Thread: Health Care in the USA

Jimmy's saying that it cost him $200 when he was self insured.

I've worked in insurance for over 15 years and almost half of that between two health plans, a national (Aetna which merged to Aetna/U.S. Healthcare) and a small county funded health plan for half of those 15 years. Half of that time was spent as an actual medical claims processor and data specialist compiling reports, etc.

Insurance companies pay contracted rates and contracted rates are based on the R&C (Reasonable and Customary) charges in a given locale. It's partly a game. If today most office visits are billed at $100 and an insurance company will pay 80% of the R&C but next year most office visits are billed at $150, an insurance company will then pay $120. The uninsured like Jimmy get the brunt of it paying the actual billed rate then.

Chris L

Exactly! If the insurance companies will pick up the bill for all the small things then doctors can charge that. If insurance companies only go for the things that you need insurance, doctors can't over charge for their services. It all goes in a nasty circle....

Originally Posted by slt5103

If insurance would really be INSURANCE and not pay for everything even though it isn't an emergency, things would be cheaper.

I don't think what you describe is accurate. My understanding is that the high costs are result not of volume but of the actual treatment being expensive. In many cases just because the condition was left to deteriorate until it is really expensive to fix.

Somebody in another thread posted incorrectly that purely market driven approach biases doctors into performing too much unnecessary yet billable procedures. Actually it biases them towards performing the most profitable procedures.

Since you seem to think that there is a very simple market solution I think you'll find very interesting what happened to various health insurance plans. There is no shortage of things that have been tried out over the last 60 years, and many of them actually worked really well for a short period and on very small scale. And then they failed miserable or became something completely different.

The current situation is not what it is because of government overregulation, it is because that's what the market forces are driving it to be.

Again, I think it's best if this is approached with as little ideological preconceptions as possible. I always find it very unfortunate when I see people rejecting actual data and instead seem to be living in a la-la land.

Well Gugi, what data am I rejecting?

Just a thought here. Does anyone take into account that visiting a doctor actually costs a lot of money?

Doctors invest a lot in their practise, their knowledge etc. Just covering the costs of equipment, buildings etc make sure that even IF services are market driven they can never drop below a certain price. Simply because it costs that muc to keep a practise/hospital running.

That's why insurance is needed. because medical care needs to be ready to be used 24/7 365. Doing that is expensive and drives up the cost.

It's partly a market forces thing....but partly it's not. Things can never go below a certain price if they're market driven. That price is the costprice. And in medicine...the costprice is pretty damn high.

Currently because of contractual discounts, medical assistance, medicare, charity care, etc, the clinic in our town actually collects about 50 cents per dollar billed (it is probably less now because the number of people getting charity care has shot up due to the economy). Medicare is paying about 40% of fees billed.

They have no choice but to try to shift those costs to payors who pay a higher percentage of the amount billed, hence higher charges to cash paying persons. However they are more than willing to set up payment plans for people and will work with anyone who is making an effort to pay something on their bills. They provide as much or more charity care than anyone in the state. Dr's pay is separate from collections so they are payed the same no matter what the payor class of the patient. There is no incentive to treat anyone different by payor class.

One thing most people dont realize is that almost all doctors have at least one or two full time highly trained people whose sole job is to interface with, request, plead, haggle and otherwise do battle with insurance companies for approvals. Insurance companies have armies of people on the other side of these arguments, which usually center around the insurance companies trying to get out of paying for either meds or procedures that the docor recommends. Think of the costs of this magnified across all doctors offices around the country. It's staggering. And this brings up another point: that in many cases it's insurance compny bean counters, not doctors, who end up making decisions. Rationing of health care is certainly quite active right now in the US.

LX is right on this one. Health care is expensive! Although, when was the last time you saw a family doctor having to pay off a CT Scan machine. Regular, family doctors visits should not cost as much as they do. The only reason they are, is because insurance companies will pay for it. They are not paying off any equipment, because any equipment they need is offered at the specialist office (which insurances will and SHOULD cover) they refer patients too. Blood work is sent off to be processed else where. This too shouldn't be that expensive, because how many people need blood work... A LOT! The only reason it is, is because insurance companies will pay those ridiculous costs. Anytime a middle man is involved, prices will go up; it's a fact.

P.S.- LX, I'm loving the TI

Originally Posted by slt5103

LX is right on this one. Health care is expensive! Although, when was the last time you saw a family doctor having to pay off a CT Scan machine. Regular, family doctors visits should not cost as much as they do. The only reason they are, is because insurance companies will pay for it. They are not paying off any equipment, because any equipment they need is offered at the specialist office (which insurances will and SHOULD cover) they refer patients too. Blood work is sent off to be processed else where. This too shouldn't be that expensive, because how many people need blood work... A LOT! The only reason it is, is because insurance companies will pay those ridiculous costs. Anytime a middle man is involved, prices will go up; it's a fact.

P.S.- LX, I'm loving the TI

In my case they don't cover a visit to a specialist until I've paid my requisite $6,000 out of pocket per year. Who is your health carrier ? Are you covered through your employer ?

Originally Posted by slt5103

LX is right on this one. Health care is expensive! Although, when was the last time you saw a family doctor having to pay off a CT Scan machine. Regular, family doctors visits should not cost as much as they do. The only reason they are, is because insurance companies will pay for it. They are not paying off any equipment, because any equipment they need is offered at the specialist office (which insurances will and SHOULD cover) they refer patients too. Blood work is sent off to be processed else where. This too shouldn't be that expensive, because how many people need blood work... A LOT! The only reason it is, is because insurance companies will pay those ridiculous costs. Anytime a middle man is involved, prices will go up; it's a fact.

P.S.- LX, I'm loving the TI

Insurance companies have become quite adept at negotiating discounts. Actually the real reason doc's charge the price they do is they are taking a relative loss seeing medical assistance and Medicare. There are also write offs to HMO's and other insurances with which they are forced to concede to or lose much of their practice.. They have to have higher rates on others to meet overhead and show some profit.