HealthCare Pop Quiz

[konradv]

For people who claim to be capitalists, I'm surprised I don't see a supply and demand analysis. Over the years the supply of doctors providing quality Lasik has increased, as the technique has became more refined and widespread. In order for each practitioner to keep their income constant or increasing, they've had to lower prices to increase patient traffic. While the insurance angle has some validity, the concentration on that aspect alone indicates a political rather than economic slant to the discussion.

 

[Oddball]

For people who claim to be capitalists, I'm surprised I don't see a supply and demand analysis. Over the years the supply of doctors providing quality Lasik has increased, as the technique has became more refined and widespread. In order for each practitioner to keep their income constant or increasing, they've had to lower prices to increase patient traffic.

Yeah.....Ain't free enterprise great?

While the insurance angle has some validity, the concentration on that aspect alone indicates a political rather than economic slant to the discussion.

The attention paid to that aspect is requisite to make the comparison...Certainly you cannot be so thick as to not recognize that.

 

[konradv]

For people who claim to be capitalists, I'm surprised I don't see a supply and demand analysis. Over the years the supply of doctors providing quality Lasik has increased, as the technique has became more refined and widespread. In order for each practitioner to keep their income constant or increasing, they've had to lower prices to increase patient traffic.

Yeah.....Ain't free enterprise great?

While the insurance angle has some validity, the concentration on that aspect alone indicates a political rather than economic slant to the discussion.

The attention paid to that aspect is requisite to make the comparison...Certainly you cannot be so thick as to not recognize that.

As usual, you've added nothing to the discussion.

 

[Oddball]

For people who claim to be capitalists, I'm surprised I don't see a supply and demand analysis. Over the years the supply of doctors providing quality Lasik has increased, as the technique has became more refined and widespread. In order for each practitioner to keep their income constant or increasing, they've had to lower prices to increase patient traffic.

Yeah.....Ain't free enterprise great?

While the insurance angle has some validity, the concentration on that aspect alone indicates a political rather than economic slant to the discussion.

The attention paid to that aspect is requisite to make the comparison...Certainly you cannot be so thick as to not recognize that.

As usual, you've added nothing to the discussion.

There's nothing to add when you inject blind ignorance into the discussion.

What are you supposed to compare fee-for-service medical care with, the price of tickets to Yankees games?

 

[thewanderer]

Junior (no need to thank me again, consider it a public service for us old-timers),

Had a long point by point response typed out yesterday and lost internet connection, lost it all, not willing to spend the time to retype it all. Here's the gist:

Reading the OP I don't see the emphasis on government intervention. I see mention of it, but don't really see what it has to do with Lasik surgery. The emphasis as I see it is on the fact that Lasik is a cash service-that's what the poll question was about, anyway.

Therefore, my post that you originally responded to was (clearly) addressing cash vs. insurance and those who advocate a cash only system. Since you do not advocate that system I'm not sure why you started arguing with me, but since you did both of us have spent time we'll never get back defending differing positions.

Because you are fixated on government intervention I have to ask exactly what "government meddling" you keep talking about that is preventing all this competition. Are we talking about the mostly not yet applied Obamacare, or something else? Sure, government regulations can drive up cost, but so does a third party pay system, which you seemingly advocate. When one entity provides a service, another consumes it, and a third pays for it, that's the surest recipe in the world for costs to go up. And history supports that theory, btw. I've found rudimentary examples of what we call "health insurance" dating as far back as the late 1800s in the United States, long before any government regulation or Medicare, and guess what trend (to my knowledge) they have always followed, government regulations or not? Over time premiums go up and benefits go down. Keeping in mind the consumption-provider-payer triangle above, it's not hard to figure out why.

So I guess that's technically a free market situation, but it's still a situation that artificially inflates prices. It does so in theory and it's done so in reality and it seems like you want to blame all of the cost inflation in health care and health insurance (two different things, although the politicians want you to blur the lines between the two) on government.

As to this:

Horse hockey. When people pay for their own services and/or insurance out of their own pocket without the influence of government or their employment status, they have an INCREASED incentive to be healthy and to engage in the preventative and other services you list.

That is a situation in which economic theory says one thing but reality is different. I know what choices people make regarding health care services that they have to pay for out of pocket. I've sold them services that they have to pay for out of pocket. And I've sold them services that insurance pays for. Guess which one they are quicker to buy, by probably an order of magnitude?

Here's a real life example from the past 30 days: I had a patient come in within the last month who has experienced neck pain for, according to him, 20 years. He tells me, "Yeah, it's been hurting and getting worse for at least 20 years, but I didn't have insurance and didn't want to pay for treatment out of pocket, so I just didn't do anything about it until now." Why now? Because he just got Medicare. Well, 20 years ago this problem could have been dealt with easily, probably six weeks of physical therapy, might have cost $1200. Now, the guy has three vertebrae in his spine that have become so irritated and inflamed over the years that they actually fused themselves together. If it can be surgically repaired at all (I'm not a surgeon, so I'm not even sure he's a good candidate for surgery), we're talking about them having to break the fusion apart, then refuse it with screws into the proper position. Tens of thousands of dollars and a fairly invasive and risky treatment, whereas if it had been dealt with at the time conservatively it would have cost a small fraction of the money with virtually no risk to the patient.

Now, all the economic tough-guys on this board are going to say, "The guy got what he deserved for being stupid." And of course that's true. However, let's not forget that he's now on Medicare's dime, which is your money now (and mine.) And lest you think this guy is a fringe example, I'm here to tell you that he is not. I don't care what economic theory says about how motivated people should be to invest in getting healthier, they don't do it. It's much rarer to find someone who is proactive about it than find patients like this guy. I see patients like him every single day. And he's your prime example-a guy who should be very concered about staying healthy because he has nothing to fall back on in an emergency. There's a spychological element to this that the economic theory doesn't take into account.
Anyway, most of your challenges and comments are irrelevant to my position, since I'm talking about the cost of going cash and you're (strangely in my view, if you're serious about avoiding artificial inflation of health care costs) not for ditching what we erroneously call "health insurance."

 

[thewanderer]

This is a false equivalency often offered by those I have seen advocating cash-based health care systems.

I do not dispute the general premise. However, equivocating shopping for heart surgery or cancer treatment is a lot different than shopping for an elective luxury procedure with relatively low risk.

That is like saying buying a car is a lot different than buying a toaster. In other words, it only makes sense if you assume people are stupid.

Not really. Lasik surgery is a luxury. The risks are very small. It's not essential to sustain life and barring a very slight chance of accident during surgery the worst thing that happens is that the patient continues to wear glasses.

If a person discovers that they have cancer on the other hand, their life is threatened. If the wrong treatment option is chosen or too much time goes by before deciding on a treatment option, the worst case scenario is death.

If you don't think those decision processes are vastly different, I don't know what to tell you. Nor do I understand what any of those things have to do with people being stupid. If you consider deciding to have Lasik surgery vs. brain surgery to remove a tumor when the surgery itself might kill you and chemotherapy might be a viable option and wouldn't kill you, but the only way to know is to roll the dice because if you try the chemo and it doesn't work it will be too late to operate, if you consider those to be the same decision making process, well, I kind of have to wonder about your own intelligence level.

 

[thewanderer]

Bullshit.

And this thoughtful and detailed reply didn't help my perception either.

 

[thewanderer]

When open heart surgery becomes an elective procedure, we'll see the cost of that come down also.

The price has gone down considerably over the years.

As with the MRI example I posted earlier, both have gone down despite both being covered by insurance, and despite both being subject to whatever government regulations are being vaguely referred to throughout this thread. And all three (Lasik, open heart surgery, and MRI) are technology dependent.

Seems like the most likely explanation here is that the price drops had a whole lot more to do with the price of technology coming down (including surgical technique technology) than cash vs. insurance or anything having to do with government intervention, wouldn't you say? Government regulations certainly didn't decrease while MRIs and OHSs were getting cheaper.

 

[thewanderer]

Besides that, there are doctors and clinic willing to set up payment schedules.

There are doctors and clinics willing to set up payment schedules for the occasional patient who cannot pay and/or has no insurance. Any significant number of them would not be feasible.

 

[Luddly Neddite]

When open heart surgery becomes an elective procedure, we'll see the cost of that come down also.

Your wait is over.

I had to fight the Colorado Insurance Commission on behalf of a family member to agree that coronary artery bypass surgery was not an elective procedure. The original letter of denial of coverage included an alphabetical list of elective procedures where it appeared right after bunionectomy.

 

[CrusaderFrank]

When people pay for any medical procedure out-of-pocket, we'll see the costs plummet.

Sure, everybody's got a spare hundred grand hanging around for just in case money.

Irrelevant to the fact.

Besides that, there are doctors and clinic willing to set up payment schedules.

In any event, THAT'S exactly what insurance is for! For big ticket items! That's why people have home owners insurance and not lawn care insurance

 

[boedicca]

This is a false equivalency often offered by those I have seen advocating cash-based health care systems.

I do not dispute the general premise. However, equivocating shopping for heart surgery or cancer treatment is a lot different than shopping for an elective luxury procedure with relatively low risk.

They are the same thing...medical services provided for a fee. Without transparency in pricing, equivalent providers charge very different fees. Consumers should have this information.

 

[CrusaderFrank]

Before The Government got involved, doctors used to make house calls -- in the Bronx!

 

[thewanderer]

They are the same thing...medical services provided for a fee.

They do not follow the same consumption process at all. Equivocating the two because they are both medical services is kind of like saying that a lawnmower and a car are the same thing because they both have wheels, run on gasoline, and can transport a person from one place to another.

Without transparency in pricing, equivalent providers charge very different fees. Consumers should have this information.

I'm not sure what you're advocating here...more government intervention to ensure that pricing information is available to all?

 

[thewanderer]

In any event, THAT'S exactly what insurance is for! For big ticket items! That's why people have home owners insurance and not lawn care insurance

Sure. Not even just "big ticket items," but big ticket items that are relatively unlikely to occur with any one individual. That's the only way insurance works...what we have now is not really insurance, which is why it artificially inflates costs.

No argument there.

 

[Oddball]

Besides that, there are doctors and clinic willing to set up payment schedules.

There are doctors and clinics willing to set up payment schedules for the occasional patient who cannot pay and/or has no insurance. Any significant number of them would not be feasible.

How much less feasible than the thousands of "buy-here-pay-here" car lots across the country?

 

[thewanderer]

Before The Government got involved, doctors used to make house calls -- in the Bronx!

Before the government got involved a lot of stuff was different, and not all of it has to do with the government getting involved. Some of it has to do with the government getting involved in other aspects.

For example, one thing that cash-health care proponents seem to not think about is the fact that education is artificially inflated as well. Now, again, from personal experience, I can tell you that racking up $275,000 in student loans and forgoing about a decade's worth of earning potential to become a doctor is worth something.

Unless your reform of health care includes a higher education reform to bring costs down there, there's only going to be so much that prices will fall. Everyone correctly estimates that administrative costs do add quite a bit to a medical office overhead, but without patient referrals from insurance companies a lot of that cost simply gets transferred to marketing costs. All these stories that you see where some M.D. goes cash are always some M.D. who has been in practice a while. Has his student loans paid down significantly. Has an already established patient base. Equipment is paid for. It's not anywhere near as feasible to do this right out of school.

And if salaries drop too much, there will still be people willing to become doctors, they just won't be the top candidates. The best and brightest will major in finance and be out in four.

 

[thewanderer]

How much less feasible than the thousands of "buy-here-pay-here" car lots across the country?

Since many, if not most, of the employees at car lots work on commission, I would think the car lot scenario more feasible. To be honest, though, I don't know anything about the finances of a car lot.

I do know that if a surgery center starting having to stretch out collections over 9 years at $300 a month instead of collecting $30,000 within 90 days for more than just a few patients at a time, I can guarantee that they would have unworkable cash flow problems.

Someone mentioned getting a bank loan earlier. That would work...if you could get the loan, which you won't be able to do.

 

[Oddball]

How much less feasible than the thousands of "buy-here-pay-here" car lots across the country?

Since many, if not most, of the employees at car lots work on commission, I would think the car lot scenario more feasible. To be honest, though, I don't know anything about the finances of a car lot.

I do know that if a surgery center starting having to stretch out collections over 9 years at $300 a month instead of collecting $30,000 within 90 days for more than just a few patients at a time, I can guarantee that they would have unworkable cash flow problems.

The owners of the lots -the one's extending the credit terms- don't work on commission.

And what's wrong with stretching out payments, when there would almost certainly be an interest payment due on outstanding balances?

Don't know much about compound interest either, do ya?

 

[thewanderer]

Don't know much about compound interest either, do ya?

I know about as much as the average guy, I guess.

I'm not sure how much you know about cash flow, however.

Compound interest doesn't help you when your monthly expenses are $200,000 per month and you only collected $80,000 because 50% of your collections are spread out over years.

The value of an unpaid bill, even though it might increase due to interest, doesn't help unless you can afford to wait for the payoff. I don't know of many (actually any) clinics that can afford to do so for any significant percentage of patients.