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I agree this is a huge problem; more tests than necessary and more procedures than necessary bump up the bottom line for doctors and hospitals and screw the consumer.
I am 69 (about to turn 70) and have the Kaiser Medicare Advantage Plan for Los Angeles and Orange Counties. We have to use Kaiser doctors and facilities except in emergencies. Kaiser does NOT derive any extra income from extra tests and doctor visits because Medicare pays them a set fee per month for taking care of each person enrolled. It's in Kaiser's best interest NOT to do extra, unnecessary things because Kaiser pays for them and receives no additional reimbursement. But it is also in their best interest to do ALL the necessary things promptly, because if a medical problem becomes worse then they will have to treat the complications without receiving any extra payment for same.
I have no deductible, and my co-pays are quite reasonable:
Doctor visits: $5
Specialist visits: $5
Lab work: $30
Emergency room visits: $75
Drug costs: $8 to $10 for any prescription I've ever had in five years
Monthly plan premium: zero
I have received excellent medical care, and I love this system. A lot of people do not care for it because they can't choose their own doctors. I have found no reason to be dissatisfied with any of the Kaiser doctors; we do have our own personal physician among the hundreds of Kaiser doctors, and we can change physicians. I am interested in receiving competent medical care; emotional support from someone I am used to is secondary to me.
Not Kaiser specific, but HMO's in general produce few better medical results than simple fee for service Medicare. Typical HMO's offer more and might have lower copays and deductibles as you show for the patients. But they do cost the taxpayers more, to the tune of roughly 12%. As you say they do not want to do excess testing. But one very major way they do profit is by not testing. Denial of service. Good for saving money for the HMO, but not always necessarily in the patient's best interest.
Not Kaiser specific, but HMO's in general produce few better medical results than simple fee for service Medicare. Typical HMO's offer more and might have lower copays and deductibles as you show for the patients. But they do cost the taxpayers more, to the tune of roughly 12%. As you say they do not want to do excess testing. But one very major way they do profit is by not testing. Denial of service. Good for saving money for the HMO, but not always necessarily in the patient's best interest.
HMO's can be short-sighted or can take the longer view, just like people can. There has been no "denial of service" on the part of Kaiser, in my experience. If an HMO does inadequate testing and fails to catch something, that is likely to bite them later because they will be obligated to treat whatever it is.
Kaiser is aggressive in reminding patients (via emails and phone calls) about tests which should be done, from colonoscopies to periodic blood work to one-time screenings at specific ages (example in my case when I was 67 or 68 they did an ultra-sound to check for any abdominal aortic aneurism - that one was not on my radar at all but it was part of their overall program.)
Yes, as others mentioned we are being over-billed for everything. Hospitals/doctor's offices want to make as much profit as possible, so they jack up prices. That causes insurance to have to pay higher and higher bills, jacking up their premiums and cutting their coverages, which gives us, the patients, a double whammy hit.
It's not that hospitals and doctor's offices want to make as much profit as possible, it's that they want to make a profit. Period. When you see a doctor, you're not just paying for their time - you're paying for their ability to pay their receptionist, their electric bill, their phone bill, their malpractice insurance. Plus, insurances typically have a contracted rate that they pay, so if your doctor charges them 5x what the actual price is, that is NOT what they are going to get reimbursed by the insurance. I've noticed a lot of independent doctor's offices being absorbed by hospital systems because they aren't being reimbursed enough to maintain their office by themselves.
HMO's can be short-sighted or can take the longer view, just like people can. There has been no "denial of service" on the part of Kaiser, in my experience. If an HMO does inadequate testing and fails to catch something, that is likely to bite them later because they will be obligated to treat whatever it is.
Kaiser is aggressive in reminding patients (via emails and phone calls) about tests which should be done, from colonoscopies to periodic blood work to one-time screenings at specific ages (example in my case when I was 67 or 68 they did an ultra-sound to check for any abdominal aortic aneurism - that one was not on my radar at all but it was part of their overall program.)
This is a bit off-topic but I just wanted to let people know about a little known rule Kaiser has: if you collect an insurance judgement as the result of an auto accident that is not your fault, Kaiser will seize that judgement as part of their "cost-of-care". An example: a serious brain injury you sustain that requires a 100K brain operation at market price; a 100K payment to you by the other guy's insurance co for your pain, disfigurement, suffering, etc--Kaiser, per terms you agree to when you sign up, gets all 100K; you get nothing.
Used to be if you didn't have medical insurance and a medical emergency struck the cost of being uninsured would bankrupt you.
You're going to start hearing of a new phenomenon real soon: even if you DO have medical insurance the cost of co-pays, deductibles, premiums, fees, etc. will also drive you to bankruptcy.
Case in point: my elderly mother was hospitalized for seven days. Cost $210/day co-pay. Total rounded: $1500. Ambulance transport (3 trips when all is over) $250 co-pays x3: $750. Rehabilitation $50/day up to a total of 100 days: 30 days estimate stay at facility: $1500. Various fees: $250. Total: (approx.) $4000.
Fortunately we have the funds to pay. But there many families out there living on the edge with part-time jobs that provide scant medical insurance for which the copays and deductibles are even higher. How do they meet an obligation that wipes out in one occurrence what little savings they've been able to put away. Even gap insurance won't completely cover the c's and d's.
Medical costs will bankrupt this country eventually as the population ages, more and more seniors drop into Medicaid territory and copays and deductibles rise higher and higher. Won't look pretty in 20-30 years.
No problem as just like the past the providers will raise cost to shared among those who do pay; then insurance premiums go up .Shared risk as normal.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Quote:
Originally Posted by oregonwoodsmoke
The big fallacy of Obama Care is that once you have medical insurance, you have medical care. That is not true.
Insurance companies have all sorts of excuses as to why a procedure won't be covered. They have high deductibles and co-pays. So, all the insurance gets you is a big bill every month that uses up money that might be used to actually get medical care.
Also, if a portion of the population doesn't have medical insurance because they don't have any money top pay for it, it solves nothing to pass a law that says they must buy medical insurance.
I'm already seeing people upset that thought they were getting medical care for a low monthly payment that didn't read the policy, including one that will use up the annual deductible in March for 2014 just with three months of prescriptions.
The cost of food is skyrocketing. Where can I get comprehensive insurance for food, so I can spread some of the cost for my food to other people?
Same with oil heat lately. Can I get a comprehensive insurance policy for my oil? I'd like to pay just a $40 co-pay when I get a fill-up, instead of $400, and let the rest of the people in my "plan" pay the other $360. Any suggestions on that?
Clothes? Have you priced a good pair of jeans or sneaks lately!?? I need a comprehensive insurance policy for this too. I'm tired of paying full price for Nikes. Other people should help me cover the cost.
Incredibly, this list goes on and on. I'm being forced to pay for ALL of the necessities of life myself!! Water (I get taxed twice a year), a place to live (I have to pay my own mortgage - no one else helps me with a comprehensive mortgage insurance plan!!), transportation / gas, heat, electricity...
I couldn't survive without them, so I have to pay for all these necessities myself!! Weirdly, though, I can afford all of them, just like the vast majority of everyone else.
Well, except for health care goods and services. I have no idea what those cost. Not a clue. I also have no idea what the insurance costs, since my employer won't tell me what they're paying (they just take $230 / mo. out of my paycheck to cover my "contribution").
Actually, I think I'm beginning to see the real problem here: one of these things is not like the others. One of them is bankrupting us, while the others are not. One is politicized, these others aren't. Why do we pay for every dollar that goes toward one of these things using such a screwed-up scheme, while the others are paid for directly?
Hmmm... wonder what would happen to the cost of all these OTHER necessities if we switched to a comprehensive insurance policy to pay for them...
The cost of food is skyrocketing. Where can I get comprehensive insurance for food, so I can spread some of the cost for my food to other people?
Same with oil heat lately. Can I get a comprehensive insurance policy for my oil? I'd like to pay just a $40 co-pay when I get a fill-up, instead of $400, and let the rest of the people in my "plan" pay the other $360. Any suggestions on that?
Clothes? Have you priced a good pair of jeans or sneaks lately!?? I need a comprehensive insurance policy for this too. I'm tired of paying full price for Nikes. Other people should help me cover the cost.
Incredibly, this list goes on and on. I'm being forced to pay for ALL of the necessities of life myself!! Water (I get taxed twice a year), a place to live (I have to pay my own mortgage - no one else helps me with a comprehensive mortgage insurance plan!!), transportation / gas, heat, electricity...
I couldn't survive without them, so I have to pay for all these necessities myself!! Weirdly, though, I can afford all of them, just like the vast majority of everyone else.
Well, except for health care goods and services. I have no idea what those cost. Not a clue. I also have no idea what the insurance costs, since my employer won't tell me what they're paying (they just take $230 / mo. out of my paycheck to cover my "contribution").
Actually, I think I'm beginning to see the real problem here: one of these things is not like the others. One of them is bankrupting us, while the others are not. One is politicized, these others aren't. Why do we pay for every dollar that goes toward one of these things using such a screwed-up scheme, while the others are paid for directly?
Hmmm... wonder what would happen to the cost of all these OTHER necessities if we switched to a comprehensive insurance policy to pay for them...
Problems with HC costs are very much related to risk, age and previous medical conditions. And the risks can be huge, of course life altering/threatening or worse. Worse in a physical and economic sense. And physical and economic risks can be both short and long term. There is also huge uncertainty, which progresses with age.
Costs of housing, food and water continue to rise as always. But typically there is no shortage. And typically there are few uncertainties. The amount and cost of housing, food and water that an individual needs doesn't typically change drastically or suddenly. The amount and cost of housing, food and water doesn't differ much between individuals, especially as it relates to age.
What this means simply is that we need insurance for HC.
And with something so huge and costly and with such serious implications for so many people, there are bound to be central regulation and controls. And then central supports for the poor, sick and elderly. Because their risks can be so high, while their ability to pay may be so low, that a typical free market enterprise simply will not want to tread there. And there is no way for all this to happen without some serious politicking by so many involved parties.
Problems with HC costs are very much related to risk, age and previous medical conditions. And the risks can be huge...
Not really. We certainly need to manage the risk of SOME health care needs. But certainly not all. Not by a long shot. Homeowners carry PMI, flood insurance and homeowner's insurance. Drivers carry liability insurance. All of these help manage risk. Nobody buys insurance to handle the "risk" of gasoline prices going from $3 to $5 over the course of a year. The key here is understanding risk.
People got along fine with "major medical" policies and direct payment for everything else before the federal government granted itself authority to manipulate the health care market, back in the 60s. And that was back before HSAs... when doctors even made house calls! Of course, that was also back when people typically focused on saving, rather than spending themselves into unsustainable debt, but that's another story...
The reason they got along fine with "major medical" was because more than 90% of health care goods and services consumed are quotidian expenses that can be budgeted for, just like food, rent, water, heat, transportation, etc. Only about 10% of health care is the potentially expensive - risky - stuff. And those expenses only affect a relatively small portion of the population in any given year.
The real problem here is that despite the lack of risk posed by 90% of health care, thanks to decades of manipulation by the federal government, the vast majority uses a financial tool that is intended to manage risk (i.e., insurance) and they abuse it, by using it to pay for everything, including all the non-risky stuff. If we were to use an insurance policy to subsidize the cost of food, rent, water, heat, transportation, etc., their costs would skyrocket the same way health care has - because cost always increases to fill the size of the subsidy.
We see this same inflationary mechanism at work in K-12 education, where teachers' salaries and benefits have increased, and the number of administrators per student has skyrocketed - while education outcomes have remained stagnant - due to increases in Taxpayer- and tuitionpayer-provided subsidies. Higher ed has also exhibited this phenomenon, where tuitions have skyrocketed thanks to cheap credit made available through Taxpayer-subsidized loans. Housing bubble - same deal: prices increased for years, primarily due to cheap credit, which was ultimately subsidized by Taxpayer-funded bailouts for FannieMae, FreddieMac, et al.
So when it comes to health care, more than 90% of the time we're not using insurance to manage real risk at all; instead, we're just using it to Spread The Wealth Around - in reverse - by spreading the costs around. This ridiculously inefficient and inflationary scheme - which we don't use for any OTHER commodity necessity - has encouraged the cost of ALL health care (i.e., not just the risky stuff) to skyrocket... for decades. And it's done the same to associated costs, like malpractice insurance and medical school.
In fact, by driving the cost of quotidian health care to increase at rates multiple that of inflation, the way we pay for it has actually created risk where there was none before, that is, by encouraging the cost of some treatments and services to skyrocket beyond the point were many people can afford even those!
Anyone who buys them knows what a gallon of gas costs, or a loaf of bread, or their rent, etc. But unlike every other commodity necessity of life, no one has any clue what the cost of their health care is. In most cases they don't even know the cost of their employer-provided insurance. That is the root of the problem, i.e., when it comes to health care, there is no direct economic relationship between the provider and the consumer. That direct relationship is what keeps the costs of all other commodities down, and that's what's been destroyed by decades of federal manipulation of the health care market.
Government could actually encourage a payment mechanism that would keep health care prices under control (without price controls), using the same economic relationship that keeps the cost everything else relatively affordable, and still help with the cost of managing the risk posed by 10% of health care needs. They don't. Maybe someone should start asking why.
Free markets in HC work fine for the relatively optional, cheap, simple and predictable medical encounters. And this includes the majority of relatively young, healthy working folks. But when you have to take losses on those with pre-existing illness, or the poor, or the elderly with complicated and/or chronic diseases, free markets fail. And that's where central controls and supports come in.
Central price controls have been so huge that I as an internist can barely make a living anymore. Hospitals and insurance companies do still make a killing. But I can't foresee a time when we can do without them, or not have central controls. I have said for some time that HC may end up similar to a public utility at some point. Because I don't think that single payer is the, or an American way.
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