The health insurance costs, even for my crappy, meager benefit, $ 3500 deductible, independent contractor plan, are going out of sight, and I’m a reasonably healthy 46 year old man who has never come close to touching the deductible! What’s driving these rocketing costs? Wasn’t the HMO -manged care movement supposed to control these vaulting increases?
What the hell is going to happen? We can’t keep going on like this! What can we do?
…is the problem? In Prince george County MD, physicians were shocked to see their medicalmalpracticeinsurance premiums doubling and trupling! Insome specialties (Ob-Gyn), doctors can expect to pay $150,000/year for insurance!
Of course, the lawyers will tell you that that is all a myth (I guess the tooth fairey pays the insurance).
You will see premuims drop when tort reform takes place in America…which will NEVER happen (because the lawyers run your state legislature). But, why should you compalin?You should be glad that the lawyers are protedting you from unscrupulous doctors and nurses!
Move to Canada? 
The nature of technological change in health care is a major contributor. Tech change can allow you to do the same thing for less (think electronic goods), but you don’t see much of that in health care. Instead you see an ability to do things that you used not to be able to do at all and slightly better ways of doing things that are more costly.
Perhaps this will change, but there are other things in the health industry which enourage it. The main one is that insurance - whether public or private - partially switches off the usual mechanisms of the market. The insured have little incentive to look for value for money when seeking treatment. Doctors have no incentive to offer it. Cost increasing technology finds a ready market and insurers have not yet found a way to control it.
Whilst the US faces the highest costs, all advanced countries face these problems.
Well you can do several things.
Start buying drugs overseas. Drugs make up 10% of healthcare costs .
Get major surgery done overseas. Places like India charge about 20% as much as the US for major surgery. However if you did that your insurance wouldn’t cover it.
Go to ehealthinsurance.com and try to find a better plan.
Vote for Kerry as his political idea of gov. paying 75% of healthcare costs above 50,000 will lower premiums for a family by roughly $1000 a year. Maybe his FEHB program will offer cheaper care too.
I predict getting healthcare overseas will become a major part of american healthcare soon. We already get our drugs overseas and soon major surgery will be done overseas more and more. Domestic medicine will probably be more for routine work and check-ups. People can’t keep dealing with 12% inflation rates, that means a doubling every 6 years. When I’m 43 healthcare will theoretically cost 8x what it does today.
Medical costs are going up due to a variety of factors. Newer, better, more expensive technology (including new drugs as well as diagnostics and treatments), an elderly population, the fact that people use more healthcare, lawsuits, labor shortages in healthcare (i know for a fact there is a nursing and medical technologist shortage, so wages go up and productivity goes down) and this also leads to rapid wage inflation (nurses just out of college can now make as much as engineers just out of college now).
The idea that medical malpractice insurance costs are driving HMO premiums is a huge pile of horseshit.
I used to contract for a dental PPO, so in case you need some background on how this HMO nonsense works, here it is:
The HMO says to the doctor, “If you agree to see patients under our plan, we will pay you less for your services than you would otherwise charge, and we won’t even touch the really pricey stuff, so forget about it. The trade-off for you is that we have so many members in your area, your patient traffic will increase dramatically, offsetting the loss of the higher service charges.”
So the doc says, “Sure!”, and has to get so many patients through the office in a day to make up for the reduced fees that you only get to see your physician for about a total of five minutes after waiting in the outer office for three hours. Sound familiar? HMOs are basically the Wal-Mart of the healthcare world, continually demanding more for less from their suppliers.
Everything your doctor can possibly imagine doing to you has a code number used industry-wide in the insurance world. Once treatment is provided, the numbers are listed on a claim form, and it is sent, along with everything that went into the doctor’s diagnosis and prescription. (Some doctors’ offices have to hire one or more people to work full time on just getting together the paperwork for the various insurance companies their patients subscribe to. Some offices have to pay so much for workers to handle the paperwork, they lose money by accepting your plan.)
The folks at the HMO get the claim and the supporting materials, and, in effect, play backseat driver to your doc. If they agree with the treatment, they pay the doctor their agreed reduced fee. If, however, they decide that some other, cheaper treatment would have been just as effective, they will only pay the doctor the agreed reduced fee for the cheaper treatment. The doctor then has the choice of passing the extra cost onto you, eating it, or simply not offering the more expensive treatment in the first place.
In other words, if they could afford the manpower, the insurance companies would prefer to have an HMO bean-counter kibbitzing over your doctor’s shoulder in the exam room, constantly trying to talk him down to the cheaper treatment for your health concern. The current system is not much different.
Now suppose that drug costs, increased use of healthcare by an aging population, and malpractice insurance costs were crippling the industry. You’d see reduced profit margins. But that’s not what’s happening.
Look for example, at the annual statement for Wellpoint (Blue Cross of California).
Look at the line “Total Stockholders’ Equity”. In these times of hardship in the world of medicine, return to shareholders more than quadrupled in four years. These companies have excess cash arriving daily by the truckload.
So why are your premiums going up?
Easy. Greed.
Easy answer-contribute more money to politicos than the insurance companies and HMOs do.
Or in other words, nothing.
God bless the AARP
Their hands are tied by their morals-they are unwilling to make illegal contributions.
That’s not what the CBO and the GAO said [url=]according to FactCheck.org. But, hey, it makes a good story and it is what the self-interested parties like the insurance companies want you to believe.
Here is a good site that presents the other side of the tort reform issue. Admittedly, it is biased. But, since most of the people like ralph124c have apparently only heard one side of the issue, I think it is good balance for them to hear the other. (The CBO and GAO are obviously more objective arbiters between the two sides.)
Insurance rates were also artificially low when the stock market was booming. When the market collapsed, that subsidy disappeared.
One non-scientific data point. I see an awful lot of ads on TV from lawyers trolling for clients. They’re already looking for vioxx “victims”.
From what I can see, the reason medical prices keep sky rocketing is largly because the health care market is so incredibly distorted, by both government interference(Government medical spending accounts for ~half of US total medical spending), and by the effects of insurance. Very few people actually directly pay for their health care - either the government pays for it, or they expect insurance to cover all medical problems.
This is rather bizarre; in most cases people buy insurance to spread out the cost of major risks, but buy minor things in the market. For example, if people viewed car insurance the same way they do health insurance, they would want their insurance company to buy them a new cup-holder if it gets broken. And pretty soon after that, you would have people complaining about rising car & car insurance cost.
Then there is government spending, which of course also isolates the medical spending from market conditions. Already, the amount the federal government spends on medical care is pretty close to the amount Canada or the U.K. spend for their medical systems on a per capita basis. I doubt throwing more government money at the problem will fix the system.
If I were to fix the medical system, I would do it either one of two ways - either stop joking around with the bastardized half-socialist system we have now, and settle for a full government payed system(but with spending on that capped at a level slightly higher than current federal medical spending),
or preferably(to me at least), scrap all federal goverment medical spending, eliminate the tax benifits for employer provided medical insurance, and bring back real competition by simply having people buy their own medical insurance (just like everyone buys their own house or car insurance) and use that to handle major things, and have people cover the minor stuff- doctors visits, most medications, out of their pockets, and let the market do its work. If individual states want to come up with extra medical help for the poor, then they can do that themselves.
Hmm, this is a very highly qualified statement, I doubt the poster realises just how much.
The US spends a greater proportion of its GDP than either the UK or Canada.
Its recognised in the UK that we actually underspend compared to most other industrialised nations, and yet certain factions, especially in the US, will point to our system of healthcare and criticise it for not being of a high enough standard or that it is rationed.
All healthcare is rationed, it does not matter what sytem you have, its just a matter of recognising it, having a lower limit for insurance claims is putting the bill on to the consumer, this is rationing because the consumer must find that money themselves, and insurance policies have differant ways of counting medical episodes so that you may not get paid out for repeated episodes of the same condition.
Insurance medicine is rationed because not everyone can afford it, and those covered by company policies are often tied down to their job until they can find another employer who offers similar medical cover.
One third of US citizens do not have medical insurance, this means the state pays emergency costs but long term chronic conditions may well not count untiol they become life threatening, this is also rationing.
If you have pre-existing medical conditions you will either have to pay more for your medical insurance, or you may not even get insurance at all as you will be deemed to great a risk, this is also a form of rationing.
The US rations medical care by using money and ability to pay for a particular level of cover.
There is so much money made by the medical insurers that they do not want to lose the captive market, competition seems to have stagnated in what is supposed to be the world most dynamic economy, its not a cartel, but it works very similarly.
So when other nations health services are mentioned in the US, it is always called ‘socialised medicine’ to try raise some spectre of communism to instill that frisson of fear of pinko bed wetters.
How can a profit making organisation actually be cheaper than a non-profit making one ? The answer is always supposed to be competition but take a look at the various policies on offer from the insurers - does it really look like true competition to you ?
I don’t buy the argument (that the ABA is pushing) that medical malpractice insurance is rising because of the stock market crash, for two reasons:
-medical insurers have huge porfolios of stocks; hey did NOT have everything in tech stocks
-check youlocal yellow pages-you will see page after page of lawyers, all adverising how much they can “get” for you. In my area, aman by the name of James Sokolove (Esq.) is ALWAYS on TV, telling you how he can “get you the money you deserve”…the shows a list of all the accidents he can help you with. Actually Sokolove is just a booking agent-he will refer you to another landshark who willtake your case (according to its financial viability).
In some states (West VA), there are NO specialists in certain fields…if you need a neurologist, you will have to go out of stste!
But that’s OK, we can retrain he lawyers to do medical care. You cannot have a legal industry this huge, without some very severe financialconsequences!
They were still hurt by the stock market. Many pension funds are in the same boat. When things were going well, they were “overfunded” by government standards. Many organizations reduced their contributions to their pension fund, or in the case of the exceptionally greedy, tried to figure out ways to extract the surplus for their own benefit. Now many of those pension funds are underfunded by huge amounts, hundreds of billions of dollars for the S&P 500 companies. GM is said to be $25 billion in the hole on their pension fund.
As a guy who’s had health care in Canada and the U.S., I have to say that American prices for everything health-care related are seriously out of whack.
For instance, my NY dentist charges $175 for a cleaning, plus nearly $300 for x-rays. This is clearly insane, when you consider that I have cavity-free teeth.
In Canada, the most expensive dental visit I ever had was CDN$175, and that included a full panorama x-ray and a cleaning.
There are similar cost discrepancies for eye exams.
While malpractice insurance is a part of the problem, it’s hardly all.
IMHO, the problem is several-fold and in most cases, does not admit of a solution.
One: the fact that we have “competitive” hospitals actually raises prices. Every hospital (and plenty of local operations) must have the latest, most expensive high-tech equipment in order to compete. In an area where one MRI machine might be sufficient, there are six. These have to be paid for. When you go to the hospital, a large portion of your fee is paying the overhead for that expensive equipment.
Two: Every individual wants the “best,” as do the doctors (this is in part due to fear of malpractice suits). Having chest pains? It’s probably bronchitis, but you go to the finest heart specialist in the area ‘just to be sure.’ As hawthorne pointed out, the fact that insurance covers this for so many of us has caused the majority of the market to be indifferent to the cost of a treatment or procedure; when was the last time any of us did a cost-benefit analysis on a medical treatment or procedure?
Three: Heroic measures. Every day you hear of extraordinary surgeries performed on fetuses, the extremely ill, people with congenital conditions that otherwise would probably kill them, the very old. These procedures cost money, and almost no individual could possibly pay for them. The cost is absorbed by the system, and passed on to all of us.
And yes, malpractice insurance costs and even more, the fear of lawsuits drives up the cost, by causing doctors to be overly cautious in what they order in the way of dianostics and treatments. And the cost of pharmaceuticals is obscene; this is one area in which I believe unbridled profit-taking on the part of the sellers is very much a part of the problem. Drug companies spend far more on marketing that on research; the belief that lowering prices would cut research is very much to the advantage of these companies. The fact that pharmaceutical companies can now advertise to the public has probably hurt us more than helped us; the companies now have ‘expenses’ that they consider essential (and therefore are built into their pricing structure), and we have patients requesting meds from doctors rather than the doctors simply prescribing what they feel is required.
I don’t know what the solution is. I have some ideas for the insurance problem (all doctors pay into a pool, which has a fixed payment schedule provided to the recipients of bad outcomes regardless of cause, then a local board monitors doctors’ performances and defrocks those who are clearly screwing up - no more law suits at all, and the boards, also responsible for payments of the bad-outcome money, have good incentive to make sure they are cleaning house.). But how do you tell the public that they must learn to accept a little less than the absolute best? Because that’s really the problem.
Competition in the medical industry has not caused prices to go down; it’s caused them to rise. It would work if we had no insurance whatsoever, but as long as the health consumer is not thinking in terms of cost-benefit, competition is useless as a price control. But the idea of health care without insurance is too brutal for me; I would vastly prefer an entirely socialized medical system. In conjunction with my negative outcome payment scheme, doctors would feel more free to consider cost/benefit when prescribing diagnostics and treatments; costly equipment could be available based on the actual needs of an area rather than the perceived liklihood of making a buck.
Howmuch DOES a Canadian doctor or dentists have to pay (for liability/malpractice insurance) to protect himself from the hordes of greedy landsharks?
Another relevant question would be: How much preventive medicine do canadian doctors have to practice to avoid being sued? Are lawyers allowed to advertise in canada?
There is NO way that my own doctor can continue to practice-he is retiring early, and moving out of state. THANK YOU, Mr. Sokolove!
Oy, you left out one important one: the bureaucracy surrounding reimbursement. A single-payer system can be much more efficient in this regard and Canada spends far less on this than we do. In fact, I knew a doctor in Vancouver who explained to me that in his practice of several doctors, they had one secretary spending part of her time on reimbursement. He said that for similar sized practices in the U.S., you’d have a few people full time doing that.