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The American Healthcare Conundrum

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Re: The American Healthcare Conundrum

#651

Post by paulddraper »

linsomniac wrote: post #244

Healthcare administrative overhead in the US is pretty huge and has been for a long time. Back in the early 90s I worked on claim processing software and I recall it being discussed as being around a third of healthcare costs. Last year this podcast said that nobody wants to solve this because solving it is going to eliminate (IIRC) hundreds of thousands of jobs. Which is a point to consider. In 2021, the U.S. spent…

> Last year this podcast said that nobody wants to solve this because solving it is going to eliminate (IIRC) hundreds of thousands of jobs. Which is a point to consider.

This is legitimately mentioned in the industry.

Imagine the "you need developers!" crowd on HN, but 5x stronger.

Re: The American Healthcare Conundrum

#652

Post by lotsofpulp »

Retric wrote: post #640
lotsofpulp wrote: post #323

Earlier quoted context omitted.

> That gap between the overturn rate and the appeal rate is where the profit lives. Or doesn’t live. https://www.macrotrends.net/stocks/charts/UNH/unitedhealth-g... All the other managed care organizations have similar 2% profit margins. It is funny seeing complaints of excess profit margins from businesses earning 2%, that compete against non profits, from people on a forum composed of employees of tech businesses e…

Profit margins are difficult to compare across industries, game developers on average have great profit margins in part because all the studios that fail quickly stop counting. Grocery stores on the other hand are a known as a low margin business, but as people constantly need more food every month it can be really stable. Further as most stock turns over multiple times a month your return on capital can be extremely…

The point of a profit margin is to be able to compare a seller's pricing power across industries. It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse. For insurers, not only do customers have a choice to switch to a different insurer, but insurance prices have to be approved by government employees.

And total returns are the end all, be all for measuring investment performance. Just because some volatile video game businesses go bust does not make the grocery business or insurance business attractive. I could just as easily put my money into SP500 and earn far more with far less (almost zero) risk.

Re: The American Healthcare Conundrum

#653

Post by shimman »

snarf21 wrote: post #575
shimman wrote: post #549

Earlier quoted context omitted.

Why make this so complicated when we can just have medicare for all? You're right that healthcare shouldn't be tied to your employment, but what you're proposing is something that only the rich + affluent can achieve independently. All you're doing is playing musical chairs with different capitalists, just stop playing the game. A large part of the electorate wants to stop playing the game.

I think politically it is an easier sell than medicare for all or government only healthcare.

You need to do some actual canvassing and get out of your SV bubble, M4A polls at a consistent 60% support where both independents and democrats are at nearly 80% support.

What you're advocating is more corporate welfare that I don't see happening but it's the only playbook those with money seem to advocate for.

Weird.

Re: The American Healthcare Conundrum

#654

Post by novok »

tacticalturtle wrote: post #388
sneak wrote: post #276

Earlier quoted context omitted.

Doctors are only part of the problem. Nurses and all of the other skilled positions also all suck up huge amounts of money because there are shortages of all of them. It was bad even before COVID, it’s even worse now. There are tons of regulations prohibiting the significant increase in creating new doctors and nurses (and air traffic controllers, but that’s a different but remarkably similar story). Limits on new pr…

Again like doctors, nurse wages aren’t a major factor in the discrepancy between US healthcare costs and elsewhere. They are a factor, in a death by a thousand cuts situation. In a source posted by another commenter, their wages are accountable for 5% of the difference. I also don’t think it’s accurate to say regulations are what’s prohibiting an increase in nurses. They don’t have a government imposed mechanism like…

But why is it a tough job? Partially it's the shift hours, they could offer it with less hours and more nurses for example. But they don't due to undersupply, and on it goes.

Re: The American Healthcare Conundrum

#655

Post by Retric »

lotsofpulp wrote: post #652
Retric wrote: post #640

Earlier quoted context omitted.

Profit margins are difficult to compare across industries, game developers on average have great profit margins in part because all the studios that fail quickly stop counting. Grocery stores on the other hand are a known as a low margin business, but as people constantly need more food every month it can be really stable. Further as most stock turns over multiple times a month your return on capital can be extremely…

The point of a profit margin is to be able to compare a seller's pricing power across industries. It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse. For insurers, not only do customers have a choice to switch to a different insurer, but insurance prices have to be approved by government employees. And total returns are the end all, be all for…

> It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse.

By that logic the cap’s on annual profits by insurance companies suggest significant pricing power by insurers.

As to S&P vs a grocery store, there are grocery chains in the S&P there’s nothing wrong with the business model. As always the arguments for starting a business are more complicated than the alternatives due to the amount of leverage you can get etc. Further a weekly turnover at 2% is a rather insane annual ROI, we’re talking 100% return on investment though obviously actual business don’t just concern themselves with groceries, labor, and rent.

Re: The American Healthcare Conundrum

#656

Post by lotsofpulp »

Retric wrote: post #655
lotsofpulp wrote: post #652

Earlier quoted context omitted.

The point of a profit margin is to be able to compare a seller's pricing power across industries. It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse. For insurers, not only do customers have a choice to switch to a different insurer, but insurance prices have to be approved by government employees. And total returns are the end all, be all for…

> It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse. By that logic the cap’s on annual profits by insurance companies suggest significant pricing power by insurers. As to S&P vs a grocery store, there are grocery chains in the S&P there’s nothing wrong with the business model. As always the arguments for starting a business are more complicate…

>By that logic the cap’s on annual profits by insurance companies suggest significant pricing power by insurers.

I disagree. If I was a seller, and if I had pricing power, then I would not settle for a 2% profit margin when the cap is 15% or more. The only reason I would settle for 2% is because I cannot sell for my product or service at higher prices or in higher volumes to get more than 2%.

>Further a weekly turnover at 2% is a rather insane annual ROI, we’re talking 100% return on investment

I don't know what definition of return on investment you are using, but it does not match any that I am familiar with based on share price and dividend history of any publicly listed grocer (kroger/albertsons/walmart/target). Obviously, Costco has done well, and Amazon, but those are not strictly due to selling groceries, or retail in general.

Re: The American Healthcare Conundrum

#657

Post by Retric »

lotsofpulp wrote: post #656
Retric wrote: post #655

Earlier quoted context omitted.

> It invalidates attempts to claim the seller is able unilaterally act in their interests without the customer having recourse. By that logic the cap’s on annual profits by insurance companies suggest significant pricing power by insurers. As to S&P vs a grocery store, there are grocery chains in the S&P there’s nothing wrong with the business model. As always the arguments for starting a business are more complicate…

>By that logic the cap’s on annual profits by insurance companies suggest significant pricing power by insurers. I disagree. If I was a seller, and if I had pricing power, then I would not settle for a 2% profit margin when the cap is 15% or more. The only reason I would settle for 2% is because I cannot sell for my product or service at higher prices or in higher volumes to get more than 2%. >Further a weekly turnov…

A 10% or 20% cap is only relevant if the company is hitting the cap. Operating a subdivision with a lower profit margin is a different matter, that’s no longer an insurance company hell they could be selling porn and it would be equally irrelevant.

Instead what matters here is that insurance companies by your own admission clearly have pricing power and that’s a problem.

> does not match any that I am familiar with based on share price and dividend history of any publicly listed grocer

Return on capital when starting a company is different than return on investment when buying a public company. If a company is kicking off 1 Billion dollars a year it doesn’t matter if it cost 10 million or 10 billion dollars building the company, you pay for the share based on future revenue. When starting a company however it very much matters if it takes 10 million or 10 billion to get off the ground.

Re: The American Healthcare Conundrum

#659

Post by glitchc »

kdheiwns wrote: post #636
glitchc wrote: post #424

Earlier quoted context omitted.

The whole debate is about what insurance companies are paying for those services, right? It's when one walks in without insurance that you see the true cost of the service. > The only reason you would pay that much is if you're visiting a private no-insurance clinic and not using insurance What alternatives does a tourist have? If Japan truly had cheaper procedures, it would see a huge uptick in medical tourism. Ther…

A country has no obligation to make its medical system cheap and affordable for tourists. Your mention of "foreigner" was wrong because foreigners have access to all the same health care as a local. No matter what country on earth you go to, a tourist will pay more than a resident for doctor's visit. That's why travel insurance exists. And health tourism is a disaster for any country since it results in high paying f…

I think the salient point is that in all jurisdictions, there are subsidies for locals, either through government or private industry, to make health care affordable. That those subsidies create perverse incentives is unsurprising. Since perverse incentives distort the market, they are not useful. Hence we cannot measure the true cost of health care by looking at what locals pay, because there isn't one single rate for a local (this includes free/fully subsidized). The true cost of the service is most clearly evident to those who do not qualify for any subsidies, it makes the most sense to measure that.

I mention medical tourism because it's a real thing. People do shop around globally to take advantage of medical systems where the cost-to-service ratio is beneficial to them, and in many cases, not all but many, those people are paying the true cost of delivering that service (this includes the flight cost).

Re: The American Healthcare Conundrum

#660

Post by snarf21 »

shimman wrote: post #653
snarf21 wrote: post #575

Earlier quoted context omitted.

I think politically it is an easier sell than medicare for all or government only healthcare.

You need to do some actual canvassing and get out of your SV bubble, M4A polls at a consistent 60% support where both independents and democrats are at nearly 80% support. What you're advocating is more corporate welfare that I don't see happening but it's the only playbook those with money seem to advocate for. Weird.

No offense, but that is meaningless.

60% support abortion but he we are with no Roe. 70% support gay marriage but the small percentage in charge want to outlaw it.

It takes more than polling to become legislation. Weird indeed.

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