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Universal health coverage could save $1T and 114k lives a year: study

ysph.yale.edu

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Re: Universal health coverage could save $1T and 114k lives a year: study

#461

Post by cyberax »

tptacek wrote: post #363
thatfrenchguy wrote: post #341

Earlier quoted context omitted.

> Take "Medicare-level payments to providers". Hospitals have an operating margin of 2-5%. Medicare pays 50% less than private insurance. So doing this would require either layoffs, cutting salaries for doctors/nurses/etc, or both. This may well be the right decision for society as a whole--that's a big part of the debate here--but there's no free lunch. I mean, admin costs at hospitals are ~25%, around half of that…

Billing and insurance ("BIR") is reported at around 8.5% of revenue --- admin isn't just BIR, as you note. But replacing private insurance with Medicare doesn't drive BIR to zero; Medicare is also a claims-based system. Estimates are that you'd cut BIR by somewhere around 30-40% (of 8.5%). Most of the savings in these kinds of reports simply comes from paying doctors less (or delivering fewer procedures, which is als…

Physician/nurse salary is not the major driver of the cost of healthcare. It's around 12-15% spending, depending on the methodology. Even if you force doctors to work for free, it won't meaningfully affect the cost.

It's really the overhead costs that are so Byzantine that they can't be quantified properly. Hospitals have teams of coders, insurance companies have teams of counter-coders, physicians have to waste their time on calls with insurance companies, etc.

"Medicare for all" would alleviate a _lot_ of this. It already works for the elder population, and pretty much every senior has health conditions. So extending it for everybody would result in savings. This is a no-brainer from a purely fiscal point of view.

Another way to fix the mess is to lean on the free market side: prohibit employer-sponsored insurance. Completely. All the health insurance plans must be sold on the open market to everyone.

Re: Universal health coverage could save $1T and 114k lives a year: study

#462

Post by autoexec »

_heimdall wrote: post #381
bpt3 wrote: post #331

Earlier quoted context omitted.

No, the problem socialists have is that most people are smart enough to realize they won't be better off under a socialist regime, to the chagrin of the self-selected vanguard.

I'm not sure most people can actually define socialism, let alone recognize it.

Exactly. Although even if you can avoid the words they don't understand or were told to be frightened of you'd still have the problem of getting them to vote, even for policies they think would be good for them.

Re: Universal health coverage could save $1T and 114k lives a year: study

#463

Post by solid_fuel »

ButlerianJihad wrote: post #391
strictnein wrote: post #131

Earlier quoted context omitted.

> ACA has saved tons of lives It was the Medicaid expansion that has been cited as saving lives [0]. An expansion that has almost nothing to do with the rest of the ACA. > "There's a very clear type of fallacy you are engaging ... There's no intellectual rigor or honesty in that sort of thinking" So you're claiming that the person who posted that is not only falling into a fallacy, but they are neither intellectually…

"Saved lives" or "Could Save Lives" is a ridiculous, un-falsifiable, and unprovable claim. First, it involves twisting correlation and causation into an Escher knot. Secondly, it's not even what cited source says. Yes, "reduced mortality along a timeline for a certain demographic" is a good and desirable statistic, but there is no way that it translates into the self-aggrandizing and sensationalistic "ACA/Medicaid sa…

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Re: Universal health coverage could save $1T and 114k lives a year: study

#464

Post by HDThoreaun »

davidfekke wrote: post #306

"You can have state of art Healthcare, or you can have Universal healthcare, you can't have both." -- Malcolm Gladwell The way that universal health coverage saves money is by rationing care. You do not save lives when you ration care.

This is certainly true to an extent, but it ignores some big problems with fee for service. The biggest one is that incentives between patients and providers are not aligned, which means more than 10% of healthcare provided in the US is wasteful stuff the provider knows is unnecessary but prescribes anyway because it makes them money. There are real opportunities to save money without making outcomes worse, in fact, if we stop doing useless stuff that leaves more time to treat people with real issues.

Re: Universal health coverage could save $1T and 114k lives a year: study

#465

Post by chermi »

I would like to know if anyone has a method or resource to cover rough calculations on things like:

1) how much cost comes from "friction" like middleman, administrative bloat, shitty digitalization/note sharing, all the time the nurses and doctors have to spend on paperwork... Etc.

2) how much drug development is subsidized by the US patient via higher domestic vs. foreign pricing. Or even how much of the cost total is drugs?

3) how much roughly every added year of life past some marker of "high quality of life" is spent just keeping people alive. And if there's any trends there, cost going up or down total and per person.

4) some basic accounting of where the spend is actually going. A lot of people in this thread are talking about hospital margins. There's much more to health care than that. Labs, hospice, mental health, labs/diagnostics, drugs, r&d, nursing facilities and many things I probably don't even know about.

Basically an equivalent of david mackays "without the hot air" but for health care.

Also if anyone has some good reading on ideas around kind of SEZs for drug/treatment development where people opt in to riskier care. Not quite the same thing but I know for example that lots of medical device development and proving is done in spain to gather evidence for the FDA since the FDA process for devices is legitimately insane.

Oh and if there has been any proposals or even adoption of better health record management, digitization. Especially access to your own health record. Im not a crypto guy but it seems like maybe it could be an application for it?

Re: Universal health coverage could save $1T and 114k lives a year: study

#466

Post by tptacek »

cyberax wrote: post #461
tptacek wrote: post #363

Earlier quoted context omitted.

Billing and insurance ("BIR") is reported at around 8.5% of revenue --- admin isn't just BIR, as you note. But replacing private insurance with Medicare doesn't drive BIR to zero; Medicare is also a claims-based system. Estimates are that you'd cut BIR by somewhere around 30-40% (of 8.5%). Most of the savings in these kinds of reports simply comes from paying doctors less (or delivering fewer procedures, which is als…

Physician/nurse salary is not the major driver of the cost of healthcare. It's around 12-15% spending, depending on the methodology. Even if you force doctors to work for free, it won't meaningfully affect the cost. It's really the overhead costs that are so Byzantine that they can't be quantified properly. Hospitals have teams of coders, insurance companies have teams of counter-coders, physicians have to waste thei…

https://nationalhealthspending.org/

BIR is 8.5% of provider spending, once you add the multiple cells up that constitute providers.

I don't think your argument is going to survive contact with the numbers here.

Re: Universal health coverage could save $1T and 114k lives a year: study

#467

Post by chermi »

GuB-42 wrote: post #337
brandonb wrote: post #113

I'd like to believe this, but the study makes a bunch of really hasty assumptions. The authors derive the $1T number from $1.3T in total cost savings and $304B in incremental spend (incremental spend is due to insuring more people). The $1.3T in cost savings come from five big buckets: lower pharmaceutical prices, Medicare-level payments to providers, reduced administrative overhead, less fraudulent billing, and fewe…

Yes, I consider big numbers like this to be red flags. The GDP of the US is $32T. Saving $1T will essentially make 3% of the US economy vanish. You don't vanish 3% of an economy without wide ranging repercussion, it would be a crisis similar in scale to that of 2008. With such numbers we are not "saving money", these are about rebuilding an entire economy, a painful process. So either the effect will be much smaller…

I mean there's flavors of contributions to gdp. Spending money on make work for people digging holes still counts. I wouldn't mind 1 trilly being freed up for more effective use. I imagine we could get pretty good returns on it just paying it against the debt as a simple idea, effectively a tax cut.

Re: Universal health coverage could save $1T and 114k lives a year: study

#468

Post by chermi »

GuB-42 wrote: post #443
missedthecue wrote: post #349

Earlier quoted context omitted.

Well it wouldn't "vanish". The $1T savings (if produced) that were once spent on healthcare would instead be spent on anything else.

Yes, it will, but think about the supply side. If people spend $1T less on health, health professionals will earn $1T less, it means, as GP said, layoffs, cutting salaries, etc... Not just doctors and nurses but also drug researchers, medical equipment manufacturers, etc... These people will now have to do the "something else" that will be spent on, let's say gardening. But you don't turn a nurse into a gardener just…

I don't understand why we always pay attention to only the jobs side of decisions like this. Why is the main concern always preserving existing jobs? The extreme version of that is obviously silly. The savings is real and lowers prices, increasing social mobility and spending elsewhere. How many people are locked out of moving for a job that matches them better, or taking some training for a better job and so on just because of medical debt leaving them no flexibility? And if we could save that trillion by eliminating jobs, doesn't that kind of imply those jobs (or at least the system requiring them) were terrible allocation of human capital?

Re: Universal health coverage could save $1T and 114k lives a year: study

#469

Post by robot_jesus »

EA-3167 wrote: post #369
nullocator wrote: post #345

Earlier quoted context omitted.

> Hospitals have an operating margin of 2-5% Very curious where this comes from and how accurate it is. For example the $37 a provider charges for an Aspirin seems like more than 2-5% margin.

Ever hear of loss leaders? Some parts of a typical hospital make money while others lose it hand over fist. The overall margin isn’t across the board, it’s after everything hopefully balances out. ER’s for example are money pits, but society really needs them. https://www.definitivehc.com/resources/healthcare-insights/h...

Exactly this. They need to offset the areas where they lose money. And we have federal laws (justifiably so, IMHO) that ERs must provide stabilizing services regardless of insurance and ability to pay.

And while that law is obviously humane and reasonable, my only gripe is that the rest of our system is so backwards that it increasingly forces people to leverage that. There was a story about a woman who needed dialysis but had no insurance. So basically, she had to wait every couple weeks until she started breaking down, go to the ER, get emergency dialysis, get sent home. Rinse, repeat.

I don't blame her but really just the system that made this her best possible option.

https://kdvr.com/news/local/every-week-this-woman-nearly-die...

Re: Universal health coverage could save $1T and 114k lives a year: study

#470

Post by jaredklewis »

atmavatar wrote: post #452
brandonb wrote: post #113

I'd like to believe this, but the study makes a bunch of really hasty assumptions. The authors derive the $1T number from $1.3T in total cost savings and $304B in incremental spend (incremental spend is due to insuring more people). The $1.3T in cost savings come from five big buckets: lower pharmaceutical prices, Medicare-level payments to providers, reduced administrative overhead, less fraudulent billing, and fewe…

> Hospitals have an operating margin of 2-5% I'm curious where you got this figure, because it doesn't track with my own experience. I used to work for a place that worked closely with hospital clients (and prospective clients) to resolve billing issues with a particular EMR system, and we regularly discovered that a given hospital was losing hundreds of thousands to millions of dollars weekly due to missing charges.…

Not the parent, but here's one source: https://www.vizient.com/insights/reports/national-hospital-f...

There are many others as well.

FWIW, your experience doesn't seem contradictory to the operating margin claims.

Your experience seems to be that hospitals are run very inefficiently, implying that if they were run efficiently that their operating margins would be much higher than 2-5%. That may be the case, but that still means the Yale paper's claims don't make sense (unless they also propose some mechanism by which to suddenly force all hospitals to start operating efficiently).

But I'm also skeptical of your claim that hospitals are leaving a huge amount of operating margin on the table. IME, very little can be explained by "everyone is stupid." Would I be surprised if a given hospital was run very inefficiently or if a given hospital had a particular poor CIO or administrator? Not in the slightest. Would I be surprised if ALL hospitals were run by idiots who were leaving 10% operating margin on the table? Yes, I would be.

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