Given the way United Healthcare is organized, with Optum as a second party that all claims or other billing issues is directed to, this allows them to very effectively point the finger at each other whenever there is a dispute. Optum in turn owns a lot of care providers including a ton of providers in my area. They have used this as a cudgel in the past, as someone I know was slammed with a bill during Optum's takeover of one of their providers. The Optum employee wouldn't provide any information about the charge and simply fired them as a patient for not paying it. Because Optum is buying up clinics left and right where we live this person has lost access to their PCP on multiple occasions as Optum buys more and more healthcare groups.
UHC and UnitedHealth group need to be broken up, and these incestuous relationships between insurance companies, private equity companies, and care providers need to be stopped by the SEC, because their only purpose is to exploit the wrapping up of care providers under one umbrella to extract more money for less work from people seeking essential services.
They key point is that healthcare insurers, pharmacy benefit managers, pharmacies, and healthcare groups are all owned by one holding company which benefits when prices go up. People think that the insurer will try to keep costs down, but in fact, if prices go up they can charge more for insurance... the only way they can keep increasing shareholder value is for prices to go up. So they do, and by owning the entire chain they can force that to happen. There is no market.
Insurers will not negotiate prices lower, it is against their interests!
It is interesting to draw a comparison with food. Practically speaking we can't go 24 hours without food, it is essential. Most people are totally dependent on others to provide their food; look at any city - the population density is too high for people to grow their own food. The food providers have no inherent incentive to make food cheap. It is totally against their interests. A shallow look at the situation suggests food providers should be able to squeeze people until all the money goes to farmers. But that isn't what happens, food is actually absurdly cheap and available given how important it is and how much needs to happen to produce it.
The situation with insurers is similar. If there was a real market that people could enter, competitive pressure would force them to be cheap. If the market was, hypothetically, choked by regulation then they'd be in a great position to charge absurd prices.
Market incentives are odd beasts. It is technically against the interests of the insurers to negotiate lower prices - unless they are competing with other insurers. Then it is in their interests to offer fair prices.
(if it isn't clear, I think I'm agreeing with you)
I think there are a couple of pitfalls in looking at healthcare as a free market.
* People often have to make uninformed decisions or have decisions made for them in an emergency. This naturally puts them at an economic disadvantage in the market place. We consider it unfair because it's the sick, injured that are disadvantaged.
* We have strict regulations about ensuring access to health care. People aren't turned away in an emergency. Sick people aren't treated differently for insurance. There are thousands of other regulations we do that shape the 'free' market.
* Food is far from a free market, although it might look that way from the consumer standpoint. The government helps in both ensuring a strong supply with farm bills and giving $114B/yr in SNAP on the consumption side.
I’ve never understood The concept of competition in insurance. Fundamentally it’s about pooling funds to average out risk. We had this nonsensical system where we socially subsidize the most expensive (Medicare) and privatize lower risk. It literally makes no sense. Alternatively is we simply pooled assets and introduced competition into care delivery, health maintenance, and care quality
I expect that the system would be more efficient and effective.
Alternatively is we simply pooled assets and introduced competition into care delivery, health maintenance, and care quality I expect that the system would be more efficient and effective.
That’s effectively what much of the rest of the wealthy world does via some form of socialized/nationalized system.
> That’s effectively what much of the rest of the wealthy world does via some form of socialized/nationalized system.
While these systems can be more efficient, the rest of the world isn't amazing either. Nationalized systems do much more central planning for healthcare delivery, so they have almost non-existent customer service culture.
You generally have no direct control over who your doctor or when procedures are scheduled. Furthermore, the concept of preventative care is nascent. Yearly physical? Nope. Routine Bloodwork? What is that? You only see the doctor when something is going wrong and you often wait weeks to months. (unless you pay for private health insurance). I literally know of someone with cancer treatment follow up that they needed to hammer the phone lines to get scheduled.
Finally, most international healthcare is effectively subsidized by the US healthcare consumer. Firstly, the majority of global research funding in healthcare comes from the US. Secondly, US consumer (forcibly) pays 5x to 100x what international systems pay for procedures, medicine, technology. As a result, almost every major technological innovation in med device or pharma is either produced in the US or delivered first to the US market by foreign companies.
Nationalized systems do much more central planning for healthcare delivery. This results in a byzantine bureaucratic nightmare where most innovation goes to die. International healthcare systems effectively delegate the implementation risk to the US and wait to see (sometimes decades).
Note: In my experience, the healthcare workers and administrators all are trying to do the right thing and working really hard, but the systems they operate in are generally broken.
Bottomline, there is no free lunch, everything sucks.
> We had this nonsensical system where we socially subsidize the most expensive (Medicare) and privatize lower risk. It literally makes no sense.
If older poor people had to pay the true market price for health insurance that takes age into account they couldn't afford it.
If insurers weren't allowed to take age into account then younger people wouldn't buy health insurance for that price.
> Alternatively is we simply pooled assets and introduced competition into care delivery, health maintenance, and care quality I expect that the system would be more efficient and effective.
What incentive is there for the patient to choose lower prices if the insurance is paying for everything? What incentive does the insurer have to prevent claims fraud or keep administrative overhead in check if they can just pass on the cost in premiums and no one has any other option?
1. I suspect the vast majority of engagement (and, spending) with the medical industry is non-emergency care. At least not emergency care required in the next hour or so. There are edge cases, but even considering most of what I've seen going to the emergency room there has been time to choose which hospital to head for.
Basically I think this is over-weighting the importance of emergency care. I don't have any stats on hand, but people entering the hospital system at ultra-short-notice is quite rare in my experience compared to having a bit of time to think. Most healthcare engagement seems to be for planned consultation, planned surgeries, emergencies but with hours to spare and then urgent emergencies. In about that order of frequency, and heavily weighted towards the first few cases.
2. People are more than capable of figuring out which of two options are cheaper. The ability of consumers to reject goods over tiny price differentials is legendary.
3. If people aren't up for the challenge of figuring out what to do in an emergency, then in a fair market you'd probably find the insurer starts to step in and assist. If the insurer has to compete for business, they have a very strong incentive to make sure their customers get good and cost-effective care.
4. And on food markets; those are distortions to the market, not limits on it's freedom. A free market can be distorted with subsidies and it is still free. The important factors are whether new providers can enter the market and whether they are allowed to compete on price and service quality.
No one knows how much care costs. Insurance companies and providers hide the real Costa when predicting in the guise of "information security" which makes choosing a facility on price literally impossible.
Time isn't a factor, if you have insurance that covers it you rarely if ever know how much it will cost.
re 2) People will reject more expensive options if and only if they have the time and energy to reach the point where they know what the price differential is.
Almost no medical practices in the US will tell you what the price is until after you've had the service there, and that price might even vary across multiple trips depending on how your insurance processed the claim _that_ time. (Ask me how I know.)
So you would need to schedule appointments and have the entire medical procedure done multiple times to have any price visibility, and even then, there's lots of nonsense around things like doctors operating in hospitals but billing separately, which completely obfuscates the end cost to someone.
People can and will choose the cheaper option, but I personally, as someone who has limited time, cannot afford to go through totalling all the bills for having the same procedure done twice every time, with all the months of back and forth for setting up being a new patient, scheduling things, being lied to about the doctor being available for the consult, showing up and having the staff gaslighting everyone about how it's not a problem on their end, everyone angrily waiting in the waiting room clearly got their appointments wrong, even if you have the reminders written by the staff at your pre-actually-seeing-the-doctor visit in hand showing their system is wrong...
It's incredibly exhausting and involved to visit a new doctor for even the most trivial things. Most people cannot afford the time commitment to do that multiple times even if the procedure is something where it's not a one-off or urgent.
Yeah. It is a comment talking about treating healthcare as a free market. The US doesn't treat healthcare as a free market, so none of the predictions or observations in that comment apply to the US.
The US seems to have some sort of racket going on in healthcare. What I've heard about their regulation makes sense if interpreted as a fairly basic system built by lobbyists to extract money from people, using emotional blackmail to break up political opposition. Otherwise it seems a bit silly.
"Emergency care can't be a free market" is a reasonable statement provided the customer is the patient and not e.g. an insurer with a contractual obligation to meet a particular emergency response time, who could contract with different emergency services providers in any given area in advance and secure lower pricing by playing two providers who could each meet their emergency response requirements against each other or threatening to enter the market themselves.
"Joint replacements can't be a free market" is simply nonsense.
Health plans are now required to give comparison shopping tools to their plan members. Those can be difficult to use for patients who don't understand the system, but it is at least a step in the right direction.
> If the market was, hypothetically, choked by regulation then they'd be in a great position to charge absurd prices.
There are countries in Europe like the Netherlands and Switzerland where the healthcare systems are almost entirely private (much more so than in the US, since there are no Medicaid/Medicare equivalents). Yet their markets are chocked fully of regulation while being able to maintain low prices (compared to the US) and very good outcomes.
One of you is talking about the regulations where doctors who purposely poison people go to jail. The other is talking about the regulations where the incumbents in an industry get a veto on whether someone new can enter the market.
I don't know about Switzerland but Dutch insurers are all non-profits though (except one, that has never once paid out dividends). They have a strong incentive to keep costs down. Hospitals are all non-profits, too.
I completely agree, but even further: health insurance is itself a silly thing.
Insurance is for:
- costly things
- that happen rarely
- in an unpredictable way
These are characteristics of things that are well suited to insurance. Healthcare -- the type of routine healthcare that makes up the vast majority of spending -- exhibits literally none of these qualities.
Most healthcare expenditure is:
- not costly. An Advil is not costly. 30 mins of some stupid doctor's time is not inherently costly. An MRI is not costly. Medical office space is not costly.
- totally predictable (eye exams, checkups, scheduled visits, hell even big operations like a heart transplant or C-section are rarely done "in the moment." Usually you can see them coming. The hospital can definitely see them coming; they know exactly how long a gastric bypass or a c-section takes, how much equipment and staff they need, etc.
- not rare; most people visit a doctor at least yearly. That's on par with buying xmas gifts!
Only a small fraction of healthcare spending should happen through insurance -- insurance should be for things where you travel in an ambulance to the hospital and that's it.
PCPs should compete individual to individual on quality of service, price, etc.
Hospitals should compete hospital by hospital on quality of care, facilities, scheduling, bedside manner etc.
Rx should be decoupled completely from insurance. Why do I choose Humalog over Novolog? Not for any medical reason! It's because I need to have insurance to buy one or the other. Why do I need insurance to buy a pill? Because I need insurance to see the doc. Why do I need insurance to see a doc? No good f%@#$ reason. Drop it.
Insurance is for when I need surgery NOW for I have no idea what, and I cannot make any kind of choice about it. It should cost $100 a year for a healthy 20yo adult and $400 a year for a healthy 60yo adult.
None of this shit makes sense to have insurance mandated. None of it. I should be able to walk into any doc's office without insurance and pay a flat cash fee, posted on a big bulletin board outside that says $20 per 15 mins. If I don't like it, I should be able to LEAVE and go across the street!
> insurance should be for things where you travel in an ambulance to the hospital and that's it.
There is another major class of things you want to insure against, and it's the big one.
Chronic conditions. You get diagnosed with diabetes. It's costly and it happens rarely in an unpredictable way. You don't know if you're going to get diabetes, or cancer, or something else, so you insure against it instead of being bankrupted by the long-term treatment.
And then the insurance covers your annual checkup for free because they want to catch things early before they progress.
This is a good point, and one that's easily overlooked by the young and healthy.
The expenses for "common" chronic conditions can be MASSIVE. A condition like rheumatoid arthritis can EASILY exceed $30,000/year in medications alone. Add in frequent doctor visits and related medical issues and that runs up even higher. Without some form of insurance (private or socialized), we would be condemning these people to a life of pain and misery (at best) or death.
Yes! I have diabetes. Believe me I am aware of this.
A vial of my humalog approaches $300. A visit to the endo is $500 on the bill.
But there is no reason why these things are so expensive! Other than that I have to have insurance so I have to be "in network" and oh, my insurance helpfully consults with a pharmacy benefits manager to decide which medications are "covered."
At no point do I have any choice in any of this. I'm not talking about choosing to have diabetes or not, I'm talking about choosing treatments for my diabetes. Always, it is a conglomerate like UHC choosing which things I have to buy this month. How convenient for them that they choose how much it costs!
In theory the choice should be in which insurance company you use. One of the biggest mistakes in the US system is having tied that to your employment, and then it's not you choosing anymore.
"Health insurance" is the wrong name for what we're purchasing, but the product itself isn't silly.
"Health maintenance plan" is a more descriptive name for what we're discussing.
Even something as basic as an annual physical is ~$400 (cash price). A doctor visit for illness is $100-$150 before any bloodwork or imaging (which can add another $100+). Those are major expenses for many families. The ability to spread those cost across the year is a good thing.
It's expensive because I can't move doctors, and I and my employer have to buy a stupid financial product to even see a doc. How much of that $400 goes towards the doc anyway? Towards payments on the MRI machine? Towards the office space? No more than $100 all in.
For one billable minute of every doc's time, we are paying 5 billable minutes for various "healthcare administrators" all over the country to move numbers and billing codes around in a labyrinthine spreadsheet. For what?
I don't disagree with any of that. I'd much prefer some form of nationalized/socialized health system (and would not prefer a "cash only" system, because there will be people who can't afford that even at half the current rates).
> hell even big operations like a heart transplant or C-section are rarely done "in the moment."
Agree on the plannability, but not on the predictability. Once you are on that table, and especially if you are under anesthesia, there are an untold number of ways that procedure can quickly turn into a secondary emergency procedure. It's a miracle of modern medicine that such invasive procedures are perceived as being trivial.
> Only a small fraction of healthcare spending should happen through insurance -- insurance should be for things where you travel in an ambulance to the hospital and that's it.
We already have that. It is called a high deductible health plan.
But health insurance companies do not just sell health insurance, they also sell price negotiation services, so you probably want to use them even before you hit your deductible/out of pocket maximum, otherwise you will end up paying more.
> If there was a real market that people could enter, competitive pressure would force them to be cheap. If the market was, hypothetically, choked by regulation then they'd be in a great position to charge absurd prices.
This is a fabrication - a free market with large capital investment requirement tends towards a monopoly. Economists call These places natural monopolies.
We had them in oil and in railways before regulation.
This doesn’t happen in food because anyone can grow a cucumber in their yard. But that’s not gonna cut it for surgeries.
And on top of that you get charlatans, snake oil salesmen, homeopathy, treating people with magnets.
Large capital investment? What large capital investment? Most of my doctor appointments are done by eye. Surgery needs more than a knife, but not that much more than a knife.
Even expensive machines in hospitals are probably not that expensive; they certainly aren't large. A lot of them would cost single digit millions; ie, be far too cheap to allow monopolies to form. I looked up MRI machines for reference and apparently they can be picked up for around a million dollars. We aren't talking about expensive kit here.
Surgery requires a sterilised filtered room, anaesthesia equipment, monitoring of all kinds, and in many cases specialised tools.
It costs >$100m to build a hospital, and then you have staffing, maintenance, IT, and other costs.
It's not at all a trivial cost of entry.
General practitioner offices are much cheaper, but typically you'll still find an ECG machine, IT systems with subscription access to industry databases and insurance applications, and possibly some on-prem blood testing.
All of that on top of property costs. And student fee payments.
The student fees and insurance access costs are largely profiteering and could be eliminated or hugely reduced. The property costs are the result of poor macro policy, but doctors are still on the hook for that.
Very little of that even starts to justify expecting monopolies to form in the healthcare industry. None of it is persuasive.
> Surgery requires a sterilised filtered room, anaesthesia equipment, monitoring of all kinds, and in many cases specialised tools.
But none of that, you'll notice, is a large capital expense. Those are what we would call "small, routine capital expenses". And sterilising the room isn't even a capital expense at all, it is an operating expense. That matters for monopolies, it isn't an up-front cost (except for literally the first patient). It is unreasonable to suggest that a business's operating costs create natural monopolies. The ease of competing with businesses with high operating costs is the big driver of market competition and exactly what people should want in the healthcare industry.
> It costs >$100m to build a hospital, and then you have staffing, maintenance, IT, and other costs.
Superficially that makes sense, but if we get into it a bit there are a bunch of reasons that won't promote monopoly conditions:
1) CBDs are full of buildings that cost >100MM, ie, skyscrapers. None of the businesses in them are monopolies, or even paying high capital costs - because they rent space. And most cities manage to organise their CBDs so that owning a skyscraper doesn't give monopoly power.
2) You don't need a 100MM hospital. I've seen small hospitals that would cost single digit millions, which is an approachable fee even for just a single wealthy family let alone a small group of people trying to sort something out.
3) You don't even need a hospital. I've had surgery done in some dude's office. You can start with a room and build up organically if the local demand is there. That is how most other businesses expand. Walmart didn't start with a global empire.
There just isn't a need for large capital accumulations to get started in healthcare. It isn't that demanding. There are a lot of edge cases that need a hospital, but that isn't where new businesses will start. They can grow in to it.
> an ECG machine, IT systems with subscription access to industry databases and insurance applications, and possibly some on-prem blood testing
Again, you're listing a couple of operating expenses (subscriptions and insurance). High operating expenses have nothing to do with monopolies; they are paid for on an ongoing basis and by customers bear the cost.
ECGs and blood testing aren't expensive enough to be interesting. A watch can be an ECG machine; and a good ECG machine is only a few thousand dollars. That'd be like saying a restaurant is a natural monopoly because it needs a special fridge ore one of those big fancy stoves.
> All of that on top of property costs. And student fee payments.
Rent then. And the limit on the number of students is generally legislative not financial. There is no tendency towards monopoly here in a free market.
> And sterilising the room isn't even a capital expense at all, it is an operating expense.
No, it’s both. Autoclave machines aren’t rented, they’re purchased. Then ongoing usage is opex. sterilization equipment is pretty well the core of the hospital (even called the core in some)
> 3) You don't even need a hospital. I've had surgery done in some dude's office. You can start with a room and build up organically if the local demand is there. That is how most other businesses expand. Walmart didn't start with a global empire.
Maybe for a vasectomy it can be done in office, now tell me how a liver transplant can be done. Also if you wait for demand to fit out a hospital, that means people are dying and you’re waiting until enough of them die to decide to expand your hospital.
Also a watch can be an EKG machine? If my Dr pulled out any cheap piece of equipment to use on me I’d get off the table and leave immediately.
> No, it’s both. Autoclave machines aren’t rented, they’re purchased.
Eh, ok. We're talking order of magnitude single digit thousands again. I, personally and literally, can lend a friend in the medical profession that sort of money if they needed it. It isn't even close to being in the range of capital costs that would cause a monopoly to form.
2.
> Livers
I'm no expert here and you haven't explained why you think this is a natural monopoly. But looking at a random article [0] it is clear that no hospital is required. You need a few doctors and I'm guessing 2-4 rooms worth of equipment. There isn't much of a hospital.
If you want to add in rooms for patients to stay in that would be a hospital, but the room requirements for that aren't especially demanding and can be scaled over time, reducing the up front capital cost.
The equipment costs would range depending on the surgeon but even a conservative estimate of a few million dollars won't get into natural monopoly territory.
3.
> Also if you wait for demand to fit out a hospital...
Demand forecasting is a thing. Capitalists have solved that problem. We don't have to wait for an obvious future to materialise, people act preemptively. And it still isn't suggesting there are natural monopolies present.
In fact, this "waiting until enough of them die to decide to expand your hospital" problems is one that comes with public healthcare systems, they systemically under-call demand in my view. The queue in the emergency department is typically hours long in Australia and the hospitals chronically under provide beds. We only seem to seriously expand them when people start dying and/or a major sandal occurs.
One of the reasons I so like the idea of private healthcare is I'm confident that if I need care right now I will pay for it, then get it. That is not a guarantee the public system can make. Adjusting to demand is a point in favour of private healthcare; they make more money if they meet demand.
4.
> Also a watch can be an EKG machine? If my Dr pulled out any cheap piece of equipment to use on me I’d get off the table and leave immediately.
If you insist that your health care is expensive, that can be arranged. Good luck to you. Please also support the people who want cheap options.
However it is still not evidence of a natural monopoly forming. And I'm not sure what your complaint is - an ECG machine is obviously not that difficult to organise given that it can be done for a couple of hundred dollars and also you get a watch thrown in. This is not a cost that will cripple a new doctor's clinic.
If you want a fancier machine, sure. But the cost still isn't going to be that high. In industries where new business cost millions to start we still get competition entering the market, none of these borderline trivial costs like an ECG machine will stop new doctors starting practices.
In Optum/UHC's specific case, I can give an example of this from using their IVF benefits. In one plan we had from them my partner was entitled to 10k for treatment and 15k for medications. Optum Specialty Pharmacy was the only in-network pharmacy for the IVF drugs.
When we started ordering IVF medications under insurance, we found out that the price the pharmacy charged insurance was over 3x what their cash price was for nearly everything. We ran out of the 15k in a single retrieval cycle because of this, and wound up with a bill to the tune of several thousand dollars because one specific prescription ended up partially billing to insurance. People often lose sight of the fact that when you bill insurance, even if the item is only partially covered, the charge you must pay is the insurance negotiated rate even if the insurance is capped well below the price of the charge. We concluded that the medication benefit was a huge racket because of this, and I would imagine Optum rakes in thousands of dollars per patient on something that according to the policy documents is fully covered.
Meanwhile other nationwide pharmacies like Alto Pharmacy do offer the drugs at very reasonable prices, often 1/5 to 1/10 what Optum was charging.
Insurers used to make their money that way. But now that US health care insurers are required to use at least 80% of premiums to pay health care costs, they've lost the incentive to keep prices low. Increasing their profit now requires paying out more in claims.
Nope, that's not how it works anymore. First, insurers (payers) no longer even provide much insurance. The majority of their business is now managing networks and processing claims on behalf of self-insured employers.
Second, payer profit margins are now capped by the 80% minimum medical loss ratio introduced by the Affordable Care Act (Obamacare). Payers actually make less profit when they deny care. When coverage for certain services is denied it's usually because your employer designed your plan with strict limits.
MA plans complicate this. There's a reason why everyone but United is getting out of the MA space, because united is growing despite medicare cutting payments.
If only there were some way to give everyone in a country necessary and preventive health care regardless of whether they could pay for it or not. Like imagine a developed nation with health care for everyone? Where even the poor can have necessary medical procedures, medicine, etc without having to be buried under medical debt? Lol what a pipe dream
What is the view on healthcare spending for IVF for 45-year-old woman? Asking because you replied right after a post about IVF and failed IVF treatments. Don’t mean to pray. I’m just very very curious
Why should I pay for somebody’s Viagra? Or IVF treatment? Because I am healthy? Diabetes is reversible with the healthy diet, no? Why not focus on reducing the costs.
Hard pass. Critical care I may be able to be convinced of, but not IVF, sex changes, hormone treatments outside of menopause or other similar issues, or anything else deemed optional.
VA healthcare sucks because people are more comfortable paying lip service to veterans than in actually helping veterans have better lives after their service is over. We're perfectly happy to say "Thank you for your service" but nobody is willing to fund things like a functioning medical system or a working payroll system for the military. You know, things that actually improve the quality of their lives.
Few things: only one doctor visit is allowed and for some insurance companies asking about health problems voids that.
Preventative is very narrowly defined to exclude anything considered a sickness in anyway.
Getting something done that will ensure you don't get more sick might be considered preventative naively but is considered fixing a problem and so not covered.
So basically this covers vaccines (make sure if you get multiple you don't see a doctor past the first or you are paying) tests unrelated to medical problems and a single non diagnostic visit to the doctor per year.
I feel frustrated when it seems that so much money somehow is going to preventive care… But when they quantify it, it’s just looks like screening. They ask if I feel safe at home they ask if I want to attend a group weight loss class, when I’m 95 pounds. They, the gatekeeping front desk clerks or nurses, just screen screen screen and check off items on a checklist earning them loads of credit. All that screening results in an approved amount of preventative treatment.
At least you’re not in need of care, are overweight, and have state medical records. I need something looked at, and the first Dr I went to noticed my weight obviously and told me my issue is weight related and I need to lose weight before getting any further care. They then entered this info into my medical record that synchronizes with every other provider in the state. Now anybody I go to says the same and I still have pain.
IME the point of health insurance is simply to collect premiums and not to pay out.
It is very much not to support health in any way whatsoever. In fact the industry loves ill-health, because it's far more profitable than wellness.
Public not-for-profit health systems change that motivation into something that actually makes sense from a healthcare pov instead of just being an exercise in piratical opportunism.
Profiting from suffering without the slightest hint of altruism or empathy is simply sociopathic.
That's not to say they're not incentivized to deny claims. If you are loose with what you pay out, you could lose money by paying out more than you take in.
They don't though, because I can buy an insurer and also a medical provider, and pay the medical provider the 80% and then collect my profits through my pet medical provider.
Even if you exclude the private insurance market (!) and look only at public health costs, the US picture is dismal.
- 944 billion on Medicare (federal)
- 805 billion on Medicaid (federal + state)
- 118 billion on VA health costs
- 21 billion on CHIP
That's 1.5 trillion alone, and that doesn't count ACA subsidies, or other state and local government-owned or subsidized medical facilities. That's $5800/year per capita - ALL persons in the US, whether they have private or public or no insurance. US government per capita health care spending is already higher than many European countries and a little more than two-thirds the Swiss number you mention. While US private health insurance companies don't help the situation, neither are they a main cause of US health care costs.
Simply replacing private payers with a single payer system ("Medicare for all" or whatever) wouldn't do much to cut US healthcare spending. Payer profit margins are relatively low and in total only constitute a small fraction of total healthcare spending. Any real savings would have to come from severe price controls on providers, drugs, and medical devices. Plus some forms of rationing. I'm not necessarily opposed to that, but it would be difficult to build a political consensus for it.
Administrative expenses on the payer side are 7.5% of total US healthcare spending. Even under a single payer system, that number would decrease only slightly.
Bullshit single payer would vastly decrease that number. Only having one payor who has from your perspective fixed rates is going to vastly simplify that process compared to the cluster of today.
Health insurance profit would also disappear as much would their administration costs.
You would still need to determine price structures and deal with fraud but you wouldn't need to network anymore.
I would love to debate the conclusions with the McKinsey team. I think their analysis was highly flawed. Do Americans consume more healthcare? Yes. Is that the primary reason for our escalating cost share? No. Market concentration at multiple layers (Payer, Provider, Tech/Data layers, etc.) is a huge issue in U.S. healthcare. In most markets we basically have 1-3 companies that have market control of the providers and inpatient facilities, and 1-2 companies that have majority market share on the carrier side. Add in the mess that is distribution (broker-controlled, and concentrated as a well), and you have a witches' brew of mis-aligned incentives, excessive costs, inefficient bureaucracies, and plain-old anti trust behaviors.
Summing up that topic that way is disingenuous at best.
The rate of self selection of healthcare is not that different in the US. While our old are more likely to seek care our young are way way less likely to.
A ton of that is unnecessary work to avoid getting sued, unnecessary work because of how our billing works (who would have thought that billing based on services rendered would result in escalating costs?), not to mention the complexity of the system helps make finding fraud more difficult.
> Payer profit margins are relatively low and in total only constitute a small fraction of total healthcare spending.
What? The government was forced to make insurers cap their profits at 20%.
Except now that means if they want to make more money, they just raise premiums and negotiated provider payments. Even easier when you're as vertically integrated as UHC.
You appear to have confused payer profit margins with the 80 – 85% minimum medical loss ratio imposed by the Affordable Care Act (Obamacare). Medical insurance is a low margin business and industry profits have never been anywhere near 20%.
You're confusing the insurance industry with the health industry. When you have the same companies owning hospital chains and insurance, they can easily pretend to be a low profit industry.
The industry as a whole is insanely profitable. Revenue is $1.4 trillion. It posts profits of around $650bn. Which means on average it extracts around $2000 of profit from every single person in the US, with an average individual healthcare spend of more than $4000.
The profit is in the ballpark of the entire US defence budget, at around $750bn.
Healthcare is a huge boat anchor drag on the entire economy.
>The industry as a whole is insanely profitable. Revenue is $1.4 trillion. It posts profits of around $650bn. Which means on average it extracts around $2000 of profit from every single person in the US, with an average individual healthcare spend of more than $4000.
Source for these numbers? 0.65 billion in profits on 1.4 billion in revenue is an insane margin
This is one of the unintended consequences of Obamacare. The act mandates that administration is a fixed percentage of the revenue. Effectively this created the same perverse incentive as cost+ contracts that have hobbled the DoD. There is no incentive to keep costs down.
Value based care models are however super effective when properly implemented. Look at Kaiser Permanente. Infinitely better than the alternatives.
CVS Caremark is also in on the scam. UHC seems quite clearly to be the good cop - low deductibles, wide network, good coverage - and CVS Caremark is the bad cop who changes my drug availability month to month, makes me jump through prior authorization hoops that go nowhere, and randomly covers or refuses to cover my kids’ ADHD medicine on a whim. So as soon as we find a medicine with availability, that works, CVS decides to terminate coverage and we - me, my wife, our kids, their doctor, the pharmacist - all start again from square 1.
I switched jobs recently and despite having a drug regime that worked well for me over an extended period and was also cost effective, CVS denied coverage (and required prior authorizations, that were all denied) for virtually every component of my prescription care. Now, about three months after the switch, it’s probably back up to 85%+ of what it was before, but there was a lot of bureaucracy between then and now - and all due to a change that was really purely administrative in nature.
> UHC and UnitedHealth group need to be broken up, and these incestuous relationships between insurance companies, private equity companies, and care providers need to be stopped by the SEC, because their only purpose is to exploit the wrapping up of care providers under one umbrella to extract more money for less work from people seeking essential services.
How about Kaiser Permanente? They have been a vertical healthcare provider/insurance organization for many decades. You pay Kaiser premiums, you see Kaiser doctors, and you get your medicine from Kaiser pharmacies.
Kaiser directly owns the provider arm. In my experience they operate totally differently from UHC. Many of their plans require you to use their provider, so you're basically prepaying for medical care from them.
UHC is notionally a PPO, but because Optum is owned by the same parent company and Optum is buying up all the providers, they're slowly becoming an HMO by monopoly. They play off of each other in any dispute.
I've had better experiences with Kaiser and had a family member who worked for them for a couple of decades.
> When HMOs were coming into existence, indemnity plans often did not cover preventive services, such as immunizations, well-baby checkups, mammograms, or physicals. It is this inclusion of services intended to maintain a member's health that gave the HMO its name.
Since the above services are required in all plans by law since ACA, there is much less difference between an HMO style plan and a PPO plan where you only go to in network providers.
Go after all the healthcare giants. If people knew even half of how consolidated their treatment was, they would riot.
For those who don't know about the significant conflict of interest present here:
1. United is a health insurer that has to make payments for people's
2. United owns several physician networks (totaling 90,000 physicians), who then determine what your care should be—no conflict with the fact that they pay the bills...
3. United owns Optum, which determines how much your drugs are going to cost, and of course, who makes them—brand vs. generic, etc.
4. Optum runs its own mail order and specialty pharmacies. Optum also writes your care plans for many chronic diseases and ships medications all over the country.
5. Optum could require their own customers to use their care plans and software in order to receive medications at all, or mark up the price for anyone who doesn't.
Let's step through a workflow.
You, a patient on United, go to a physician for treatment. Later on, you get referred to a specialist, then get diagnosed with a chronic disease and need medication that you receive delivered monthly.
That pans out to:
United pays United, who refers you to United, that forwards you to Optum (owned by United), who gets paid by United. Each and every month.
Let's say you find a better deal for your medication at another pharmacy. Too bad, its not going to be in your network and Optum will no longer cover it.
How is a health system or an independent supposed to compete with that level of integration?
This, of course, does not result in any savings or quality of life improvement for the patient or the physician. United and Optum charge the same prices as everyone else, or more.
If people knew half of how consolidated their treatment was they would riot.
Most Americans experience first hand how horrible health care here is. No one can get upset at whatever little details are involved, however 'cause it's beyond them. Especially, you won't get people excited about more competition in a field where markets and competition seem neither logical nor have shown any benefit.
The complex referral system you describe basically results in turning regulated monopoly behavior into unregulated monopoly behavior. And this is the upshot of breaking up the original, regulated monopoly Blue Cross/Blue Shield, which provided adequate insurance in America's "Golden Era". Which to say that, imo, "restoring the free market" isn't a useful action in this mess. State controlled medicine is essentially the only solution to the already partly collapsed US health care system.
Right. If these huge insurance companies had to "compete" with a real universal system, there's no way they could even exist. All they do is scrape profit off the top of every healthcare procedure in the US.
The most useless middleman to ever exist, in my opinion.
I agree with your broader point, but it’s worth noting that insurance middlemen exist in many European countries with universal health insurance, so surely some form of this can exist in a more regulated health insurance/provider market.
I had private insurance in Germany. The big difference is that they have to compete there instead of having a captive audience they have in the US with employer based health insurance. Your employer picks the insurance options that are convenient for them, they don't care much about what's good for you. So you are basically trapped unless you are willing to not take insurance from your employer but go on the open market which will be very expensive.
A while ago I asked my employer to just give me the money they give to Optum so I can buy insurance via ACA but they wouldn't do it.
The problem is the US has for-profit medical insurance as well as mutual insurance (collectively owned by their members). The laws were altered in the 90s to permit mutuals to convert to for-profit. This was generally a bad move as it takes out any real incentive to manage costs when jacking them up is the only way to boost profits so the C-levels can get 8-figure bonuses.
Not everyone in the healthcare industry would lose their jobs, that's absurd. It would mostly be the redundant insurance staff (and redundant sets of highly-paid insurance execs).
Execs would lose their jobs. Billing specialists (who do a 4 year degree in medical billing, which is in and of itself fucking absurd) would lose their jobs.
You know who wouldn't lose their jobs? Doctors and nurses. The actual people who the system's outcome is dependent on.
The managed care apparatus in the United States is about allocating insufficient supply of healthcare to excess demand based on the political value of the healthcare recipient.
That is why Medicare pays doctors more than Medicaid for the same work (old people are worth more since they vote more than poorer and younger people).
You can endlessly bucket people into infinite changing tiers based on their political power using reimbursement, deductible, out of pocket maximum, in and out of network providers, formularies, and prior authorization protocols.
For example, you can give members of the military a different quality/quantity of healthcare than US federal Senators, who have a different set of policies, who in turn have a different set of policies from a highly profitable white collar firm’s employees, and yet again different from a less profitable business with lower paid employees, and so on and so forth.
You can adjust reimbursements so that some people can immediately see doctors whereas others have to go to Physician Assistants or Nurse Practitioners.
The system is a thing of beauty from a political point of view, and I bet countries with nationalized healthcare like UK and Canada move closer and closer to the US system as the population pyramids go upside down and cuts have to be made.
And the whole time, people will waste their time being mad at managed care organizations, when the government leaders are the ones hiring them to be the “bad guy”.
> Billing specialists (who do a 4 year degree in medical billing, which is in and of itself fucking absurd)
What? I have never heard of such a thing, and I worked in the claims benefit management industry for nearly a decade.
So I searched this, "bachelor medical billing" and while I got plenty of results, all of them were for certificate courses, which I'd expect. "Top rated medical billing courses" were all at community colleges.
I am yet to find a Bachelor degree in medical billing.
Indeed, on ... Indeed:
> Can you get a bachelor's degree in medical billing and coding?
> While a bachelor's degree in medical coding and billing isn't an option, people interested in pursuing this career can earn a degree in a related field instead. For example, you might consider earning a bachelor's in health care management or health information management.
A certificate/diploma is going to be 9 months to 1 year. An associate diploma? 2 years. I also can't find any four year courses in medical billing.
They're also firing people for fun. I know of a guy who is deep in the weeds upgrading their scala libraries that just got laid off within the week. (You have to do that to stay on top of all of the cves)
That's lie rewriting a code base from scratch because the current is deemed unmaintainable. Most of the time you end up with the same number, but different problems or it's even worse.
In my view Medicare for all would be a viable path but even the Democrats are not interested in tackling healthcare.
I’ve lived at my current address for about five years. The first year, zero issues. Starting at around the 2020 election, service dropped off precipitously, to the point where I’ve had a piece of outgoing mail in my box since Friday. I can’t trust the mail with anything time sensitive any longer.
I blame this on Louis DeJoy, who was appointed Postmaster General in May 2020, and has numerous conflicts of interest.
What evidence do you have that this would be a good thing?
And to the larger question, which I hear all the time, what does “starting from scratch” even mean when it comes to ongoing health care?
You can’t seriously argue that we should risk medication interruptions so your friend loses her dad to his heart condition so we can somehow “start over?”
We need a smooth transition to a more sustainable system with incentives aligned to customers and not investors in one scenario, single payer in another, or some other working idea to continue to provide care while reducing the insane profits and aligning health and well being of patients, as well as the health and well being of the people providing it, with the actual service delivery again.
Burning everything down could kill a lot of people. I think this position is actually not particularly compassionate.
Ban all health insurance. And Medicare. And Medicaid. Require all healthcare services be transparently and consistently priced in cash. Transform the IRS into an insurer of last resort by providing 100% tax credits for all medical care in excess of 8% of income. Fixed.
Health insurance is good, as long as it remains actually insurance - that is, risk pooling. Over the past few decades, "health insurance" transformed into "healthcare subsidization" - which caused costs (and complexity, and fraud, and many other bad things) to skyrocket. Insurance should not be used for routine doctor visits - it should literally be "insurance" against catastrophic events like getting your spine broken.
The combination between pricing that is completely invisible to the buyer (which you mentioned) and "insurance" that is really just spreading costs around (instead of risk pooling) is one of the biggest reasons why healthcare is so expensive. If the price for a CPAP machine was as transparent as that of an iPhone, and you had to pay 100% out-of-pocket (because sleep apnea is not a catastrophic event and your insurance wouldn't cover it), then we'd very quickly see the prices of CPAP machines plummet (as well as every other piece of medical equipment and procedure) because of how price-sensitive consumers are, and because now they'd have the ability to use that price-sensitivity.
Would you keep or get rid of EMTALA in this scenario? What would happen with medical debt? I'd hate my healthcare options to be tied to my credit score.
> Which to say that, imo, "restoring the free market" isn't a useful action in this mess. State controlled medicine is essentially the only solution to the already partly collapsed US health care system.
That's a wild claim that is not only completely unprovable, but self-inconsistent. We're in this mess because of the failure of the state to create (and enforce) good regulation to begin with, and you're proposing that we move the healthcare system into the state? Pure insanity.
> State controlled medicine is essentially the only solution to the already partly collapsed US health care system.
But wouldn't government control and subsidy lead to the same malinvestment and cost explosions as college tuitions?
Wouldn't fierce competition at all levels be a good thing?
Why not force insurers to cover everything up to a set cost on a per-disease basis? That is, let patients spend a set allowance before forcing them to use in-network?
Why not adapt upfront cost estimates? Allow overages, but if a hospital goes consistently over estimate, then they get penalized?
Allow patients to access cheaper doctors and services if they waive their rights to medical malpractice lawsuits.
Give patients cheaper healthcare for demonstrable good health practices (taking into account diseases and existing conditions).
> But wouldn't government control and subsidy lead to the same malinvestment and cost explosions as college tuitions?
It could do. It is hard to see how it could be worse. The USA health care system, "industry", is a case study in failure at all levels except some pointy headed technology
> Wouldn't fierce competition at all levels be a good thing?
Definitely not. Competition is good in some areas, very bad in others. All sides must be able to enter and leave the market, and there must be even distribution of information. Most health care does not fit well
Many countries have socialised systems that use waiting lists rather than wealth to ration access to health care. The private health industry work very hard, at all levels I have seen, to undermine those systems, but in many cases they offer very good care.
Some of the best health care in the Americas is in Cuba
It literally would. Subsidies invariably result in cost disease, because there's more money for the same amount of value in the market.
> It is hard to see how it could be worse.
This isn't a very useful statement - it would just literally get worse. You don't have to visualize it.
> Definitely not. Competition is good in some areas, very bad in others.
Where is competition bad? You haven't pointed any areas out. Competition seems obviously good to me basically everywhere.
> Most health care does not fit well
Which is not a property intrinsic to healthcare, but a mere result of the fact that the government hasn't legislated price transparency in that area into effect yet.
> Many countries have socialised systems that use waiting lists rather than wealth to ration access to health care.
...which is obviously stupid because, unlike situations where you pay for your care, adding people to a wait list does not fund further capacity.
> Most Americans experience first hand how horrible health care here is.
The little people and not so little people experience how horrible it is. All the big people get the platinum plated VIP treatment. And it's a great source of nomenklatura make work jobs for them.
Anecdote: Friend worked for a billionaire. Had a seizure at the office and ended up in the ER and the head of neurology department came down to check on him.
> Most Americans experience first hand how horrible health care here is
I mean, no, most Americans are just upset about cost-sharing, most providers in the United States are pretty good and have pretty good facilities and equipments.
You can have systems that are mostly privatized (cough, France) that are better regulated than the United States, but that'd mean doctors would get paid less money & upper class folks would likely get worse care
I agree that upper-class folks' experience would change in ways that would generate loud protests. But the biggest anger points likely wouldn't involve quality of care. Instead, we'd hear shouting about:
providers' increased emphasis on cost-effective care. (You don't need an MRI because there's nothing in your symptoms that warrants it.) Right now, there's a lot of overtreatment in the U.S. medical system, catering to patients' desire to get big workups.
scaling back of today's concierge-level ambiance, with fancy chairs, skyline views, etc.
> there's a lot of overtreatment in the U.S. medical system, catering to patients' desire to get big workups.
It’s not just happening in the US. What goes on in the US is very influential elsewhere, and both patients and staff get pulled into the vortex of over-testing. And then to top it off, sometimes they are correct and they did need the test.
Partly. Let's also talk about the ugly world of Certificates of Need and diagnostic imaging and how they collide.
CoNs are something lobbied for by hospitals. If you want to open a new hospital or healthcare facility in an area, you need to apply for a certificate of need, which allows/asks existing hospitals if they think there is a need for your facility, to avoid "overservice" (lol, okay) of an area.
Diagnostic imaging companies - each of the big ones (Siemens, GE, Philips) offer in house financing for MRI, CT, etc., that they advertise to physicians. They also all offer specialist consulting help to facilitate you getting a CoN for your facility. Hell, they all also well help you find other physicians in your area who'd like to go in on setting up a DI facility (and will assist with spinning up the practice).
And then we find that physicians who own a DI practice (or a share in one) refer their patients to diagnostic imaging at rates several standard deviations above other physicians, and at rates that are "statistically improbable" when correlated to underlying ICD-10 diagnostic codes.
Upton Sinclair comes to mind ("It is difficult to get a man to understand something, when his salary depends on his not understanding it").
It's the same in San Francisco, where we support returns to investors in residential real estate by banning new development since the 1960s and therefore doctor salaries don't afford a luxury lifestyle [https://www.nytimes.com/2017/06/03/business/economy/high-end...] and therefore we have a shortage of physicians.
This is because congress wont expand residencies so there arent enough doctors. Doctors make a bunch of money and can live anywhere they want, almost none of them want to live in bumfuck.
Remove the residency cap, allow foreign doctors to immigrate and quickly certify their skills, allow nurses to attend night school to become doctors, etc.
> Which to say that, imo, "restoring the free market" isn't a useful action in this mess. State controlled medicine is essentially the only solution to the already partly collapsed US health care system.
I don't trust the US government is competent enough to run healthcare. If it can do better than the existing system, let it create a new voluntary, unsubsidized insurer, free of the BS rules it has created. Competition is the source of quality and low prices. Any monopoly is an invitation for poor quality and high prices.
The great thing about the "50 states" model is states can try random experiments. For example, Texas has done a lot to try to bring more competition but none of them have done a thing for the high cost of healthcare.
Yup. The big one to me being capping malpractice payouts. "Healthcare costs a lot because physicians have to carry very expensive malpractice insurance because of astronomical judgments".
Texas caps malpractice payments and everything stays exactly the same.
Also, malpractice insurance in itself isn't typically as onerous as people believe it to be. What is onerous, and what that industry does differently to most other insurance segments is "tail insurance".
Tail insurance is the concept that major malpractice suits may appear well after your claims-made liability policy has ended. In most cases it's actually DOUBLE the premium you're paying for malpractice insurance, implying the insurer believes that your coverage is less than one-third of the claims they expect to pay. What -should- happen is that you carry "claims-made and prior acts" coverage. The challenge there is that in many cases your employer will cover claims-made as part of your compensation or part of their insurance, but don't elect prior acts coverage (and because of the way they do it, I suspect it's not as simple as "let me pay the difference").
But in general capping malpractice payouts has done nothing to offset malpractice coverage costs, let alone flow-through to end consumer costs.
That would be great if we had real federalism. The states cannot try anything really unique, because they are hamstrung by federal law and federal subsidies with strings attached.
That kind of extractive, anti-consumer business model would be worth going after in any industry, but it feels especially bad in health care. Most health care isn't optional for the patient, and of course the more non-optional the care is the more expensive it tends to be. And serious health problems are both rare and incredibly stressful for the patient. Someone with cancer is going to have no experience shopping around for oncologists and will be willing to pay almost anything not to die.
It's almost the worst possible scenario for consumer driven free market dynamics. My personal opinion is that giant health-care conglomerates probably shouldn't exist at all. But if they do, they should be subject to much higher standards when it comes to things like antitrust than regular companies.
> If people knew half of how consolidated their treatment was they would riot.
My partner deals with claims denials for care providers and if someone wrote a book on the stuff she's seen happen, I genuinely think it would be akin _The Jungle_ for modern audiences in terms of cultural impact.
I’ve been getting exposure to this space and the backend systems that drive it. It is mind-bogglingly dysfunctional.
Aphyr recently provided a limited window[1] into the level of dysfunction that happens with one of these behemoths that are the result of 100+ mergers, acquisitions, spinoffs, and joint ventures.
I feel terrible for the providers who have to try to navigate these antics.
In my opinion, all of this contributes to two primary “bad” things: 1) increased rates of retirement from older physicians who don’t want to deal with this anymore (despite wanting to continue practicing for 5-10 more years), and 2) consolidation of physician practices into larger entities as a way of coping which inevitably leads to the entity being acquired by a hospital and absorbed into another behemoth of an organization.
Both make it hard for individuals to receive consistent, quality care.
Isn’t this just how HMO’s work? It’s not a PPO, you’re supposed to have the majority of your care managed within the large organization. Kaiser Permanente is another one.
In theory it makes sense - by keeping everything in network there’s no constant negotiation over reimbursement rates.
But the problem is there aren’t many competitive HMOs, and we have a healthcare system driven by employment, so you can’t switch to a new HMO if you’re unsatisfied by your current one.
Edit: My point is that it’s not a conflict of interest to be routed through the UH network - that’s the entire point of an HMO vs a PPO. The idealized goal is that you have a coordinated team of providers across the organization.
Yep. I have UHC through work. I'm on an expensive medication and UHC requires that I order it through Optum, so they keep more of the money. At least neither of the doctors I usually see work for them, so I don't have that conflict.
And has Optum conveniently forgotten to ship refills, but only for the expensive drugs? That happened to my wife on multiple occasions.
Or maybe they've rejected refill requests until right before your supply runs out, such that you have to go days without your meds while the new supply is shipped?
Optum is the shadiest shitshow I've ever dealt with.
They make it extra painful sometimes when it's time to refill, requiring re-authorization every year. My doctor has a woman working for his practice who spends almost full time battling insurance companies so that patients can get their meds, and she's been my ally at managing these fights.
A lot of the doctors I've seen recently just don't take insurance. Basically they just tell me what something costs and then I pay it. Obviously if you are poor this is a problem, but then again so is everything else and you probably can't afford health insurance anyway.
Getting new prior auths every year is annoying but not exclusive to Optum, thats been the case with all the specialty pharmacies I've gotten prescriptions from.
It's important to understand the factors driving consolidation in the healthcare industry as this goes beyond UnitedHealth Group. Everyone is sort of gradually converging on a "payvider" model like Kaiser Permanente with everything under one parent corporation. Payers and providers have been merging for years in order to gain more negotiating power over claim reimbursement rates. Regulatory compliance issues and IT costs are also killing off small, independent medical practices. In many regions a few large health systems now dominate the market. So, the only way for payers to hold down costs is to build up captive provider organizations where they can drive some operational efficiencies and economies of scale.
> 2. United owns several physician networks (totaling 90,000 physicians), who then determine what your care should be—no conflict with the fact that they pay the bills...
I disagree that this is necessarily a bad thing. One of the critical problems with our current model is the Fee-For-Service. When the insurance company is separate from the payer, then the incentive is to treat patients like revenue. A significant part of our ballooning costs are due to this fundamental miss-incentive.
When the payer and provider are the same entity, that is the one of the only effective mechanisms to control costs.
I've thought about this a lot and I think that there are 3 critical changes that would fix the whole fucking thing:
- Insurance being one country scale pool of capital - Actually average out the risk across lifetime
- Every provider must be the payor - Incentivize hospitals to manage costs
- Individual vouchers to join a network - Give the patient agency to join a care network that manages their health well.
I’m sick of paying 5k a year myself and close to 20k counting my employer for a doctor to see me for 20 minutes, ignore everything i say, and then prescribe some shit without explaining anything.
Additionally seeing how my wife is treated by doctors makes me feel physically sick. I have no respect for the medical field
Feel like you also explained the Apple walled garden. You pay 30% tax or no entry. Regulation need to be passed to change adapter port. Things won't work if you aren't in the ecosystem. And they cost a buck for Mediocre service.
I've been with Kaiser in Northern and Southern California. But not really with other HMOs.
I think the difference is Kaiser (in most places) is really a closed system; if you're with Kaiser, you go to Kaiser facilities for everything, as long as you're in the service area. If you're not with Kaiser, you don't go to Kaiser facilities, other than the emergency room maybe. Everyone you interact with is a Kaiser employee or contractor. You don't get recommended care that won't be covered, you don't get treated by someone who isn't in network, you show up, you pay your copay, and that's it, you're done.
For HMO plans with other providers, it seems like the doctors are often independent; you have to stay in network, but you still have to deal with network BS like this office is in network, but only some of the doctors. There's not a Blue Shield medical center with doctors, specialists, and a pharmacy at one location.
Because Blue Cross Blue Shield is neither a healthcare provider nor a managed care (health insurance) seller.
BCBS is kind of like a franchising business, where the franchisors get access to other members’ negotiated pricing and administrative services to create a larger (nationwide) network. For example, your employer could purchase managed care from Horizon BCBSNJ, and if you get into trouble on vacation on the west coast, then they coordinate with Elevance or BlueShield California or Regence in Washington/Oregon to figure out how much they are paying providers.
And this way Horizon BCBSNJ does not have to do all the legwork of negotiating with every healthcare provider in the country. I’m sure it is quite a bit more complicated in practice though.
> if you're with Kaiser, you go to Kaiser facilities for everything, as long as you're in the service area.
Kaiser also sells PPO plans where you do not have to see a Kaiser employee for covered healthcare.
Feel like you also explained the Apple walled garden. You pay 30% tax or no entry. Regulation need to be passed to change adapter port. Things won't work if you aren't in the ecosystem. And they cost a buck for Mediocre service
Imagine if the useless governments actually broke up these behemoth megacorporations that control the entire vertical and horizontal slice of industry they operate in. What a crazy concept, right?
Oh, and I love where my insurance would cover my prescriptions from CVS in Washington, but when I was down in California needing steroids and anti-inflammatories urgently for my gout, they would not cover them there (and I'd made the apparently idiot assumption of having the urgent care physician send the scripts to a nearby CVS because I thought they'd be covered. Nope. Not even "out of network" - I ended up paying out of pocket and arguing for reimbursement.
For non-Americans: US health insurance is often bound to a state or even a region of a state, paying only for emergency care (and that, only because they are required to) outside that area.
We basically need travel insurance to safely travel in our own damn country.
Add it to the list of crazy features of our system, any one of which would cause riots in another OECD state if not fixed promptly. And we’ve got several.
Basically, most forms (including ours) of capitalism turn into a oligopoly where each oligo-member is highly vertical and controls the whole narrative.
Another word for this would be corporation-states.
Amazon is another example of this. So is Google. So is Apple.
It's high time that government steps in and breaks these 'too big to fail' corpo-states up into actual competing interests that, in the end, do better for the citizenry. Cause each corporation is a dictatorial 'state' acting in opposition to our elected government, and much of our monopoly laws, either in spirit or in application.
I've had United for a little over a decade, and overall I have to say it's been pretty good. My wife was hospitalized for about a month with our first born, racking up hospital bills over half a million USD. I think I paid about $3500 out of pocket. Then, a number of years later, the same child had her appendix removed. Again, terrifying bills, and about $3500 out of pocket.
That being said, after the second event, we had discharge orders from the surgeon that included very specific conditions for when we should bring her in. When some of those conditions presented, we brought her to her (in network) primary care physician, whose office is (incidentally) in our in-network hospital. The physician agreed with our having brought her in, and recommended a CT scan. My daughter was sent down the hall from her in-network pediatrician to the in-network emergency room where the CT machine was located. CT scan proceeded, findings were good, and my daughter recovered just fine.
So imagine my surprise when I get a bill for the CT scan. After many phone calls, emails, registered letters, etc. the final determination was that the ER was, at the time of the events in question, had been staffed by an out-of-network third party and thus would not be covered.
Now in the scheme of things, the CT scan was a drop in the bucket compared to everything that was covered, and I'm very thankful for how things worked out. But the principal of that situation really left a bad taste in my mouth. We had no reason to suspect that the CT scan wouldn't be covered, and were in no way advised as such. Doesn't seem right.
"After many phone calls, emails, registered letters, etc. the final determination was that the ER was, at the time of the events in question, had been staffed by an out-of-network third party and thus would not be covered."
I always wonder how a normal person is supposed to figure out stuff like this. I suspect these traps are set intentionally to squeeze more money out of people.
As of Jan 1, 2022, the No Surprises Act requires all healthcare providers that work in a hospital to be considered to be in network if the hospital is in network. And also, all emergency healthcare is considered in network even if the hospital or doctors or labs are not in network.
Because most people give up or forget after the first round of phone calls. It's more profitable to deny claims initially. Patient either forgoes care or pays out of pocket. Insurance company keeps the premium from customer.
I had an out of network emergency room visit with a kidney stone once while covered by a $1,000/month UHC platinum plan. When the bills arrived I stupidly paid them thinking it’d be easier to just file the claim for reimbursement from UHC on my own. After two years of
submitting forms, exchanging letters, and hours of phone calls, I just gave up. It’s hard for me to consider their business as anything but an outright scam.
When I moved to the US somebody told me to hold onto money as long as possible when it comes to health care.. Once they have it, they won’t give it back.
> We had no reason to suspect that the CT scan wouldn't be covered, and were in no way advised as such. Doesn't seem right.
I can’t understand how this is even legal. I know its a somewhat normal occurrence but you wouod think people could at least easily win a lawsuit and get them to sure-up their policies.
Its probably ignorance and not malice but it doesn’t really matter. It basically just amounts to a scam.
Emergency care (ER care) is required to be covered even if it is out of network.
So the CT scan should have been covered.
Also if this was post 2021 there is the no surprises act that applies as well. This is when you go to an in network facility and out of network providers are staffing it.
"My wife was hospitalized for about a month with our first born, racking up hospital bills over half a million USD"
The problem is here and it is not pretty good. A month of hospitalization should not cost half a million dollars anywhere in the world. Most of this is because of the multiple middle men involved including the biggest mafia: health insurance companies.
I don't mean in an insulting way but this is the thinking that keeps us americans getting scrfewed by these mafia.
What is and is not covered is set by your employer. That is the “plan design” they either choose entirely (for self funded plans) or pick a group’s plan to join (group plans)
The surprise third party provider bills are kind of a separate issue, in that it was a scam every insurance company did. we’re mostly protected by the “no surprises act” that went into effect jan ‘22
My "favorite" story about UHC is from a provider perspective.
Taking a page from Section U in The Rainmaker ("deny all claims"), they went through a phase where multiple people took them to court over HEMS (helicopter EMS) transport denials, including from the scene of serious car accidents, due to lack of "pre-authorization".
Apparently in their mind, us paramedics (or maybe the chopper pilot) should have been calling their 800 number as we stabilized our patient...
"This is John, I'm a paramedic working on one of your patients who was hit by a truck. We would like to fly him to the hospital due to extensive multisystem trauma but we need a pre-auth. His name? Hang on, let me find his wallet. No, that's Smythe, S-M-Y-T-H-E, I know, I know, sorry, it's a bit loud with the jaws of life and the engines... What's that? Um, sure, yes, I can hold for a nurse consult..."
I think the main problem is lack of free market. Oligopolies are part of the problem, but an equally large part is lack of choice from employes. Many (most?) insured in the US get their healthcare through their employer. You get maybe 2 choices of insurer, often only one. You’re not going to get a new job to switch insurers. The people negotiating the plans are too far away from the people receiving care (it’s probably the finance people anyway). Not everyone has the same healthcare needs or lives in the same area, group plans don’t make sense in today’s world.
The government should be promoting and incentivizing ICHRAs and similar. If you haven’t heard of ICHRAs they allow employers to give you a stipend for healthcare. You get to choose your plan (including open marketplace plans, which have some affordability regulations), you can use it for copays or to just pay for stuff out of pocket. You can choose a catastrophic plan and get insurance / a plan from your PCP so you never have to worry about “network” changes. And it’s tax free for employers and employees. Cheaper for employers too, they don’t have to hire benefits administrators and negotiate with brokers/insurance companies.
If you’re a company, especially a mid to small sized one, I highly encourage you to look into ICHRAs.
> lack of free market. Oligopolies are part of the problem
Free market produces Oligopolies, monopolies, cartels and collusion. They are perfectly absolutely natural formations. FAANH Companies form anti-poaching agreements, now they suddenly all have layoffs at the same time, you think that’s a coincidence? Even drug cartels divide up territories instead of ‘competing’.
> Free market produces Oligopolies, monopolies, cartels and collusion.
You conflated two different uses of the word "free market" - one which is correctly described as "laissez-faire", and the other one, which is the one that everyone actually uses (including gazpacho, the user you were responding to). With very few exceptions, nobody on HN argues for laissez-faire capitalism - and "Oligopolies, monopolies, cartels and collusion" only happens in laissez-faire capitalism. In other words, you made a strawman argument.
If you ever tried private insurance in the US, you might disagree. In my experience, it's impossible to use. The only option if you want health care in US is to be employed.
But also: could you clarify what do you mean by private insurance? You can buy insurance from Blue Cross, Cigna, United, etc on healthcare.gov. It’s the same providers you get through your employer, the only difference is that it’s the government negotiating (kinda) and you choosing instead of your employer doing both.
All health insurance companies need to die. They are all crooks and frauds and are using an outdated system in our country siphoning money from families.
This opinion isn't actually all that drastic. If we just got people on the HSA + disaster coverage* train a lot of the issues with the system would disappear. I am far far from the cheapest patient but my annual spending doesn't even get to 50% of my portion of the premiums of my employer's PPO plan.
* Where if a doc prescribes insurance pays for it no questions asked (to you the patient). They can claw it back from the doctor if they think it's excessive. I think for disaster only coverage you could successfully pass laws to this effect without insurance companies starting a third world war.
Why would your ideal solution still involve insurance? I think most people want the hospital (they don't care who runs it) to send the bill to the government. That's it. And if the state or federal government wants to set up a system of oversight over the charges, then good.
> And if the state or federal government wants to set up a system of oversight over the charges, then good.
That is what happens now. See Medicare/Medicaid/Tricare/federal government employee plans/etc.
That is why health insurance companies are better referred to as “managed care organizations” (MCOs). Most importantly, they are selling a plausible deniability shield to government leaders.
The government is paying for healthcare, but since there is insufficient supply of healthcare, someone has to get shafted. Using the MCOs to do it lets government leaders point fingers.
We signed up for a United Healthcare plan a couple years back. It showed a bunch of Doctors in network. Once we were on the plan, 90%+ of the Doctors told us they didn't accept United Healthcare or weren't accepting new patients. We couldn't find quality Doctors near us as a result. Ended up having to switch off United Healthcares plan as a result. Certainly felt like it was false advertising to say all the Dr's are in network just to find out none of them will treat you.
There's also this : https://www.reuters.com/technology/cybersecurity/cyber-secur... , this hack caused by malware from 2021, caused huge portions of their employee base tied to optum and their change healthcare acquisitions to be unable to work for days (and it's still ongoing!). I guess their employees got a "vacation" out of it while everyone else waiting on prescriptions at CVS, etc got shafted. It literally took a huge portion of the US pharmacy network to go down for the US to realize what a big problem UNH is.
Former Optum/UHG employee, worked in automating things in IT. While I was there they went on a years long spree to get rid of everyone under 40. I finally got laid off and in my group of 153, 17 were under 40. I had automated most everything in my area,and although I meticulously documented everything, when you get the plug pulled like that you don't get time to do any hand off, so it hit things pretty hard. They did this for months (laying off people under 40). They gave me a large enough severance to cover a long time out of work, and the severance agreement stated if I sued for EIRSA I had to pay it back. I took it, but the entire thing painted a picture of management totally disconnected from the people putting code to programs.
Optum is the most garbage organization that has absolutely ruined local healthcare. I go out of my way to find places that aren't affiliated, even though they're much further distance, just to avoid them. It's about time this happened.
Not shilling here, merely impressed by the work of journalist Marshall Allen—he has a book "Never Pay the First Bill". Search around on podcasts and YouTube for some interviews to get the jist.
I've bought a few copies for friends that had expensive health issues and have used the techniques on relatively small stuff for myself.
I started following this person called Doctor Glaucomflecken who makes funny short skits on TikTok and YouTube, and that was how I first learned about United Healthcare. The wild thing is that he makes these funny videos so you think it's a joke, but then you look it up and realize it's real. Healthcare in the US is not in a good place, so this definitely sounds like a good action.
Covered this space from an investment angle for nearly two decades. These guys are crooks. It’s a controversial take but UNH (and everything else in healthcare) became so big directly as a result of PPACA. That should really be Obama’s legacy. US healthcare system is broken because both the right and left are completely bought by these monsters.
My first thought as well. Everything I know about UH and Optum (all of it negative) come from his videos, and it makes me appalled that any company like this is allowed to exist, when every study seems to indicate that patient in private-equity-owned care experience worse, more expensive care. It's the opposite of "capitalism creating efficiency".
Its my primary source of Schadenfreude, because whenever he says anything about insurance covering, i usually research it and come up with that it is covered.
Covered according to what source? The ones the insurances provide?
Because the single most frequent complaint I hear about insurance is them deciding that something which they claim to cover, and should cover, they're suddenly no longer going to pay for because of some bullshit excuse.
It's one of the reasons doctors have to waste hours of their time every week getting "prior authorizations" for things the insurance claims they will cover.
They are legally Required to cover it. An council checks every new drug if it helps and if the price is appropiate. That is done for each drug indipendent of the regulation of the drug. the insurance has very few things to deny an claim(in most cases they deny them because an doctor abbreviated his/her title, but due an new method to transport the receipts its very probably that the number will drop) and none if the doctor deems it absolutly nessesary.
I want to know who exactly the “industry officials who compete with the healthcare giant” they’re interviewing are. The price fixing and collusion go way way deeper and broader than just United Healthcare and Optum.
Just to provide a counter point to all the anti-UHC complaints here - some of which may be legit - my last job had UHC insurance, without question the absolutely best insurance I have ever had in my life - literally everything was covered, no denials, no referrals needed, very reasonable co-pays and honestly felt like I had a truly gold-plated health coverage.
Now I switched to a new job, with a much small regional health insurance provided by new employer- and it sucks. Higher copays, more hoops to jump thru, penalized for going out of network (and that network is much smaller than UHCs) etc.
I for one don't care how big UHC is, how many additional related businesses they own including pharmacies etc, especially if it allows them to control costs better up and down the delivery chain - if, as a consumer, that gives me excellent service and limits my out-of-pocket expenses, I see that as a good thing, so I am all for it.
Are these reviews completely paid for? What's going on here? Or are all the options awful.
I am in the position to choose our provider at our (small) company, but between Gusto and JustWorks and the majority of our employees being in Texas there was slim to none options except united.
UHC is great under one circumstance - if you and your family are all relatively healthy, so your coverage needs are just visits to the family doc or maybe an occasional injury. Many people fit that scenario, so may not realize that it can get bad once you start dealing with chronic problems, unusual cases, needing atypical prescriptions, etc.
Basically, it is a product made for the 80%, and the 80% don't realize how badly screwed the 20% are.
All the options are awful. Obama got in trouble for saying "if you like your plan you can keep it" when promoting the Affordable Care Act, because it wasn't true, but in some sense it was true because I truly cannot imagine any American liking their healthcare plan.
No matter how expensive your plan is, the simplest interactions like changing a birth control prescription or getting new glasses are absolute torture.
The criteria that your Forbes piece judges UHC on don't seem to be the things that people are complaining about. Seems that the Forbes piece is more of a surface-level judgement than anything.
That's insane. The archive link isn't working for me so I can't read the article, but we received a letter that any long term prescriptions might need to go through Optum and that we'd only be able to fill a few at a local pharmacy before the refused to cover them.
I was a bit flabbergasted as that didn't seem like it could possibly be legal.
By the way - that's absolutely not great if you have controlled medications, as you need to sign for them and can't exactly get them filled early. I take three different ones. Luckily my wife and I work from home.
How is there an argument of wrongdoing here when the regulatory approach for healthcare is still based around this idea that multiple anticompetitive arrangements (the price fixing between providers and "insurers") will somehow actually create competition? Like don't providers have to be standing alone as their own market independent of payer before one could say that UHC's actions here are specifically anti-competitive, rather than just the HMO system working as envisioned?
The healthcare system in the United States is so hard to navigate. I recently switched to Sedera (https://sedera.com/). They to have much better incentives, better prices and service. We'll see how it goes
I see a lot of comments on here about how to "fix" the system, ranging from informed to terribly uninformed.
There's one thing that I haven't seen mentioned that would be a great place to start:
Be healthy.
I know, many people don't have that choice. There are hereditary conditions, and accidents and chronic conditions - I know. I work in the industry.
However, as a nation we've largely chosen to outsource our health.
It makes sense, in a world that operates around specialization, we tend to follow those patterns for everything. Electrical problem? Call electrician. Plumbing problem? Call plumber. Health problem? See a doctor.
It's understandable, but it's reactive and not an optimal solution for wellness.
Consider these leading areas of healthcare costs in the U.S.:
Obesity: 173 billion per year. [1]
Diabetes: 412 billion per year. [2]
Heart disease & stroke: 216 billion per year. [1]
Smoking: 240 billion per year. [3]
And alcohol just makes all of that way worse. [4]
Most of the above can be controlled.
If we really want to reduce costs and improve healthcare, I think it's best to start at home and work towards making sure we and our families are healthy and fit. It's not easy, and it takes a lot of education and work, but it's worth the effort.
If Americans did that, we could reduce healthcare spend and ease the burden of stressed medical systems. We'd all be healthier and happier.
It's not the whole answer, but it would be a great start.
The path we're on seems to be trending in the opposite direction. Processed foods, sedentary lifestyle, addictive additives, high stress jobs - it all adds up.
I think rising healthcare costs are (amongst other things) a symptom of our choice to deprioritize our wellness.
Sure there are lots of opportunities for disintermediation in the gordian knot of U.S. healthcare, and we should pursue good solutions.
But we should start with what we can directly control: our diet and fitness.
This - obviously a lot of things are out of our control, but it is also absolutely true that the vast, vast majority of health problems Americans have are all self-inflicted by decades of poor diet and lifestyle - as an individual, if you are concerned about the kind of care you are going to get when you need it, the very best and easiest thing you can do, is take as many actions as you can to avoid needing it.
You can't control everything, but you can do your part to ensure a healthy life - if only for selfish reasons (i.e. that won't fix the healthcare problems in the country, but it will minimize your own need for it).
UnitedHealth is by far the worst health coverage I have ever had. They are so bad at paying claims that our local hospital network has dropped them; all of our emergency care in the immediate region is now out-of-network. They absolutely are criminals and deserve to be put out of business.
A friend of mine couldn't get his claims paid even as a UHC corporate employee. He ended up quitting his job at a health insurance company because he wanted functional health insurance.
Most health issues are connected to food. Synthetic sugars, seed oils, herbicides, pesticides, and diminished quality of vitamin mineral content. If you think the heal5 care industry has it locked up look into ag.
