[QUOTE=Gunslinger;38266]Health care is a monopoly, so they CAN overcharge for their services, and there is nothing you can do about it. Doesn't the government usually break monopolies up? [/QUOTE]
It's not too hard to argue that the health care industry IS a monopoly, in a large part, due to government regulations.
Not saying that the health care system here isn't fucked up. But more government involvement may not be the answer to fixing it.
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by Guest » Mon Nov 01, 2010 10:08 am
There are different kinds of monopolies. Drug companies are Natural monopolies. In the case of Natural monopolies, it's best that there not be a lot of competition because of their business model is not able to support a lot of competitors. Usually companies that require a lot of capital are natural monopolies. The reason airlines go bankrupt so often in the U.S. is because these are natural monopolies operating in an environment that's way too competitive...the high fixed costs of the equipment they use means they have to have a very reliable, very high level of pricing.
Hospitals and insurance companies are different. Although the competition is limited, i.e. you cannot buy insurance from across state lines, there is still a lot of competition in the marketplace. These are definitely not monopolies.
To understand how closely a company/industry is to a Natural monopoly, one only needs to follow the money.
Profit margins by industry (as per Fortune 500 2008):
Pharma: 15.8%
Medical Equipment/Device Makers: 15.2%
Health Insurance Cos: 6.2% (compared to 10.6% for Life Insurance and 9.9% for property/casualty
Medical Facilities: 3.3%
Pharmacies: 2.6%
Pharma and Medical Equipment Makers are closer to being a monopoly but this is due to the high cost of R&D AND the presence of patents. They have to charge high prices to keep the business running and to keep inventing new drugs. And, they need the patent protections to ensure they can charge a high enough price to pay for the cost of development and for the cost of failed development (both of which are much higher than they should be because of the presence of the FDA).
Health Insurance Companies are the least profitable form of insurance company. But, why? If you peel back the onion, you'll see that it's due to government interference in the market place. And, the nature of insurance. Their entire business model is based on the idea of not paying back premiums. Their JOB is to decline claims. It's easier to decline a claim on a buidling fire than it is to do so on someone's illness. Just he nature of the beast.
Medical facilities make the least amout of profit margin. These definitely ARE NOT monopolies. Not even close. Further, these guys are ultimately the guys that set the price of services in the market place for health care. Unfortunately, the government constantly steps in and sets the prices for the market for them. This results in tighter controls for services rendered (one way to increase revenue to ensure that you collect 100% of said revenue) AND for outrageous mark-ups on services/goods that are not regulated by the government.
The system doesn't work because insurance is the worst way to provide healthcare. And, because no one really knows how much things cost. This results in people not ascribing the appropriate level of scarcity to consuming these products as they should. You pay a $50 co-pay for services rendered. But, what did it really cost? When you don't know, you make bad decisions. Economics is about incentives and dis-incentives. That's how the market works. But, when you don't understand the implications of your actions, then the decisions you make tend to be wrong or detremential.
The best system would be one in which everyone pays out of pocket for everything they consume. Health Savings Accounts should be promoted for their tax free aspects and the funds in the account should be rolled over every year allowing them to accumulate and grow if not used. On top of that, you add a high deductible plan for catastrophic illness (major surgeries, cancer, etc.).
This would put the proper scarcity back in the market place and allow for the pricing mechanism, which always works if left alone, to function properly. People would understand what the implications of their decisions would be and everyone would act in a rational matter.
No longer would Joe Blow run to the doctor for a fucking cold that will go away in 3 days any ways. We OVER CONSUME healthcare and, that's the biggest problem. But, that should be no shock. Americans OVER CONSUME everything and feel entitled to do so.
Hospitals and insurance companies are different. Although the competition is limited, i.e. you cannot buy insurance from across state lines, there is still a lot of competition in the marketplace. These are definitely not monopolies.
To understand how closely a company/industry is to a Natural monopoly, one only needs to follow the money.
Profit margins by industry (as per Fortune 500 2008):
Pharma: 15.8%
Medical Equipment/Device Makers: 15.2%
Health Insurance Cos: 6.2% (compared to 10.6% for Life Insurance and 9.9% for property/casualty
Medical Facilities: 3.3%
Pharmacies: 2.6%
Pharma and Medical Equipment Makers are closer to being a monopoly but this is due to the high cost of R&D AND the presence of patents. They have to charge high prices to keep the business running and to keep inventing new drugs. And, they need the patent protections to ensure they can charge a high enough price to pay for the cost of development and for the cost of failed development (both of which are much higher than they should be because of the presence of the FDA).
Health Insurance Companies are the least profitable form of insurance company. But, why? If you peel back the onion, you'll see that it's due to government interference in the market place. And, the nature of insurance. Their entire business model is based on the idea of not paying back premiums. Their JOB is to decline claims. It's easier to decline a claim on a buidling fire than it is to do so on someone's illness. Just he nature of the beast.
Medical facilities make the least amout of profit margin. These definitely ARE NOT monopolies. Not even close. Further, these guys are ultimately the guys that set the price of services in the market place for health care. Unfortunately, the government constantly steps in and sets the prices for the market for them. This results in tighter controls for services rendered (one way to increase revenue to ensure that you collect 100% of said revenue) AND for outrageous mark-ups on services/goods that are not regulated by the government.
The system doesn't work because insurance is the worst way to provide healthcare. And, because no one really knows how much things cost. This results in people not ascribing the appropriate level of scarcity to consuming these products as they should. You pay a $50 co-pay for services rendered. But, what did it really cost? When you don't know, you make bad decisions. Economics is about incentives and dis-incentives. That's how the market works. But, when you don't understand the implications of your actions, then the decisions you make tend to be wrong or detremential.
The best system would be one in which everyone pays out of pocket for everything they consume. Health Savings Accounts should be promoted for their tax free aspects and the funds in the account should be rolled over every year allowing them to accumulate and grow if not used. On top of that, you add a high deductible plan for catastrophic illness (major surgeries, cancer, etc.).
This would put the proper scarcity back in the market place and allow for the pricing mechanism, which always works if left alone, to function properly. People would understand what the implications of their decisions would be and everyone would act in a rational matter.
No longer would Joe Blow run to the doctor for a fucking cold that will go away in 3 days any ways. We OVER CONSUME healthcare and, that's the biggest problem. But, that should be no shock. Americans OVER CONSUME everything and feel entitled to do so.
- Guest
by Guest » Tue Nov 02, 2010 1:08 am
[QUOTE=Bull Run]No longer would Joe Blow run to the doctor for a fucking cold that will go away in 3 days any ways. We OVER CONSUME healthcare and, that's the biggest problem. But, that should be no shock. Americans OVER CONSUME everything and feel entitled to do so. [/QUOTE]
I can only speak from my own experience, and I will do so now. When I know that I have a bacterial sinus infection and want Antibiotics to clear it up faster, I have to go see the Doc. When I get a stomach virus and want something to supress the nausea so that I can keep working, I am made to go see the doc. In both cases, I should be able to just call in, email, IM, or whatever and get the magic pills, but I am required to sit in a disgusting germ infested waiting room with other sick people until the doctor can see me. Then just to cover his ass he has me sent to the lab to confirm that Ive got a stomach flu or whatever..
I would say that Joe Blow runs to the doc not because of any desire to over-consume, but as a necessity enforced upon him by a flawed system. By in large, people follow the path of least resistance if they are aware of said path. In our current system, the path of least resistance has the Doctor watching his ass so carefully that we are forced to over-consume. It has the FDA being so strict on what drugs are released that it forces over-consumption.
I can only speak from my own experience, and I will do so now. When I know that I have a bacterial sinus infection and want Antibiotics to clear it up faster, I have to go see the Doc. When I get a stomach virus and want something to supress the nausea so that I can keep working, I am made to go see the doc. In both cases, I should be able to just call in, email, IM, or whatever and get the magic pills, but I am required to sit in a disgusting germ infested waiting room with other sick people until the doctor can see me. Then just to cover his ass he has me sent to the lab to confirm that Ive got a stomach flu or whatever..
I would say that Joe Blow runs to the doc not because of any desire to over-consume, but as a necessity enforced upon him by a flawed system. By in large, people follow the path of least resistance if they are aware of said path. In our current system, the path of least resistance has the Doctor watching his ass so carefully that we are forced to over-consume. It has the FDA being so strict on what drugs are released that it forces over-consumption.
- Guest
by Guest » Tue Nov 02, 2010 9:12 am
Everything is due to greed, but most of the issues we see with high costs in health care services are due to the American public.
Traxxxus, the reason you have to go to the lab to verify illness is simple; it’s due to malpractice lawsuits.
Many illnesses have similar symptoms and doctors aren’t always right. I would like to believe that they make a diagnosis according to their best judgement, but because there is a margin of error, its better to be safe than sorry.
If the doctor does not verify illness and gave you medication to treat the symptoms, resulting in your death, he will be sued and his life is over. To protect him from this, he purchases malpractice medical insurance and walks on egg shells when making a diagnosis. Malpractice insurance, if you don’t know, is outrageous! The cost is distributed to the patients. Due to the greed of a few, many assume to cost.
Additionally, hospitals are a business and they are here to make money; just like every company you have worked for. The different types of equipment used are expensive. The expertise of doctors is expensive. Facilities are expensive. Therefore, this cost is passed on to you – it’s business 101.
Hospitals cannot refuse treatment to patients in life threatening situations; that means that they must provide treatment to illegals and the poor. If the poor cannot pay for their treatment, they don’t have to. The hospital will either sell off the debt to a third party collector (at a fraction of what is owed to them) or write it off as an uncollectible debt (expense). This affects the bottom line of hospitals. To make up for that loss, they have to raise the cost of services to have revenue that results in a profit, which is not much according to BR’s stats (medical facilities only have a 3.3% profit margin).
I think that the high cost for health care is a function of many factors and variables, not simply because hospitals are greedy. If they were, they’d shoot for profit in the double digits.
Traxxxus, the reason you have to go to the lab to verify illness is simple; it’s due to malpractice lawsuits.
Many illnesses have similar symptoms and doctors aren’t always right. I would like to believe that they make a diagnosis according to their best judgement, but because there is a margin of error, its better to be safe than sorry.
If the doctor does not verify illness and gave you medication to treat the symptoms, resulting in your death, he will be sued and his life is over. To protect him from this, he purchases malpractice medical insurance and walks on egg shells when making a diagnosis. Malpractice insurance, if you don’t know, is outrageous! The cost is distributed to the patients. Due to the greed of a few, many assume to cost.
Additionally, hospitals are a business and they are here to make money; just like every company you have worked for. The different types of equipment used are expensive. The expertise of doctors is expensive. Facilities are expensive. Therefore, this cost is passed on to you – it’s business 101.
Hospitals cannot refuse treatment to patients in life threatening situations; that means that they must provide treatment to illegals and the poor. If the poor cannot pay for their treatment, they don’t have to. The hospital will either sell off the debt to a third party collector (at a fraction of what is owed to them) or write it off as an uncollectible debt (expense). This affects the bottom line of hospitals. To make up for that loss, they have to raise the cost of services to have revenue that results in a profit, which is not much according to BR’s stats (medical facilities only have a 3.3% profit margin).
I think that the high cost for health care is a function of many factors and variables, not simply because hospitals are greedy. If they were, they’d shoot for profit in the double digits.
- Guest
by Guest » Tue Nov 02, 2010 9:31 am
[QUOTE=prodigy]Everything is due to greed, but most of the issues we see with high costs in health care services are due to the American public.[/QUOTE]
We disagree here. I believe that John Q. Public is an idiot of the worst kind. You will get no argument from me about this. As an idiot, the masses are simply not equipped to do anything but follow a prescribed path. (npi). Like water and electricity, the public follows the path of least resistance.
If the healthcare system provided a path that was easier to follow with a similar or better risk/reward profile then the masses would flock to it.
Saying the problem with Healthcare is the American Public is like saying, the problem with the maze is the rat that runs through it. I will always argue that it is the maze and not the rat that is at fault.
There is always risk in surgery, perscribing medication, etc... But there are better ways of dealing with that risk than forcing over-consumption.
EDIT: Then I stepped away and thought about this. The difference between the rat and the American public is that the American Public is supposed to be able to choose how to maze looks, what shape it takes, etc. That's part of what the republic is about. The rat can not do this. Now, I have honestly believed that the republic is dead, and that we are no longer a society being led by a representative government. Which leads me to two conclusions.
A) You guys are right and the American public lacks the political willpower to fix the issues.
or
B) The real power behind our so called representative government likes it this way because they get more power, wealth, whatever. Corrupt Motherfuckers!
We disagree here. I believe that John Q. Public is an idiot of the worst kind. You will get no argument from me about this. As an idiot, the masses are simply not equipped to do anything but follow a prescribed path. (npi). Like water and electricity, the public follows the path of least resistance.
If the healthcare system provided a path that was easier to follow with a similar or better risk/reward profile then the masses would flock to it.
Saying the problem with Healthcare is the American Public is like saying, the problem with the maze is the rat that runs through it. I will always argue that it is the maze and not the rat that is at fault.
There is always risk in surgery, perscribing medication, etc... But there are better ways of dealing with that risk than forcing over-consumption.
EDIT: Then I stepped away and thought about this. The difference between the rat and the American public is that the American Public is supposed to be able to choose how to maze looks, what shape it takes, etc. That's part of what the republic is about. The rat can not do this. Now, I have honestly believed that the republic is dead, and that we are no longer a society being led by a representative government. Which leads me to two conclusions.
A) You guys are right and the American public lacks the political willpower to fix the issues.
or
B) The real power behind our so called representative government likes it this way because they get more power, wealth, whatever. Corrupt Motherfuckers!
- Guest
by Guest » Tue Nov 02, 2010 10:18 am
Traxxxus, I think you misunderstood what I was saying. Though I agree the American public should do more for reform, that was not m point.
My point is that the litigious nature of Americans and the poor who abuse the health care system has a significant impact in the rising costs of health care services.
As for health insurance, that too can be blamed on the american public. We overconsume and go to the doctor for everything. Historical high levels of obesity results in more freQuent illnesses leadibg to doctor visits and teatments.
If you understand how health insurance works, you'll understand the rising costs of health insurance is due to increased health services provided, directly related to the poor health of Americans...
My point is that the litigious nature of Americans and the poor who abuse the health care system has a significant impact in the rising costs of health care services.
As for health insurance, that too can be blamed on the american public. We overconsume and go to the doctor for everything. Historical high levels of obesity results in more freQuent illnesses leadibg to doctor visits and teatments.
If you understand how health insurance works, you'll understand the rising costs of health insurance is due to increased health services provided, directly related to the poor health of Americans...
- Guest
by Guest » Tue Nov 02, 2010 1:14 pm
I say we measure everyones bmi level, then set a maximum number on the bmi scale that is acceptable. If your fat ass is over the designated limit, then you are only able to buy certain foods at the grocery store (such as fruits, veggies, and the such) until you get the lard off of yourself.
In addition, there will be suggested heart bpm by age bracket. If your heart resting or active rate is above the limit, then you will be fined. This will get people to do cardio on a regular basis.
Sure, it may be extreme, but america is fat, one of the fattest countries in the world. We are lazy. Social pressure no longer applies to us, we simply don't care. If a girl is plus size, we say good and that she is "healthy and confident", more like unhealthy and disgusting. If you are fat, it is no ones fault but your own. I have no pity for fat people. Sure, some people have to work harder to keep fat off, but ultimately it is up to you.
Lets not forget, this would reduce doctor visits and problems like high blood pressure and heart attacks.
In addition, there will be suggested heart bpm by age bracket. If your heart resting or active rate is above the limit, then you will be fined. This will get people to do cardio on a regular basis.
Sure, it may be extreme, but america is fat, one of the fattest countries in the world. We are lazy. Social pressure no longer applies to us, we simply don't care. If a girl is plus size, we say good and that she is "healthy and confident", more like unhealthy and disgusting. If you are fat, it is no ones fault but your own. I have no pity for fat people. Sure, some people have to work harder to keep fat off, but ultimately it is up to you.
Lets not forget, this would reduce doctor visits and problems like high blood pressure and heart attacks.
- Guest
by Guest » Tue Nov 02, 2010 3:05 pm
[QUOTE=Gunslinger;38280]I say we measure everyones bmi level, then set a maximum number on the bmi scale that is acceptable. If your fat ass is over the designated limit, then you are only able to buy certain foods at the grocery store (such as fruits, veggies, and the such) until you get the lard off of yourself.[/QUOTE]
That's in the Obamacare plan...as are death panels...as are Federal Subsudized abortions
When freedom and life are more important than convenience then everything is lost.
I don't like fat people either. But, freedom means being free to make good as well as bad decisions.
Plus anyways, if the government didn't start fucking with the food pyramid (which has way too many carbs in it), start stripping fiber out of food to preserve it longer for foreign trade, and push for replacing sugar with high fructose corn syrup then people wouldn't be nearly as fat as they are...
Basically, one can argue that government is the root cause to all social and financial woes in this, and every other, country.
Doubling down on government is a fool's bet. Obamacare will kill more than it saves. Just like the FDA, fuel efficiency standards, and banning DDT.
Everyone believes that government is benevolent. Show me their benevolence. Most in Congress are millionaires. Most have strong connections to major corporations. The goal of a company is to maximize profits, that's their sole purpose. The goal of government is to maximize control and power as a back door to lining their pockets.
So, pick your poison. Give dollars to greedy corporations, that have a lot of competitors. Or give up your freedoms to just ONE government, with no competitors.
That's in the Obamacare plan...as are death panels...as are Federal Subsudized abortions
When freedom and life are more important than convenience then everything is lost.
I don't like fat people either. But, freedom means being free to make good as well as bad decisions.
Plus anyways, if the government didn't start fucking with the food pyramid (which has way too many carbs in it), start stripping fiber out of food to preserve it longer for foreign trade, and push for replacing sugar with high fructose corn syrup then people wouldn't be nearly as fat as they are...
Basically, one can argue that government is the root cause to all social and financial woes in this, and every other, country.
Doubling down on government is a fool's bet. Obamacare will kill more than it saves. Just like the FDA, fuel efficiency standards, and banning DDT.
Everyone believes that government is benevolent. Show me their benevolence. Most in Congress are millionaires. Most have strong connections to major corporations. The goal of a company is to maximize profits, that's their sole purpose. The goal of government is to maximize control and power as a back door to lining their pockets.
So, pick your poison. Give dollars to greedy corporations, that have a lot of competitors. Or give up your freedoms to just ONE government, with no competitors.
- Guest
by Guest » Tue Nov 02, 2010 3:13 pm
True, that giving the government more power isn't really a smart decision. And if the plan I mentioned was to actually come up for debate, I would probably be against it, since freedom is more important than anything.
But like you said, you have to pick your poison. It's a catch 22, no matter what happens, it will have a negative effect.
I was stating a hypothetical, extreme plan to get this nation back in shape and off of our fat asses. Would this plan ever come into effect or would it be the best solution? Probably not. But the real pity is that we no longer care about our looks or health.
What are our alternatives?
The truth is, we have to be in the middle. Extremes are never good. We don't want total government intervention, but there has to be some government intervention to regulate what is put on the market. Without certain regulations, companies would be free to put what they want in our food...and not tell us about it.
But like you said, you have to pick your poison. It's a catch 22, no matter what happens, it will have a negative effect.
I was stating a hypothetical, extreme plan to get this nation back in shape and off of our fat asses. Would this plan ever come into effect or would it be the best solution? Probably not. But the real pity is that we no longer care about our looks or health.
What are our alternatives?
The truth is, we have to be in the middle. Extremes are never good. We don't want total government intervention, but there has to be some government intervention to regulate what is put on the market. Without certain regulations, companies would be free to put what they want in our food...and not tell us about it.
- Guest
by Guest » Tue Nov 02, 2010 3:18 pm
[QUOTE=Bull Run;38281]
Doubling down on government is a fool's bet. Obamacare will kill more than it saves. Just like the FDA, fuel efficiency standards, and banning DDT.[/QUOTE]
DDT? Are you referring to the pesticide that was soaked all over humans in the 50s to prevent malaria, and has been linked to cancer?
Doubling down on government is a fool's bet. Obamacare will kill more than it saves. Just like the FDA, fuel efficiency standards, and banning DDT.[/QUOTE]
DDT? Are you referring to the pesticide that was soaked all over humans in the 50s to prevent malaria, and has been linked to cancer?
- Guest
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