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How to Charge $546 for Six Liters of Saltwater

nytimes.com

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Re: How to Charge $546 for Six Liters of Saltwater

#41

Post by mahyarm »

DanielBMarkham wrote: post #11

It's always in the seller's interest to create a complex and opaque system of pricing, especially when the buyer doesn't even pay for the services. This is why free markets aren't the answer to everything. It's free and open markets that drive efficiency out of any process. The problem here is one of incentives. If I promise to pay you for mowing your neighbor's lawn, and he rarely reviews what you're doing and I rar…

I've noticed convoluted pricing happens in these industries for consumers:

  - Airfare
  - Cell phones
  - Many telecom services
  - Banking & finance
  - Healthcare
  - Lawyers?
  - Accountants?
One common pattern they have is they're prone to monopoly effects either through regulation or network effects.

Re: How to Charge $546 for Six Liters of Saltwater

#42

Post by zdean »

microcolonel wrote: post #32

They don't clarify though, the costs of running a sufficiently-advanced multiple-effect distiller, dealing with the FDA, WHO and whomever else forces them to... these costs could definitely add up, no? What do you think the bar is for entering the market of providing water for injection? Who's there to make it costlier, maybe the insurance oligopoly can hold some of the blame for this as well...

Apparently the bar isn't too high:

http://www.zorotools.com/g/00107210/k-G4226537?utm_source=go...

Re: How to Charge $546 for Six Liters of Saltwater

#43

Post by ucha »

dnautics wrote: post #10
w1ntermute wrote: post #9

Earlier quoted context omitted.

I'm not sure why the overall size of the population is relevant here. If it works for countries with populations of 5 million (Norway), 63 million (UK), 82 million (Germany), and 126 million (Japan), I think it's completely reasonable to at least try it in a country of 319 million.

Ethnic homogeneity is also an issue. If you think that an arab living in france gets the same quality of healthcare as a european french person at the same poverty level, you're kidding yourself. Not that the US doesn't have these problems. Ultimately, different ethnicities get different diseases, too, so the bureaucrats in charge of deciding what gets covered and to what extent are basically institutionalizing racia…

That is absolutely false. All French citizens and even foreigners enrolled in the "securite sociale" scheme have access to the same facilities, procedures and doctors. There is no discrimination in the public service. Any claims to the contrary are at best unfamiliarity with the subject if not deliberate misinformation.

Re: How to Charge $546 for Six Liters of Saltwater

#44

Post by AsymetricCom »

jes wrote: post #31
smokinn wrote: post #29

Earlier quoted context omitted.

Sounds like the problem isn't actually medicare, sounds more like it's adding a capitalistic, profit-maximizing middleman into the system.

With respect, what does capitalism mean to you? Lassiez-Faire or something different?

I'm sure competition fits in there somewhere.

Re: How to Charge $546 for Six Liters of Saltwater

#45

Post by icegreentea »

microcolonel wrote: post #32

They don't clarify though, the costs of running a sufficiently-advanced multiple-effect distiller, dealing with the FDA, WHO and whomever else forces them to... these costs could definitely add up, no? What do you think the bar is for entering the market of providing water for injection? Who's there to make it costlier, maybe the insurance oligopoly can hold some of the blame for this as well...

They list the manufacturer sale price right there ($1.07 a liter). The manufacturer is the one who has to go through the certifications, capital costs, and part of the overhead. All the remaining cost (the remaining 89 dollars) is overhead from the hospital, middle distributors (if they exist) and the such.

The the majority of the cost of capital, dealing with regulation, and other "justified" increases is absorbed into the manufacturer sale price.

Re: How to Charge $546 for Six Liters of Saltwater

#46

Post by noonespecial »

csense wrote: post #3
kumarski wrote: post #2

I keep getting that feeling that something must be done. Any suggestions HN readers?

Turn healthcare into a government bureaucracy. Because that's an effective way to combat waste, inefficiency, and overcharging

The government is wasteful and inefficient, but it is not the most wasteful and inefficient system possible.

Politics is the art of figuring out when to burn the extra resources on the government method because all of the other available methods are even worse.

Re: How to Charge $546 for Six Liters of Saltwater

#47

Post by ekianjo »

coenhyde wrote: post #27

The problem with having healthcare under private enterprise is that these healthcare providers do not operate under the free market conditions we assume they do. There is no "perfect information" allowing consumers to choose the cheapest price. As the article points out the pricing structure is very opaque. Not to mention the "consumers" want the best product regardless of cost, after all we are talking about their l…

They dont operate in a free market. Everything is closely regulated and the patient cannot compare costs. Companies which would like to provide lower costs services would not be allowed to advertise them.

Re: How to Charge $546 for Six Liters of Saltwater

#48

Post by smokinn »

jes wrote: post #31
smokinn wrote: post #29

Earlier quoted context omitted.

Sounds like the problem isn't actually medicare, sounds more like it's adding a capitalistic, profit-maximizing middleman into the system.

With respect, what does capitalism mean to you? Lassiez-Faire or something different?

The current sense of the term in which I use it now is capital-maximizing. If you have money, if you're capitalistic, you should be investing in what can make you the most money, or, if you're bought in to a system, you should be extracting the most "value" from it as possible.

I'm not using it as a political term, rather to describe our current, quarter-profit-maximization system driven by the stock market and public company board + CEO directives for how to run a company.

It's great for efficiently using capital to exploit existing innovations but it's really bad at things like investing in the public, social good of things like healthcare.

Re: How to Charge $546 for Six Liters of Saltwater

#50

Post by mattstocum »

nikatwork wrote: post #36

Many in this thread are claiming that price fixing wouldn't occur in a "truly free" market. This is misty-eyed naivety. In a completely deregulated free market, it is even more in the hospitals' interest to form a price-fixing cartel. Any new player in the market trying to set reasonable market prices could be excluded through market pressure tactics (eg, tell distributors don't sell to them or our cartel will no lon…

Even if there were perfect competition, it doesn't matter much, people don't comparison shop for ERs. If you are having a heart attack, you're not in a position to compare prices at local hospitals.
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