One Simple Reason Why Health Care Costs More In The US Than Anywhere Else

[auditor0007]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that America lets providers set prices.

The Washington Post's Ezra Klein draws this conclusion from talking to Johns Hopkins' Gerard Anderson:

“Other countries negotiate very aggressively with the providers and set rates that are much lower than we do,” Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they’re set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.

In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it’s a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured."

As we've reported, the average U.S. family of four dropped more than $8,000 on basic health care services in 2011, while record numbers of Americans have been filing for bankruptcy due to outstanding medical bills they can't afford to pay.

Check out Klein's chart below to see how America's medical costs stack up against other countries like France and India:

Read more: One Simple Reason Why Health Care Costs More In The US Than Anywhere Else - Business Insider

Here is why our healthcare industry is so messed up. We blame high prices on people being sick too much and needed excessive care due to bad health. We think that by reducing obesity and smoking, people would be healthier and require less care. Then we find out that if the medical field sees a drop in patients, providers will need to raise prices even more to keep their operations afloat, because without all the patients, they will go belly up. And we already have less doctors per capita then most other countries, and we actually have a need for more because so many people are in poor health due to their being overweight.

 

[Procrustes Stretched]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that...

...is simply that Americans are some of the dumbest people in the history of mankind. Just ask P.T. Barnum, Joseph Smith, George W. Bush...

 

[hipeter924]

Medicines that go of of patent and become generics often cost 1/1000 the brand name drug.

and don't give me that development crap. the US govt pays for much of the drug development and research thru universities and the NIH.
Drug companies spend more on advertising than they do development.
And many of our patent drugs are manufactured overseas and are sold MUCH cheaper in other countries.

A majority of our patent drug ingredients are imported from China for the drugs made here as well.

Or due to fact Americans seem to take drugs for everything, and have such a bureaucratic mess, rather than a simple public health service aka treat all you can, leave the rest to the private sector. Better yet, eat fruit and vegetables, rather than junk food.

 

[Douger]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that...

...is simply that Americans are some of the dumbest people in the history of mankind. Just ask P.T. Barnum, Joseph Smith, George W. Bush...

Lose the A already. It's over. Dem is(B) murkins.............soon to be urkins.

 

[Skull Pilot]

The reason medical costs are high is that people don't actually know what medical services cost therefore market forces cannot be applied.

Just call up any medical center and ask how much a physical and routine blood work cost.

No one knows.

 

[editec]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.
A huge reason why is simply that America lets providers set prices.

Normally, where there is supply and demand, the market sets prices.
However, fior this to work properly, the prospective consumer must be directly encumbered with paying the cost of the goods and services he consumes.

When third-parties pay for those goods/services, the consumer is insulated from the costs of what he receives, and the free-market system of supply/demand breaks down.

Simple solution: remove third-party payers and expose the consumer to the full cost of the goods and services he receives. This will cause consumers to 'shop around' and thus force providers to compete for business; this, in turn will lower prices and improve quality.

Want to solve the 'problem' of health care costs? Make people pay for it themselves and bring the free market back ito it.

Of course you are perfectly right that would drive down the cost of HC, on that we agree.

So let us think more deeply about your proposal, shall we?


What you think the transition period would be like when we did that? Can you paint us a scenario of what it would be like for the Average American when they find they have to pay for treatment for that heart attack Daddy just had?

How, for example, does the median income and wealth American family find the money to keep Daddy alive during this new age of market driven HC?

Can you tell us many people in the USA you think would not have any access to health care because they could not afford it?

And how long do you suppose it would take before the price of HC would become slow enought that the median American family could really afford to pay for our of their incomes?

I am asking you to THINK BEYOND your simple solution (that I agree WOULD WORK to drive down the cost of HC, remember) and imagine what the OUTCOMES of such a policy change would bring us.

Can you do that for us? Can you think past your policy change to the probably outcomes of implementing it?

What do YOU THINK would happen to the people in the USA if we did what you just proposed?

 

[dblack]

What you think the transition period would be like when we did that? Can you paint us a scenario of what it would be like for the Average American when they find they have to pay for treatment for that heart attack Daddy just had?

How, for example, does the median income and wealth American family find the money to keep Daddy alive during this new age of market driven HC?

Can you tell us many people in the USA you think would not have any access to health care because they could not afford it?

And how long do you suppose it would take before the price of HC would become slow enought that the median American family could really afford to pay for our of their incomes?

I am asking you to THINK BEYOND your simple solution (that I agree WOULD WORK to drive down the cost of HC, remember) and imagine what the OUTCOMES of such a policy change would bring us.

Can you do that for us? Can you think past your policy change to the probably outcomes of implementing it?

What do YOU THINK would happen to the people in the USA if we did what you just proposed?

editec, I'll throw that challenge back at you and ask you to think beyond the extreme 'cold turkey' scenario you're imagining. Most of us pointing out the inflationary pressures inherent in insurance aren't suggesting getting rid of it altogether, but minimizing its use seems like an obvious goal. Even beyond the market distorting effects of insurance, stop and think about the illogic of maintaining a middleman, a profit-taking middleman, in every single health care transaction. Does that really make sense? Obviously, the less we rely on insurance, and the more we pay for health care out-of-pocket, the further our health care dollars will go.

The frustrating irony is that the changes necessary to resolve the problem were well on their way to happening (and are still likely to occur if PPACA is struck down). Health care insurance rates are finally catching up to the inflation that our overuse of insurance has helped to create, and people are beginning to see that health insurance, as a means of financing regular health care expenses, isn't a good deal. That's why so many young people are turning to catastrophic policies instead of the traditional low-deductible, high-premium policies. It's not because they're foolish and irresponsible - quite the opposite. It's because they can do math. The way we use insurance is idiotic. It really only makes sense as a hedge against risk, and even then only the risk you can't afford to cover yourself.

 

[dblack]

What do YOU THINK would happen to the people in the USA if we did what you just proposed?

Also, it occurs to me I dodged your question, and it deserves an answer. If we did as I'm suggesting, and simply removed policies propping up over-insurance, here's how I see it playing out. By necessity, we'll move away from the low-deductible, high-premium insurance policies and instead begin using insurance as it's meant to be used - as a hedge against catastrophic risk. At first, it will be great - the money we'll save on premiums will be a boon to families and the economy in general. But, as you suggest, the transition would be far from painless.

The first time we do get sick and go do the doctor on our own dime, we'll be in for a very unpleasant surprise. When we're charged five dollars for an aspirin at the hospital emergency room, we'll be none too pleased. We might even get a little pissy at them for having the gall to charge so much. We might just say "keep your aspirin, I brought some from home".

The point is, people will start demanding lower prices. We'll keep track of which hospitals are 'gouging' people, and which aren't. We might even ask ahead of time how much a doctor charges for offices visits and basic services. We'll shop around for a family doctor we can trust who also happens to offer reasonably priced services. These are the kinds of basic consumer activities that are all but absent from the health care market today - and it's not because of anything inherent in health care. It's because we've been sold a bill of goods when it comes to health insurance.

 

[editec]

What you think the transition period would be like when we did that? Can you paint us a scenario of what it would be like for the Average American when they find they have to pay for treatment for that heart attack Daddy just had?

How, for example, does the median income and wealth American family find the money to keep Daddy alive during this new age of market driven HC?

Can you tell us many people in the USA you think would not have any access to health care because they could not afford it?

And how long do you suppose it would take before the price of HC would become slow enought that the median American family could really afford to pay for our of their incomes?

I am asking you to THINK BEYOND your simple solution (that I agree WOULD WORK to drive down the cost of HC, remember) and imagine what the OUTCOMES of such a policy change would bring us.

Can you do that for us? Can you think past your policy change to the probably outcomes of implementing it?

What do YOU THINK would happen to the people in the USA if we did what you just proposed?

editec, I'll throw that challenge back at you and ask you to think beyond the extreme 'cold turkey' scenario you're imagining.

It wasn't MY cold trukey plan, sport it was yours.

I asked you to explain to me how we make that transition. If it isn't cold turkey then WHAT IS IT?

Most of us pointing out the inflationary pressures inherent in insurance aren't suggesting getting rid of it altogether, but minimizing its use seems like an obvious goal.

Okay...now explain in greater deatail the policy decision you are advocating that will do that.

Even beyond the market distorting effects of insurance, stop and think about the illogic of maintaining a middleman, a profit-taking middleman, in every single health care transaction. Does that really make sense?

NO it doesn't make sense, on that we agree.

But I am not DEFENDING the system we have now, am I?

I am merely asking YOU to imagine the TRANSIONAL period if we eliminate the system we have now.

What do we replace it with?

You first post didn't offer anything but to eliminate third party paymentsystem and to allow market forces to fix things.

Clearly you have a more detailed plan in your head that you didn't share with us.

I am asking you to think more DEEPLY and explain that plan of yours to US,

Obviously, the less we rely on insurance, and the more we pay for health care out-of-pocket, the further our health care dollars will go.

No it is NOT obvious to me that will happen.


What is obvious is this...if we change the third party payment system we have no and depend on the people paying for their own health care, then it is obvious to me that most American families cannot pay for their HC.

That isn't obvious to you?

The frustrating irony is that the changes necessary to resolve the problem were well on their way to happening (and are still likely to occur if PPACA is struck down). Health care insurance rates are finally catching up to the inflation that our overuse of insurance has helped to create, and people are beginning to see that health insurance, as a means of financing regular health care expenses, isn't a good deal.

AGreed.

That's why so many young people are turning to catastrophic policies instead of the traditional low-deductible, high-premium policies. It's not because they're foolish and irresponsible - quite the opposite. It's because they can do math. The way we use insurance is idiotic. It really only makes sense as a hedge against risk, and even then only the risk you can't afford to cover yourself.

Yes. The YOUNG AND THE HEALTHY can afford to only have catastropic insurance.

SAdly we ALL GET OLD and with advancing age comes the inevitable decline in health.

So what?

How does that really address the issue I asked you to think more deeply about?

I'll ask you again...what does the TRANSITON period look like?

It looks to me like 80 or 90% of the popilation would be completely economically destroyed if they had any major illness.

Adn since every human being ALIVE is going to have a majory catastropic illness sooner or later, I am asking you how those people who are currently in one of those Health criseses will SURVIVE if they cannot pay for that health care.

Don't come back and explain to me again why the system we currently have sucks.

WE AGREE on that.

Now tell me what YOUR plan looks like.

 

[dblack]

Don't come back and explain to me again why the system we currently have sucks.

WE AGREE on that.

Now tell me what YOUR plan looks like.

I don't have a lot of time to get into it today (gotta get some work done), but it doesn't require any grand plan. As I said, it's a transition that is/was happening already. We can, and should, remove government policies propping up the current status quo (the tax incentives and regulatory hurdles). In the mean time we can beef up safety nets for bottom rungs, as they'll be in the tightest pinch until prices come down.

 

[theHawk]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that America lets providers set prices.

The Washington Post's Ezra Klein draws this conclusion from talking to Johns Hopkins' Gerard Anderson:

“Other countries negotiate very aggressively with the providers and set rates that are much lower than we do,” Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they’re set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.

In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it’s a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured."

As we've reported, the average U.S. family of four dropped more than $8,000 on basic health care services in 2011, while record numbers of Americans have been filing for bankruptcy due to outstanding medical bills they can't afford to pay.

Check out Klein's chart below to see how America's medical costs stack up against other countries like France and India:

Read more: One Simple Reason Why Health Care Costs More In The US Than Anywhere Else - Business Insider

The reason health care is so high is because we let government interfere with everything in the industry.

 

[PeteEU]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that America lets providers set prices.

The Washington Post's Ezra Klein draws this conclusion from talking to Johns Hopkins' Gerard Anderson:

“Other countries negotiate very aggressively with the providers and set rates that are much lower than we do,” Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they’re set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.

In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it’s a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured."

As we've reported, the average U.S. family of four dropped more than $8,000 on basic health care services in 2011, while record numbers of Americans have been filing for bankruptcy due to outstanding medical bills they can't afford to pay.

Check out Klein's chart below to see how America's medical costs stack up against other countries like France and India:

Read more: One Simple Reason Why Health Care Costs More In The US Than Anywhere Else - Business Insider

The reason health care is so high is because we let government interfere with everything in the industry.

HAHAHAHAH.. it is quite the opposite and the fact you belive that it is the governments fault is sad and hilarious at the same time.. typical right wing brainwashing via Fox News at its worst.

The "government" are nothing but puppets to the industries.

It is the industries that have been fighting against opening up the insurance market.
It is the industries that wanted the banning of imported drugs from outside the US.
It is the industries that got it made to law that the biggest single consumer of medical supplies, the US government, was not allowed to negotiate the price but had to accept the price given to them

The problem is very clear in the US.. and industry driven legislation that is made to improve the balance sheets of the private corporations instead of improving the over all health of the citizens. To do this, the industry have given hundreds of millions of dollars in "donations" to politicians on both sides, insuring that they have the influence to dictate healthcare policy in the US. Even Obamacare is ripe with industry friendly parts, but on the flip side it also opens up for things that the industries have been fighting against for decades.. It is a sad poor compromise but it is a hell lot better than not having it.

 

[dblack]

HAHAHAHAH.. it is quite the opposite and the fact you belive that it is the governments fault is sad and hilarious at the same time.. typical right wing brainwashing via Fox News at its worst.

The "government" are nothing but puppets to the industries.

It is the industries that have been fighting against opening up the insurance market.
It is the industries that wanted the banning of imported drugs from outside the US.
It is the industries that got it made to law that the biggest single consumer of medical supplies, the US government, was not allowed to negotiate the price but had to accept the price given to them

The problem is very clear in the US.. and industry driven legislation that is made to improve the balance sheets of the private corporations instead of improving the over all health of the citizens. To do this, the industry have given hundreds of millions of dollars in "donations" to politicians on both sides, insuring that they have the influence to dictate healthcare policy in the US. Even Obamacare is ripe with industry friendly parts, but on the flip side it also opens up for things that the industries have been fighting against for decades.. It is a sad poor compromise but it is a hell lot better than not having it.

PPACA is EXACTLY the kind of industry-driven legislation that you rightly point out as the problem. Wake up man.

 

[theHawk]

Americans are feeling the pinch of rising health care costs more than any other nation in the world.

A huge reason why is simply that America lets providers set prices.

The Washington Post's Ezra Klein draws this conclusion from talking to Johns Hopkins' Gerard Anderson:

“Other countries negotiate very aggressively with the providers and set rates that are much lower than we do,” Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they’re set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.

In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it’s a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured."

As we've reported, the average U.S. family of four dropped more than $8,000 on basic health care services in 2011, while record numbers of Americans have been filing for bankruptcy due to outstanding medical bills they can't afford to pay.

Check out Klein's chart below to see how America's medical costs stack up against other countries like France and India:

Read more: One Simple Reason Why Health Care Costs More In The US Than Anywhere Else - Business Insider

The reason health care is so high is because we let government interfere with everything in the industry.

HAHAHAHAH.. it is quite the opposite and the fact you belive that it is the governments fault is sad and hilarious at the same time.. typical right wing brainwashing via Fox News at its worst.

The "government" are nothing but puppets to the industries.

It is the industries that have been fighting against opening up the insurance market.
It is the industries that wanted the banning of imported drugs from outside the US.
It is the industries that got it made to law that the biggest single consumer of medical supplies, the US government, was not allowed to negotiate the price but had to accept the price given to them

The problem is very clear in the US.. and industry driven legislation that is made to improve the balance sheets of the private corporations instead of improving the over all health of the citizens. To do this, the industry have given hundreds of millions of dollars in "donations" to politicians on both sides, insuring that they have the influence to dictate healthcare policy in the US. Even Obamacare is ripe with industry friendly parts, but on the flip side it also opens up for things that the industries have been fighting against for decades.. It is a sad poor compromise but it is a hell lot better than not having it.

Thanks for proving my point. "Industry driven legislation" still comes from the government.

 

[M14 Shooter]

Because the patient isn't paying for it directly.

Yup... pretty much the core of the problem.

A patient paying out of pocket for health care pays more than the insurance company does for exactly the same service/procedure.

You miss the point.
Normally I'd say that you did so deliberately, but this is a complex situation, so I'm willing to gove you the benifit of the doubt.

The aspirin costs $5 because a third party will pay that much.
If you get rid of the third parties and thus force everyone to pay for their own good/services, aspirin will not cost $5 because no one will pay that much.

 

[Greenbeard]

The aspirin costs $5 because a third party will pay that much.

Is an insurance company a rational actor? Does it seek to maximize profit?

 

[Dont Taz Me Bro]

Normally, where there is supply and demand, the market sets prices.
However, fior this to work properly, the prospective consumer must be directly encumbered with paying the cost of the goods and services he consumes.

When third-parties pay for those goods/services, the consumer is insulated from the costs of what he receives, and the free-market system of supply/demand breaks down.

Simple solution: remove third-party payers and expose the consumer to the full cost of the goods and services he receives. This will cause consumers to 'shop around' and thus force providers to compete for business; this, in turn will lower prices and improve quality.

Want to solve the 'problem' of health care costs? Make people pay for it themselves and bring the free market back ito it.

That's a great idea if everyone could afford the $80,000 bill for heart surgery. The problem is that people need insurance because very few are prepared for a bill that big. Now what might help is if health insurance was limited to major medical and all the everyday stuff was left to the consumer to pay out of pocket.

Insurance, yes, but what most of us have is not insurance, it's a health plan that covers way too much. If your automobile insurance covered every tire change and oil change it would be a hell of a lot more expensive too.

 

[AVG-JOE]

The single largest reason can be summed up with one word, "Republicans".

Not helpful.




The single largest reason can be summed up with one word, per patient / per procedure payment plans.

O.k., that was six words... the point being that if government is to be in the health care business, it needs to keep the services basic and provide those services by owning a building and paying the young and the dedicated in the medical profession to handle the governments patient load on a salary. The rich, hypochondriacs and the insured can make the medical pros who're in it for the money rich doing what they do.

The only other option that makes sense and doesn't include legless and diseased beggars in the streets is a single payer option with prices negotiated in good faith between the American Medical Association and the duly elected representatives of We, The People.

 

[Ropey]

This unfettered Capitalism run by the special interests that clearly pander to all sides of political divides needs to be reined in by all sides.

 

[M14 Shooter]

The aspirin costs $5 because a third party will pay that much.

Is an insurance company a rational actor? Does it seek to maximize profit?

Whatever the answer to your question, the fact remians - the aspirin costs that much because the third party is willing to pay that much.