Author Topic: Free-market based healthcare. What does it mean?  (Read 1658 times)

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Free-market based healthcare. What does it mean?
« on: March 17, 2017, 01:51:09 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

FL_MM

  • 5 O'Clock Shadow
  • *
  • Posts: 28
  • Location: Florida
Re: Free-market based healthcare. What does it mean?
« Reply #1 on: March 17, 2017, 02:05:07 PM »
IMO, free market healthcare is just a nice term for if you can't afford it, you have to do without. Is that really the type of country we want to be? 

prognastat

  • Pencil Stache
  • ****
  • Posts: 698
  • Age: 28
  • Location: Texas
Re: Free-market based healthcare. What does it mean?
« Reply #2 on: March 17, 2017, 02:10:58 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

Well it all depends on the level of free they advocate for.

1. Completely free to the point where you don't have to have healthcare and you can be refused treatment if you can't pay for it and don't have insurance. This is not what we had before ACA and are unlikely to have after ACA. This would lead directly to people dying.
2. Free to not have insurance, but not free to refuse service. This leads to medical bankruptcies and raising the prices of these services for everyone else and the tax payers. So it just allows people to take advantage of everyone else if they opt out of coverage when they can't afford the costs themselves.
3. Not free to not have insurance and no need to be able to refuse service since everyone has coverage. This would mean forcing people to have insurance through paying of this with taxes.

There are of course some possibilities between these three but these 3 cover the main options.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #3 on: March 17, 2017, 02:22:57 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

Well it all depends on the level of free they advocate for.

1. Completely free to the point where you don't have to have healthcare and you can be refused treatment if you can't pay for it and don't have insurance. This is not what we had before ACA and are unlikely to have after ACA. This would lead directly to people dying.
2. Free to not have insurance, but not free to refuse service. This leads to medical bankruptcies and raising the prices of these services for everyone else and the tax payers. So it just allows people to take advantage of everyone else if they opt out of coverage when they can't afford the costs themselves.
3. Not free to not have insurance and no need to be able to refuse service since everyone has coverage. This would mean forcing people to have insurance through paying of this with taxes.

There are of course some possibilities between these three but these 3 cover the main options.

Those are the options I can think of too. But how can anyone want options 1 and 2 who's not at least a multimillionaire? If you get cancer or other unexpected condition almost nobody could afford to pay out of pocket, and the next time you apply for insurance they would charge $10,000/month, if would insure you at all! You're a certain risk, and profit drain at that point, so why agree to cover your treatment unless you can pay in an equal amount?

Same with age. It's a near certainty you'll need expensive treatment at some point, so past a certain age it's no longer profitable for anyone to insure you, or at best for insane amounts.

You can drive you're whole life and never use your car or fire insurance, but you're 99% sure to need expensive medical care at some point. So how does a risk pool, i.e. people willing to pay because they need it consisting of sick and/or old people work? Because healthy people will only be willing to pay for the cheapest plans.

tarheeldan

  • Pencil Stache
  • ****
  • Posts: 663
Re: Free-market based healthcare. What does it mean?
« Reply #4 on: March 17, 2017, 02:27:50 PM »
I think you can see why the idea that healthcare could be provided in a perfectly competitive market where suppliers are price-takers and everything is hunky-dory (this is the scenario people seem to envision when they say "free market") is preposterous.

There are so many reasons there will be market failures without appropriate regulation, some of which you highlighted:

1. Insurance companies have economies of scale where the more people they can put into the risk pool the better
2. There are significant barriers to entry into the market. Start an Etsy shop, sure. Start a competitor to BCBS, not so much.
3. The two above mean there will be few firms with concentrated market power, and they can then price discriminate to extract consumer surplus and turn it into producer surplus.
4. Asymmetric information - you know how healthy you are and you control your behaviors but insurance companies don't
5. Adverse selection and moral hazard - as you said, the more risky individuals are the most likely to sign up. Once a person has insurance, they are marginally more likely to take risks with their health since they have it.
6. Imperfect and opaque market for medical services
7. Huge financial incentives for insurers to shirk or write contracts that are heavily in their favor.
8. Externalities - my being healthy benefits me X. I don't think about how my being healthy benefits society Y (lower costs, etc). So I put in a suboptimal (societally) effort in my health. See 5.

I probably missed some other, big reasons. The main point is the beautiful, perfect information, perfectly competitive free market is a small subset (potato chips, bubble gum, etc.) and not a realistic descriptor of many markets where people nevertheless try to apply the concept.
« Last Edit: March 17, 2017, 02:29:22 PM by tarheeldan »

Ichabod

  • 5 O'Clock Shadow
  • *
  • Posts: 18
Re: Free-market based healthcare. What does it mean?
« Reply #5 on: March 17, 2017, 02:35:03 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

Some free market proposals are:
High deductible health plans and HSAs (consumers paying for more of their healthcare directly)
Eliminating the employer tax-deduction for healthcare (consumers buying their own insurance directly)
Eliminating certificates of need (hospitals can expand without consulting the state)
Decreasing licensing requirements (more opportunities to be physician's assistants, nurse practitioners, midwives, etc.)
Allowing drug imports
Streamlining the drug approval process (more drugs making it to market)
Allowing insurers to sell across state lines (theoretically more competition)


There's a spectrum here. It's not people dying on the streets or single-payer, and people's policy preferences can be really diverse. Maybe one person thinks there should be no government subsidies, but we need stringent regulation of pharmaceutical companies, or another persons think the opposite.

prognastat

  • Pencil Stache
  • ****
  • Posts: 698
  • Age: 28
  • Location: Texas
Re: Free-market based healthcare. What does it mean?
« Reply #6 on: March 17, 2017, 02:37:26 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

Well it all depends on the level of free they advocate for.

1. Completely free to the point where you don't have to have healthcare and you can be refused treatment if you can't pay for it and don't have insurance. This is not what we had before ACA and are unlikely to have after ACA. This would lead directly to people dying.
2. Free to not have insurance, but not free to refuse service. This leads to medical bankruptcies and raising the prices of these services for everyone else and the tax payers. So it just allows people to take advantage of everyone else if they opt out of coverage when they can't afford the costs themselves.
3. Not free to not have insurance and no need to be able to refuse service since everyone has coverage. This would mean forcing people to have insurance through paying of this with taxes.

There are of course some possibilities between these three but these 3 cover the main options.

Those are the options I can think of too. But how can anyone want options 1 and 2 who's not at least a multimillionaire? If you get cancer or other unexpected condition almost nobody could afford to pay out of pocket, and the next time you apply for insurance they would charge $10,000/month, if would insure you at all! You're a certain risk, and profit drain at that point, so why agree to cover your treatment unless you can pay in an equal amount?

Same with age. It's a near certainty you'll need expensive treatment at some point, so past a certain age it's no longer profitable for anyone to insure you, or at best for insane amounts.

You can drive you're whole life and never use your car or fire insurance, but you're 99% sure to need expensive medical care at some point. So how does a risk pool, i.e. people willing to pay because they need it consisting of sick and/or old people work? Because healthy people will only be willing to pay for the cheapest plans.

I have yet to hear a good argument to that. It mostly seems to be coming from a I shouldn't be forced to pay for other's misfortune coming from people who have not had any major health concerns yet.

There is the fact that everyone having coverage means we are planning for all the costs instead of having to deal with costs as they come. If there weren't people performing medical bankruptcy then prices for medication/procedures could be lower since the doctors, hospitals etc wouldn't have to calculate the cost of people filing bankruptcy in to the cost for everyone(so the cost is still being shared either way, but instead now you are allowing people to take advantage of it in a sense).

Also the only way for the cost to be affordable for everyone is to have a large and diverse enough pool to keep the average risk low and thus prices low. Allowing healthy or lower risk people to have lower coverage means that instead these costs are spread only on the people actually at high risk making it hard to afford which limits the pool even more raising the price etc etc.

Then there is the fact that the government can run it at cost since it doesn't need to make a profit and appease shareholders.

Finally having a single health insurer means the government has the ability to force down prices since the healthcare providers can't just refuse service since that would be refusing service to all possible customers.

prognastat

  • Pencil Stache
  • ****
  • Posts: 698
  • Age: 28
  • Location: Texas
Re: Free-market based healthcare. What does it mean?
« Reply #7 on: March 17, 2017, 02:53:59 PM »
I've read some more right-leaning news sources, trying to understand the viewpoints. On thing that comes up in the healthcare debate is that it's terrible now (because (Obamacare of course), and if someone acknowledge it was expensive and gave poor results before ACA too, one point brought up is that it's because it was too much regulation/government regulation. If only we had "free-market" healthcare we would have superior results. But what does this mean exactly? What would this entail?

From the way I see and understand it, a free market healthcare system can only work if we all accept that some (possible many) people will have no insurance, likely no healthcare, and be sick and dying? High-risk people mean potentially large payout (i.e. loss). How do you deal with high risk? Increase costs, or they refuse to insure at all. So if we had a "free" insurance market, with no caps on premiums, no regulation of coverage etc, wouldn't that just mean that healthy people wouldn't have insurance, or very limited and cheap coverage. The people who really need insurance (the sick) are people insurers would not want to cover, or only at very, very high costs (and the sick often don't have much money in the first place).

If a company sell gizmos, and I want to buy gizmos we can both get what we want, at the right price. But the service sick people need is the very service insurance companies want to avoid giving. I'm having trouble wrapping my brain around how supply/demand philosophy is supposed to work in giving everyone what they want in this market. Am I missing something? What is the argument for how this is supposed to work?

Some free market proposals are:
High deductible health plans and HSAs (consumers paying for more of their healthcare directly)
Eliminating the employer tax-deduction for healthcare (consumers buying their own insurance directly)
Eliminating certificates of need (hospitals can expand without consulting the state)
Decreasing licensing requirements (more opportunities to be physician's assistants, nurse practitioners, midwives, etc.)
Allowing drug imports
Streamlining the drug approval process (more drugs making it to market)
Allowing insurers to sell across state lines (theoretically more competition)


There's a spectrum here. It's not people dying on the streets or single-payer, and people's policy preferences can be really diverse. Maybe one person thinks there should be no government subsidies, but we need stringent regulation of pharmaceutical companies, or another persons think the opposite.

"High deductible health plans and HSAs (consumers paying for more of their healthcare directly)"
I doubt this is something that will work, as nice as it would be too many people would simply not save enough, then there is also the problem that until you get significant amount of money in to the HSA you might not have enough to afford the high deductibles.

"Eliminating the employer tax-deduction for healthcare (consumers buying their own insurance directly)"
I would agree that this at least would be a step in the right direction since by having this be a benefit based on your employer you are first off locked in to needing an employer and secondly you are dependent on your employer actually providing a good plan.

"Decreasing licensing requirements (more opportunities to be physician's assistants, nurse practitioners, midwives, etc.)"
Possibly, but you also want some form of quality control so to speak. You want to make sure the people providing medical service are appropriately educated/trained.

"Allowing drug imports"
Only reason this isn't the case is because corporate influence.

"Streamlining the drug approval process (more drugs making it to market)"
Is a tight rope balancing act since you want to ensure products are fully vetted before people take something that could be potentially hazardous to themselves.

"Allowing insurers to sell across state lines (theoretically more competition)"
Hard to say, an argument can be made in the few states that do allow this it hasn't. A counter argument could be made that unless it were all states this could be different.

ncornilsen

  • Pencil Stache
  • ****
  • Posts: 598
Re: Free-market based healthcare. What does it mean?
« Reply #8 on: March 17, 2017, 02:57:13 PM »
Nice straw man, FL_MM. That's not free market anything.

What Scandium is describing would be a mess, for sure. The problem with our current system isn't so much the insurance market, but rather the actual provision of care. Our current paradigm has everyone spending someone else's money, so nobody feels market pressure to reign in costs. Look at elective surgeries - the cost of those procedures in real terms has gone DOWN while everything else has gone up.

A more free market system, for example, would create a system where people are prevented from being ruined financially by a medical event, but still requires them to foot the bill, or have some skin in the game, for the small scale stuff. I don't think that's unreasonable at all.

Another free market healthcare thing would be to eliminate the situations where insurance acting as a pass-through for some costs, like birth control and contact solution. (There are better ways to ensure accessibility to these things.)

It would also entail eliminating the massive administrative overhead created by the half-million different insurance plans, networks, rules, etc that result in extra admin costs. (IE: policies can be standard across state lines.) This is an efficiency that socialized healthcare and a free market solution could both do...

A purely free-market solution in this market would leave some people without care... but I'm not convinced that without a strong market feedback loop in the healthcare system it will not be sustainable, as we are witnessing with the slow collapse of European entitlement states.

Spork

  • Walrus Stache
  • *******
  • Posts: 5697
    • Spork In The Eye
Re: Free-market based healthcare. What does it mean?
« Reply #9 on: March 17, 2017, 03:24:59 PM »
A purely free-market solution in this market would leave some people without care... but I'm not convinced that without a strong market feedback loop in the healthcare system it will not be sustainable, as we are witnessing with the slow collapse of European entitlement states.

Maybe... but I'm skeptical.  There are teaching and research hospitals that treat people in exchange for  experience for new doctors.

I'll also mention that, while I don't know a huge number of docs personally, the ones I know are so "into" doctoring, that treating people matters more than the money. 

My dad was a physician and there was a little slip of paper in every bill that said: "At my age it seems to me that every charge for physician services (or anything else) is too high. Please know that I do not want to place a hardship on anyone and am willing and able to furnish your surgical needs without charge.  Please call if you need your bill to be lowered or canceled.  Quite often I do not know what you are charged."

Dad was very hard right conservative and would have fought tooth and nail to be free of government health controls.  But he also didn't mind giving it away for free.  As a kid it was quite common that someone gave him a pie (or equivalent) for his services.  He smiled and accepted it as payment.
« Last Edit: March 17, 2017, 03:37:15 PM by Spork »
Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
To relax their restless flight

cheapass

  • Bristles
  • ***
  • Posts: 466
  • Location: Dallas, Texas
  • On track for FIRE @ 40
Re: Free-market based healthcare. What does it mean?
« Reply #10 on: March 17, 2017, 03:34:45 PM »
IMO, free market healthcare is just a nice term for if you can't afford it, you have to do without. Is that really the type of country we want to be?

There's that, or there's using the government to force your neighbor to pay for it. The ethics of both approaches are debatable.

Then there is the fact that the government can run it at cost since it doesn't need to make a profit and appease shareholders.

How's that working out for the post office? Do we really want the same goons in charge of the PO, the VA, and social security in charge of everyone's healthcare?
« Last Edit: March 17, 2017, 03:43:14 PM by cheapass »
Every single decision you make with money either shortens or lengthens your working career.

prognastat

  • Pencil Stache
  • ****
  • Posts: 698
  • Age: 28
  • Location: Texas
Re: Free-market based healthcare. What does it mean?
« Reply #11 on: March 17, 2017, 04:08:30 PM »
IMO, free market healthcare is just a nice term for if you can't afford it, you have to do without. Is that really the type of country we want to be?

There's that, or there's using the government to force your neighbor to pay for it. The ethics of both approaches are debatable.

Then there is the fact that the government can run it at cost since it doesn't need to make a profit and appease shareholders.

How's that working out for the post office? Do we really want the same goons in charge of the PO, the VA, and social security in charge of everyone's healthcare?

Instead you would rather have a for profit that has every incentive to not pay out if at all possible take care of it instead? Or denies people due to it not being cost effective to cover them?

This is also ignoring that both these systems have been shown viable as government programs in many other countries and the fact that plenty of politicians actively work against these services either to benefit the private sector or due to their political beliefs about the service. This would make it more of an argument against the politicians than the services themselves.

ncornilsen

  • Pencil Stache
  • ****
  • Posts: 598
Re: Free-market based healthcare. What does it mean?
« Reply #12 on: March 17, 2017, 04:20:38 PM »
IMO, free market healthcare is just a nice term for if you can't afford it, you have to do without. Is that really the type of country we want to be?

There's that, or there's using the government to force your neighbor to pay for it. The ethics of both approaches are debatable.

Then there is the fact that the government can run it at cost since it doesn't need to make a profit and appease shareholders.

How's that working out for the post office? Do we really want the same goons in charge of the PO, the VA, and social security in charge of everyone's healthcare?

Instead you would rather have a for profit that has every incentive to not pay out if at all possible take care of it instead? Or denies people due to it not being cost effective to cover them?

This is also ignoring that both these systems have been shown viable as government programs in many other countries and the fact that plenty of politicians actively work against these services either to benefit the private sector or due to their political beliefs about the service. This would make it more of an argument against the politicians than the services themselves.

you two are talking past each other.

there NEEDS to be a profit incentive for the provision of the care, manufacture of the drugs, etc... Period. Without this, "at cost" means "at ever increasing cost" a-la the post office, and many other government run endeavors.

When it comes to paying for the service, and insurance, there's where the economics push toward non-payment. THAT needs fixed. I'm not convinced single payer is the only, or the best way to fix this, as it removed incentives from the consumer to self-ration care in a workable way.

As for how viable these are in other countries... some not so much. some are.  I do not anticipate they will exist in anything resembling their current form by 2030.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #13 on: March 17, 2017, 05:45:20 PM »
I thank for the responses, but I haven't gotten a satisfactory answer. How do you solve fundamental issue of insurance companies not being able to profitabily covering the people who need it (the sick), while only making profits of covering the people who don't need it (the healthy)? I don't see how this can be solved no matter how free the market? Or should I say only possible if we allow huge amounts of people to not have coverage (e.g. Once you're old maybe $100k per year premiums? Just guessing)

BTW the old argument that single payer is more expensive is nonsense so please don't bother. US spends more than almost every other country, and cover fewer people. As percent of GDP the US spends TWICE that of the UK on health care, in addition to all private spending! The US is so clearly the worst when it comes to this so just adopting the system of a any random industrialized nation would be a huge improvement.

cheapass

  • Bristles
  • ***
  • Posts: 466
  • Location: Dallas, Texas
  • On track for FIRE @ 40
Re: Free-market based healthcare. What does it mean?
« Reply #14 on: March 17, 2017, 06:19:59 PM »
US spends more than almost every other country, and cover fewer people. As percent of GDP the US spends TWICE that of the UK on health care, in addition to all private spending!

I think personal lifestyle choices here in the US are a significant contributor to our out of control healthcare spending.
Every single decision you make with money either shortens or lengthens your working career.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #15 on: March 17, 2017, 06:47:32 PM »
US spends more than almost every other country, and cover fewer people. As percent of GDP the US spends TWICE that of the UK on health care, in addition to all private spending!

I think personal lifestyle choices here in the US are a significant contributor to our out of control healthcare spending.
I find that a pretty inadequate explanation for a double the spending (yes I know in gdp % only, not relative or per capita). British lifestyle is pretty similar to the US (and imagine those dental bills..) Canada even more so, it's basically a colder US. There's as much McDonald's and TV watching there. Yet they both spend orders of magnitude less.

CDP45

  • Pencil Stache
  • ****
  • Posts: 508
Re: Free-market based healthcare. What does it mean?
« Reply #16 on: March 17, 2017, 10:49:40 PM »
I think the retirement problem is similar to health insurance, basically the choices made over a lifetime have a consequence when you don't have the ability to change the outcome.

The retirement problem has been "solved" by forced savings into social security, but obviously not everyone chooses to neglect saving for a more comfortable future, and so not everyone has the same standard of living in retirement.

The healthcare problem is not solved because there is legally only 1 standard of care in the US, which encourages free-riding because anyone paying less than the per-capita cost of about $9,000 is being subsidized, and encouraging costs to rise as their use costs less than 100% of the cost.

The only solution other than bankrupting the US government and millions of families along the way is to have costs closer align with what the user pays. I think different tiers of care will have to exist for people to chose from.

I think drugs like Provenge can't be part what is publicly subsidized if we want healthcare to be affordable for most people.
Provenge extended median survival by 4.1 months compared to control and costs $100,000 and Medicare spent $183,000,000 on just that drug in 2013. That spending could have paid for 5x the families entire healthcare costs for a year and it was squandered. I'm sorry but another 4 months of life beyond 65 are meaningless for me, especially with what good could be done with that money. Literally 9,150 FAMILIES could have had annual market-price healthcare for what was spent on 1,830 old men living a couple more months.

A line has to be drawn for public healthcare in dollars per life years, something like $50,000 or even $100,000 could have dramatic savings. And people would be free to pay for it, but we're running out of money, healthcare is already 20% of the economy and rapidly rising.
The game will be changing soon, hopefully it will get better instead of worse.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #17 on: March 18, 2017, 08:25:45 AM »
I think the retirement problem is similar to health insurance, basically the choices made over a lifetime have a consequence when you don't have the ability to change the outcome.

The retirement problem has been "solved" by forced savings into social security, but obviously not everyone chooses to neglect saving for a more comfortable future, and so not everyone has the same standard of living in retirement.

The healthcare problem is not solved because there is legally only 1 standard of care in the US, which encourages free-riding because anyone paying less than the per-capita cost of about $9,000 is being subsidized, and encouraging costs to rise as their use costs less than 100% of the cost.

The only solution other than bankrupting the US government and millions of families along the way is to have costs closer align with what the user pays. I think different tiers of care will have to exist for people to chose from.

I think drugs like Provenge can't be part what is publicly subsidized if we want healthcare to be affordable for most people.
Provenge extended median survival by 4.1 months compared to control and costs $100,000 and Medicare spent $183,000,000 on just that drug in 2013. That spending could have paid for 5x the families entire healthcare costs for a year and it was squandered. I'm sorry but another 4 months of life beyond 65 are meaningless for me, especially with what good could be done with that money. Literally 9,150 FAMILIES could have had annual market-price healthcare for what was spent on 1,830 old men living a couple more months.

A line has to be drawn for public healthcare in dollars per life years, something like $50,000 or even $100,000 could have dramatic savings. And people would be free to pay for it, but we're running out of money, healthcare is already 20% of the economy and rapidly rising.
The game will be changing soon, hopefully it will get better instead of worse.
Ok, so do other industrialized countries not pay for drugs like provenge? Is that how they spend half what we do?

Listen; any time anyone bring up "the problem is x". I'll ask is that the reason almost all other countries cover more people (usually their whole populace) for less?

I'm usually more libertarian/selfish, but I'm not convinced there's a good market solution to this
« Last Edit: March 18, 2017, 02:11:10 PM by Scandium »

Ichabod

  • 5 O'Clock Shadow
  • *
  • Posts: 18
Re: Free-market based healthcare. What does it mean?
« Reply #18 on: March 18, 2017, 12:18:42 PM »
US spends more than almost every other country, and cover fewer people. As percent of GDP the US spends TWICE that of the UK on health care, in addition to all private spending!

I think personal lifestyle choices here in the US are a significant contributor to our out of control healthcare spending.
I find that a pretty inadequate explanation for a double the spending (yes I know in gdp % only, not relative or per capita). British lifestyle is pretty similar to the US (and imagine those dental bills..) Canada even more so, it's basically a colder US. There's as much McDonald's and TV watching there. Yet they both spend orders of magnitude less.

I find government vs private insurance an inadequate explanation for double the spending. There's more differences between the US and Europe than just how healthcare is funded. Different drug approval regimes, less hospital infrastructure, lower paid healthcare professionals, less educated doctors, more midwives...

Single-payer wouldn't be disastrous. I'd support a version of single-payer where the government acted as a catastrophic insurer. But if we get rid of the private insurers and replaced it with the government paying for everything and nothing else changes, the United States would still be paying way too much for healthcare, and some people would still be unable to get care. Ability to pay would just be replaced with ability to wait or show sufficient need. E.g. If our current health system can only provide healthcare for 30 million and another 30 million want but can't get healthcare, changing who foots the bill isn't going to increase our healthcare capacity to 60 million.

Ichabod

  • 5 O'Clock Shadow
  • *
  • Posts: 18
Re: Free-market based healthcare. What does it mean?
« Reply #19 on: March 18, 2017, 12:26:24 PM »
"High deductible health plans and HSAs (consumers paying for more of their healthcare directly)"
I doubt this is something that will work, as nice as it would be too many people would simply not save enough, then there is also the problem that until you get significant amount of money in to the HSA you might not have enough to afford the high deductibles.

"Eliminating the employer tax-deduction for healthcare (consumers buying their own insurance directly)"
I would agree that this at least would be a step in the right direction since by having this be a benefit based on your employer you are first off locked in to needing an employer and secondly you are dependent on your employer actually providing a good plan.

"Decreasing licensing requirements (more opportunities to be physician's assistants, nurse practitioners, midwives, etc.)"
Possibly, but you also want some form of quality control so to speak. You want to make sure the people providing medical service are appropriately educated/trained.

"Allowing drug imports"
Only reason this isn't the case is because corporate influence.

"Streamlining the drug approval process (more drugs making it to market)"
Is a tight rope balancing act since you want to ensure products are fully vetted before people take something that could be potentially hazardous to themselves.

"Allowing insurers to sell across state lines (theoretically more competition)"
Hard to say, an argument can be made in the few states that do allow this it hasn't. A counter argument could be made that unless it were all states this could be different.

HSAs could be government funded or setup like SS or the superannuation in Australia.
Re: drug imports: I think we agree that corporate influence doesn't equate to free market.
And I'm also skeptical that allowing insurers to sell across state lines would lower prices much. It might make insurance more available in some rural areas.

Reducing licensing requirements and streamlining the FDA process both have trade-offs, but if we want cheaper healthcare like Europe, they would help. My understanding is that in most Europe it's possible to become a doctor years faster than it is here, and that it is also cheaper to get drugs approved.

protostache

  • Pencil Stache
  • ****
  • Posts: 668
Re: Free-market based healthcare. What does it mean?
« Reply #20 on: March 18, 2017, 12:57:54 PM »
This is a huge derail but

Quote
How's that working out for the post office? Do we really want the same goons in charge of the PO, the VA, and social security in charge of everyone's healthcare?

I would love for the people in charge of USPS to be in charge of a national health care system. They run an extremely challenging service under tight constraints with great efficiency. The only reason USPS is having to raise prices at the rate they are is because Congress put an unfair restriction on their pension fund, one that no other department shares.

rosaz

  • Stubble
  • **
  • Posts: 166
Re: Free-market based healthcare. What does it mean?
« Reply #21 on: March 18, 2017, 01:28:46 PM »
I think drugs like Provenge can't be part what is publicly subsidized if we want healthcare to be affordable for most people.
Provenge extended median survival by 4.1 months compared to control and costs $100,000 and Medicare spent $183,000,000 on just that drug in 2013. That spending could have paid for 5x the families entire healthcare costs for a year and it was squandered. I'm sorry but another 4 months of life beyond 65 are meaningless for me, especially with what good could be done with that money. Literally 9,150 FAMILIES could have had annual market-price healthcare for what was spent on 1,830 old men living a couple more months.

A line has to be drawn for public healthcare in dollars per life years, something like $50,000 or even $100,000 could have dramatic savings. And people would be free to pay for it, but we're running out of money, healthcare is already 20% of the economy and rapidly rising.
The game will be changing soon, hopefully it will get better instead of worse.
Ok, so do other industrialized countries not pay for drugs like provenge? Is that how they spend half what we do?

I can't speak for all other countries, but my understanding is that UK's NHS, for example, would not pay for that. The NHS is supposed to spend less than than £20,000 to £30,000 (~$24k to $37k) per Quality-Adjusted Life Year (http://www.bbc.com/news/health-28983924). A quality-adjusted life year reflects how long a treatment would give you of healthy life (and since many of these patients wouldn't be in full health for those 4 months anyway some kind of factor would probably be applied (.7 or so? I'm guessing). The article does state that they'll frequently spend up to twice that on end-of-life care.

Even so though: $100,000/ (.33 * .7) <-- years gained * health factor = $432,900 per QALY

Even if you don't add in any health factor, you'd still get $300k per year of life saved, which is 4 times higher than even twice that $37k. So yes, I think that's at least a big part of the reason other countries spend less than we do. People here call that  rationing and say its heartless, but the truth is, we all ration everyday. When we decide to cut gym and recess time at our schools (to save time, i.e. money), or cut back on the price (quality) of school lunches, or decide whether we can afford the technology to reduce the car fumes urban kids breathe... we're rationing with regards to how much we're willing to pay per life saved. We have this idea in this country that it's ok to ration for everything else, except healthcare (and then it's evil) even though there's a lot of other ways to save more life (as in years of life) per dollar than end-of-life care.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #22 on: March 21, 2017, 10:23:13 AM »
Well, I guess we might find out soon enough:
http://www.cnn.com/2017/03/20/politics/three-bucket-health-care/index.html

I still have no idea what the Republican's "ideal" healthcare system looks like. Does anyone have a good source? How would Paul Ryan set it up if he had full control, has anyone asked him? They opposed all of obamacare so that means opposing; lifetime payout caps, denying based on pre-existing conditions, and premium caps.

So right now it seems to me like they'd prefer:
Everyone pays full cost of insurance. If you get seriously ill (or old) you get denied insurance or reach your cap and a) pay $500,000+ for all your care yourself b) die. I mean at least it's simple and efficient..

rocketpj

  • Pencil Stache
  • ****
  • Posts: 597
Re: Free-market based healthcare. What does it mean?
« Reply #23 on: March 21, 2017, 10:58:43 AM »
From the outside looking in, it means you are writing off a large proportion of your population is unworthy.

You Americans have this argument but are apparently unwilling to look at other examples around the world (Because America Fuck Yeah!). 

The most efficient and best outcomes happen with single payer universal coverage.  We have it in Canada - 10 different versions of it with many variations.  Europe has dozens of other variations.  All better outcomes at a lower cost per capita.

And we pay lower taxes in Canada (to rebut the obvious claim).  Lower personal taxes, lower corporate taxes. 

Maybe consider having one less carrier group, maybe halve the nuclear arsenal so you can only vaporize the whole planet 5 times instead of 10?  Crazytalk I know, but if it extends the lives of millions of your fellow citizens...

acroy

  • Handlebar Stache
  • *****
  • Posts: 1218
  • Age: 39
  • Location: Dallas TX
    • SWAMI
Re: Free-market based healthcare. What does it mean?
« Reply #24 on: March 21, 2017, 11:49:03 AM »
And we pay lower taxes in Canada (to rebut the obvious claim). 
wrong-o
https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP
Canada 32%, US of A 26%. America fuck Yeah is right.
SWAMI (Satisfied Working Advanced Mustachian Individual) 1 stash, 1 DW, 7 Mini MM's...
God, Family, Country. Everything else is details.

protostache

  • Pencil Stache
  • ****
  • Posts: 668
Re: Free-market based healthcare. What does it mean?
« Reply #25 on: March 21, 2017, 11:49:32 AM »
From the outside looking in, it means you are writing off a large proportion of your population is unworthy.

Correct.

golden1

  • Handlebar Stache
  • *****
  • Posts: 1384
  • Location: MA
Re: Free-market based healthcare. What does it mean?
« Reply #26 on: March 21, 2017, 11:53:31 AM »
One interesting model for removing the insurance from health care is something like this guy:

http://www.golddirectcare.com/

If they had one of these type of practices closer to me, I would be sorely tempted to drop my expensive premium insurance and pick up a bronze level high deductible catastrophic plan.  You basically pay a flat monthly fee per family member for basic care non-emergency services.  No insurance involved, and continuity of care from the same practice, which is something I value.  I would imagine that this type of service would incentivize this practice to keep his costs lower. 

stratozyck

  • 5 O'Clock Shadow
  • *
  • Posts: 34
Re: Free-market based healthcare. What does it mean?
« Reply #27 on: March 21, 2017, 12:26:10 PM »
I think you can see why the idea that healthcare could be provided in a perfectly competitive market where suppliers are price-takers and everything is hunky-dory (this is the scenario people seem to envision when they say "free market") is preposterous.

There are so many reasons there will be market failures without appropriate regulation, some of which you highlighted:

1. Insurance companies have economies of scale where the more people they can put into the risk pool the better
2. There are significant barriers to entry into the market. Start an Etsy shop, sure. Start a competitor to BCBS, not so much.
3. The two above mean there will be few firms with concentrated market power, and they can then price discriminate to extract consumer surplus and turn it into producer surplus.
4. Asymmetric information - you know how healthy you are and you control your behaviors but insurance companies don't
5. Adverse selection and moral hazard - as you said, the more risky individuals are the most likely to sign up. Once a person has insurance, they are marginally more likely to take risks with their health since they have it.
6. Imperfect and opaque market for medical services
7. Huge financial incentives for insurers to shirk or write contracts that are heavily in their favor.
8. Externalities - my being healthy benefits me X. I don't think about how my being healthy benefits society Y (lower costs, etc). So I put in a suboptimal (societally) effort in my health. See 5.

I probably missed some other, big reasons. The main point is the beautiful, perfect information, perfectly competitive free market is a small subset (potato chips, bubble gum, etc.) and not a realistic descriptor of many markets where people nevertheless try to apply the concept.

I am a PhD economist. I endorse this reply. There is no such thing as "free market healthcare." Kenneth Arrow (died recently) won a Nobel Prize and as early as the 1950s he was preaching this.

The key thing is market power. Free market/libertarian types generally base their conclusions on the "perfect competition" model of markets. Only problem is, this is an "optimal" market that really only exists in a few products, if at all. Most markets have some degree of buyer or seller power. You hate your cable company but love your supermarket (in general) in large part because of this.

The two mindsets can get drastically different conclusions. Minimum wages always cause unemployment in perfect competition (if set above equilibrium) but not necessarily so in models of market power (buyer power on low skilled workers). You see this market power evidenced by how crappy low wage workers are treated today vs decades ago. They tell you your schedule a week before and its your responsibility to find a replacement if something comes up, or you are fired. People can drop out of the labor force faster this way and if you had a government propping up the labor side it can actually increase employment and working conditions.

Spork

  • Walrus Stache
  • *******
  • Posts: 5697
    • Spork In The Eye
Re: Free-market based healthcare. What does it mean?
« Reply #28 on: March 21, 2017, 12:35:08 PM »

The key thing is market power. Free market/libertarian types generally base their conclusions on the "perfect competition" model of markets. Only problem is, this is an "optimal" market that really only exists in a few products, if at all. Most markets have some degree of buyer or seller power. You hate your cable company but love your supermarket (in general) in large part because of this.


Interesting example.  The supermarket is likely free market.  The cable company is a government mandated monopoly.
Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
To relax their restless flight

Telecaster

  • Pencil Stache
  • ****
  • Posts: 820
Re: Free-market based healthcare. What does it mean?
« Reply #29 on: March 21, 2017, 01:40:39 PM »
Nice straw man, FL_MM. That's not free market anything.

What Scandium is describing would be a mess, for sure. The problem with our current system isn't so much the insurance market, but rather the actual provision of care. Our current paradigm has everyone spending someone else's money, so nobody feels market pressure to reign in costs. Look at elective surgeries - the cost of those procedures in real terms has gone DOWN while everything else has gone up.

I agree with the premise, and it is certainly true in practice for elective proceedures.  Let's say you want Lasik.  You shop around, you talk to people who have had the proceedure, maybe talk to a few clinics and then pick the one you like the best, price being one of the factors. 

But how does that work say, a heart attack?  Do you shop around for the cheapest ER?  Check WebMD so see if a catheter is really necessary?  Do you quibble over the price of nitroglycerine?  Or lets say you have a sports injury.   Your insurance probably limits your network, so you can't shop around much.   If the doctor wants an x-ray, do you then spend a day or two shopping around, or do you do it right there in his office?   You can see that while the straight free market approach works for some things, it can't work for others. 

Quote
A purely free-market solution in this market would leave some people without care... but I'm not convinced that without a strong market feedback loop in the healthcare system it will not be sustainable, as we are witnessing with the slow collapse of European entitlement states.

Are we seeing that?  Most European states have lower debt/GDP and lower deficit/GDP than we do.   That looks more sustainable to me than what we are doing. 

http://www.oecd-ilibrary.org/economics/government-deficit_gov-dfct-table-en

Most people know that we pay higher per capita health care costs than other developed countries.  But one thing many people don't realize is that our government spending alone per capita is also higher (including tax expenditures too, of course).   Let that sink in for a minute.  Even if we removed the private insurance industry in its entirety our health care would still be the most expensive.   

There is clearly an unsustainable path, and it is the one we are on.   


CDP45

  • Pencil Stache
  • ****
  • Posts: 508
Re: Free-market based healthcare. What does it mean?
« Reply #30 on: March 21, 2017, 01:47:44 PM »

The key thing is market power. Free market/libertarian types generally base their conclusions on the "perfect competition" model of markets. Only problem is, this is an "optimal" market that really only exists in a few products, if at all. Most markets have some degree of buyer or seller power. You hate your cable company but love your supermarket (in general) in large part because of this.


Interesting example.  The supermarket is likely free market.  The cable company is a government mandated monopoly.

The "perfect competition" strawman is really lame, and no, libertarian conclusions aren't based on that premise. What we're saying is that better outcomes and less waste results with less regulation.

A funny example is where traditional economists "proved" the used car market couldn't exist: https://en.wikipedia.org/wiki/The_Market_for_Lemons. Just another ridiculous justification for more government intervention based on the myth of "market failure."

 "beautiful, perfect information, perfectly competitive free market" isn't a necessary condition of high-qualify economic goods delivered to the masses at affordable prices.

Oh, and just a hint that market power is highly correlated with massive regulation and government monopoly grants.

CDP45

  • Pencil Stache
  • ****
  • Posts: 508
Re: Free-market based healthcare. What does it mean?
« Reply #31 on: March 21, 2017, 02:00:32 PM »
From the outside looking in, it means you are writing off a large proportion of your population is unworthy.

You Americans have this argument but are apparently unwilling to look at other examples around the world (Because America Fuck Yeah!). 

The most efficient and best outcomes happen with single payer universal coverage.  We have it in Canada - 10 different versions of it with many variations.  Europe has dozens of other variations.  All better outcomes at a lower cost per capita.

And we pay lower taxes in Canada (to rebut the obvious claim).  Lower personal taxes, lower corporate taxes. 

Maybe consider having one less carrier group, maybe halve the nuclear arsenal so you can only vaporize the whole planet 5 times instead of 10?  Crazytalk I know, but if it extends the lives of millions of your fellow citizens...

Gee what about the hundreds of thousands of people in Canada with Hep C the government is refusing to pay for? Guess that would reduce the costs by not providing healthcare:

Quote
But, whatever the price, it's steep enough that only those patients whose liver disease has progressed to Stage 2 will qualify for publicly funded medication.

That is a tough message to deliver to patients who know they have a life-threatening illness and want access to the cure before it gets worse, says Shawn Sharma, general manager of the Vancouver centre where Masters is being treated.
http://www.cbc.ca/news/health/hepatitis-c-medication-expensive-cure-1.3359149

Hope I don't have a broken bone in Canada and have to wait 38 weeks on average:
http://www.ctvnews.ca/health/healthcare-wait-times-hit-20-weeks-in-2016-report-1.3171718
http://www.cbc.ca/news/canada/british-columbia/patients-lives-ruined-as-hip-surgery-waits-grow-1.2976196

Jesus 3 years for a mother age 55 to get a hip replacement??
Quote
"Iím very angry. I donít understand whatís going on here. I really donít. Itís not like this is a new problem," said Bennett, who is among more than 3,000 people in B.C. currently waiting for new hips. "There are lives ruined."

"My mom is not suffering because there is nothing we can do," said Borelloís daughter Renata, "This is the type of suffering that could be resolved right now."

Demand up, waits grow

Among larger provinces, statistics show B.C.ís increasing wait times are the longest Ė twice as long as in Ontario, where earlier wait-time improvements have also slipped.  Demand is up everywhere.

Among all provinces, only Saskatchewan showed significant, consistent reductions in wait times since 2009. 

Bennett was referred for surgery on her right hip in November of 2013 and said sheís been told she wonít get in until early in 2016. She said her joint has deteriorated so much she is unable to work or even function without strong narcotic painkillers.

Sign me up...

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #32 on: March 21, 2017, 02:30:07 PM »


Ask how many Canadians would rather have the US system? The US healthcare system is pretty much the worst in the industrialized world, both in cost and medical outcomes. That's close to an objective fact.

http://www.commonwealthfund.org/publications/issue-briefs/2015/oct/us-health-care-from-a-global-perspective

ps: the US wins in prescription drug use though! yey USA!

Spork

  • Walrus Stache
  • *******
  • Posts: 5697
    • Spork In The Eye
Re: Free-market based healthcare. What does it mean?
« Reply #33 on: March 21, 2017, 02:48:13 PM »


Ask how many Canadians would rather have the US system? The US healthcare system is pretty much the worst in the industrialized world, both in cost and medical outcomes. That's close to an objective fact.

http://www.commonwealthfund.org/publications/issue-briefs/2015/oct/us-health-care-from-a-global-perspective

ps: the US wins in prescription drug use though! yey USA!

I know I am totally taking away the wrong thing from this and running off down a rabbit hole, but wtf causes Denmark to have so many diabetic amputations?  Especially since it looks like they have a (relatively) low obesity rate.  (Sorry, that just jumped out at me as a really strange anomaly.)
Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
To relax their restless flight

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #34 on: March 21, 2017, 02:51:33 PM »


Ask how many Canadians would rather have the US system? The US healthcare system is pretty much the worst in the industrialized world, both in cost and medical outcomes. That's close to an objective fact.

http://www.commonwealthfund.org/publications/issue-briefs/2015/oct/us-health-care-from-a-global-perspective

ps: the US wins in prescription drug use though! yey USA!

I know I am totally taking away the wrong thing from this and running off down a rabbit hole, but wtf causes Denmark to have so many diabetic amputations?  Especially since it looks like they have a (relatively) low obesity rate.  (Sorry, that just jumped out at me as a really strange anomaly.)

huh, no idea. Both  danes and germans (2nd place) love to drink beer and eat sausages though. Does cured meat lead/contribute to diabetes..?
« Last Edit: March 23, 2017, 09:49:48 AM by Scandium »

lemonlyman

  • 5 O'Clock Shadow
  • *
  • Posts: 29
Re: Free-market based healthcare. What does it mean?
« Reply #35 on: March 21, 2017, 02:59:24 PM »
Insurance companies are always the boogeymen in the US, but the provider side that is out of control with costs. Insurance companies have to maintain strategic network contracts with providers in order to attract employer groups and customers to buy their insurance. Obviously at a profit because business, but it's the providers demands that have to be met in order to get those contracts. Higher payments to providers = higher premiums. The provider side of the equation is extremely distorted in the US. *When I say "provider", I'm mostly referring to hospitals not independent physicians. It's not easy for independent physicians to negotiate good contracts. Larger specialty groups can though.

rocketpj

  • Pencil Stache
  • ****
  • Posts: 597
Re: Free-market based healthcare. What does it mean?
« Reply #36 on: March 21, 2017, 03:48:49 PM »
From the outside looking in, it means you are writing off a large proportion of your population is unworthy.

You Americans have this argument but are apparently unwilling to look at other examples around the world (Because America Fuck Yeah!). 

The most efficient and best outcomes happen with single payer universal coverage.  We have it in Canada - 10 different versions of it with many variations.  Europe has dozens of other variations.  All better outcomes at a lower cost per capita.

And we pay lower taxes in Canada (to rebut the obvious claim).  Lower personal taxes, lower corporate taxes. 

Maybe consider having one less carrier group, maybe halve the nuclear arsenal so you can only vaporize the whole planet 5 times instead of 10?  Crazytalk I know, but if it extends the lives of millions of your fellow citizens...

Quote
Gee what about the hundreds of thousands of people in Canada with Hep C the government is refusing to pay for? Guess that would reduce the costs by not providing healthcare:

Not a perfect system, such a thing doesn't exist.  Want to compare infant mortality, deaths in childbirth, life expectancy (across all socioeconomic groups), and overall availability of care?  Or are you maybe cherrypicking a counterpoint to avoid cognitive dissonance?

Quote
But, whatever the price, it's steep enough that only those patients whose liver disease has progressed to Stage 2 will qualify for publicly funded medication.

That is a tough message to deliver to patients who know they have a life-threatening illness and want access to the cure before it gets worse, says Shawn Sharma, general manager of the Vancouver centre where Masters is being treated.
http://www.cbc.ca/news/health/hepatitis-c-medication-expensive-cure-1.3359149

Hope I don't have a broken bone in Canada and have to wait 38 weeks on average:
http://www.ctvnews.ca/health/healthcare-wait-times-hit-20-weeks-in-2016-report-1.3171718
http://www.cbc.ca/news/canada/british-columbia/patients-lives-ruined-as-hip-surgery-waits-grow-1.2976196

Jesus 3 years for a mother age 55 to get a hip replacement??
Quote
"Iím very angry. I donít understand whatís going on here. I really donít. Itís not like this is a new problem," said Bennett, who is among more than 3,000 people in B.C. currently waiting for new hips. "There are lives ruined."

"My mom is not suffering because there is nothing we can do," said Borelloís daughter Renata, "This is the type of suffering that could be resolved right now."

Demand up, waits grow

Among larger provinces, statistics show B.C.ís increasing wait times are the longest Ė twice as long as in Ontario, where earlier wait-time improvements have also slipped.  Demand is up everywhere.

Among all provinces, only Saskatchewan showed significant, consistent reductions in wait times since 2009. 

Bennett was referred for surgery on her right hip in November of 2013 and said sheís been told she wonít get in until early in 2016. She said her joint has deteriorated so much she is unable to work or even function without strong narcotic painkillers.

Sign me up...

I live in BC and it sure isn't perfect.  But if the above people you are referencing were in the States, what would the cost be to them?  Could they get care at all without going bankrupt?

Want to compare the number of medical bankruptcies in each country?  The number of suicides when faced with costly treatment options? 

We have an ongoing debate here in Canada about health care, because it is expensive.  Especially with a huge stack of aging boomers entering into the hip replacement/knee replacement demographic in large numbers. 

Again, let's compare access to care across all socioeconomic groups.  No cherrypicking allowed.



The really funny part is that the US spends much more per capita on health care than Canada, for worse outcomes (across the entire population).

hoping2retire35

  • Pencil Stache
  • ****
  • Posts: 978
  • Location: UPCOUNTRY CAROLINA
Re: Free-market based healthcare. What does it mean?
« Reply #37 on: March 22, 2017, 08:50:13 PM »
Op, to answer your question; if the young refused to buy insurance and the old were refused insurance then insurance companies would have no business. They will lower costs on the young and allow, at greater costs to the old. I doubt it would be astronomical as you think. Some people are relatively healthy very late in life and just go down hill in a coup,e days. It isn't always 10+ years in a nursing home etc.

 I am sure it would be like a lot of other insurance policies. Hit a $100k Mercedes, they cover it but premiums go up. Start taking insulin and premiums go up, etc. Might also make people more nutrition/health conscious.

alsoknownasDean

  • Handlebar Stache
  • *****
  • Posts: 1555
  • Age: 33
  • Location: Melbourne, Australia
Re: Free-market based healthcare. What does it mean?
« Reply #38 on: March 23, 2017, 01:37:09 AM »
IMO, free market healthcare is just a nice term for if you can't afford it, you have to do without. Is that really the type of country we want to be?

Ask whoever voted for Trump.

The free market works really well for goods and services where someone can either choose alternatives or can do without. If I'm after healthcare, then my choice might be to either obtain healthcare or continue to suffer.

Many countries have public and private healthcare systems coexisting.

BTW the old argument that single payer is more expensive is nonsense so please don't bother. US spends more than almost every other country, and cover fewer people. As percent of GDP the US spends TWICE that of the UK on health care, in addition to all private spending! The US is so clearly the worst when it comes to this so just adopting the system of a any random industrialized nation would be a huge improvement.

You'd think with such expensive healthcare the life expectancies in the US would be massively longer than many comparable countries. Australia's universal healthcare system was introduced in 1975. At the time, the US and Australia had similar life expectancies. Today the average Australian lives three years longer. We can buy private health insurance too.

Scandium

  • Handlebar Stache
  • *****
  • Posts: 1959
  • Location: EastCoast
Re: Free-market based healthcare. What does it mean?
« Reply #39 on: March 23, 2017, 10:00:08 AM »
Op, to answer your question; if the young refused to buy insurance and the old were refused insurance then insurance companies would have no business. They will lower costs on the young and allow, at greater costs to the old. I doubt it would be astronomical as you think. Some people are relatively healthy very late in life and just go down hill in a coup,e days. It isn't always 10+ years in a nursing home etc.

 I am sure it would be like a lot of other insurance policies. Hit a $100k Mercedes, they cover it but premiums go up. Start taking insulin and premiums go up, etc. Might also make people more nutrition/health conscious.

I don't believe, and don't see, how it would be as rosy as you say. Car insurance has a (relatively) fixed payout ceiling. As you age the potential healthcare payouts are almost limitless, at least compared to the premiums people can pay in. Even if you charge someone $10,000 a month for ten years, they could burn through that in a single surgery or cancer treatment. As the risks are fairly clear, often unavoidable, and the costs extreme, the premiums would shoot up incredibly fast with age and health events. A minor heart issue in you're 30s? Hope you have tens of thousands per year for insurance. A risky driver could maybe cause a few $100k damage, a health risk is often certain to cause millions. The people who need it the most are the first ones insurance companies would cut.

So yes, it would work as upside down car insurance, where the young are offered dirt cheap, skimpy plans, while as you age prices skyrocket, and eventually they refuse to cover you as payout is virtually certain. But as several have pointed out it won't work as a free market because of information and demand/need asymmetry. You can't go without insurance unless you have millions lying around.

hoping2retire35

  • Pencil Stache
  • ****
  • Posts: 978
  • Location: UPCOUNTRY CAROLINA
Re: Free-market based healthcare. What does it mean?
« Reply #40 on: March 23, 2017, 11:02:36 AM »
Op, to answer your question; if the young refused to buy insurance and the old were refused insurance then insurance companies would have no business. They will lower costs on the young and allow, at greater costs to the old. I doubt it would be astronomical as you think. Some people are relatively healthy very late in life and just go down hill in a coup,e days. It isn't always 10+ years in a nursing home etc.

 I am sure it would be like a lot of other insurance policies. Hit a $100k Mercedes, they cover it but premiums go up. Start taking insulin and premiums go up, etc. Might also make people more nutrition/health conscious.

I don't believe, and don't see, how it would be as rosy as you say. Car insurance has a (relatively) fixed payout ceiling. As you age the potential healthcare payouts are almost limitless, at least compared to the premiums people can pay in. Even if you charge someone $10,000 a month for ten years, they could burn through that in a single surgery or cancer treatment. As the risks are fairly clear, often unavoidable, and the costs extreme, the premiums would shoot up incredibly fast with age and health events. A minor heart issue in you're 30s? Hope you have tens of thousands per year for insurance. A risky driver could maybe cause a few $100k damage, a health risk is often certain to cause millions. The people who need it the most are the first ones insurance companies would cut.

So yes, it would work as upside down car insurance, where the young are offered dirt cheap, skimpy plans, while as you age prices skyrocket, and eventually they refuse to cover you as payout is virtually certain. But as several have pointed out it won't work as a free market because of information and demand/need asymmetry. You can't go without insurance unless you have millions lying around.
I would imagine it would look similar to.life insurance. Some type of.lomg.term fixed costs, perhaps on some predetermined scale.

(Sitting with kids at home so functionality is low) non term life Insurance is expensive (IMHO)but people do it.
« Last Edit: March 23, 2017, 11:04:31 AM by hoping2retire35 »

bacchi

  • Handlebar Stache
  • *****
  • Posts: 1935
Re: Free-market based healthcare. What does it mean?
« Reply #41 on: March 23, 2017, 11:07:53 AM »
You'd think with such expensive healthcare the life expectancies in the US would be massively longer than many comparable countries. Australia's universal healthcare system was introduced in 1975. At the time, the US and Australia had similar life expectancies. Today the average Australian lives three years longer. We can buy private health insurance too.

We keep searching, halfheartedly, for that elusive, pure, free-market approach to the problem when there are over a dozen examples around the world that can be adapted. It really comes down to money, of course, and who has it and who wants to make more.