What comes after the ACA?

[FIREstache]

With the shortage of doctors expected to get even worse, I don't think the solution is to pay them less.

[ysette9]

To pay then less you have to fix the med school debt problem. The only way it makes sense to take on $200-400k in student loans is of you are going to make massive amounts of $ on the other side.

So maybe open up med school slots so there isn’t an artificially low supply of doctors. Make med school free or low tuition so doctors can choose family medicine or pediatrics (lower paid professions) instead of automatically choosing anesthesiology because that is what will pay off the student loans first.

[pecunia]

To pay then less you have to fix the med school debt problem. The only way it makes sense to take on $200-400k in student loans is of you are going to make massive amounts of $ on the other side.

So maybe open up med school slots so there isn’t an artificially low supply of doctors. Make med school free or low tuition so doctors can choose family medicine or pediatrics (lower paid professions) instead of automatically choosing anesthesiology because that is what will pay off the student loans first.

That sounds like a great idea.  Existing doctors would know there was a lot of new doctors coming down the pipeline so they could adjust if needed.  It provides people with a wonderful career.  It provides the public with the needed service.  I do think, however,  that these new doctors should be required to commit some time to public service

I'm not familiar with medical school, but wonder why it is so expensive.  The following article lays out the costs of public and private medical schools.  The public medical schools tend to be much less.

https://www.kaptest.com/study/mcat/whats-the-real-cost-of-medical-school/ 

Seems like if there were more public medical schools, it would not only provide the needed training, but do it for less money.  I am sure they receive some subsidies, but it sure does seem like a worthwhile investment.

[Roland of Gilead]

So I am curious why we need to do things to compensate doctors if we cut their pay yet we have no problem cutting the pay of drug researchers and the returns of investors who put their money into these drug companies?

Why are doctors in other countries paid so much less?   Why does their schooling cost a lower amount?  Why do other countries limit the awards on medical lawsuits which means the hospitals and doctors pay a lower rate of insurance?

I see so little of this discussed by either political party.   They go after the easy target, a big evil corporation that *gasp* is concerned about making a profit for their shareholders.   They don't mention that the returns on most of these big evil drug companies are lower than most tech stocks and the risk is much higher than most staple stocks and utility stocks.

But hey, it makes for a good sound bite.   We will save billions by going after these drug companies (we will ignore the other trillion or so we spend on all the other medical stuff)

[John Galt incarnate!]

To pay then less you have to fix the med school debt problem. The only way it makes sense to take on $200-400k in student loans is of you are going to make massive amounts of $ on the other side.

So maybe open up med school slots so there isn’t an artificially low supply of doctors. Make med school free or low tuition so doctors can choose family medicine or pediatrics (lower paid professions) instead of automatically choosing anesthesiology because that is what will pay off the student loans first.

Just yesterday I heard something  about a bill in the California legislature that if passed and signed into law will pay the medical-school expenses of California medicos if they in return  accept Medi-Cal's  low reimbursement rates  for a certain period of years.

[Roland of Gilead]

Just yesterday I heard something  about a bill in the California legislature that if passed and signed into law will pay the medical-school expenses of California medicos if they in return  accept Medi-Cal's  low reimbursement rates  for a certain period of years.

What would happen if they defaulted, went to another state to practice medicine for higher pay?   Would they have to pay back the expenses?

[seattlecyclone]

To pay then less you have to fix the med school debt problem. The only way it makes sense to take on $200-400k in student loans is of you are going to make massive amounts of $ on the other side.

So maybe open up med school slots so there isn’t an artificially low supply of doctors. Make med school free or low tuition so doctors can choose family medicine or pediatrics (lower paid professions) instead of automatically choosing anesthesiology because that is what will pay off the student loans first.

Just yesterday I heard something  about a bill in the California legislature that if passed and signed into law will pay the medical-school expenses of California medicos if they in return  accept Medi-Cal's  low reimbursement rates  for a certain period of years.

Seems like a win-win. The state probably spends less overall this way if it keeps their reimbursement rates down, as the doctors don't need to mark up the cost of their services just to pay interest to the banks on the schooling they got.

[John Galt incarnate!]

Just yesterday I heard something  about a bill in the California legislature that if passed and signed into law will pay the medical-school expenses of California medicos if they in return  accept Medi-Cal's  low reimbursement rates  for a certain period of years.

What would happen if they defaulted, went to another state to practice medicine for higher pay?   Would they have to pay back the expenses?

I don't know.

What I do know is that if I drafted the legislation I'd include a clawback  provision to deal with willful defaulters.

[protostache]

Just yesterday I heard something  about a bill in the California legislature that if passed and signed into law will pay the medical-school expenses of California medicos if they in return  accept Medi-Cal's  low reimbursement rates  for a certain period of years.

What would happen if they defaulted, went to another state to practice medicine for higher pay?   Would they have to pay back the expenses?

Maybe something like, the license is provisional, only valid in California, and full licensure is contingent on accepting Medi-Cal for X number of years.

[freya]

Now consider that drug costs are only 10% to 13% of the total cost of US healthcare.   This means you can only cut a certain amount from the total cost of US healthcare by cutting drug prices.   Nobody talks about the other 90%.   A lot of it is the much higher pay we have in the USA (and maybe a little bit in the amount of medical lawsuits we allow here).

Why does nobody talk about the 90%?

I'm very happy to talk about the 90%. Here's the breakdown according to a recent CMS report:

Hospital care:  33%
Physician and clinical services:  20%
Retail prescription drugs:  10%
Other health, residential, and personal care services:  5%
Nursing home:  5%
Dental:  4%
Home health care:  3%
Other professional (e.g. physical therapy, chiropractic etc): 3%
Non-prescription drug medical products/equipment: total 4%

link to the report here:  https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

Of the 20% that goes to "physicians and clinical services", a large chunk, at least 30%, goes to administrative overhead.  This has been skyrocketing in recent years thanks to Obamacare's massive increase in regulation and the poorly implemented EHR mandate.  So yes, cutting physician pay will help a bit, but not as much as you all seem to think based on the erroneous sentiment in the above post that 90% of health care expenses goes to physician pay.   The big money in fact is going to administrators/executives of hospitals and insurance companies.  And the solution to cutting costs is going to have be systemic, not aimed at individuals.

I have a good idea where that thought came from.  Demonizing physicians has unfortunately become a national pastime, and it is doing the damage you might expect.  About half of physicians want out of the profession.  Even if they don't go through with it, that means that half the time you go to the doctor, the person treating you would rather be doing something else.   It's not hard to imagine how this can increase medical costs.  A disengaged physician will be more likely to order a lot of tests and refer to subspecialists.  A distrustful patient will doctor-shop resulting in multiple visits and repeated tests.  I hope the press (and especially the NY Times) is happy with the results of their diligent efforts.

Here's a blog post with a contrary view that most of you are guaranteed to hate, that's worth a look:

https://www.kevinmd.com/blog/2019/05/stop-the-anti-doctor-media-bias.html

 

[FIREstache]

The big money in fact is going to administrators/executives of hospitals and insurance companies.  And the solution to cutting costs is going to have be systemic, not aimed at individuals.

I worked at a hospital for years, and the administrative staff were just one small part of the overall budget.  Cutting their pay wouldn't make a dent on healthcare costs.  There's a LOT of overhead, and the dollar mount didn't change all that much with the ACA - I could keep listing things for days going back 20 years.  It's far more complicated than some admin staff paychecks, and even the administrators often don't stick around long.

I also did not support cutting physician pay, as I mentioned a few posts back.

[Roland of Gilead]

I'm very happy to talk about the 90%. Here's the breakdown according to a recent CMS report:

Hospital care:  33%
Physician and clinical services:  20%
Retail prescription drugs:  10%
Other health, residential, and personal care services:  5%
Nursing home:  5%
Dental:  4%
Home health care:  3%
Other professional (e.g. physical therapy, chiropractic etc): 3%
Non-prescription drug medical products/equipment: total 4%

link to the report here:  https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

Why does it all add up to only 87%?  Both in your quoted figures and in the actual report?

That is a pretty big error in an official looking report.

[Roland of Gilead]

The big money in fact is going to administrators/executives of hospitals and insurance companies.  And the solution to cutting costs is going to have be systemic, not aimed at individuals.

I worked at a hospital for years, and the administrative staff were just one small part of the overall budget.  Cutting their pay wouldn't make a dent on healthcare costs.  There's a LOT of overhead, and the dollar mount didn't change all that much with the ACA - I could keep listing things for days going back 20 years.  It's far more complicated than some admin staff paychecks, and even the administrators often don't stick around long.

I also did not support cutting physician pay, as I mentioned a few posts back.

This is the problem, nobody wants to take a pay cut.   The researchers and investors running the drug companies don't want to take a pay cut, the doctors don't want a pay cut, the medical schools and their professors don't want a pay cut, the hospitals certainly don't want a pay cut.

It just irks me that of all these the easiest one to target is the "big evil pharma" because a corporation doesn't have the same heart string pulling as the poor anesthesiologist barely able to afford two Tesla's on his $400,000 salary.  But if we go after pharma, full tilt and force them to sell their drugs at a buck each, even though this would eventually bankrupt every single one of them, the USA is still going to have the most expensive healthcare in the world because we don't want to touch the 90%.

[bacchi]

The big money in fact is going to administrators/executives of hospitals and insurance companies.  And the solution to cutting costs is going to have be systemic, not aimed at individuals.

I worked at a hospital for years, and the administrative staff were just one small part of the overall budget.  Cutting their pay wouldn't make a dent on healthcare costs.  There's a LOT of overhead, and the dollar mount didn't change all that much with the ACA - I could keep listing things for days going back 20 years.  It's far more complicated than some admin staff paychecks, and even the administrators often don't stick around long.

I also did not support cutting physician pay, as I mentioned a few posts back.

This is the problem, nobody wants to take a pay cut.   The researchers and investors running the drug companies don't want to take a pay cut, the doctors don't want a pay cut, the medical schools and their professors don't want a pay cut, the hospitals certainly don't want a pay cut.

It just irks me that of all these the easiest one to target is the "big evil pharma" because a corporation doesn't have the same heart string pulling as the poor anesthesiologist barely able to afford two Tesla's on his $400,000 salary.  But if we go after pharma, full tilt and force them to sell their drugs at a buck each, even though this would eventually bankrupt every single one of them, the USA is still going to have the most expensive healthcare in the world because we don't want to touch the 90%.

It is odd in these conversations that no proposed cuts will do any good.

It's almost as if everyone has an interest (except the consumers) in keeping prices high.

[zolotiyeruki]

Why are doctors in other countries paid so much less?   Why does their schooling cost a lower amount?  Why do other countries limit the awards on medical lawsuits which means the hospitals and doctors pay a lower rate of insurance?

I see so little of this discussed by either political party.   They go after the easy target, a big evil corporation that *gasp* is concerned about making a profit for their shareholders.   They don't mention that the returns on most of these big evil drug companies are lower than most tech stocks and the risk is much higher than most staple stocks and utility stocks.

I'm with you there--there seems to be a distinct *lack* of discussion of the root causes of high healthcare costs.  There has been a LOT of "healthcare is too expensive, so let's make other taxpayers have the government pay for it!" or "just let the (heavily-regulated) free market work!"

From a political perspective, it makes sense, because it's an effective political message.  "Let's dig down and figure out exactly how our real healthcare costs compare with other countries, and figure out all the root causes for every percentage!" doesn't get as many votes.  Medication may only represent 10% of medical spending, but if we're paying twice as much as other countries for the same drugs, there's a potential for probably 3-4% savings there.  And if Physician and Clinical services are 30%, but 50% of that is overhead, then by all means let's see what we can do about reducing that overhead.  It's the lack of attention to detail in favor of a sound byte, plus political opportunism and polarization (you can't be seen to agree with the other party, regardless of the merits of the proposal), that makes it very difficult to accomplish anything legislatively.

I see a similar phenomenon in our school district, which is looking at a 2%-ish (and worsening) deficit for the next 10 years.  The first few years, the administration and Board picked the low-hanging fruit (admin salary freeze, reduction of district-level staff, etc), but it's now getting harder.  Rather than putting forth the effort to find the myriad small-dollar cuts that would add up to significant cuts, the administration has jumped to cutting sports and increasing class sizes, and the BoE proposed a tax hike.  There appears to be an assumption that every task, every position, and every activity performed in the district is a sacred cow that cannot possibly be cut, without an evaluation of whether that task/position/activity is actually necessary.

[Paul der Krake]

https://www.nytimes.com/2019/07/11/health/drug-prices-rebate-donald-trump.html

This thing may have legs.

You know, people keep saying the Republicans aren't doing anything to try to curb healthcare costs, but there sure seems to be a lot of things in that article that they're trying to do.

The prescription drug costs are an interesting one.  I've asked this before, but haven't seen an answer:  how much does the US effectively subsidize other countries' healthcare by paying so much more than other countries?

I too would love to get a credible answer on this. Here is what I know though: the price being sold in other first world countries (i.e. ignoring the developing world) is plenty to support a robust market. I know this because there are drug companies based outside the US, who don't sell their drugs in the US at all.

Can the world do without US drug companies altogether? I don't know.

I think Trump deserves credit for trying something here. Let's hope he succeeds.

[MDM]

I'm very happy to talk about the 90%. Here's the breakdown according to a recent CMS report:

Hospital care:  33%
Physician and clinical services:  20%
Retail prescription drugs:  10%
Other health, residential, and personal care services:  5%
Nursing home:  5%
Dental:  4%
Home health care:  3%
Other professional (e.g. physical therapy, chiropractic etc): 3%
Non-prescription drug medical products/equipment: total 4%

link to the report here:  https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf

Why does it all add up to only 87%?  Both in your quoted figures and in the actual report?

That is a pretty big error in an official looking report.

Add 0.333% to each of the whole numbers and the total is 90%.

Neither statistically likely nor statistically extremely unlikely....

[DaMa]

I would say the other 13% goes to non-medical "health care" expenses -- like the insurance companies. 

[John Galt incarnate!]

Maybe something like, the license is provisional, only valid in California, and full licensure is contingent on accepting Medi-Cal for X number of years.

Yes.

Your provision would be  more effective (remedial before the fact)  than mine   at discouraging  willful defaulters.

[freya]

Ha, that's hilarious - I didn't notice that the figures didn't sum up to 100%.  Way to go CMS...maybe a typo in there somewhere.

I'm actually in favor of cutting procedure reimbursements, because they are WAY out of proportion to office visit costs and are a principle reason why there are super highly paid specialties. For example, a dermatologist freezing off a small skin lesion (which takes about 7 minutes) gets paid the same as a neurologist spending two hours with a patient and family giving them an Alzheimer's diagnosis.  CMS embarked on exactly that project several years ago, and it's ongoing.  Radiology, cardiology, and neurology have all been hit hard.  The response so far has been to find ingenious ways to increase the number and complexity of procedures, so that to my knowledge no pay cuts have occurred.  Not really sure how this is going to play out long term.

When I said "systemic solutions" I meant improvements at a higher level than simple reimbursement cuts.  Here's an example:  EHR systems.  The EHR mandate was possibly the most disastrous regulation of the 21st century.  It has created a whole new set of medical errors, severely disrupted clinical practice and residency training by increasing note writing and order entry time from a few minutes to 6+ hours a day, and increased costs beyond belief - all while NOT achieving the stated goal of improving information sharing between health providers.  Due in no small part to the strengthening of HIPAA that occurred at the same time, that has actually gotten worse.

The simple solution would have been to take the VA's EHR system and mandate that as the national EHR.  Physicians would have loved it.  It's a very well designed, easy to use system and it can share data across sites.  It is built on a Linux platform and the VA offers it for free.   Everyone who trained at a VA hospital (which is just about everyone) already knows how to use it. There are private companies who will implement and support it, and some hospitals have gone that route very successfully.  Ours (I work for a major academic center) has not, because the lawyers didn't like the fact that there's no one to sue plus they could care less about clinical usability (I have a friend who was on the panel making the decision).  Instead, they spent $40 million for a horrible EHR system that was incompatible with other systems that turned out to be important, so they're scrapping that and are now paying $120 million for another one which is slightly less horrible.

Somebody was saying something about overhead?

[DaMa]

Oh @freya, I can soooo relate.  I reviewed proposals and demos from 6 different vendors selling risk adjustment (CMS MA RAPS) software and worked on the implementation and ongoing use of two different packages.  What a joke.  I imagine at least 1% of healthcare cost is just thrown away on systems that never work as marketed.

[MDM]

Ha, that's hilarious - I didn't notice that the figures didn't sum up to 100%.  Way to go CMS...maybe a typo in there somewhere.

They aren't supposed to add to 100%, and do plausibly add to 90% if one considers rounding.  Of course, there still could be a typo.

[FIREstache]

The simple solution would have been to take the VA's EHR system and mandate that as the national EHR.  Physicians would have loved it.  It's a very well designed, easy to use system and it can share data across sites.  It is built on a Linux platform and the VA offers it for free. 

I heard the VA was in process of migrating to Cerner.

[freya]

The simple solution would have been to take the VA's EHR system and mandate that as the national EHR.  Physicians would have loved it.  It's a very well designed, easy to use system and it can share data across sites.  It is built on a Linux platform and the VA offers it for free. 

I heard the VA was in process of migrating to Cerner.

OMG that is tragic.  Just found articles, some of which are bemoaning the waste of $10 billion on this needless transition.  Oh if you only knew that's just the beginning of the costs...

Dang lawyers.  They run the world.  Maybe the best way to control healthcare costs is to start shutting down law schools.

[pecunia]

The US pays twice as much for health care per person than the next country.

How much of that is due to litigation needless or otherwise?

The litigation used to be the stock excuse for the high cost of health care.

[bacchi]

The US pays twice as much for health care per person than the next country.

How much of that is due to litigation needless or otherwise?

The litigation used to be the stock excuse for the high cost of health care.

A few states have severely limited tort actions brought against doctors. It has a minimal effect, on the order of a few %.

It's definitely not a panacea to lower costs.

[seattlecyclone]

Right. There is no panacea. Lowering drug costs won't fix things, but it will help. Lowering legal bills won't fix things, but it will help. Do enough of these small things and it adds up to a bigger deal.

[AdrianC]

Biden unveils health care plan: Affordable Care Act 2.0

https://www.politico.com/story/2019/07/15/joe-biden-health-care-plan-1415850

“We’re starting with the Affordable Care Act as the base and going to insist on the elements that we sought last time,” said a senior Biden campaign official. “And we’ll get them this time.”

Sound good?

Seems like a step in the right direction, and actually achievable. I like the fixing of the premium tax credit cap, and adding a public option.

[pecunia]

From the article:

"Biden's public option plan drew fire from Republicans and health care industry lobbyists who said that the proposal went too far."

What have any of them done to help people who need health care?

[zolotiyeruki]

What have any of them done to help people who need health care?

You may have missed this link from not that far upthread: https://www.nytimes.com/2019/07/11/health/drug-prices-rebate-donald-trump.html

It's not for lack of trying.

[pecunia]

What have any of them done to help people who need health care?

You may have missed this link from not that far upthread: https://www.nytimes.com/2019/07/11/health/drug-prices-rebate-donald-trump.html

It's not for lack of trying.

I can't read that link as I don't subscribe to the New York Times.  Lowering drug prices is a good idea.  Bernie Sanders has been ranting about that for a long time.  Give them one attempt.  I did find another article on a quick search.

https://www.axios.com/trump-drug-prices-plan-pharma-ec527a14-0287-492b-937d-a7144c47b734.html

He's got to throw us one or two bones if he wants to get re-elected.  Health care will give him a big bang for his buck.

[Exflyboy]

My one political prediction is that the biggest bone to be thrown will be in the spring of next year, i.e a resolution to the trade war with China.

Grammar fixed..:)

[FIREstache]

Biden unveils health care plan: Affordable Care Act 2.0

https://www.politico.com/story/2019/07/15/joe-biden-health-care-plan-1415850

“We’re starting with the Affordable Care Act as the base and going to insist on the elements that we sought last time,” said a senior Biden campaign official. “And we’ll get them this time.”

Sound good?

Seems like a step in the right direction, and actually achievable. I like the fixing of the premium tax credit cap, and adding a public option.

Biden's plan is the only health care related plan I've heard that I like.

[Roland of Gilead]

Biden's plan is the only health care related plan I've heard that I like.

Its ok, but again there is the hand waving to attack high drug prices and then this tidbit about all the rest (the 90% of the cost of healthcare):

"Biden’s plan also takes aim at health care providers, suggesting that he’ll try to tackle problems like unexpected large medical bills and health care market concentration, although the details released by the campaign are sparse. "


I am still waiting for the candidate that says "Here is exactly how I plan to bring our costs in-line with healthcare costs in other countries".   

[katsiki]

Dang lawyers.  They run the world.  Maybe the best way to control healthcare costs is to start shutting down law schools.

And how many other problems would that solve... :)

[katsiki]

I am still waiting for the candidate that says "Here is exactly how I plan to bring our costs in-line with healthcare costs in other countries".

Don't hold your breath.  I don't think such a person exists.

[pecunia]

I am still waiting for the candidate that says "Here is exactly how I plan to bring our costs in-line with healthcare costs in other countries".

Don't hold your breath.  I don't think such a person exists.

Old man Bernie says it all the time.  Then they try to tell him he is full of it and he pulls out all these facts and figures as to what they have in other countries. 

[Roland of Gilead]

I am still waiting for the candidate that says "Here is exactly how I plan to bring our costs in-line with healthcare costs in other countries".

Don't hold your breath.  I don't think such a person exists.

Old man Bernie says it all the time.  Then they try to tell him he is full of it and he pulls out all these facts and figures as to what they have in other countries.

I don't mean bring our costs in line with other countries by shifting the cost from the individual to the government, I mean bring our costs in-line with other countries by actually reducing the cost to go to the hospital and get tests or treatments, as well as cheaper drugs.   Why is a hospital stay so much more expensive in the USA?

[Davnasty]

I am still waiting for the candidate that says "Here is exactly how I plan to bring our costs in-line with healthcare costs in other countries".

Don't hold your breath.  I don't think such a person exists.

Old man Bernie says it all the time.  Then they try to tell him he is full of it and he pulls out all these facts and figures as to what they have in other countries.

I don't mean bring our costs in line with other countries by shifting the cost from the individual to the government, I mean bring our costs in-line with other countries by actually reducing the cost to go to the hospital and get tests or treatments, as well as cheaper drugs.   Why is a hospital stay so much more expensive in the USA?

When we say "cost per capita" that is total cost paid by the individual and the government. Shifting costs from one to the other doesn't change that number.

[Roland of Gilead]

When we say "cost per capita" that is total cost paid by the individual and the government. Shifting costs from one to the other doesn't change that number.

Right.  I have not heard that Bernie's plan will reduce "cost per capita", just that it will majorly shift the cost to the government.   He will pay for that with other taxes and stuff but it still is not getting the USA the cheaper healthcare that other countries enjoy...it is just moving money from one bucket to another.

[Exflyboy]

Pretty much what the ACA did.. all while keeping the existing HC industry happy.

Unless you are going to use the huge purchasing power of the Government to drive down costs (like almost every other developed nation on Earth does) then there is little point.

As wealthy people we will simply game the system as best we can.. Just like I can gerrymander our income down to maximise ACA subsidies.

[Roland of Gilead]

Pretty much what the ACA did.. all while keeping the existing HC industry happy.

Unless you are going to use the huge purchasing power of the Government to drive down costs (like almost every other developed nation on Earth does) then there is little point.

As wealthy people we will simply game the system as best we can.. Just like I can gerrymander our income down to maximise ACA subsidies.

But how does the purchasing power of the government in other countries drive the costs down so low?   We already see that just targeting drug prices will not do it (even a 50% cut across the board in average drug prices would only reduce USA healthcare costs 5% or so).

Do they have salary caps for doctors and nurses?  Real estate caps for land and buildings used by care facilities?

Are we as a nation willing to go that far down the path to get lower healthcare costs?

[former player]

31% of health care costs in USA are administrative overhead, compared with 16.7% in Canada -

https://www.nejm.org/doi/full/10.1056/NEJMsa022033

So there's an instant 15% reduction in USA health care costs.

NHS from a while ago had admin costs at 7.7%: see Table 90 -
https://publications.parliament.uk/pa/cm200910/cmselect/cmhealth/269/269i.pdf

That would be a reduction of almost 25% in USA health costs.

[PathtoFIRE]

Don't forget, the goal also won't be to get "down" to the level of other countries necessarily. We expect as a wealthy nation that, as a general rule, service-based economic sectors will probably cost US citizens a little more than other countries, $ for $. I would argue that there is probably a natural progression, as economies progress in technology and wealth, to end up spending more and more of GDP on industries that cannot significantly rationalize away labor costs. Per capita health care spending tends to rise with time in most countries, and as one of the first and most mature industrial countries for the past 100 years, it shouldn't be surprising that we are ahead of the curve. But nor does that absolve the obviously inefficient and broken parts of our system either, but just realize that the difference is probably more modest than just pure number comparisons would suggest.*

*I am a physician and that will introduce some degree of bias into my views for sure

[rantk81]

Don't forget, the goal also won't be to get "down" to the level of other countries necessarily. We expect as a wealthy nation that, as a general rule, service-based economic sectors will probably cost US citizens a little more than other countries, $ for $. I would argue that there is probably a natural progression, as economies progress in technology and wealth, to end up spending more and more of GDP on industries that cannot significantly rationalize away labor costs. Per capita health care spending tends to rise with time in most countries, and as one of the first and most mature industrial countries for the past 100 years, it shouldn't be surprising that we are ahead of the curve. But nor does that absolve the obviously inefficient and broken parts of our system either, but just realize that the difference is probably more modest than just pure number comparisons would suggest.*

*I am a physician and that will introduce some degree of bias into my views for sure

The problem is that the 2x level of spending is coinciding with worse patient outcomes.
The current system needs to be blown up.  Sorry if it impacts the rate of compensation you've become accustomed to -- but what we have now -- it isn't sustainable and isn't working for the populace.

[ysette9]

Don't forget, the goal also won't be to get "down" to the level of other countries necessarily. We expect as a wealthy nation that, as a general rule, service-based economic sectors will probably cost US citizens a little more than other countries, $ for $. I would argue that there is probably a natural progression, as economies progress in technology and wealth, to end up spending more and more of GDP on industries that cannot significantly rationalize away labor costs. Per capita health care spending tends to rise with time in most countries, and as one of the first and most mature industrial countries for the past 100 years, it shouldn't be surprising that we are ahead of the curve. But nor does that absolve the obviously inefficient and broken parts of our system either, but just realize that the difference is probably more modest than just pure number comparisons would suggest.*

*I am a physician and that will introduce some degree of bias into my views for sure

The problem is that the 2x level of spending is coinciding with worse patient outcomes.
The current system needs to be blown up.  Sorry if it impacts the rate of compensation you've become accustomed to -- but what we have now -- it isn't sustainable and isn't working for the populace.

When I mentioned how much more expensive we are I wasn’t comparing to Guatemala or Thailand but England, France, Canada, Australia, Switzerland, etc.

[freya]

31% of health care costs in USA are administrative overhead, compared with 16.7% in Canada -

https://www.nejm.org/doi/full/10.1056/NEJMsa022033

So there's an instant 15% reduction in USA health care costs.

NHS from a while ago had admin costs at 7.7%: see Table 90 -
https://publications.parliament.uk/pa/cm200910/cmselect/cmhealth/269/269i.pdf

That would be a reduction of almost 25% in USA health costs.

We'd do even better if we went with Medicare for all.  Medicare's overhead cost is 2%.  And, the cost imposed by Medicare documentation on doctors & hospitals is less than it is for private insurance, so that would be even more savings.  It would get even better if CMS put some serious effort into simplifying the paperwork burden on doctors and hospitals.  You may be looking at cost reductions in the range of 40%!

Even more good news:  CMS has been trying to do just that.  Ironically, the AMA and other large MD organizations have been fighting measures like the proposal to simplify office billing & documentation, from the current 5-tier system with a ludicrously complicated set of point-based documentation requirements, to a single office visit code with minimal documentation requirements plus time-based billing, where you just have to explain what you spent time on.  That would have been an almost miraculous improvement, but of course we can't have that..thank you SO much AMA.

[Exflyboy]

31% of health care costs in USA are administrative overhead, compared with 16.7% in Canada -

https://www.nejm.org/doi/full/10.1056/NEJMsa022033

So there's an instant 15% reduction in USA health care costs.

NHS from a while ago had admin costs at 7.7%: see Table 90 -
https://publications.parliament.uk/pa/cm200910/cmselect/cmhealth/269/269i.pdf

That would be a reduction of almost 25% in USA health costs.

We'd do even better if we went with Medicare for all.  Medicare's overhead cost is 2%.  And, the cost imposed by Medicare documentation on doctors & hospitals is less than it is for private insurance, so that would be even more savings.  It would get even better if CMS put some serious effort into simplifying the paperwork burden on doctors and hospitals.  You may be looking at cost reductions in the range of 40%!

Even more good news:  CMS has been trying to do just that.  Ironically, the AMA and other large MD organizations have been fighting measures like the proposal to simplify office billing & documentation, from the current 5-tier system with a ludicrously complicated set of point-based documentation requirements, to a single office visit code with minimal documentation requirements plus time-based billing, where you just have to explain what you spent time on.  That would have been an almost miraculous improvement, but of course we can't have that..thank you SO much AMA.

So what you're saying is.. "if the American healthcare system wasn't Fubar'd beyond recognition it would be much cheaper"

Yeah, I'll buy that.

[rantk81]

Don't forget, the goal also won't be to get "down" to the level of other countries necessarily. We expect as a wealthy nation that, as a general rule, service-based economic sectors will probably cost US citizens a little more than other countries, $ for $. I would argue that there is probably a natural progression, as economies progress in technology and wealth, to end up spending more and more of GDP on industries that cannot significantly rationalize away labor costs. Per capita health care spending tends to rise with time in most countries, and as one of the first and most mature industrial countries for the past 100 years, it shouldn't be surprising that we are ahead of the curve. But nor does that absolve the obviously inefficient and broken parts of our system either, but just realize that the difference is probably more modest than just pure number comparisons would suggest.*

*I am a physician and that will introduce some degree of bias into my views for sure

The problem is that the 2x level of spending is coinciding with worse patient outcomes.
The current system needs to be blown up.  Sorry if it impacts the rate of compensation you've become accustomed to -- but what we have now -- it isn't sustainable and isn't working for the populace.

When I mentioned how much more expensive we are I wasn’t comparing to Guatemala or Thailand but England, France, Canada, Australia, Switzerland, etc.

https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries/#item-relative-size-wealth-u-s-spends-disproportionate-amount-health

[ysette9]

Don't forget, the goal also won't be to get "down" to the level of other countries necessarily. We expect as a wealthy nation that, as a general rule, service-based economic sectors will probably cost US citizens a little more than other countries, $ for $. I would argue that there is probably a natural progression, as economies progress in technology and wealth, to end up spending more and more of GDP on industries that cannot significantly rationalize away labor costs. Per capita health care spending tends to rise with time in most countries, and as one of the first and most mature industrial countries for the past 100 years, it shouldn't be surprising that we are ahead of the curve. But nor does that absolve the obviously inefficient and broken parts of our system either, but just realize that the difference is probably more modest than just pure number comparisons would suggest.*

*I am a physician and that will introduce some degree of bias into my views for sure

The problem is that the 2x level of spending is coinciding with worse patient outcomes.
The current system needs to be blown up.  Sorry if it impacts the rate of compensation you've become accustomed to -- but what we have now -- it isn't sustainable and isn't working for the populace.

When I mentioned how much more expensive we are I wasn’t comparing to Guatemala or Thailand but England, France, Canada, Australia, Switzerland, etc.

https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries/#item-relative-size-wealth-u-s-spends-disproportionate-amount-health

Nice summary and visuals