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Nonprofit hospitals spend billions on consultants with no clear effect

uchicagomedicine.org

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Re: Nonprofit hospitals spend billions on consultants with no clear effect

#71

Post by akramachamarei »

boxed wrote: post #64
bawana wrote: post #58

The whole premise of 'for-profit' healthcare stinks to high heaven. Regardless of hospitals calling themselves 'non-profit', they behave like profit seeking enterprises. This is the ultimate corporate double speak. The bottom line is that - people do not get to choose their illness. So a capitalist model in Adam Smith's sense where people get to 'choose' their 'insurance' based on price and benefit is an illusion. It…

There's a third option though: the state is the customer, not the individual. Then private healthcare can work. Insurance companies sort of try to emulate that, but it doesn't really work.

What do you mean by the state is the customer? As in they act as a buyer of healthcare for taxpayers? Why would we expect that to be better?

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#72

Post by akramachamarei »

CWwdcdk7h wrote: post #56
Jensson wrote: post #49

Earlier quoted context omitted.

Why should it be illegal to help people for profit? That is what doctors do, they profit a lot when they help people, they could live on much smaller salaries than they currently have but of course market economics makes it so we want to pay doctors higher salaries than they really need.

People don't seem medical services because they want to, they do it when they need them. It is the only industry where there price list might as well be replaced with "we will take as much as you can afford". No one can afford to be stingy with money with health and live of their loved ones on stake. It is very asymmetric situation, so it is clear to me why someone would want to ban for profit hospitals.

> we will take as much as you can afford

This is only true where medical service providers have no competition. In fact, the state often facilitates this lack of competition.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#73

Post by akramachamarei »

boxed wrote: post #65
thefz wrote: post #45

Earlier quoted context omitted.

Why should there be any profit in healthcare.

Why should someone sell food for a profit? We literally DIE within DAYS of we can't get food! You see the issue here right? Now.. who pays is the question. Imo it must be the state, because otherwise there are too many perverse incentives.

You don't foresee perverse incentives for the state being the buyer of healthcare? Namely, they aren't the patient, so the incentives have already been divorced is remote, plus they have an incentive to divert funds to consultants, regulators, and lobbyists that the actual consumer doesn't care about. There's some saying about how no one spends someone else's money as wisely as one's own.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#74

Post by scarier »

auggierose wrote: post #70
aesh2Xa1 wrote: post #66

Earlier quoted context omitted.

I think your position seems reasonable, too. Though intuitive, it isn't the reality. The tax-exempt status is granted for Exempt Purposes, but not as a matter of altruistic intention: https://www.irs.gov/charities-non-profits/charitable-organiz... For example, ask your favorite LLM search engine: Can you list non-profits/501(c)(3) that are US defense contractors? Draper Laboratory and Energetics Technology Center are…

You will see that in your link "charitable" is printed in bold. Yes, other "exempt purposes" are tacked onto that in US law, if that is reasonable I leave up to you. Given that the NRA counts as a non-profit, not sure there is anything reasonable about giving them tax breaks. But hey, you also voted for Trump. Twice.

Just to be clear, the NRA Foundation and the NRA are distinct entities (the NRA is not a non-profit), even though the Foundation was more or less obviously created to take advantage of tax law. Hilariously, the NRA recently sued the Foundation.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#75

Post by insane_dreamer »

arjie wrote: post #38

Realistically, non-profit hospitals aren't non-profit because they are altruistic in some sense. It's because that is a tax-efficient structure for them. Given that, the participants in the structure must have a mechanism to extract money from the machine. It's a bit of a cynical view, but I believe many non-profits are organized in this fashion and their vendor contracts are the mechanism of value extraction. Beside…

> Realistically, non-profit hospitals aren't non-profit because they are altruistic in some sense. It's because that is a tax-efficient structure for them.

I disagree. There may be some exceptions, but generally non-profit hospitals were not set up as for-profit companies because the primary purpose of a for-profit company is to generate value for its shareholders. Not having shareholders, who if large enough have considerable power over you, removes a very large and perverse incentive to put profits over the public the hospital is serving. Instead the profits generated (and non-profits can turn a profit of course) must be re-invested into the business as retained earnings, thus benefitting the public.

IMO, for-profit hospitals should not exist for the same reason that for-profit prisons should not exist.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#76

Post by digdugdirk »

arjie wrote: post #38

Realistically, non-profit hospitals aren't non-profit because they are altruistic in some sense. It's because that is a tax-efficient structure for them. Given that, the participants in the structure must have a mechanism to extract money from the machine. It's a bit of a cynical view, but I believe many non-profits are organized in this fashion and their vendor contracts are the mechanism of value extraction. Beside…

Wait... How does Ikea operate using a tax advantaged method?

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#77

Post by boxed »

akramachamarei wrote: post #73
boxed wrote: post #65

Earlier quoted context omitted.

Why should someone sell food for a profit? We literally DIE within DAYS of we can't get food! You see the issue here right? Now.. who pays is the question. Imo it must be the state, because otherwise there are too many perverse incentives.

You don't foresee perverse incentives for the state being the buyer of healthcare? Namely, they aren't the patient, so the incentives have already been divorced is remote, plus they have an incentive to divert funds to consultants, regulators, and lobbyists that the actual consumer doesn't care about. There's some saying about how no one spends someone else's money as wisely as one's own.

States have huge incentives to keep the population healthy though. Sick days aren't a tax base.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#78

Post by boxed »

akramachamarei wrote: post #71
boxed wrote: post #64

Earlier quoted context omitted.

There's a third option though: the state is the customer, not the individual. Then private healthcare can work. Insurance companies sort of try to emulate that, but it doesn't really work.

What do you mean by the state is the customer? As in they act as a buyer of healthcare for taxpayers? Why would we expect that to be better?

Yea. I expect it to be better because we have this in Sweden and it's vastly better than the US' system :P But there are many other things that are different of course, so hard to know which is which.

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#79

Post by GauntletWizard »

digdugdirk wrote: post #76
arjie wrote: post #38

Realistically, non-profit hospitals aren't non-profit because they are altruistic in some sense. It's because that is a tax-efficient structure for them. Given that, the participants in the structure must have a mechanism to extract money from the machine. It's a bit of a cynical view, but I believe many non-profits are organized in this fashion and their vendor contracts are the mechanism of value extraction. Beside…

Wait... How does Ikea operate using a tax advantaged method?

Complicated legal structures, and favorable treatment by a government who uses it as a form of cultural diplomacy. The tldr is that there's a nonprofit that owns the company that operates as Ikea, while there's some concessions made to a for-profit that owns the IKEA branding.

https://www.europeanceo.com/business-and-management/ikea-com...

Re: Nonprofit hospitals spend billions on consultants with no clear effect

#80

Post by AngryData »

boxed wrote: post #65
thefz wrote: post #45

Earlier quoted context omitted.

Why should there be any profit in healthcare.

Why should someone sell food for a profit? We literally DIE within DAYS of we can't get food! You see the issue here right? Now.. who pays is the question. Imo it must be the state, because otherwise there are too many perverse incentives.

To be fair, farms average 1-2% profit margins at best, its not like they are making bank off you, it is barely enough for most farms to survive even if they got 1,000 acres.
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