I'll tell you why: because we have a healthcare system that is run by both the government AND by the private insurance market. That's one wrinkle of complexity in the system Canada doesn't have. (Not sure if you were actually asking anything at all or if it was rhetorical...)

 

[starfishprime]

How in the world do we expect to fix a system mired in this much red tape?

Milton Friedman - How to Cure Health Care