Romney is an ignoramus on health care...

[jshore]

So, when I went to try to find this quote by Romney about firing insurance companies because I wanted to see if it was a dumb as it sounded, I found this Krugman blog piece (quoting an economist named Aaron Carroll) that explains much better than I can why it shows that Romney is completely ignorant of the lives of real people, especially in regards to health care:

The real issue, unfortunately, is that very, very few people have the luxury that Gov. Romney is endorsing. Let’s say that you are self-employed, and lucky enough to have found a company to provide you with health insurance. Then, let’s say you develop cancer. You suddenly find out that your insurance company stinks. So you fire them, right?

Of course not. You’re screwed. Now you have a pre-existing condition. There’s not an insurance company out there that wants to cover you. So you don’t fire them. You scream, and curse, and cry, but you’re stuck. Only healthy people have the luxury of picking and choosing.

Let’s also not forget that most people don’t find out that they’re not getting “good service” until they’re sick. Healthy people don’t make much use of their insurance, so they don’t know how bad it is. They only find out after they’re ill, and then it’s too late. It’s only fun to fire the insurance company if you’re sure you can go to another company to get what you need. Almost no one can.

It is frustrating that the media meme has been mainly this sort of "strawman" argument about how it shows how Romney likes to fire people when the real meme should be how it shows that Romney has no understanding whatsoever of the problems that real, not-insanely-wealthy people face. (Admittedly, there used to be a guy by the same name, who was Governor of Massachusetts, who may have had a little more comprehension of this stuff...but that person is apparently now long gone.)

Discuss.

[XT]

I can't really speak to the OP, since I haven't been following this election very carefully and really don't care that much about Romney one way or the other, but I don't think Krugman is exactly an unbiased source here. What little I've heard though is that the health care plan that Romney is trying to deny ever happened when he was Governor is curiously similar to what the Dems were trying to adopt a few years ago...so, if he's clueless about healthcare, it's interesting that his plan seems so similar. Perhaps Krugman has caught Romney flip flopping due to pandering to his current audience, or perhaps he's spinning this (pretty vague) blog post to make what is likely the only real threat from the Republican side look bad or fire up the base against him.

Frankly I think it's wasted effort, since I can't imagine Romney beating Obama in this election, regardless of how things work out. But I'm a bit suspicious of a blog piece from a guy like this, even if he IS a conscientious liberal.

-XT

[Voyager]

From here is the actual quote.

Originally Posted by Mittens

"I don't want to live in a world where we have Obamacare telling us which insurance we have to have, which doctor we can have, which hospital we go to," Romney said. "I believe in the setting as I described this morning where people are able to choose their own doctor, choose their own insurance company. If they don't like their insurance company or their provider, they can get rid of it."

I suspect this is the new anti-socialist healthcare Romney, not the old pro-socialist healthcare Romney. And the criticism seems right on, and should be obvious for anyone for who money is an issue.

I'll let the rest of the blog I linked to - not by Krugman, but no doubt a liberal, living in Massachusetts and liking RomneyCare and all - speak for itself.

[XT]

I don't know...that doesn't really clarify it for me. Maybe he thinks his own health care reform is better. Or, maybe he's just pandering to the crazy right wingers until he has the election locked up, and then, assuming he becomes president he'll move towards the center. Like, I don't know, say Obama? Well, pandering to the crazy left wingers and then moving towards the center of course...

-XT

[Wesley Clark]

Originally Posted by Voyager

From here is the actual quote.


I suspect this is the new anti-socialist healthcare Romney, not the old pro-socialist healthcare Romney. And the criticism seems right on, and should be obvious for anyone for who money is an issue.

I'll let the rest of the blog I linked to - not by Krugman, but no doubt a liberal, living in Massachusetts and liking RomneyCare and all - speak for itself.

I was going to post that Romney's version of reality was the opposite of what was going on, but that link already does that.

Under the affordable care act you can pick your insurer through an exchange, and because pre-existing conditions will be banned in 2014 and there will be subsides, people will be able to move from insurer to insurer (I think) if they want to, within reason (I don't think you can refuse an employer plan or refuse medicare, etc).

Under our current system you can't 'fire' your insurer. If you get sick you can't get insurance elsewhere due to pre-existing conditions.

Romney is totally orwellian on this issue, and nobody mentions it.

[jshore]

xtisme says:

I can't really speak to the OP, since I haven't been following this election very carefully and really don't care that much about Romney one way or the other, but I don't think Krugman is exactly an unbiased source here.

What is there to be biased about? Are you saying that Romney didn't say what he said? That it was taken out of context? That the insurance industry works more the way candidate Romney seems to believe it does than the way it is described in what I quoted?

What little I've heard though is that the health care plan that Romney is trying to deny ever happened when he was Governor is curiously similar to what the Dems were trying to adopt a few years ago...so, if he's clueless about healthcare, it's interesting that his plan seems so similar.

True...which is why I noted "Admittedly, there used to be a guy by the same name, who was Governor of Massachusetts, who may have had a little more comprehension of this stuff...but that person is apparently now long gone."

But, then, which Romney are we electing...the one who implemented a health care plan in Massachusetts that by the accounts that I have read is similar in many respects to Obama's or the one who is going to make it one of his top priorities to repeal Obama's plan because the free market for health care is apparently just glorious at the moment?

Like, I don't know, say Obama? Well, pandering to the crazy left wingers and then moving towards the center of course...

Somehow, I seem to have missed the pandering to the crazy left wingers part.

[XT]

Originally Posted by jshore

Somehow, I seem to have missed the pandering to the crazy left wingers part.

You missed it in the primaries when he was trying to become president?? basically, if he got the Democratic nomination he HAD to pander to his base...same with whoever wants to become the Republican nominee has to pander to the crazy Republican base. Haven't you seen all the threads with disillusioned left wing 'dopers lamenting how Obama sold them out? Do a search...I can think of half a dozen I've seen around here in the last year or so.

-XT

[Lobohan]

Originally Posted by xtisme

You missed it in the primaries when he was trying to become president?? basically, if he got the Democratic nomination he HAD to pander to his base...same with whoever wants to become the Republican nominee has to pander to the crazy Republican base. Haven't you seen all the threads with disillusioned left wing 'dopers lamenting how Obama sold them out? Do a search...I can think of half a dozen I've seen around here in the last year or so.

-XT

What specifically? He tried to close Guantanamo, that was stopped by cowardly Republicans. He didn't run on the public option.

He walked back the idea of no lobbyists, but I imagine that's because everyone is a lobbyist.

[GIGObuster]

Originally Posted by Wesley Clark

I was going to post that Romney's version of reality was the opposite of what was going on, but that link already does that.

Under the affordable care act you can pick your insurer through an exchange, and because pre-existing conditions will be banned in 2014 and there will be subsides, people will be able to move from insurer to insurer (I think) if they want to, within reason (I don't think you can refuse an employer plan or refuse medicare, etc).

Under our current system you can't 'fire' your insurer. If you get sick you can't get insurance elsewhere due to pre-existing conditions.

Romney is totally orwellian on this issue, and nobody mentions it.

I always look for character moments like this one in primaries, for Bush the lesser it was the confederate flag issue, it did not matter that Bush's hero Sam Houston (He had a huge painting of Houston in his office while he was governor) refused to have the confederate flag raised and supported the union, Bush decided that it was better to throw San Houston under the bus and side with the state that still wanted to have the confederated flag on their capitol building.

Mittens just ran into that moment here, his "trow your ideals under the bus for political expedience" moment that shows a lack of character.

[XT]

Originally Posted by Lobohan

What specifically? He tried to close Guantanamo, that was stopped by cowardly Republicans. He didn't run on the public option.

Specifically? Take your pick. He sold out on the health care bill (what, no single payer system? TRAITOR!!). He sold out on now prosecuting/executing Bush et al. for war crimes. He sold out on not hammering the banks or increasing taxes on business, or myriad other pie in the sky lefty issues that they THINK he could have done but didn't...or didn't try hard enough on. Or something. Like I said, there are plenty of threads on this board with left leaning 'dopers lamenting how Obama hasn't fulfilled his promises, or has otherwise disappointed them. For a while I was seriously worried, as it seemed to me that the left was getting apathetic about Obama and he might actually lose. Fortunately, it seems that the Republicans and their right wing are even loopier than the Dems with their left wing, so Obama seems to be in no danger of losing the reelection.


-XT

[Lobohan]

Originally Posted by xtisme

Specifically? Take your pick. He sold out on the health care bill (what, no single payer system? TRAITOR!!).

I was taking issue with the idea that Obama had pandered to them, not that some people on the left weren't unrealistic with their expectations.

I think he made good faith efforts on most of what he promised. A lot of very liberal types wanted more, but he had the most obstructionist congress of all time to fight against.

[Fuzzy Dunlop]

Originally Posted by Lobohan

I was taking issue with the idea that Obama had pandered to them, not that some people on the left weren't unrealistic with their expectations.

I think he made good faith efforts on most of what he promised. A lot of very liberal types wanted more, but he had the most obstructionist congress of all time to fight against.

Politifact keeps a decent record of Obama's promises that make a handy reference to look up if you're so inclined. You can count on them to have a good citation on him making the promise and take their analysis of whether he kept it, broke it or compromised however you want.

Here's a page on then-candidate Obama promising to make a push for comprehensive immigration reform in his first year, for example. http://www.politifact.com/truth-o-me...ill-first-yea/

Maybe your point was supposed to be entirely rhetorical but I think it's a useful site to remind myself of things.

[puddleglum]

Mr. Carrol point is entirely untrue. People go to their doctors for things other than cancer and health insurance companies have incentives to keep customers healthy regardless of whether the population is captive or not. I have never had a major illness yet I have gone to the doctor dozens of times and have had plenty of chances to evaluate my health insurers. Some i have liked and others I have not, however I have never contemplated changing my insurance because the preferential tax treatment the government provides to employer provided health care means that it would cost me thousands of dollars to change providers. Car insurers are always sending junk mail to me promising low prices and great service and I can't watch TV for five minutes without being asked to change my insurance for something that is cheap and has a 98% satisfaction rating. This despite the fact that it is impossible to know whether your car insurance is good until you have an accident and it is to late to change. State farm does not provide me with good service because they are such wonderful people, they provide good service and low rates because they are afraid of my firing them and hiring someone else and even more than that they are afraid of me telling other people about my bad experience. Reputation is something that insurance companies live and die by. An example of this is the insurance companies that paid off for Kristallnacht despite the german government trying to prevent them. CareFirst gave me crappy service because they knew it would cost me thousands of dollars to fire them. If we had government run healthcare like Mr Caroll would like, if I did not like my health care plan I could move to Canada.
Mr Romney's point is just plain common sense, more competition is good for customer service and less competition is bad for customer service. This is as true in health insurance as it is any other market.

[Procrustus]

Originally Posted by puddleglum

Mr Romney's point is just plain common sense, more competition is good for customer service and less competition is bad for customer service. This is as true in health insurance as it is any other market.

But there is more competition under "Obamacare" (and Romneycare) then there is under current employer-based system. Romney has criticism has no relation to the recent legislation, as far as I can tell.

[Jas09]

Excactly, Procustus. The ability to "fire" your health insurance company is in no way reduced by Obamacare, and is in some very real ways increased by it. It's just another way to tell the "Obamacare is government-run health care" lie.

[puddleglum]

The criticism is that Obamacare preserves the current employer based system and Romney was saying that he would like to move toward a situation where individuals buy their own health insurance instead of it being a job benefit. He was not contrasting Obamacare with Romneycare but Obamacare with his ideal solution.

[FixMyIgnorance]

How does Obamacare work versus the current system (in the basic sense)? What's the alternative?

[John Mace]

Originally Posted by puddleglum

The criticism is that Obamacare preserves the current employer based system and Romney was saying that he would like to move toward a situation where individuals buy their own health insurance instead of it being a job benefit. He was not contrasting Obamacare with Romneycare but Obamacare with his ideal solution.

Yes, that's a point that people seem to be missing. From Romney's web site:

Empower individuals to purchase their own insurance

The tax code currently offers open-ended subsidies for the purchase of insurance through employers. Mitt Romney will expand the tax deduction to also include those who buy their own health insurance. This simple change creates the best of both worlds. Absolutely nothing will change for those who like their current coverage. And individuals who don't get coverage through their employers will have portable, lower-cost options.

Now, that might (hah!) be a sound-bite, oversimplified statement addressing a complex problem, but it does show that Romney wants to move away from the current system that tends to lock you into a provider based on your employee benefits.

[FixMyIgnorance]

That sounds awful

I prefer to have my employer prodivde insr options

[joebuck20]

A lot of these arguments also fail to touch on the fact that health insurance is freakin' expensive, and that for most people, if they weren't getting it through their employer as a benefit (regardless of what tax breaks are or are not being offered) they wouldn't be able to afford it all. That's why a lot of people choose to even do without COBRA when they lose their job - even though COBRA offers the group rate the employer was paying which is ostensibly cheaper than what you might be able to find on the open market.

So, yeah, it's not something most people are going to change willy nilly.

[Jas09]

Yeah, the idea that individuals could acquire insurance on the open market if only they got a federal income tax deduction for the premiums seems farfetched, especially when you consider that those that are uninsured tend to not pay very much in federal income tax anyway.

When you add in the desire to repeal the bans on pre-existing conditions I don't see how the Romney proposal makes it more possible to change insurance providers than the Obamacare provisions do. I have to think that the Obamacare premium support subsidies will go much farther than a federal income tax deduction would, at least according to the numbers I've seen.

Also, unreimbursed medical expenses are already tax deductible, IIRC, once they exceed 7.5% of AGI, which I think would kick in pretty quickly for low-income filers. I think this number is raised in Obamacare, however (10% seems to ring a bell).

[Voyager]

Originally Posted by John Mace

Yes, that's a point that people seem to be missing. From Romney's web site:

Now, that might (hah!) be a sound-bite, oversimplified statement addressing a complex problem, but it does show that Romney wants to move away from the current system that tends to lock you into a provider based on your employee benefits.

Does Romney propose forcing insurance companies to take people with pre-existing conditions? Because if he doesn't, he is not really backing a plan where people have the freedom to move. Employer-based healthcare plans typically prevent insurers from canceling coverage, and give coverage to new employees even with pre-existing conditions.
Second, a bulk purchaser of insurance is always going to be able to do better than a single purchaser, assuming best effort. You don't need a PhD in economics to figure that out.

it seems that most of the expectation of savings on individual healthcare is supposed to be from the consumer with a gunshot wound shopping around for the cheapest emergency room, and from people not wasting money on checkups and cancer treatments and stuff.

[Chronos]

Second, a bulk purchaser of insurance is always going to be able to do better than a single purchaser, assuming best effort. You don't need a PhD in economics to figure that out.

But Republicans inherently must start by denying that premise, because accepting it inevitably leads you to a single-payer system.

[John Mace]

Originally Posted by FixMyIgnorance

That sounds awful

I prefer to have my employer prodivde insr options

What sounds awful? This: "Absolutely nothing will change for those who like their current coverage."

[Jas09]

Originally Posted by Chronos

But Republicans inherently must start by denying that premise, because accepting it inevitably leads you to a single-payer system.

Not necessarily - it could also lead you to a free-market-based exchange, with an individual mandate and rules against exclusion based on pre-existing conditions. Couple that with generous subsidies for low-income families and you could achieve universal coverage in a market-based private system.

I wonder if anybody has ever tried that kind of plan at the state level?

[Chronos]

That's good as far as it goes, but it still has a great many relatively small groups doing the negotiating. If it's cheaper for a larger group to negotiate, then the end result is the largest group of all, consisting of everyone, to negotiate as a bloc.

[jshore]

Unless there are very stern provisions to prevent insurance companies from discriminating on the basis of pre-existing conditions, free market solutions like Romney's will be a disaster. (And, of course, the only way you can keep health insurance affordable in that case is some sort of mandate so that the healthy pay into the system too, rather than just going without and becoming free-riders if they do end up needing expensive medical care.)

When I was in grad school, the health insurance we had through the university only covered up to $20,000. Some of the grad students got together and had the insurance company come in and offer a policy on an individual basis with a $20,000 deductible that would cover up to $1 million. When I talked to the insurance guy and it came out that I had had kidney stones, he said that would be excluded as a pre-existing condition. Then, he asked, "Just once, right?" and I said that, no, I had had 2 or 3 events. He looked up in his big book and said I was "NCA" (no coverage available)...All he could do is write me an accident-only policy!

I mean, it wasn't even rational, given that a kidney stone is not likely to be something that is going to lead to medical bills over $20,000...but, here I was a young healthy male in my mid-20s and I couldn't even get health insurance because I had had a few kidney stones.

That is one f-cked up "free market"!

[John Mace]

Originally Posted by jshore

Unless there are very stern provisions to prevent insurance companies from discriminating on the basis of pre-existing conditions, free market solutions like Romney's will be a disaster. (And, of course, the only way you can keep health insurance affordable in that case is some sort of mandate so that the healthy pay into the system too, rather than just going without and becoming free-riders if they do end up needing expensive medical care.)

When I was in grad school, the health insurance we had through the university only covered up to $20,000. Some of the grad students got together and had the insurance company come in and offer a policy on an individual basis with a $20,000 deductible that would cover up to $1 million. When I talked to the insurance guy and it came out that I had had kidney stones, he said that would be excluded as a pre-existing condition. Then, he asked, "Just once, right?" and I said that, no, I had had 2 or 3 events. He looked up in his big book and said I was "NCA" (no coverage available)...All he could do is write me an accident-only policy!

I mean, it wasn't even rational, given that a kidney stone is not likely to be something that is going to lead to medical bills over $20,000...but, here I was a young healthy male in my mid-20s and I couldn't even get health insurance because I had had a few kidney stones.

That is one f-cked up "free market"!

Well, what you're talking about is not insurance. If you brought your car in to be insured and the breaks light didn't work, would you expect the insurance company to just ignore that and give you liability insurance?

[Wesley Clark]

Originally Posted by FixMyIgnorance

How does Obamacare work versus the current system (in the basic sense)? What's the alternative?

There are several aspects to Obamacare. For one thing it tries to reduce long term medical costs via programs like medicare, it will start cutting medicare funding later this decade to stop long term medical inflation.

But as far as what you are asking, Obamacare sets up state wide insurance policy exchanges where insurers are required to cover applicants (you can't be denied for a pre-existing condition). There is also a subsidy for buying private insurance based on income (I think it maxes out at about 45k income for a single and 80k for a family, the lower the income the higher the subisdy).

The theory is that by creating real competition (by having insurers forced to take all applicants, and by having insurers compete) this will drive down overhead costs and improve quality. I have no idea if it'll work or not, I don't think it reduced costs in MA.

http://en.wikipedia.org/wiki/Patient...Act#Provisions

[puddleglum]

Originally Posted by Voyager

Does Romney propose forcing insurance companies to take people with pre-existing conditions? Because if he doesn't, he is not really backing a plan where people have the freedom to move. Employer-based healthcare plans typically prevent insurers from canceling coverage, and give coverage to new employees even with pre-existing conditions.
Second, a bulk purchaser of insurance is always going to be able to do better than a single purchaser, assuming best effort. You don't need a PhD in economics to figure that out.

it seems that most of the expectation of savings on individual healthcare is supposed to be from the consumer with a gunshot wound shopping around for the cheapest emergency room, and from people not wasting money on checkups and cancer treatments and stuff.

Romney's plan is that pre-existing conditions would be covered if the person had been covered previously covered by insurance for a significant amount of time.
If a bulk purchaser is always able to do better than a single purchaser in markets why do we not buy everything in bulk? I could save a significant amount of money if my employer had a deal with a developer to buy homes in bulk, or I could save on my food bills if my employer bought groceries in bulk. My employer could also buy fire, flood, life, and car insurance in bulk. Yet most employers only buy health insurance and a token amount of life insurance for their employees.
The price of automobile insurance seems to be much less than health insurance and that did not come about by people who just had accidents shopping around for the best price on tow trucks and body shops. It came through competition and efficiency. There is nothing about the market for health insurance that keep competition for customers from lowering the price of health insurance. An example is the price of Lasic eye surgery. Since it was introduced the cost has fallen almost 50% in nominal terms and the quality is better. This is because insurance does not cover the procedure and doctors have to compete on price. Safeway has kept the cost of its plan from rising by introducing plans which require employees to pay some of the costs of their care after 1,000 dollars.
Romney's plan is to end the preferential tax treatment of employer plans which will allow users to shop around and to end the ban on inter-state purchase of health insurance which would allow low cost insurers to compete nationally. This enhanced competition will lower the cost of health insurance as competition has lowered the cost of all other goods.

[Voyager]

Originally Posted by puddleglum

Romney's plan is that pre-existing conditions would be covered if the person had been covered previously covered by insurance for a significant amount of time.

So, a young person who plays the odds and chooses not to purchase insurance gets screwed if he suddenly gets sick? The mandate is to prevent this, and to also prevent the young person from gaming the system.

If a bulk purchaser is always able to do better than a single purchaser in markets why do we not buy everything in bulk? I could save a significant amount of money if my employer had a deal with a developer to buy homes in bulk, or I could save on my food bills if my employer bought groceries in bulk.

Never been to Costco, have you? You can save if you buy things in bulk. People with freezers buy half a cow and save tons. Restaurants buy in bulk, obviously. My employer buys coffee in bulk so we get it free. That an employer wishes to focus and not provide some things in bulk in no way disproves the principle.

My employer could also buy fire, flood, life, and car insurance in bulk. Yet most employers only buy health insurance and a token amount of life insurance for their employees.

My life insurance is more than token. However, if you are a member of a professional society, especially one in which some members are self-employed, you can usually get a better deal on group insurance than you can independently. IEEE has liability insurance for member conferences which they buy in bulk, and which is very expensive if bought separately.

The price of automobile insurance seems to be much less than health insurance and that did not come about by people who just had accidents shopping around for the best price on tow trucks and body shops.

Ever hear of AAA? Towing in bulk. And if you have a collision, your insurance company will direct you to a body shop with which it made a bulk purchase agreement.
There is a mandate for car insurance, which helps the price. What also helps is that cars have an upper bound on value. If we did health insurance so that we declared a patient as totaled if he required more than $100K of care, our health insurance costs would come way down. (No Mr. Romney, you may not steal that idea.)


It came through competition and efficiency. There is nothing about the market for health insurance that keep competition for customers from lowering the price of health insurance. An example is the price of Lasic eye surgery. Since it was introduced the cost has fallen almost 50% in nominal terms and the quality is better. This is because insurance does not cover the procedure and doctors have to compete on price. Safeway has kept the cost of its plan from rising by introducing plans which require employees to pay some of the costs of their care after 1,000 dollars.
Romney's plan is to end the preferential tax treatment of employer plans which will allow users to shop around and to end the ban on inter-state purchase of health insurance which would allow low cost insurers to compete nationally. This enhanced competition will lower the cost of health insurance as competition has lowered the cost of all other goods.[/quote]

You can bring up plastic surgery also. Optional, non-emergency treatments for which people can shop around are good examples of things the market can regulate - and I'm not aware any mandated health care plan covers these. Nor should it. Treatment for e heart attack is slightly different.
You have not yet demonstrated that individuals would be able to beat the cost of mass company plans. (Most large companies are self-insured, which is always going to be cheaper.)
There are plenty of nationwide health insurance companies already. Since the basic cost of health insurance depends on expectation of use rates by the customers, and this is more accurate the more customers you have, small companies can never beat big companies as far as the base cost of care goes. As I mentioned, big companies buy doctor services in bulk through contracts. Small companies can't beat this either. Small companies might be more efficient at first in terms of overhead, but because of their price disadvantage the big companies can stomp them at will. The fantasy of boutique health insurance companies beating the big boys is just that - a fantasy.
Plus, there are tons of people without employer paid health care today. Where are these companies? California is plenty big enough to support them, and they don't exist. So the claim made in the title of this thread stands.
Actually, he isn't an ignoramus - he is just playing one to appeal to the Republican base which is stupid and doesn't get these complicated concepts.

[Wesley Clark]

Originally Posted by puddleglum

Romney's plan is that pre-existing conditions would be covered if the person had been covered previously covered by insurance for a significant amount of time.

If a bulk purchaser is always able to do better than a single purchaser in markets why do we not buy everything in bulk? I could save a significant amount of money if my employer had a deal with a developer to buy homes in bulk, or I could save on my food bills if my employer bought groceries in bulk. My employer could also buy fire, flood, life, and car insurance in bulk. Yet most employers only buy health insurance and a token amount of life insurance for their employees.

The price of automobile insurance seems to be much less than health insurance and that did not come about by people who just had accidents shopping around for the best price on tow trucks and body shops. It came through competition and efficiency. There is nothing about the market for health insurance that keep competition for customers from lowering the price of health insurance. An example is the price of Lasic eye surgery. Since it was introduced the cost has fallen almost 50% in nominal terms and the quality is better. This is because insurance does not cover the procedure and doctors have to compete on price. Safeway has kept the cost of its plan from rising by introducing plans which require employees to pay some of the costs of their care after 1,000 dollars.

Romney's plan is to end the preferential tax treatment of employer plans which will allow users to shop around and to end the ban on inter-state purchase of health insurance which would allow low cost insurers to compete nationally. This enhanced competition will lower the cost of health insurance as competition has lowered the cost of all other goods.

The problem is that more and more employers are abandoning health care coverage. Around 1993 close to 75% of employers offered health insurance. By 2000 it was closer to 56%, now it is in the mid/high 40s. And the plans can be skimpier, they may only cover the employee rather than the employees entire family. Many people can't get insurance now. Employers don't offer it, and pre-existing conditions keep them out of private plans.

Not only that but if you have a small business with 30 employees and one develops a health condition that costs 400k a year to treat, the employers premiums can skyrocket and cause him to drop coverage. So there are tons of holes in the system. Most employers don't offer coverage, and lots of small businesses can lose coverage if their employees develop a serious illness due to radical premium hikes.

Taiwan has a single payer system and also uses a lot of competition to drive up quality and drive down prices because if doctors can't offer good service, nobody comes to them. And if they can't make a profit on the reimbursement rates, they lose money. There is nothing about using competition to increase innovation and quality while decreasing cost that needs to be at odds with a single payer universal health care system. Other nations have found ways to implement competition into their universal systems.

Ending the ban on interstate health insurance purchases will lead to what happened with credit cards, all the companies will move to the 1 or 2 states that have the fewest consumer protections. That is why credit card companies are all in South Dakota and Delaware. The same will happen with health insurance, the insurers will find some ideologically friendly state, offer millions to the politicians if they pass a few laws friendly to their industry and then move their headquarters there. Then insurance truly will become just junk insurance for everyone.

The problem with that is that the inhumanity and frustration caused by our health care system will get worse, which may lead to even more rebound changes down the road.

[redtail23]

I don't believe my insurance agent has ever looked at my brake lights. I give him the VIN and some cash, he gives me insurance.

Laser eye surgery is an elastic demand. It's a luxury good; the vast majority of folks can get along just fine with contacts and glasses. That's why competition has lowered the price. Same for most cosmetic surgery.

The majority of major health care (heart attack, stroke, diabetes, liver cancer, what have you) is not. Your other choice is dying. That makes it much less responsive.

The two areas are not really comparable.

Let's talk about this 'consumer choice will lead to better, more informed decisions' nonsense.

In general, I will agree with that idea. HOWEVER, that is not the case with insurance as it exists today in the US.

Don't believe me? Try to get your standard insurance company to tell you how much a particular procedure will cost you. Go ahead, give it a try. You can't do it. They will not tell you. The customer service reps don't even have access to that information.

So, there's no way in hell you'll get any real info to compare plans with. About the only info you can get is for basic office visits and such that have standard copays.

Without that sort of information, you can not make an informed decision about what you're purchasing.

As an example, say that one plan has a 20% coinsurance and another has a 15% coinsurance. In other words, the doc charges X amount, the insurance company agrees to X-Y amount as "appropriate" or "usual and customary" or however they want to word it. Then you pay 15% or 20% of that amount plus your deductible, and the insurance pays the rest.

But percentage of what? If the first plan is only allowing $500 for a procedure and the other plan is allowing $700 for the same procedure, the 15% copay will cost you more. Of course, that plan will probably have a better choice of providers, but good luck on getting that list either.

The only way to find out APPROXIMATELY how much you'll pay is to have the doctor's office do it - which means that you can't price shop on doctors, either, because the doctors generally won't tell you until you are in their office to schedule the procedure.

Why won't the insurance company tell you? Because they negotiate different allowable amounts with different doctors, and they like to keep that quiet. Not just like to a little bit - they actually prohibit their contracted providers from giving out that information except to actual patients after the procedure has been approved.

If all the regular individual doctors found out how much they were paying those docs over there in the group practice that had more clout, they might get upset and gang up together to negotiate themselves better rates. It happened once. So the insurance companies do everything in their power to keep that information suppressed.

Yay for the free market and informed consumer choice!

[Voyager]

Originally Posted by redtail23

Why won't the insurance company tell you? Because they negotiate different allowable amounts with different doctors, and they like to keep that quiet. Not just like to a little bit - they actually prohibit their contracted providers from giving out that information except to actual patients after the procedure has been approved.

If all the regular individual doctors found out how much they were paying those docs over there in the group practice that had more clout, they might get upset and gang up together to negotiate themselves better rates. It happened once. So the insurance companies do everything in their power to keep that information suppressed.

Yay for the free market and informed consumer choice!

Not only that, if their competitors found out it would guarantee that the competitors would never pay the doctors more than they do, and give them a great competitive advantage. When I was involved in negotiating software licenses I'd have loved to know what my competitors paid. Of course not only didn't they tell me but this is the most proprietary of proprietary information, and it would be unethical (and maybe illegal) for me to try to find out.

[puddleglum]

Originally Posted by Voyager

You can bring up plastic surgery also. Optional, non-emergency treatments for which people can shop around are good examples of things the market can regulate - and I'm not aware any mandated health care plan covers these. Nor should it. Treatment for e heart attack is slightly different.
You have not yet demonstrated that individuals would be able to beat the cost of mass company plans. (Most large companies are self-insured, which is always going to be cheaper.)
There are plenty of nationwide health insurance companies already. Since the basic cost of health insurance depends on expectation of use rates by the customers, and this is more accurate the more customers you have, small companies can never beat big companies as far as the base cost of care goes. As I mentioned, big companies buy doctor services in bulk through contracts. Small companies can't beat this either. Small companies might be more efficient at first in terms of overhead, but because of their price disadvantage the big companies can stomp them at will. The fantasy of boutique health insurance companies beating the big boys is just that - a fantasy.
Plus, there are tons of people without employer paid health care today. Where are these companies? California is plenty big enough to support them, and they don't exist. So the claim made in the title of this thread stands.
Actually, he isn't an ignoramus - he is just playing one to appeal to the Republican base which is stupid and doesn't get these complicated concepts.

Some things are bought in bulk and some things are not. There are disicentives to scale as well as incentives. The disenctive is things are not customizable and fraud is harder to monitor. If you want a different kind of coffee than your company buys you are SOL. If you want to buy a health insurance policy different than your company offers you can not. I am through having children but unless things change I will have a policy that covers pregnancy expenses until I qualify for Medicare. There is nothing unique about health insurance where buying in bulk leads to unique savings. You cite AAA and CostCo as examples but there is a reason CostCo is not the only store in America. If Ford, GM, Toyota, and Mercedes merged they could get great deals on parts and theoretically pass the savings on to the customer. Yet in practice whenever there is monopoly or monopsony service and price do not become better for the customer.
As has been pointed out, health care is one of the few retail services where they try to hide the price from you. The reason that they can do this is because the customer is not paying. I guarantee that the insurance company knows how much it is paying. If consumers were paying the doctors would have no choice but to reveal how much things cost and begin to compete on price.
When people pay no marginal cost usage goes up. I am old enough to remember when you paid for the internet by the hour and when long distance calling was only for special occasions. Paying the marginal cost led to people using the service less. The same is true for health care. In the definitive study of health care utilization the Rand corporation found that people used more health care when it was free and health outcomes were no better. The implication is that increasing marginal costs for the consumer will decrease money wasted on unnecessary health care.

[jshore]

Originally Posted by John Mace

Well, what you're talking about is not insurance. If you brought your car in to be insured and the breaks light didn't work, would you expect the insurance company to just ignore that and give you liability insurance?

The difference is that some of us feel that bad health should not doom you to a life of poverty and destitution. If you feel differently, that is your prerogative.

If a bulk purchaser is always able to do better than a single purchaser in markets why do we not buy everything in bulk?

The main point is that bulk purchasing of insurance evens out the cost distribution. The problem with the insurance "free market" is that, left to its own devices, what you get are insurance companies who are willing to insure the healthy people but balk at insuring people who they think might actually get sick (or at the very least, charge them exorbitant rates). On the other side of things, those who think they are most likely to get sick are those who are most likely to buy insurance...and to buy the best policies, whereas those who think they are unlikely to are the ones who are likely to do without (and then end up "free riding" if they do have bad fortune).

"Free markets" are not some magical solution that always work for anything. Some of us think that markets should be considered as a very useful economic tool, but one that doesn't work well for everything, not as a religion.

[redtail23]

Originally Posted by puddleglum

As has been pointed out, health care is one of the few retail services where they try to hide the price from you. The reason that they can do this is because the customer is not paying. I guarantee that the insurance company knows how much it is paying. If consumers were paying the doctors would have no choice but to reveal how much things cost and begin to compete on price.
When people pay no marginal cost usage goes up. I am old enough to remember when you paid for the internet by the hour and when long distance calling was only for special occasions. Paying the marginal cost led to people using the service less. The same is true for health care. In the definitive study of health care utilization the Rand corporation found that people used more health care when it was free and health outcomes were no better. The implication is that increasing marginal costs for the consumer will decrease money wasted on unnecessary health care.

So are you talking about getting rid of the insurance industry entirely? Because that's the only way for that to work.

[Wesley Clark]

Originally Posted by puddleglum

As has been pointed out, health care is one of the few retail services where they try to hide the price from you. The reason that they can do this is because the customer is not paying. I guarantee that the insurance company knows how much it is paying. If consumers were paying the doctors would have no choice but to reveal how much things cost and begin to compete on price.
When people pay no marginal cost usage goes up. I am old enough to remember when you paid for the internet by the hour and when long distance calling was only for special occasions. Paying the marginal cost led to people using the service less. The same is true for health care. In the definitive study of health care utilization the Rand corporation found that people used more health care when it was free and health outcomes were no better. The implication is that increasing marginal costs for the consumer will decrease money wasted on unnecessary health care.

What that study found was that among middle class, healthy people higher copays did reduce unneeded care. But among poor people and people with chronic diseases higher copays led to higher medical expenses because people avoided needed medical care for certain conditions. RAND recommended a mix of higher copays for some care with lower copays for other care. One thing they recommend is lowering the copay for statin cholesterol medication (which may not matter as much now since most are $4 a month).

http://www.rand.org/pubs/research_br...74/index1.html

Key findings

In a large-scale, multiyear experiment, participants who paid for a share of their health care used fewer health services than a comparison group given free care.

Cost sharing reduced the use of both highly effective and less effective services in roughly equal proportions. Cost sharing did not significantly affect the quality of care received by participants.

Cost sharing in general had no adverse effects on participant health, but there were exceptions: free care led to improvements in hypertension, dental health, vision, and selected serious symptoms. These improvements were concentrated among the sickest and poorest patients.

Also, medical care is not split evenly among the population. Statistics show roughly 50% of the population use 96% of health care spending, the other 50% use about 4%. On top of that, the sickest 20% use 80% of spending, the sickest 5% use about 50%, and the sickest 1% use nearly 20% of all spending. Medical care is like that, most people just need a few prescriptions, doctor visits and dental visits, while a handful of people need 300k in medical care in a given year. In a given year, about 15 million Americans use 1.3 trillion in health care dollars, the other 285 million or so use the other 1.3 trillion.

To get cost down you have to find a way to deal with chronic illnesses cheaply and effectively. There are pilot programs doing that and what they have found is the opposite, that more intensive and available care draws down cost. Studies in Chicago and New Jersey found more intensive visits by physicians, nurses, aides, etc. to the sickest and most expensive patients could cut their needed medical care costs down. Having a doctor or nurse visit someone who has several chronic illnesses and ensure they are sticking to their treatment regimin is cheaper than high copays since that means the patient will avoid filling prescriptions and keeping appointments.

So the concept of copays is kindof counterintuitive. If you are a well off middle class person with a not so serious illness that can be treated at home, a copay will result in less health care spending. If you are among the 5% who use up 50% of health care spending, copays will end up costing more because you will neglect your condition.

[Voyager]

Originally Posted by puddleglum

Some things are bought in bulk and some things are not. There are disicentives to scale as well as incentives. The disenctive is things are not customizable and fraud is harder to monitor. If you want a different kind of coffee than your company buys you are SOL.

I can go out the door to a Starbucks and get coffee. I'll pay more, of course.
You are quite right that things bought in bulk are not customizable - but customized things cost more. There is a difference between the chain that buys truckloads of meat and the gourmet restaurant where the chef personally picks the meat each day. I'm not saying bulk is always better - just that it is cheaper. Cheap is not always good.
As for fraud, the bulk seller has more to lose, and the purchaser can amortize quality checks over more products. If you buy a memory chip you hope it works. When we buy tens of thousands of memory chips, we can afford to monitor supplier quality and even, if we wish, tie into their databases to check serial numbers for counterfeits.

If you want to buy a health insurance policy different than your company offers you can not. I am through having children but unless things change I will have a policy that covers pregnancy expenses until I qualify for Medicare. There is nothing unique about health insurance where buying in bulk leads to unique savings.

Sure - and the person of childbearing age is paying for the coverage of your (and my) greater chance of getting sick. Like you said, it is not customizable. And there is certainly nothing unique about health insurance and buying in bulk - it is just another example. BTW, I do have a choice - I can switch to an HMO. I believe in my new company I can turn down health insurance entirely and buy it outside. I don't get the employer contribution, and I would pay a lot more.

You cite AAA and CostCo as examples but there is a reason CostCo is not the only store in America. If Ford, GM, Toyota, and Mercedes merged they could get great deals on parts and theoretically pass the savings on to the customer. Yet in practice whenever there is monopoly or monopsony service and price do not become better for the customer.

I never claimed that buying in bulk scales infinitely. Remember,. Safeway buys in bulk also. The corner grocer did not, and the corner grocer is gone. There was a recent book on A&P - it became one of the biggest companies in America by good inventory management and buying in bulk, unlike its competitors. The competitors got wiped out.

As has been pointed out, health care is one of the few retail services where they try to hide the price from you. The reason that they can do this is because the customer is not paying. I guarantee that the insurance company knows how much it is paying. If consumers were paying the doctors would have no choice but to reveal how much things cost and begin to compete on price.

Why the customer does not know this is already covered. Actually, my statements say how much the list price is and what the insurance company paid and what I have to pay. I don't believe a word of it. And, as mentioned also, you don't know which services you are going to purchase, so there is no way of making a good decision.

We will always pay through insurance companies, not directly, by the way. I trust I don't have to say why insurance makes sense for healthcare.

When people pay no marginal cost usage goes up. I am old enough to remember when you paid for the internet by the hour and when long distance calling was only for special occasions. Paying the marginal cost led to people using the service less. The same is true for health care. In the definitive study of health care utilization the Rand corporation found that people used more health care when it was free and health outcomes were no better. The implication is that increasing marginal costs for the consumer will decrease money wasted on unnecessary health care.

I see Wesley covered this. We have a large population now, getting bigger all the time, who has to pay directly for care. I'm eagerly awaiting the results showing how well this is working for them.
I remember paying for service also. If we still did that, usage might be down, but do you think we would have Amazon and EBay? People see really big cost savings from unlimited internet availability, as you are easily able to find the lowest cost supplier. You think we'd have a better economy with expensive internet connections?
Ditto phones. When I was in college I spoke to my parents once a week. Today my kids are in NJ and Germany, and we get to be a lot more a part of their lives than my parents were in mine due to free long distance through our cell phones and Skype. That, and free internet, allowed my daughter and me to write papers together and collaborate on a class we teach together. Reduced usage is not better.
Plus, since my doctor visits are effectively free, when I got rejected from donating blood I went to my doctor, though I was 99% sure it was just too much Mountain Dew for lunch. I was wrong - I had atrial fibrillation, and if I had ignored it to save money I could easily be dead today, or at the least cost the system a ton for treating a heart attack. So I'm not a big fan of reduced access to health care.

[sinjin]

For all of you thinking that cobra is the be all and end all of insurance protection for employees changing jobs I give you the actual experience of my daughter. She left one job on Friday and started her new job on Monday. Her corbra payment for the transitional 30 days was $1700 for her and her healthy 1 year old child. Any of you, except for Bricker who thought this was cheap, think this is an acceptable price for basic health insurance? How about those who don't start a new job in two days? Cobra payments of $1700 a month for months while looking for a new job??

[Novelty Bobble]

There are many, many models outside of the USA that would give cheaper, more complete and more comprehensive cover for ALL of the US citizens. Nor do such systems impinge one whit on the richest's ability to pay for more and better and quicker.

The problem is not finding one that works, it is building the political will do do it. All the details discussed in this thread and others like it are simply a distraction, they have been solved dozens of times before.
You won't get to a working system by degrees, too many vested interests. The real issue is, will any administration ever had the clout and the balls to force through the quantum leap that is needed?

[Wesley Clark]

Originally Posted by Novelty Bobble

There are many, many models outside of the USA that would give cheaper, more complete and more comprehensive cover for ALL of the US citizens. Nor do such systems impinge one whit on the richest's ability to pay for more and better and quicker.

The problem is not finding one that works, it is building the political will do do it. All the details discussed in this thread and others like it are simply a distraction, they have been solved dozens of times before.
You won't get to a working system by degrees, too many vested interests. The real issue is, will any administration ever had the clout and the balls to force through the quantum leap that is needed?

On a federal level it'll take a while. Part of obamacare created a pathway that makes it easier for states to reform their health care system, just so long as they do the same things as Obamacare or better (cover everyone, cost the same or less, have the same consumer protections).

Vermont passed a health reform bill that starts in 2014. Montana is considering a single payer system.

http://motherjones.com/politics/2011...er-health-care

http://thinkprogress.org/health/2011...yer/?mobile=nc

So it can happen. California, Illinois and PA are all looking into major health reform on the state level too.

[John DiFool]

Originally Posted by Novelty Bobble

The real issue is, will any administration ever had the clout and the balls to force through the quantum leap that is needed?

Strange women in ponds distributing swords is no basis for a system of government!

He'll also need 60+ Senators who are 100% united behind him (which Obama didn't have from 09-10).