I’m trying to understand it. Why do we blame the insurance companies for everything? Specifically, medical insurance. You see on the news all the time about how the doctors say that this man with cancer will die for certain unless he gets a controversial treatment in the next three weeks. Insurance company refuses to pay for it. Now that man is stuck, unable to pay, waiting to die, and its all the fault of the insurance provider.
Sick child needs tests 1-8 to determine what’s wrong and pills 1-4 to get better. Insurance company refuses to pay for tests 2, 5, and 7 and pills 2 and 3. Suddenly it’s all the insurance company’s fault if the child gets even sicker.
Now don’t get me wrong. I’m not fully defending an insurance provider for denying a proven treatment to a helpless patient. I’m not fully defending denying experimental treatment to a dying patient. What I am asking is why is it always the insurance company that’s to blame?
What about the doctors whose bills are too high? Can’t they cut the price of surgery? Can’t the drug companies cut the cost of pills? Can’t the medical suppliers cut the cost of the equipment they provide?
The bottom line is that medicine, much to many people’s dismay (including mine) is a business. Business decisions need to be made every day or else everyone suffers. But everyone is making these business decisions, not just the insurance companies!
I’m just trying to find out why we hate HMOs more than the doctor who set his prices at what they are.
One, because most doctors have an agreement with the HMO to accept whatever their set rate is for a procedure. For example, you go to a specialist and get charged $380. You pay your $10 co-pay, and leave. Your insurance says that visit is only “worth” $190. They pay the doctor, and you aren’t billed the rest. So a doctor overcharging doesnt’ affect things much.
Two, MOST people’s bad experiences are with HMOs, not doctors. I have never had to fight a doctor to get the care I wanted. (lucky me…) However, I have had to fight an HMO REPEATEDLY to get the care I needed. HMOs (IMHO) operate on the assumption that if you deny 20 claims, only about 2 people will complain and you’ll have to pay. Saves a LOT of money…
Ender, while not totally disagreeing with your POV, you have a misunderstanding of how HMO’s work, particularly on the issue of doctors and pricing.
With the rise of HMO’s, doctors have lost pricing power. The HMO’s, not the doctors, dictate how much they will compensate for procedures/treatments. You are right about high drug prices, but, given that drug companies pay their own research and, more importantly, have to pay for the overwhelming amount of research that does not produce a marketable drug, I’m not sure how to fix that problem.
Anywhoo - I agree whole-heartedly with your example #1. Much as it pains me, I think that, if we are going to hold doctors/insurance companies responsible for providing responsible, effective care, we can’t penalize them for providing unproven care. We all know that, if these experimental treatments don’t work or cause damage, the doc will be sued for malpractice.
But your example #2 is an indictment of HMO’s. Assuming those tests and pills are “proven” medicine, hell yeah the insurance company is responsible if the child gets sicker because he/she didn’t get appropriate treatment.
I am constantly having to fight with my insurance company. I have a herniated disk in my lower back, and just getting that taken care of is taking months. First they didn’t wan’t to pay for a CT scan. Then after fileing a complaint with the state insurance board, they approved that. THen they didn’t wan’t to pay for the specialist that was on thier approved list for a couple of weeks, and now they have approved that finally. All in all, I have spend a couple of months waiting on them to approve stuff, and all the while I have been sitting here in pain. I finally get to see a Neurosurgeon on the 24 of March, and God only knows what hoops I will have to hobble through to get them to approve whatever he suggests. I had surgery earlier this year for a differant problem, and I had to wait over a week to get them to approve a follow up visit with the specialist that performed the procedure afterwards. Isurance company’s should not be allowed to dictate to the doctors how they can treat a patient.
Of course you’ve never had to fight a doctor to get the care you need. A doctor’s profession is to help people! He (or she) will never tell you that he’s denying you care you need. And I’m sure that he’ll fight the insurance company every step of the way. But when’s the last time he lowered the cost to those that couldn’t afford it? To do so means that hospitals get paid less, doctors get paid less, nurses get paid less. Doctors have bills too, not the least of which is the enormous cost of medical school. To lower rates means less money for them. So a doctor’s profession is helping people but their job is to keep their job.
Maybe Sua’s correct. Maybe doctors don’t determine their own prices anymore. If so then I can understand the argument against me. But I would like to see some evidence of it.
Thanks guys. I am happier than ever that I work for a company that dosen’t fight my clients over routine stuff. I still give everyone who buys insurance from me my home phone number. Never had a problem with it yet. I can explain a lot of the rest of the stuff brought up, but don’t have time now. I’ll try to post later tonight.
This happens a LOT more than you think, again, depending on the situation.
They do and they don’t. It’s a long explanation, but I’ll try to get it up tonight.
My point on that example was this. I was on Plaquenil for over 7 years for lupus. A side effect of that drug is that you can slowly develop blindness. Because of that, I had to go for a FULL eye exam every 6 months while I was on the drug. I had to fight my HMO every time to get them to pay for it. And this was for a $60 visit.
And yes, I have heard of patients fighting to get the care they need, from doctors who refuse to consider other options. Or who aren’t read up on what’s new.
Not trying to nitpick and I’m far from an expert, but I’m pretty sure that the pharmaceuticals are making money hand over fist. I’m thinking in the hundreds of billions. And I think much of the research is being subsidized by our tax money through the universities.
I was watching a news show about the AIDS crisis in Sub-Saharan Africa. Some American pharmaceutical made the offer to sell AZT to the government of South Africa at 25% of the cost in America.
They didn’t make the point to say it was a donation or a subsidy; they just said sold, which implied that they would be breaking even on the deal. Which makes me wonder if (after some serious, close to reckless, reading between the lines) these multi-nationals are selling at a 75% profit.
I don’t think that these are particularly controversial statements (except maybe the 75% crack), but if you disagree, perhaps I can drudge up some cites. Or I could just be wrong, since this is admittedly coming off the top of my head…
Absolutely, drugs still under patent protection are sold at prices far, far above their manufacturing costs, and indeed far above the development costs of that particular drug. BUT …
The pharmaceutical industry spends gobs on R&D, and almost all of that R&D does not result in a usable drug. They have to do this R&D – even with the advances in genome research and computer modeling, drug development is still mostly “throw it at the ceiling and see if it sticks.” The way drug companies recoup these lost R&D costs (and yes, still make a good profit) is to put a high price on the drugs that work.
Completely eliminating a drug company’s profits would likely reduce the price of drugs around 15-20% (I base this on the average operating profits of drug companies; if my math is wrong, please correct me.) And, of course, if you eliminate profit, people won’t make new drugs.
An addendum to Sua’s post: Drug companies also only have the limited life of the patent to make their money before the patent expires and generic drug companies move in to produce the drugs without the overhead. So they spend billions of dollars to develop a drug (with many failures for each successful pill), and then they only get to make money off of it for a certain amount of time. Damn right they’re going to charge high prices.
In related news, pharmcos are fighting to be allowed to extend their patent protection right now, by, among other ways, allowing a repatent of the same drugs with slight modifications in dosage levels, frequency or delivery systems.
I always have two questions about this one. Most of the time, they are referring to experimental treatment, which most insurance companies don’t cover,but don’t explain why whichever entity (hospital,drug company, medical school) is doing the research doesn’t cover the cost.Secondly, the insurance company can’t deny treatment, they can only refuse to pay for it. They can’t prevent the doctor and hospital from providing the care and waiving the fee, but no one ever seems to have a problem with the fees not being waived.
A similar situation with some plans is the provider list. People have a doctor,change insurance, and gripe that they have to change doctors because of the insurance company (usually HMO’s or preferred provider types). I’ve never heard that insurance companies limit providers to a certain number, so I have to assume that generally, if a doctor doesn’t take a particular plan, it’s either because it’s never been thought of (and s/he might sign up if a patient asked), the doctor doesn’t meet the company’s standards in some way or the doctor doesn’t want to take the plan for one reason or another (maybe the level of payment, maybe something else).I’ve heard of more than one case where the doctor has said he didn’t participate because he didn’t like the company, but people still never get mad at the doctor - only the insurance company Sua,
While HMO’s do dictate how much they will pay, that hasn’t taken all the pricing power away from doctors.There still are traditional health insurance plans (pay 80% of what they determine to be the usual fee, patient pays the rest, no limit on what the doctor charges) and combination plans (use a doctor on the list-works like a HMO,use one not on the list - works like traditional insurance). There’s nothing to prevent a doctor from not participating in any HMO’s and being completely free to set his/her own fees except the fear of not being able to attract enough patients that way.When other businesses respond to the market in this way (stores don’t charge $5 for a quart of milk because they won’t get enough customers that way) no one says those businesses have lost all of their pricing power.
The trouble with health insurance is simple: the consumer is not the buyer.
If individuals bought health insurance the same way they bought auto insurance, they would not expect any and all medical treatment to be paid for by the insurer; they would begin to be discriminating users of medical care, since the ultimate cost of such care would be reflected in higher premiums. But, because health insurance is routinely paid for by the employer, the buyer wants low premiums and doesn’t care about the services obtained for those premiums, and the consumer consumes the health care (and, thus, the benefits) with no concern as to the cost of the medical decisions.
Having said that, let’s face it: an insurer or health care maintenance organization which establishes rules to try and avoid paying for treatment is attempting to get out of what most of us think it has obligated itself to do: pay the cost of our medical care. The fact it has exclusions and the fact it has people making decisions about treatment within its rules of reimbursement is no solace to someone who needs medical care, and whose only provision for that care is a health care insurance policy provided by the employer that ostensibly provides for all needed care.
The system will remain dysfunctional until we start buying our own insurance en masse, and eschew accepting whatever care is foisted on us as a ‘benefit’ by our employers.
That’s exactly my point! No one ever blames the doctors. I’m not even saying we should blame doctors for not making care available for everyone. They have a skill which they paid money to learn. It’s only fair we pay money to make use of that skill. But the fact is that, just because insurance providers are the ones that pay for your treatment doesn’t mean they’re the only ones responsible if you don’t get the treatment you need.
I go with DSYoungEsq, and a step further. The existence of insurance itself is the problem. This causes the people making the decision (the patient and doctor) to do so with little or no financial consequence. This causes a skewing of the cost/benefits calculation, which hurts everyone on a larger scale.
There is frequently a lot of room for ambiguity or disagreement as to which or how many medical procedures or tests are necessary in a given case. Generally a doctor has an incentive to do as many as possible, and most patients will tend to go along with what there doctor tells them. If the patients were to face the consequences of their own decisions there would be some brake on unrestrained spending on medical procedures. Insurance removes this. Managed care tries to reintroduce this.
There is a lot of publicity about the instances of HMOs refusing to pay for legitimate and necessary treatments. No doubt many of these exist. But perhaps an even greater problem is the HMOs not refusing to pay for unnecessary and possibly harmful treatments.
But beyond this, the problem is that when the HMO pays for everyone, everyone ultimately pays back. The end result of the insurance scheme is that you get to make your medical decision with little financial consequence, but you also pay for the decisions that everyone else has made with little or no financial consequence as well. Whereas we would like would like to think that health is so important that it should be beyond financial considerations, there is a limit to how much a society can spend on health related matters. Having insurance skews this.
The best system IMHO would be for everyone to have catastrophic indemnity insurance, which would have a deductible of, say, $5,000. Under such a system, people would have to consider the cost of treatments before undergoing them, while still being protected against financial ruin due to serious illness. But I don’t see any way of bringing this about. (Catastrophic plans are currently available, but do not have the provider discounts of HMOs, which makes them uneconomical). More likely, we will move in the direction of socialized medicine. Under which the same problems will continue to exist but be swept under the general category of complaints about the government.
With regards to drug costs in particular, they are the fastest growing part of medical costs. Annual trends on drugs are probably between 15% and 20%. However the idea that this is due to drug companies increasing their prices by these amounts is a misconception. Actually there is an increase in the amount of utilization of drugs which drives the increase.
Also in defense of doctors…Doctors are also the victims of high insurance costs, not just HMOs. If I remember correctly here in Virginia back in the 80s we almost had a crisis in the OB/GYN field because of malpractice insurance. It went up to astronomical prices because some legal precident was set holding an OB responsible for years after a delivery for injuries incurred during birth. Many rural doctors declined to accept this additional cost and actually stopped delivering babies. They continued to see to their patients gynocological needs but were not willing or able to eat the increase in cost for insuring OB services.
Here in the cities the cost was passed on to the customer. My first child was born in 1984 and the total fee for the doctor’s care and delivery was around $800. Seven years later when my son was born that fee had risen to $1900. Things had also changed in the way that doctors provided care. A routine ultrasound was performed by my doctor during my first pregnancy, but during the second I got none at all. The doctor deemed it an unnecessary proceedure unless there were problems. Also by then hospitals had begun to kick women and babies out of the maternity ward within two days as opposed to the week we spent the first time.
So when you look at what doctors charge their patients you have to look at more than just them paying for their education, their nurses, other staff, and supplies. They pay insurance too, and it’s expensive. I’m of the mind that many of them these days do not take home as much money as we think they do, they carry tremendous overhead.
Also in defense of doctors…Doctors are also the victims of high insurance costs, not just HMOs. If I remember correctly here in Virginia back in the 80s we almost had a crisis in the OB/GYN field because of malpractice insurance. It went up to astronomical prices because some legal precident was set holding an OB responsible for years after a delivery for injuries incurred during birth. Many rural doctors declined to accept this additional cost and actually stopped delivering babies. They continued to see to their patients gynocological needs but were not willing or able to eat the increase in cost for insuring OB services.
Here in the cities the cost was passed on to the customer. My first child was born in 1984 and the total fee for the doctor’s care and delivery was around $800. Seven years later when my son was born that fee had risen to $1900. Things had also changed in the way that doctors provided care. A routine ultrasound was performed by my doctor during my first pregnancy, but during the second I got none at all. The doctor deemed it an unnecessary proceedure unless there were problems. Also by then hospitals had begun to kick women and babies out of the maternity ward within two days as opposed to the week we spent the first time.
So when you look at what doctors charge their patients you have to look at more than just them paying for their education, their nurses, other staff, and supplies. They pay insurance too, and it’s expensive. I’m of the mind that many of them these days do not take home as much money as we think they do, they carry tremendous overhead.
I also have to disagree that patients do not carry any financial consequences when they employ an HMO. We pay premiums, as do our employers, some of them health. A family that remains relatively healthy and relies on their plan for mostly preventitive care does not put a strain on the HMO. A person could go on for years without having to submit a large claim. I think it all evens out in the end.
You’ve GOT to be kidding me. What about those people with chronic illnesses who require treatment, but never make it to the magical $5000? I probably would hit $4500 a year in drugs, bloodwork, doctor visits, etc…I can’t afford that. I’m sorry. But my choice under YOUR plan would be to pay an amount that would bankrupt me, or get extremely ill. GREAT plan. :rolleyes:
Also, a side note for DS - there will never be a time where people do not accept health care from their employers for one simple reason. Under an employer plan, you CANNOT be excluded for a pre-existing condition.
There’s winners and losers under every scheme, and you would apparently lose out under the one that I proposed. But I think it would work out overall, for the reasons given. And I would make several points in your specific instance.
You are asking for, in effect, a form of charity, not insurance. The purpose of insurance is to insure against the risk of losses. You seem to be saying that you know that you will have greater expenses, but want other people to help absorb them. You may be right about that issue, but that might be considered independently of the insurance issue.
I ignored, for convenience purposes, the effects of current tax law in this insurance discussion. The reason for our present system of benefits has to do with tax law, which allows employers to fund health insurance tax free. This would make my proposal untenable in any event, as employers cannot give employees money for medical bills tax free. If the laws treated these payments equally, employers might fund medical bills in the manner that they currently fund insurance. (Alternatively, they might fund neither, as DSY proposed). This would alleviate the impact somewhat.