Private enterprise bankrupting America?

[bb113]

Can you post the specific number you are referring to?

[Hawker]

The angiogram.  It shows the US citizen pays more.  Even at the lowest commercial rate, the US citizen pays more.

[bb113]

I really don't see how this is difficult to understand?

Nova Scotia Public Coverage:
Total Cost to Citizen = Share of Public Sector Fee + Share of Other Tax Dollars (that go to healthcare)

US Private Coverage:
Total Cost to Citizen = Insurance Premiums + Deductibles

The WaPo chart compares Nova Scotia public sector fee to Insurance claims. It is not a valid comparison. The claim rate is not even in the second equation (although it is related to to the premiums). The public sector fee is only a portion of what the Nova Scotian citizen actually pays, they pay additional taxes on top of this.

It is impossible to say which citizen pays more from the WaPo chart. It compares two completely different things, it is useless. On top of this, it groups together all angiograms, which will have wildly different costs. It needs to be established that the same proportions of each type of angiogram are performed on both populations.

I agree that US healthcare is overpriced, but that chart does not support this fact.

[Hawker]

...snip...

I agree that US healthcare is overpriced, but that chart does not support this fact.

Thank you.  Feel free to contact them about methodology in their charts.  Is the price gouging is the bigger issue.

[bb113]

Wait, before moving on... do you understand what I am saying about that chart or not?

[Hawker]

Wait, before moving on... do you understand what I am saying about that chart or not?

Of course - international comparisons are had and will always be an approximation.  The big picture remains the same - Americans are being overcharged and if it could sort out its health costs, the country's fiscal situation would be transformed.

[bb113]

No, this was not a problem due to approximation. It was a problem of either vast ineptitude or fraud. I just want to emphasize this, every time I see some statistic in the news and then go follow it up I find out the news was completely full of shit with that statistic. I don't remember the last time it didn't happen.

[Hawker]

No, this was not a problem due to approximation. It was a problem of either vast ineptitude or fraud. I just want to emphasize this, every time I see some statistic in the news and then go follow it up I find out the news was completely full of shit with that statistic. I don't remember the last time it didn't happen.

The point remains; Americans pay more and there is not a medical reason for their paying more.  If you are concerned about fraud or ineptitude, is that not the place to start?

[bb113]

No, the place to start is establishing a reliable source of information. So far we know it is not the washington post.

[Hawker]

No, the place to start is establishing a reliable source of information. So far we know it is not the washington post.

Fine.  When you find a source of information that says American pay less, do let us all know.  I can't wait.

[bb113]

Huh, that's not the issue. The issue is where that money is going and why.

*edit: see your thread title

[Hawker]

Huh, that's not the issue. The issue is where that money is going and why.

*edit: see your thread title

A part of the extra goes to the vendors and the reason they charge Americans more is because they can.  A system where one person gets charged more than another just because they are in a weak negotiating position will always be efficient if the vendor has a patent based monopoly.

[bb113]

The "extra" is $700 billion a year... By vendors you mean medical equipment and consumable suppliers?

[Hawker]

The "extra" is $700 billion a year... By vendors you mean medical equipment and consumable suppliers?

US population is 300 million or so.  The articles say that the average American pays $8000 per year compared to $4000 for the average of the other countries.

Does that not come to $1.2 trillion per year overpay?

EDIT: fixed my math.

[bb113]

Ah my number was from 2006. Your math is wrong somehow though. Total spending is like 2.5 trillion. Also I keep seeing people report this wealth effect:


http://www.kff.org/insurance/snapshot/oecd042111.cfm

So when calculating the "overpay" you need to accout for the US's high GDP per capita. So apparently it would be "expected" to be around 5k per capita, or $1.56 trillion. So by that calculation that's one-trillion "overpaying".

Then again some of the GDP numbers in that chart disagree with wikipedia by a wide margin:
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28nominal%29_per_capita

Another thing to consider is that I have also come across people saying the US deficit is about $5 trillion a year if you count the money the government owes to itself to pay back the social security fund.

Edit: I read $1.2 trillion as $2.1 trillion

Edit2: Ok, I didn't read wrong

[Rassah]

Sorry to interject, but you keep saying this

if it could sort out its health costs, the country's fiscal situation would be transformed.

And considering our top causes of budget deficit are Social Security, war spending, and Medicare that supposedly gets way cheaper prices than private insurance, I don't see how just solving our medicine stuff will solve our country's fiscal situation. At most it's just one part of a much much bigger problem.

[Hawker]

Sorry to interject, but you keep saying this

if it could sort out its health costs, the country's fiscal situation would be transformed.

And considering our top causes of budget deficit are Social Security, war spending, and Medicare that supposedly gets way cheaper prices than private insurance, I don't see how just solving our medicine stuff will solve our country's fiscal situation. At most it's just one part of a much much bigger problem.

Medicare is not allowed to seek the best price.

$1.2 trillion per year is not small change.  If that was a tax cut to engineer a stimulus, or a fall in oil prices, celebrations would be in order.  An economic boom would be expected.

My bigger point is that a lot of posts here are from people saying "The US is doomed, buy guns and food and all democracy based societies will collapse real soon now."

The evidence is that the US is in robust good health.

[Rassah]

For anything in US to change, Congress needs to agree to the change. Congress is split between two parties with diametrically opposing views on economics (free market vs social programs) and is gradually influenced by lobbyists and special interests that are spending millions to keep the status quo. Regardless of whether US is in good shape, nothing will change any time soon. Heck, how many decades did it take for Obama's healthcare reform to pass, which in the great scheme of healthcare is but an asterisk to the established system?

[SgtSpike]

Maybe the US needs twice as much healthcare, because everyone's so dang unhealthy here?

[Hawker]

Maybe the US needs twice as much healthcare, because everyone's so dang unhealthy here?

Thats a good point.

So is the argument that America is richer so of course stuff is a lot more expensive.

However, American don't get more.  Assuming the drug is patent protected, an American who receives a tablet gets the same tablet a Canadian gets.  The American can be charged several times as much though.

America is richer than Canada.  But no-one argues that Americans should pay more for hard drives, or for shoes.  Why are tablets uniquely more expensive?

The argument of the article is that medicines are more expensive because a sick person is a poor negotiator and the US doesn't dictate prices the way better run systems do.  But I'm not so sure.  There is a big cultural thing here.  I came across this article today:
http://www.theatlantic.com/business/archive/2012/03/france-and-us-health-care-twins-separated-at-birth/254033/

Now, why is that? The process is well-understood: France (and other countries) simply set prices low by political fiat. The US doesn't, and so has very high prices.

You'd think someone who wrote that would have a view that the US should set prices by fiat fast.  But no.

So, where does all that leave us? Well, I don't know. As I said, I'm a layman when it comes to healthcare policy. My pro-market instincts tell me that deregulation and consumer choice are the answer.

A lot of Americans who think about this stuff are so steeped in free market fundamentalism that they can't bear to think of imposing that price control.  Paying the extra few $1000 for avoiding ideological confusion may be a valid trade-off.