Are you a mod here? Maybe someone could move these to a different thread, I forget who the mods are, seeing as how I keep my nose clean.
I’d argue this is true for much of healthcare. Consolidation for both payers and providers has restricted competition a lot, or in the case of United and Kaiser they are often both payer and provider. In many markets you only have one or two options for various specialists these days. See the KFF link below.
And the barriers to entry aren’t low in many spaces. They aren’t terribly high for many physician offices, although the AMA has their barrier to entry - the cap on how many docs go to med school. But standing up a facility is expensive.
And competition… is weird in healthcare. Most of healthcare is still fee-for-service or close to it, and there is evidence in such a system that physicians essentially create their own demand, see the MIT link.
And, of course, health care costs are heavily skewed. Something like 4% of people account for half of total cost. The reasons are diverse, but I think it’s fair to say many of these people don’t have any sort of opportunity to shop around.
My general working thesis is that single payer is likely the least bad solution, perhaps something more like Medicare Advantage for all so there is still some room for innovation and what-not, with regulation around that. However, that’s politically untenable and likely will continue to be, so I’ve spent all of my working life since 2006 trying to find ways to at least put a dent in this damn thing. It seems that value-based care is finally starting to come to a boil and I think we stand a decent chance of at least stemming costs by a few percent maybe.
I don’t want healthcare to be run by the government, because government is pretty much the most inefficient administrator of anything. When a healthcare company is trying to make a profit, they will do what they can to keep costs down. When the government runs anything, costs go up, because they know they won’t go out of business if they lose money. They won’t be competing with anyone for services either. This will cause even more debt than we have now.
My libertarian leanings have me wishing that healthcare could be handled by free market principles, but for the free market to work, participants have to behave rationally and exercise proper foresight, and the nature of healthcare is such that people don’t do so.
I also think that 60-90 years of inertia in setting up the mess we have in the US today complicates efforts to fix it.
The first big step to transitioning to a free-market system would require the entire business model to be nuked from orbit and reinitialized…and that’s not going to happen.
That unfortunately leaves some sort of state-sponsored program/structure as the least-bad, most achievable model.
Agree, and I’d add that participants should be able to make informed decisions. If you are, say, a woman with metastatic HER2+ breast cancer, your options are basically ribociclib, palbociclib, or abemaciclib. It will be hard to discern the cost, and likely even harder for most consumers to read the literature to figure out anything on safety and efficacy. Normally patients will defer to the physician, who will have strong incentives on which one they may prescribe - rebates paid by the manufacturer. This is an interesting example, three drugs for the same diagnosis that are largely comparable. So manufacturers are competing on price, right? Right? Last I looked, no, they were competing on paying rebates to get docs to prescribe it, and the costs were nearly identical.
There are just so many distortions in this market. I’d like to think the free market could fix it, but we’ve had some manner of a free market here for generations and it hasn’t fixed it. Amazon and Wal-Mart and so many others tried to disrupt it and failed. Who knew healthcare could be this complicated?
In theory it becomes a single buyer and many sellers, a monopsony, which should have very low prices. Which does have some real life evidence in the UK, etc.
US medical care is but one of many things that Canadians buy from the USA. And Americans buy a lot of stuff from Canada. We are each other’s biggest export country and that is mutually beneficial. Unfortunately free trade between our two countries is going to be under attack from the next US President and that should be an issue that Presidential candidates are talking about.
Agreed. Like I said, you’d need to nuke the current business model from orbit and start again if free market were the goal.
There are some benefits to patent protection, in terms of giving businesses an extra financial incentive to aggressively pursue new things, but that comes at the expense of those businesses abusing the temporary monopoly-ish power they gain from such protections.
Free market is the system of dropping expensive patients, excluding preexisting conditions, life time caps on benefits and other things most folks don’t think about until they effect them or someone they know.
…and you’re touching upon why, despite my libertarianism, I think free market isn’t realistic for healthcare.
For free market to work, you need rational decision-makers with good information. Sadly, health care consumers are often dumb and make irrational decisions relatively early in their lives, before they become really aware of the consequences.
In a free market utopia, a consumer would demand some kind of a health plan with a predictable premium schedule, without lifetime maximums, and with some portability mechanism to guard against moves or changes in customer service levels. They would demand admittance to such plans before chronic, expensive health conditions have emerged (perhaps by parents signing the contact for their kids shortly after conception). And, they would make decisions during their life that ensured they would be able to afford the premiums, or that premiums would somehow be provided for.
It’s not actually going to happen. Too many people lack the foresight to demand such programs, and therefore adverse selection would preclude such programs from being marketed.
For lot of people not making an actuarial salary though it’s not a matter of rational choice when a healthy 25 year old had to decide between paying rent and buying health care 99 out of a 100 are going to chose rent and 97 of those 98 will probably be just fine but that one is going to get a very expensive medical problem or some sort.
Using our current private health insurance system, I had a $360/year prescription drug I’d been taking for 2-3 years that the insurance company suddenly denied. They said they needed more recent proof that I was sick enough to require the maintenance drug that kept me from getting sicker. I looked too healthy while using the cheap pill.
I got sicker. I stayed sicker. I’m now on a drug that costs $2500 every 8 months. My QoL is significantly worse.
I would hope that a MFA system would avoid requiring me to get sicker. Maybe it wouldn’t. I doubt it could be much worse than my current insurer.
I think our current system is the worst of all worlds. I think it’s likely broken beyond fixing and a new system will be needed to fully replace it. When the inertia to make that happens is. Is anyone’s guess but I’d be surprised to see it happen in the next 10 years.
I agree. Sometimes I wonder if I should have used my time and energy trying to make a big change happen, which I consider low probability but high impact. I instead chose… maybe a more pragmatic option of trying to engage with the current system to make things better. Lower impact, but I’ve been able to help save a pretty decent amount of money, and work on things like getting more end-of-life patients into palliative care and hospice, and reduce things like inpatient rates.
Maybe when I retire I can devote my time to something more altruistic. A lot of those endeavors don’t pay much.
In theory, yes. Can you find me a project run under the government which completed on time, and at or under budget? With all the cronyism in Washington, do you really think they go through an actual process of looking at bids and choosing the best value? Or do they just go through the motions, then award a contract to whomever is lining their pockets?
…and that gets at the reason why, for a free market utopia to be possible, people would have to have the foresight to make decisions to ensure that they will be able to pay premiums in the future.
Also, in a free market utopia, health care should cost less than it does today in the US, although some of that savings might come from people deciding to pursue less expensive treatments that are “good enough”.
(I’m writing this with the awareness that one of my meds that adds significantly to my quality of life would be prohibitively expensive without insurance coverage. I happily accept it because, given the stop-loss provision of my health insurance and company subsidy of coverage, the cost is invisible to me. If I were fully exposed to the cost…it’d suck, but I could decide that the QoL benefit isn’t worth the expense even given my actuarial salary.)
And have crappy ass care. No thanks. I’d rather pay a fortune for high quality care if those are the only two options. I had an opportunity to advance professionally by moving to London and I turned it down due to the NHS. It scared me just visiting.
Yes, I am still bitter that they killed my family member. I can show you on the doll precisely where the NHS hurt me.
And again, I’d characterize single payer as the least bad option. I’d argue that the level of rent-seeking behavior and deadweight loss exceeds the value lost if the government was running things.