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How much health insurers pay for almost everything is about to go public

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Re: How much health insurers pay for almost everything is about to go public

#251

Post by xboxnolifes »

lotsofpulp wrote: post #23
xboxnolifes wrote: post #18

Earlier quoted context omitted.

In the US, isn't there regulations that effectively cap their profit margins? Since they have no incentive to increase their margin through negotiation, their only incentive would be to lower their costs below competition.

Medical Loss Ratio: https://www.healthcare.gov/glossary/medical-loss-ratio-mlr It says 80%/85% of premiums have to go back out as payments for claims. > Since they have no incentive to increase their margin through negotiation, I do not see why this would be true. The less an insurance company pays for healthcare, the lower the premiums or can offer and win more business.

> The less an insurance company pays for healthcare, the lower the premiums or can offer and win more business.

I cover this in the second half of that sentence.

Re: How much health insurers pay for almost everything is about to go public

#252

Post by lotsofpulp »

CogitoCogito wrote: post #104
lotsofpulp wrote: post #99

Earlier quoted context omitted.

From experience operating businesses and reading financials of various companies, 5% profit margin is on the low end. Walmart and other retail play in the 2% to 5% range.

Why would you compare such different businesses profit margins? Anyway I just think saying a 5% profit margin is small because other businesses have larger profit margins is kind of naive. I mean if through competition insurance companies' profit margins dropped to 2%, then the current status quo of 5% would seem crazy. It's all just a matter of perspective. Saying 5% is low because other businesses have higher profi…

The reason to compare it to other businesses is to see what kind of moat/regulatory capture/monopoly/monopsony power they have.

For those purposes, a 5% profit margin indicates that health insurance companies do not have the pricing power that many other industries have. They actually have some of the lowest, which is fine, but then the claims of them being in control go out the window.

Whether or not 5% itself is too high can be determined by looking at the competition. There are at least 7 other major publicly traded health insurers competing against each other, all with nearly the same profit margin.

So either they are colluding with each other and there is corruption on a massive scale, or, the current parameters of the health insurance business simply result in a ~5% profit margin. If you think you can do better, then you are betting that you can do the job better than all the employees at these 7 companies, which is a lofty claim.

Re: How much health insurers pay for almost everything is about to go public

#253

Post by happyopossum »

manquer wrote: post #222
treis wrote: post #176

Earlier quoted context omitted.

Which price and who determines it?

Hospital is free to determine their prices, but they cannot give steep discounts to one channel of sales over other. They have to be consistent. Healthcare pricing should be based on cost+plus models for the hospitals rather than on value driven approach you see every else in any sales. We are not questioning their costs whatever they maybe, if the costs logically remain roughly same no matter how a particular patien…

> Healthcare pricing should be based on cost+plus models

Cost plus models provide a perverse incentive to increase costs, as 5% of $2 is more than 5% of $1.

Re: How much health insurers pay for almost everything is about to go public

#254

Post by pc86 »

spaetzleesser wrote: post #230
ageitgey wrote: post #2

I'm one of the co-founders of Turquoise Health, mentioned in the article here. We've been downloading and parsing this data all day. It's a really big deal in the industry that the prices that insurance companies pay doctors are now being shared publicly. It will have all sorts of positive impacts over time, hopefully making rate negotiations more consistent and fair between different insurance plans. Right now, 10x…

“Right now, 10x differences in prices paid for the same healthcare service from the same doctor between insurance plans is not uncommon.” Makes me wonder how things got to this point. How can a business perform any planning if they sell their services with such big differences between prices charged to customers?

Over time the higher paying ones subsidize the lower ones. Due to this we'll see some people's insurance premiums increase, some decrease, and some insurance providers probably go out of business (all good IMO).

Re: How much health insurers pay for almost everything is about to go public

#255

Post by heretogetout »

ars wrote: post #241
spaetzleesser wrote: post #231

Earlier quoted context omitted.

You don’t need to have the state pay. Make them charge the same price to all customers. Then you can have insurances compete. My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work.

So many don't realize that this is entirely because Medicaid pays less than the cost of treatment. So hospitals make it up by charging other customers more. If you actually wanted this then your taxes would go up because Medicaid expenses go up dramatically. Maybe it's worth it - but at least be aware of what you are asking for.

I'd be interested in reading more about this. A lot of the cost of medicine is overhead interfacing with insurance providers and all the layers of profit therein, but I don't know exactly how much.

Re: How much health insurers pay for almost everything is about to go public

#256

Post by missedthecue »

antisthenes wrote: post #173
ageitgey wrote: post #2

I'm one of the co-founders of Turquoise Health, mentioned in the article here. We've been downloading and parsing this data all day. It's a really big deal in the industry that the prices that insurance companies pay doctors are now being shared publicly. It will have all sorts of positive impacts over time, hopefully making rate negotiations more consistent and fair between different insurance plans. Right now, 10x…

Are you guys hiring?

Look like it

https://turquoise.health/careers

Re: How much health insurers pay for almost everything is about to go public

#257

Post by Hellbanevil »

ars wrote: post #241
spaetzleesser wrote: post #231

Earlier quoted context omitted.

You don’t need to have the state pay. Make them charge the same price to all customers. Then you can have insurances compete. My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work.

So many don't realize that this is entirely because Medicaid pays less than the cost of treatment. So hospitals make it up by charging other customers more. If you actually wanted this then your taxes would go up because Medicaid expenses go up dramatically. Maybe it's worth it - but at least be aware of what you are asking for.

No post body was provided.

Re: How much health insurers pay for almost everything is about to go public

#258

Post by 29athrowaway »

spaetzleesser wrote: post #230
ageitgey wrote: post #2

I'm one of the co-founders of Turquoise Health, mentioned in the article here. We've been downloading and parsing this data all day. It's a really big deal in the industry that the prices that insurance companies pay doctors are now being shared publicly. It will have all sorts of positive impacts over time, hopefully making rate negotiations more consistent and fair between different insurance plans. Right now, 10x…

“Right now, 10x differences in prices paid for the same healthcare service from the same doctor between insurance plans is not uncommon.” Makes me wonder how things got to this point. How can a business perform any planning if they sell their services with such big differences between prices charged to customers?

Short answer is: because they can.

And they can because there's a lack of transparency that makes people believe this is OK.

Re: How much health insurers pay for almost everything is about to go public

#259

Post by nradov »

codegeek wrote: post #212
ageitgey wrote: post #2

I'm one of the co-founders of Turquoise Health, mentioned in the article here. We've been downloading and parsing this data all day. It's a really big deal in the industry that the prices that insurance companies pay doctors are now being shared publicly. It will have all sorts of positive impacts over time, hopefully making rate negotiations more consistent and fair between different insurance plans. Right now, 10x…

I appreciate what you all are doing. We need people to try and really fix our Healthcare Industry. However, I do have a question. Are you trying to get rid of Insurance mafia at all for at least some things like basic preventive care etc because I am sure that drives costs up a lot if Insurance companies are always between a doctor and a patient. I really hope something can be done where I can just go to a doctor/hos…

Most healthcare providers are happy to accept cash payments from patients. You can sometimes even negotiate a discount.

If you have a medical plan subject to the Affordable Care Act then most preventive care is already fully covered at no cost to the patient.

https://www.healthcare.gov/coverage/preventive-care-benefits...

Re: How much health insurers pay for almost everything is about to go public

#260

Post by richiebful1 »

arcticbull wrote: post #242
spaetzleesser wrote: post #231

Earlier quoted context omitted.

You don’t need to have the state pay. Make them charge the same price to all customers. Then you can have insurances compete. My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work.

> My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work. Do you know that for a fact?

In my experience auto insurers assess damage and award $X for repairs. You can either go to their contracted body shop or pick your own. If you pick your own, they typically take the $X as payment.
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