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

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

#421

Post by sarpeedo »

nickff wrote: post #208
snarf21 wrote: post #155

Earlier quoted context omitted.

This is why we need reference based pricing. You can't charge more than 1.2 * Medicare and if you pay cash, you get the Medicare price. This change alone would remove 25+% of unnecessary bloat from the US system.

> "This change alone would remove 25+% of unnecessary bloat from the US system." Where do you think the money is going? Insurance companies are not as profitable as you might think, drugs are not a massive burden on healthcare expenditures, and many hospitals are non-profits. The truth is that most of the money is going to staff wages; if you want to reduce healthcare spending, the only way to do it sustainably is to…

Even if you drive down staff salaries physician, nurse, and everyone else working in the hospital, the profits that are made from those changes would simply be pocketed by the CEOs and MBAs in the system.

Many business which successfully reduce costs don't pass on those savings to consumers.

I will also point out medical students graduate (after 4 years college and 4 years medical school) on average with $210,000 of debt and make $60,000 dollars a year while working 60-80 hours a week for 3-8 years of residency. While yes doctors after residency are well compensated they have gone through 11-16 years of post secondary education by the time they achieve these salaries. Cutting salaries without reforming medical school tuition and residency salaries would be a mistake.

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

#422

Post by FireBeyond »

rsj_hn wrote: post #414
CPLX wrote: post #341

Earlier quoted context omitted.

> So far no one has been able to do it. But that's the problem with your argument. Of course people have done it, nearly every developed country has. > 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. No, it won't. I'm talking about eliminating the positions…

To believe that administrative overhead would significantly reduce healthcare costs is just obviously false. We spend 20% of GDP on healthcare and UK spends 10%. Total spend is employees * average salary per employee. Let's take a look: * For doctors, there are roughly the same number, ~2.8 per 1000, but US doctors earn three times as much as UK doctors[1]. 294K/year US versus 66K/year (UK). * The US has twice as man…

> The US has 40 MRI machines per million. The UK has 6.

Funny story - these days most DI (diagnostic imaging) machines (CT, fMRI, PET) are owned by doctors or consortiums of doctors.

They are money printing machines.

Doctors, and manufacturers know this. Manufacturers will find you doctors you can partner up with to buy DI assets, and get set up. You can pay off a CT machine in a couple of months, even high end fMRI in under a year. The manufacturer will finance. They'll even help you write CON applications (Certificate of Need, a nice little thing that hospitals lobbied for to reduce competition - if a new hospital wants to open up in an area it has to demonstrate that the existing community healthcare needs are being underserved. And the existing hospital gets input into the process). A nice little imaging production line.

Interestingly, though perhaps unsurprisingly, doctors who own an interest in imaging equipment tend to refer their patients to it at a rate approaching 2 standard deviations higher (comparing specialties like-for-like).

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

#423

Post by trixie_ »

mullingitover wrote: post #118
trixie_ wrote: post #103

Earlier quoted context omitted.

I'm not a fan of the guy, but this is probably the most important/good thing he did with his presidency. Price transparency is the most fundamental first step to driving down health care costs. Once people get a taste of it, it will drive even more, better and accurate data. Start real conversations about costs and open the door to measureable improvement through innovation.

Price transparency is a pointless shell game designed to keep everyone strung along on the entrenched, failed system. When you're having a heart attack, the last thing you're doing is shopping around for the best prices on heart attack emergency treatment. The free market has no place in health care, because in the hands of the free market the first thing that will happen in a life-threatening emergency is for you to…

Price gouging especially in a system with transparent pricing is not difficult to prevent with laws.

This is really is the ideal place for government in healthcare. Make the laws, set the standards, level the playing field and let the free market work just like in every other facet of society.

It’s funny people who see how incompetent and irresponsible our government is on a daily basis think that handing healthcare over to them is a good idea.

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

#424

Post by nums »

flowerlad wrote: post #364
nums wrote: post #328

I studied this years ago for years. My summary: - 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 compariso…

The solution is to make the consumer participate in driving costs down. One employer I know of has an excellent solution to the problem: Make employees pay 100% of the bill up to a certain amount, such as $6000. That's a large amount, but the employer then contributes a large amount to your Health Savings Account (HSA), such as $4000. This amount is for you to keep regardless of whether you have any health bills or n…

100% agree. It's a good start.

Also, I think emergency healthcare should be contemplated differently than ... I'll call it "premeditated healthcare". In one instance, the individual can make a deliberate shopping decision and weigh cost/benefit. That's fundamentally different than an ambulance taking you to the ER when you're bleeding out ... no price shopping then.

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

#425

Post by COGlory »

jonathan-adly wrote: post #63

I am one of the people responsible for making these lists. The fact that the general public as well as journalists think this data is accurate in anyway is really funny. This an exercise of futility that only increases the overall cost and provides job security for me :) No one working in a hospital knows how much do we acquire things for, or how much we get paid for doing things in advance. And only like 8 people ca…

>Take the simple exercise of figuring out cost/revenue of an aspirin administration.

>Cost depends on: 1. Are you an outpatient/Obsveration v. inpatient v. ED? 2. Are you on Medicaid? 3. Is the hospital a part of GPO organization or not? 4. Is contractual obligations of GPO includes/excludes Aspirin?

Wrong.

Cost depends on "how much does the raw aspirin cost in bulk + some standard overhead cost"

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

#426

Post by hamburglar »

ben0x539 wrote: post #220
hamburglar wrote: post #187

Earlier quoted context omitted.

Yes, our medical/dental insurance industry has encouraged the attitude of “cost doesn’t matter, because it’s free to you (oh and besides, you can’t put a price on your health, can you, you cheapskate?)” which just serves to constantly let prices grow out of control. This is an instrumental part of how our healthcare costs got so high. It also is why it’s laughable to think of medical care as a free market: you can’t…

I don't think consumers budgeting can realistically be the control on the growth of healthcare costs. For one thing, people's budgets vary too wildly. Healthcare should simply be "free", ie budgeted into the operation of a modern society, like infrastructure costs and education.

Oh, I completely agree with this. In the meantime, the HDHP and acknowledging that, yes, you are paying for your healthcare is the best option.

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

#427

Post by paulddraper »

lotsofpulp wrote: post #137
rpmisms wrote: post #82

Earlier quoted context omitted.

Not technically "insurance", these are cost-sharing companies. Often religious due to Obama's brilliance.

Is there evidence that Obama wanted those religious exemptions and bullshit cost sharing plans? I would be willing to bet that was a concession to other politicians in Congress in order to get ACA passed.

You misread. Parent thought those are a decent option and it's unfortunate that their availability is restricted.

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

#428

Post by paulddraper »

satronaut wrote: post #189
jonathan-adly wrote: post #63

I am one of the people responsible for making these lists. The fact that the general public as well as journalists think this data is accurate in anyway is really funny. This an exercise of futility that only increases the overall cost and provides job security for me :) No one working in a hospital knows how much do we acquire things for, or how much we get paid for doing things in advance. And only like 8 people ca…

You're in charge of literally saving lives but you can't handle something as standard as cost estimation? How can you joke about that? Figuring out the cost to the hospital in terms of materials and labor should be standard. Example, an x-ray. You know you need to pay an x-ray tech X$/Hour and after doing 1,000's of x-rays, a hospital should have it down that somebody with a broken leg will require N hours (maybe .5,…

> You're in charge of saving lives but you can't handle something as standard as cost estimation.

The irony, coming from a profession which is notoriously bad at cost estimation.

But in any case, the difficultly is not so much the materials/services as much as figuring out what the patient's insurance company (which is completely different then the practice) will cover and by how much. But of course that's actually what matters to the patient.

They know medicine, not the intricacies of your particular insurance policy.

Source: Am founder of rivethealth.com which does cost estimation.

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

#429

Post by CPLX »

rsj_hn wrote: post #414
CPLX wrote: post #341

Earlier quoted context omitted.

> So far no one has been able to do it. But that's the problem with your argument. Of course people have done it, nearly every developed country has. > 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. No, it won't. I'm talking about eliminating the positions…

To believe that administrative overhead would significantly reduce healthcare costs is just obviously false. We spend 20% of GDP on healthcare and UK spends 10%. Total spend is employees * average salary per employee. Let's take a look: * For doctors, there are roughly the same number, ~2.8 per 1000, but US doctors earn three times as much as UK doctors[1]. 294K/year US versus 66K/year (UK). * The US has twice as man…

> What we need to cut are salaries and employment. If you don't acknowledge that, then you are not a serious participant in this discussion because you are refusing to acknowledge that this problem has tough trade offs. You are not going to solve it by "cutting waste".

Yes I agree. Take the windfall profit motive out of the system and you’ll see quite a bit of change. Paying doctors less sounds like a great plan.

But we can start with the truly staggering amount of deadweight loss. Do you actually interact with the US health care system? Is it really that hard to understand just how much energy is wasted fucking around with just the billing component alone?

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

#430

Post by Spivak »

mwerd wrote: post #355
callmeal wrote: post #255

Earlier quoted context omitted.

>You're making the reasonable-sounding (but incorrect) assumption that the cost to the hospital of a drugs is the same for every patient. Why shouldn't it be? How hard is it for a hospital to project their annual aspirin/paracetamol/? usage and budget for it?

Easy. Now try it at a rural critical access hospital for rattlesnake antivenom with a short shelf life, so it usually expires unused. They are required by law to stock it or they cannot have their emergency room open. Estimate the revenue generated from treating the one patient who needs it every other year, and by the way, you have 9 contracted payers with different rates and you don't know which one, if any, the pa…

Radioactive pharmacy is another example of insane pricing complexity (and logistics) because of the short half life problem.
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