Hospitals lift curtain on prices, revealing giant swings in pricing by procedure

I won’t say always, but Medicare price is usually marginal but not profitable. I.e. if you’ve got an empty bed, Medicare is better than nothing, but you wouldn’t actively try to fill beds at sub-Medicare rates even without the hassle of dealing with insurance companies

The key problem is that 20% of our GDP goes to healthcare, and similarly 20% of our population is employed in healthcare provision. This isn't just people sitting around doing nothing. It's nurses, doctors, administrators, etc. If you want to reduce healthcare costs in half, so that it is only 10% of GDP, then expect to throw 10% of the population out of work. That will include nurses, doctors, EMT personnel as well as administrators. Sure, you can try to shift that and fire a bit more administrators than nurses, but you will soon discover that's about as easy as eliminating government waste.

This inability to address the core issue arisies from people approaching these difficult problems in administration and systems science from a facile moral point of view. "it's wrong!" they say, to be given a big bill for a snake bite. Well, OK, it's wrong. But that same attitude will tell you "it's wrong" to fire a hard working nurse, or to reduce the pay of a doctor, etc. So now you are left with boogeymen like greedy insurance companies and fat cat CEOs. This is like the person who insists on a tax cut funded by reducing government waste. It's not a serious proposal. And what we have in the US healthcare debate is two sides, the first side is just lying and obfuscating (that is the side opposed to reform) and the second side is so bound in the chain of moralizing that they are unable to make any serious proposals. They can only go after the fat cats, and not the nurses. Thus their proposals will never work.

Same thing for education -- you need to fire most of the university staff and reduce the pay or fire many of the teachers. Same thing for all the difficult problems in life where we complain that things cost too much. It is not shadowy fat cats that are causing these problems, it is too many people employed in the provision of services who are earning too much. Ordinary professionals. The biggest problems of modern life are that professionals have too much power and are extracting too much from the society as a whole. Whether it is hospital workers or government workers or teachers, the issues of skyrocketing costs and bureaucratic bloat are very similar across these areas, and they cannot be solved by getting rid of shadowy fat cats or employees that "do nothing".

Is there a reason that US doctors should get paid significantly more than their peers in other developed countries?

https://www.medscape.com/slideshow/2019-international-compen...

- a mandated MLR of 85% means the insurance companies have zero incentive to reduce the cost of items. In fact, their toplines and real (non%) profits increase as healthcare gets more expensive.

- industry profitability for insurance companies is around 3%. So, their overhead is around 15%-3% = 12%. They have an incentive to do their job cheaper. This pales in comparison to the 85% cogs.

- the small company cfo (me) has negative incentive to get involved in my employees' healthcare decisions. In fact, even being aware of cancer, pregnancy, etc. can be used against management in an employee lawsuit. No thanks. We just accept the situation and pay the bill.

- huge companies that can afford to self-insure can do it as they can firewall healthcare information from employment decision makers.

So, who in this system is going for cheaper healthcare:

- employees ... no

- insurance companies .. no

- healthcare providers ... no

- business paying the bills ... no

This bullshit billing structure is the tip of the iceberg. We have no freemarket incentives to keep down the cost of healthcare (i.e., carveout for high deductible insurance plans). Why would we expect otherwise?