Quote:
Originally Posted by villageidiot1
I agree with most of what you are saying. Fee-for-service is a contributing factor to the high cost of healthcare, but what is the solution around it.
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Bona fide health insurance.
Real insurance is not fee-for-service. Real insurance is built around risk, and then that risk has a limit.
Take an auto insurance policy where a car is insured for $20,000; $25,000 medical; $25,000 property damage, and $50,000 personal liability.
What is the total payout? $120,000.
See how easy that was?
And what does it cost to insure someone for $120,000? That depends on the risk factors involved. The risk factors will determine the monthly premiums to be paid.
And note the amount of personal control that you have here. You can increase personal liability from $50,000 to $100,000 if you want, although it will cost more, but that is a choice that you make, not the government (although granted most State governments stipulate a minimum of $25,000 in personal liability). If you want additional coverage, say a rider for flood damage, you are free to choose that or not. Again, you have control and you are making choices.
The threat of an increased risk factor resulting in higher insurance costs or loss of insurance, is sufficient to keep the vast majority of driver's in line, who do not act recklessly or take unwarranted risks exposing others to dangers. You can also take actions to reduce your risks by installing a Lo-Jack, being a member of AAA or an auto-club, operating vehicles that have high reliability ratings as well as crash-test ratings and so on. And if your car is damaged, there's no such thing as "Out-of-Network" fees. You can get an estimate or service anywhere.
If you had true health insurance, then you would have choices; you would have control; and you would have incentives to reduce costs, and those who engaged in risky behaviors would bear the burden of increased costs.
The mere fact that health plan providers would know the maximum payout in advance would in and of itself result in reduced premiums.
If you had real health insurance, you would exercise numerous choices:
1] Do you want emergency room coverage? How much? $10,000 per year, $25,000 per year or $100,000 per year? You choose $25,000 and are willing to eat the costs over that. Your premium is then based on that...say $1.70 per month,
2] Do you want prescription medication coverage when prescribed by an ER physician? It's a simple question, yes or no? Yes, then your monthly premium is $1.78/month.
3] Do you want annual prescription medication coverage? How much? $1,000? $5,000? $10,000? Your premium is adjusted based on your risk for that.
4] Do you want doctor's offices visits covered? How much? $250? $1,000? $5,000? You decide, and your premium is adjusted based on your risk.
5] Do you want a rider for sexually transmitted diseases? Which diseases and how much?
6] Do you want a rider for Type II Diabetes? How much?
7] Do you want a rider for cancer, or pregnancy/child-birth, etc etc? How much?
As you can see, the primary issue here is choice, individual choice. If you are married and planning a family, then you'd probably want insurance cover-age for child-birth. You may also want insurance coverage for prenatal care and at-risk pregnancies. Child-bearing years for women are the onset of menses to age 28. Anything over that is high-risk and the risk increases tremendously with age. If women want to wait until they're 35 to have children, fine, but then I shouldn't be saddled with the responsibility of paying for their premature low-birth-weight-baby just because they wanted to wait until they were in an high-risk age-group.
Same with Type II Diabetes. Some fat slob wants to rob me because they're too damn lazy to go walk 20 minutes every other day? Sorry about their luck.
And preexisting conditions? That's like your house is on fire and you call an insurance agent wanting to purchase homeowner's insurance. You can certainly insure preexisting conditions, but it will cost more. They are no different than any other high risk situations. You think Hollywood stunt men and women pay less than others for life insurance? No, they don't.
You can create an high risk insurance fund for preexisting conditions, but then there must also be limitations, and the total payout has to be known in advance.
I guess the real question is why are so many so opposed to having real insurance? Well, that's because what they really want is a big spend-fest with the sky as the limit.
Quote:
Originally Posted by villageidiot1
Section 6001 of Obamacare deals with physician ownership of hospitals and self-referrals to physician-owned hospitals. The argument is that physician-owned hospitals exist in only those specialties that have lucrative reimbursement, e.g., cardiology, orthopedics, and oncology. So are you arguing that a clinic model with a capitated reimbursement system is more efficient in the long run? This seems to be the model with Geisinger and the Mayo Clinic.
The clinic model would seem to be at odds with what you describe in your last paragraph above. The Geisinger model includes an insurance plan. If I am a member of the the Geisinger Plan and I go out of network, shouldn't I pay a higher fee since Geisinger has to reimburse the other provider?
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A physician can refer a patient to himself if he is on staff at a hospital, and a physician on staff at an hospital can refer a patient to another physician on staff at an hospital but physicians cannot make referrals if they are not on staff?
What kind of stupid logic is that?
I've heard of the Mayo Clinic. I know nothing about Geisnger.
What I do know is the same thing that Europeans know, and that is an hospital is the least effective, most costly, least efficient means of health care delivery. It would be impossible to construct an health care delivery system in the US that was more inefficient than an hospital.
Hospitals are out-moded, outdated, obsolete and antiquated.
The best way to see that is to compare an hospital to a business.
You manufacture a product in your production division, you have a packaging division, a warehouse division, and then a shipping and distribution division.
What happens if the shipping and distribution division becomes unprofitable and starts losing money (and it doesn't matter why)? You get rid of it. You either shut down your shipping division and contract another business to provide that service for you, or you sell off your packaging division, or you spin-it off (of your books).
Now, an hospital has oncology, OB-GYN, pediatrics, geriatrics, psychiatry, cardo-pulomnary, orthopedics and many other specialties, plus a weight loss clinic (like several of our hospitals here do).
What happens if the weight loss clinic suffers massive financial losses and ends up being a money pit? What does the hospital do? Does the hospital shut down the weight loss clinic? Nope. Does the hospital sell-off the weight-loss clinic to another hospital? Nope. Does the hospital spin-off the weight-loss clinic into a private entity? Nope.
What the hospital does is raise the rates of all other fees and services to make up for the fact tha the weight-loss clinic is losing money hand over fist.
Fail.
That is an economic fail.
An hospital has a cardiopulmonary center that is losing money faster than the government can print it, perhaps because the hospital has a bad reputation. Does the hospital shut down the cardiopulmonary unit? Nope. Does the hospital sell off the unit? Nope. Does the hospital spin off the unit? Nope.
What the hospital does is raise the rates, prices and fees for all other service to cover the fact that the cardiopulmonary unit is losing money.
Again, economic fail, because that drives up the price of health care.
And then in the name of "competition" you have massive redundancy in health care. In Europe, you can't go to just any medical facility you want for open-heart surgery. You can only go to certain special facilities. Why? To eliminate redundancy, because redundancy increases the cost of health care.
That's one of the reasons you're in this mess in the first place. In the late 1960s, you had a technology bonus from the military and from NASA that was parlayed into medical technology. It was very, very expensive (as all new technology is) and in the name of competition, hospitals bought up this very expensive technology, but no one was using it. So hospitals started losing money, and then to make matters worse, that period of time was the healthiest for Americans ever in the history of America (it was before the introduction of oil into the food supply and pharmaceuticals).
So hospitals are closing left and right, and if not closing, then they are merging (like our St Francis and St George merged here).
Allowing hospitals to fail was the right thing to do, since it would have resulted in the forced transformation (by the Laws of Economics) to the more highly effective Clinic Model.
Instead the AHA made a deal with health plan providers, and then you had the Great Proliferation....where the US went from 16 "health insurance" companies to more than 800 in less than 6 years and then a few years after that, after all of the mergers and bankruptcies and acquisitions, you were down to 600+ "health insurance" companies.
And where this also plays out is like here in this area, each of the hospitals touts its "birthing clinic" and they have the space to accommodate 40,000+ newborn infants each year (assuming each infant stays 3 days on average).
That's wonderful for advertising, but only 11,000 infants are born in this area annually and so you have an excess capacity of about 30,000 neonatal "bed-days."
That is grotesquely inefficient and wastes money.
Who pays for this grotesque inefficiency? You do through higher health care costs.
Getting back to physician clinics, as I've mentioned before, a group of doctors attempted to open a cardiopulmonary clinic here in Cincinnati. The AHA and their health plan provider buddies ran to Columbus and rammed through legislation to block it.
According to the
Cincinnati Enquirer, this clinic would have charged only $13,000 for open-heart surgery, while the cheapest hospital charged $26,000 and the most expensive was $41,000.
So, why would you pay $26,000 for something that only truly costs $13,000?
Why would you pay $41,000 for something that only truly costs $13,000?
Economic fail.
And why do hospitals charge $26,000 for something that costs $13,000?
I just explained why. Hospitals are the biggest waste of money ever.
And how could this clinic possibly charge $13,000 -- 50% less than a hospital? It must be bad low quality care right? No.
Does the clinic have an $8 Million parking garage with a $1.7 Million closed-circuit TV security system that has to be maintained daily? Nope.
Does the clinic have to the cost to insure the parking garage in the event someone is assaulted, robbed, mugged, raped or murdered in the parking garage? Nope.
Does the clinic have hospital security with an annual pay roll of $3 Million and a $2.25 Million budget? Nope.
Does the clinic have a psychiatry ward complete with the special secure pharmacy with psychotropic drugs, plus an head of the psychiatric and a chief resident and residents and interns and nurses and CNAs and administrators? Nope.
Does the clinic have a neonatal ward? Nope.
Does the clinic have an emergency room. Nope.
Think those things don't impact the cost of health care? You're all wrong.
When you all grow a brain with an IQ over 25, you'll get rid of your hospitals and adopt the Clinic Model that Europe uses, so you can have an high quality, highly efficient and effective means of health care delivery that does not waste money and constantly drive up the costs.
Economically...
mircea
Quote:
Originally Posted by Middle School Mustache
How has the ACA changed this is my question.
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Obamacare is anti-choice. Obamacare forces people to purchase something that don't necessarily need and don't necessarily want, at a level that is above and beyond what people are currently paying in a system that is broken. Obamacare is a massive forced redirection of Capital into a sector of the economy that is grotesquely inefficient and highly over-Capitalized, and for that, you will be punished severely economically.
Quote:
Originally Posted by Middle School Mustache
How is it only now that the ACA passed that dropping HI is a good business decision? Companies having been scaling back HI bennies since costs started to skyrocket. It's nothing new.
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I'll ask you the same question I've posed to Liberals on this forum for 2 years running now and never gotten an answer:
Exactly how much will one employee cost on January 1, 2014?
If you can answer that question, then PM me, because you will be the
Darling of Wall Street™.
I'm fairly well-connected. I will get us on Talk-Radio, all of the Network morning shows, news shows, and then of course, the lecture circuit.
My friend, you and I will be rich beyond the wildest dreams of avarice, and you and your spouse and your parents and in-laws and your brothers and sisters and brothers and sisters-in-law and your children and nieces and nephews and cousins will all be able to retire by December of this year.
So, chop-chop, get working.
Nobody has a freaking clue how much it will cost, because Obamacare does not state how much it will cost, rather the incredibly vague and ambiguous language allows H&HS to make up all kinds of rules and regulations that drive up the cost of health care plans, and H&HS is still cranking out regulations and will continue to do so up through January 1, 2014 and beyond.
Obamacare has also created a tremendous amount of uncertainty that has hampered whatever possible recovery your economy can make.
If the cost of Obamacare causes me to lose profits then what? Can I raise the price of might goods or services? I don't know. I will have to pay an exorbitant amount of money to contract economic consultants who will contract market researchers and conduct a survey to determine the Price Elasticity of my goods or services.
Raising the prices of goods and services does not automatically result in higher profits. In fact, depending on Price Elasticity, it could result in higher revenues, but lower profits, or it could result in lower revenues and lower profits.
If I am already struggling, that could put me out of business -- along with the employees.
So Obamacare is going to cost me a lot as an employer; I struggling to survive amongst fierce competition; and one of my competitors drops his employee coverage to stay profitable. That just causes more grief for me, and the best solution for me then is to drop employee health care.
Like I said in a previous post on this thread: I have advise some clients to do exactly that for exactly those reasons. They are barely profitable, and they cannot raise the prices of their goods and services, and they will lose money because of Obamacare.
If the employer fails to offer health plan coverage meeting certain standards --- mandated by H&HS on a whim whenever they feel like it -- to every full-time employee
and any one employee receives tax-subsidized coverage through an individual exchange, the employer must pay a $2,000 penalty for every full-time employee. (The first 30 employees are not counted in figuring the penalty.)
Employees with "preexisting conditions" or who have high costs most likely will use the "individual exchange."
If an employer offers coverage that an employee doesn't like and the employee buys coverage through the individual exchange, the employer must pay a $3,000 penalty for that employee.
So the only thing Obamacare does create in terms of certainty is limits via its fines/penalties.
The whole issue is that the employer no longer has any control of group health plans. The government via H&HS controls group health plans and H&HS is the sole arbiter of what an "appropriate" health plan should have in terms of coverage. The employer either buys the "Cadillac Plan" created by H&HS or it pays a penalty.
Since the penalty is a fixed cost, while the cost of the "Cadillac Plan" is unknown and always changing since H&HS can crank out a new regulation whenever they feel like it, the common sense thing to do is pay the penalty, especially if it is less than the cost of employee health care.
If employers control health plans and can negotiate costs, then they have control, so no, they aren't likely to drop employee health plans, especially since no real alternative exists.
Obamacare not only removes employer control, it creates a real alternative, giving the employers an "out" that never existed before in the form of both the low-cost penalties and the fact that if they dump their health plans, their employees have an alternative, being able to purchase through the "individual exchange."
I take it you've never run a business and don't know the "ins-and-outs."
My clients are not major corporations. They are LLCs, LLPs, LPs and S-Corps. They employ close to 100 to as many as 400 employees. The "CEOs" of those companies in many cases ---
their salary is their profits. Sure, in the case of the LLP, they have a CEO on salary, but the partners' incomes are the profits.
Your annual salary averages $250,000 to maybe $350,000 from your company's net profits, and now some idiot demands that you increase the cost of your employee health care by $1,000 and you have 300 employees.....do the math.
You just took a pay-cut.....unless you can increase your prices and simultaneously increase both revenues and profits and seeing how some of them export globally, that isn't possible.
And who will pay the price increase for domestic businesses? You will.
The lot of you still haven't figured out that nothing is free. That's okay, because you will learn the hard way.
Amused....
Mircea
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