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We’re already paying for healthcare

the-far-side-comic


Opponents of health care reform seem to focus on two main points – cost and “rationing.” It is an article of faith among Republicans that single payer health care will cost a lot more but will provide less health care. Near as I can figure they think there isn’t enough health care for everyone so in order to extend coverage to everyone we’ll have to take some away from the people who have it now. But I don’t want to discuss the “rationing” fallacy today, I want to discuss the cost fallacy.

This is what we were paying for health care two years ago:

Total spending on health care, per person, 2007:

United States: $7290
France: $3601
United Kingdom: $2992
Italy: $2686

As of 2007 we were spending $7290 per person for health care. That is not an average of $7290 for each person lucky enough to have health care coverage, that is the average for everyone in the United States. Take the total amount we spend on health care and divide it by the number of people in the country and you get $7290.

But for all that money we aren’t even covering everyone.

For reasons that used to make sense most people that have health insurance get it through their employer. Most people that don’t have employer-based health insurance are either on Medicare, Medi-caid or have no health insurance. Some self-employed people purchase health care insurance but the cost is prohibitive especially for the working poor.

This is how we pay for health care now:

Employer contributions
Employee contributions
Self-insured premiums
Co-pays
Deductibles
Cash payments for uncovered/excluded treatments/medicines
OTC medicines
Taxes

Employer contributions are a non-taxable benefit your employer may choose to provide to you. It’s logical to assume that if they weren’t paying health care premiums with that money they could add it to your salary since they are spending it on you anyway. This is a point I will come back to in a bit.

Right now some people have good health care insurance, some have bad health care insurance, and some have no insurance at all. People with insurance or lots of money can go see a doctor for minor problems and routine exams. People without health care insurance or piles of cash are limited to urgent and emergency care. For too many people the local emergency room is their primary care physician.

When people go to the emergency room for non-emergency care the chances are they can’t afford to pay the bill. If they could afford to pay the bill they would go somewhere cheaper. So not only are premium services being used to treat minor illnesses and injuries, but those services end up being paid by tax dollars or by passing the cost on to the paying customers. (Basically the same thing)

When someone declares bankruptcy on medical bills the medical providers do what all businesses do – they raise their prices to compensate. Whatever your doctor charges for his or her services includes a calculation for bad debts. That’s just business.

There ain’t no free lunch. If we reform health care we still have to pay for it. But we’re already paying for it. If we took all those same dollars we’re spending now and applied them to a single payer system we would almost certainly far pay less than we’re paying now.

I can say this with assurance because every civilized nation with single payer or socialized medicine pays far less per person than we do. I qualified my statement by saying “almost certainly” because given half a chance our government will let the foxes into the henhouse.

The logical way to pay for single payer health care is through taxes. It would be similar to the current Social Security and Medicare people already pay. But even if we were able to cut our current costs in half that would still mean a cost of $300 per month per person. ($3600 divided by 12)

Poor people won’t be able to pay that amount. They can’t pay it now, and passing a law requiring them to purchase insurance won’t make them able to afford it either. The only people who can pay are the people with money.  That means that people with higher incomes will have to pay more. But they are already paying more. The trick is to figure out where that $7290 is coming from now.

Theoretically we could come up with a tax that would take the money we are paying now from the same people that are already paying it. Ideally it would be a progressive tax on all income. We should eliminate the artificial distinction between “earned” and “unearned” income. (Ever since the Sixteenth Amendment was passed the rich have been trying to get out of paying their fair share.)

If single payer became a reality it would sure be helpful if employers were to pass on all the money they are currently spending for health insurance coverage to their employees as a pay raise. Some would, but many would figure out a reason to keep it for themselves.

When someone starts yapping about the cost of health care reform and claims that Social Security and Medicare are going into the red, point out that we already pay twice as much as the civilized world pays and we’re getting less than they are for our money. If we do it right we’ll spend less than we are now and get more for it.

And point out that the problem with Social Security and Medicare is one of execution, not design. The Republicans want to bankrupt all the New Deal and Great Society entitlement programs so they can justify repealing them.


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97 Responses

  1. Hi Myiq2xu! This is a great post. I wish I understood all those naysayers demonstrating against Universal Health Care. I was watching a bit of McCaskill’s townhall today and people were nearly in tears they’re so upset at the possibility.

    McCaskill was actually pretty good rebutting them…. considering their position is so bizarre.

    It’s NOT like these guys are upset at the specifics of the proposed reform – that could very well make sense. These guys just don’t believe in Health Care for everyone at all.

  2. I keep saying this and I know people here get it, but we’re a mess because we link health care to employment. It kills our businesses and their ability to compete globally. It kills babies, children, and adults every single day. It ruins and bankrupts families. We’ve got a system that’s basically broken. If you’ve got a third party payer in a market, it cannot be characterized as as ‘free market’ or capitalism in any way. The only difference we’re talking about is making the payment mechanism cheaper and more efficient. That’s taking advantage of economies of scale like we do when building Hoover Dams, Bridges, providing for the defense of the nation with a US military, and with public schools. We just need medicare for all as a basic plan for every one with a proper funding mechanism. Let the private insurers fill in the spaces with gap programs.

    • And see, that is so simple to comprehend Daki. That is the sad part. I just don’t get why we are still having this conversation after twenty years.

    • You already addressed the 3rd fallacy about health care reform in your last post.

      “It’s socialism!”

      • yeah, we talked about that in my classes today … unless they talk about nationalizing the hospitals, the equipment and the clinics, and they put all the doctors and nurses on the federal pay roll, it’s NOT SOCIALISM!!!

        what is wrong with people? didn’t their parents raise ’em right?

        • of course when I use that argument, I get back, just wait they ‘ll do that next …

          there appears to be a domino theory of health care just like the one about the commies in Vietnam … once those nurses get used to filling out just federal paper, they’ll want to be government employees next!!!

          • Oh yeah, fight everything tooth and nail because it’s all part of a plot to turn us into godless commies.

            Flouridated Water! Abortion! Gay marriage! Designated hitters!

        • Ayup…, but the meme Republicans never let facts get in the way.

        • Actually, they did raise them right … rightwing that is.

    • The problem is that a lot of people don’t give a damn about anyone else but themselves. And they don’t think long-term. We live in a very sick country, filled with selfish, ignorant, frightened people.

  3. Great post myiq. Healthcare reform has really been depressing me lately, because I’m afraid if someone doesn’t do something drastic we won’t be getting Single Payer for another two decades.
    I am so sick of having this conversation. How many posts like this do we have to have? We’ve proven time and time again that Single Payer is the cheapest and most effective way to cover everyone. It’s like our Government is screwing us over on purpose.
    In fact, I refuse to talk about Health Care reform with any friends or members of my family. It depresses me too much. If anyone I know brings it up, I change the subject or sing a song really loud or turn on a Lady Gaga song and just start dancing.

    • Unfortunately, I teach economics and when something like this comes up, and I have to dig in and talk about it.

      • Well, you’re the professor so it’s only natural. I just get too worked up about this. It’s like when someone starts talking about “Gay Marriage” to me. I just get up and leave the room, because I know I’ll be hitting people in a few minutes if I don’t.

        • I know the feeling exactly.

        • ah well then, here is your challenge. If some one is on medicare tell them they already have government health care and they are i an insurance pool with only old and sick people. Tell them that if all the young and healthy people joined in at the same cost it would lower what they currently pay for medicare (for most people, about 100 dollars a month). Then tell them the government would enhance the program to make it cover 100 percent of expenses so that the 185 or so they are paying for their gap policy would disappear unless you wanted a very inexpensive gap policy that would cover things such as private rooms.
          For anyone who is not on medicare, ask them if they would like to pay about 50 dollars a month to have medicare like their parents do…. because that is about what it would cost us with one pool everyone in.

  4. myiq,

    My sense is that securing the operating revenues is easily done through taxation, like it is in nations with single payer. The capital side will be more complicated and will probably make it necessary to phase in care from basic to more advanced, given the that it involves acquiring or creating physical infrastructure. It is undoubtable it can be done because it has been done in other nations that used to have for profit care, like Canada.

    On an OT note, I want to express my pride at the interesting array of posts that we’ve published in the last two days. The breakfast posts are great for stirring the pot!

    🙂

    s

    • It will be just like Medicare. Not sure what you mean by infrastructure? The government will not become a care provider-it will just set rates and reimburse providers, as private insurers do now. If the govt was the provider and owned hospitals, etc, that would be socialized medicine(like the UK), not single-payer. Most of the other countries have some form of single-payer or non-profit insurance.The providers will still be for-profit but the large profit that goes to insurers would be eliminated.

      • I think a better term would be bureaucracy. We would have to create one from scratch, or vastly expand the current one.

        The changeover will be a challenge but we’ll muddle through.

        The current vested interests (health insurance companies) will do whatever they can to sabotage progress. In fact, they already are.

      • J,

        Canada has single payer. The government is the care provider. The government owns the infrastructure, such as hospitals. It need not, but it is more cost effective.

        As you note, there are other types of single payer systems.

        s

        • I don’t really think that we need to nationalize clinics or hospitals. I think we just need to over medicare for every one.

          • D,

            I think it would need to be done your way for it work in this economic climate. I happen to like owning the stuff, which is why my bookcases runneth over…

            s

        • Canada is single payer. Each province administers its own plan which is funded both by Federal transfer payments, in accordance with the Canada Health Act, and by Provincial taxes. The government is NOT the care provider and does NOT own the infrastructure, such as hospitals. Hospital development is approved and partially funded by government; local taxes and fund raising contribute substantially to capital costs. Individual communities and non-profit organizations own the hospitals. Doctors own or rent their facilities.

          • From what I’m given to understand, that’s the case in the EU with the exception of Great Britain. The NHS is the one system I don’t want us to emulate at all.

          • jt,

            You are both right and wrong. The non-profits, which are set up by the government, own the hospitlals, regardless of the fact that they are mostly paid for by the government. What makes you wrong, and the structure a bit of a shell game, is the determination of how assets are dispersed, when such institutions are taken out of service. Because so many of the structures are paid for by taxpayer dollars, much of the asset makes its way back into government coffers.

            s

          • I have lived in Ontario since 1972. I have experience of hospital ownership through a major battle over hospital redevelopment in my community some years back. One hospital, the General, was owned by the city and operated by a locally appointed board of Governors. The other, St. Joseph’s, was owned by the Sisters of St. Joseph, and run by a board whose membership they determined.
            At that time, The General and St. Joe’s were both acute care hospitals, and St. Joe’s had a long term center as well. The province mandated that, in redeveloping the system, only one hospital could offer acute care and the other, long-term care.
            St. Joe’s wanted to be the long-term care facility. However, they could not offer any reproductive health services due to church doctrine. They also had issues with some end-of-life choices. So the plan they proposed had “cradle and grave” at the General, and all the high tech glitz and glamour at St. Joe’s. We organized, we did battle on every front, the community divided, and we lost! (At that time, the St. Joe’s board and their backers had a direct pipeline to the premier’s office, and that plan was actually approved.)
            And then an election was called. The long and the short of it is, our local MPP was defeated and the Liberal government fell. It was replaced by an NDP majority, and under that government the issue was reopened and common sense prevailed.
            The soundest assessment through the whole messy affair was, “The Ministry of Health will fund hospital redevelopment for (our community) when (our community) wants what the Ministry wants us to want.”
            That said, the municipality now OWNS the acute care General Hospital, and the Sisters of St. Joseph OWN the long-term care hospital. Huge percentages of the funding were contributed for both facilities by local government and through local fundraising.
            Hospitals receive major OPERATING funds from the Province and must have their budgets approved by the Ministry annually. However, in this province, hospital properties are owned by either local municipalities or by non-profit organizations.

          • NOTE: MAJOR ERROR!

            “St. Joe’s wanted to be the long-term care facility.”

            NO! St. Joe’s wanted to be the ACUTE CARE facility.

            I’d also like to state more directly: St. Joe’s is owned and operated by the Catholic Diocese of Hamilton, Ontario. The Sisters of St. Joseph are, quite literally, a dying breed.

          • jt,

            I should not assume that each province follows the same procedures. Alberta has de facto nationalization, according to this brief, and Alberta is the basis for my knowledge of Canadian healthcare.

            http://www.longwoods.com/product.php?productid=16395

            Thanks for the posts.

            s

        • Thanks, Steve, for the Longwoods link. It looks like it may be about 10 years old, but, to my knowledge, the Ontario situation is unchanged. It may be helpful to note that most Ontario hospitals long pre-date the implementation of either O.H.I.P. or the Canada Health Act, a fact that has to complicate any determination of “ownership”.

  5. This is far too logical and well reasoned — who’s going to believe it?

    /sarcasm off

  6. I am one of the lucky ones. I have medicare and a secondary insurance as part of my retirement package.
    I do not understand why all Americans can not have the same options.
    I pay a monthly premium for my medicare. Lucky for me my former employer pays my secondary insurance. I assume they pay less because it is a secondary insurance.
    If there were a government backed insurance plan with a monthly affordable cost and insurance companies used as a secondary would that help most people?
    Better information broadcast to the public might also help this country get a decent health program.
    How many people really know what is in backtrack’s plan?
    Most just know that it is being rushed throught just like the bailout and that did not help most Americans.
    Human nature is to not trust what you don’t know.

    WOMEN WITH INTELLIGENCE AND EXPERIENCE,MEN WHO SUPPORT THEM AND COUNTRY BEFORE PARTY ALWAYS

    PUMAS,BUBBAS,EQUALISTS AND THOSE PEOPLE RULE

    • your company is paying depending on your age, about 140 to 300 dollars a months for your secondary insurance if it is a medicare supplement. Or they may bargain for a lower rate if they pay for a large pool of seniors. But chances are they are paying more for your extra 20 percent coverage than you are for the 80 percent medicare costs.
      Do you have co-pays and deductibles?

      • Yes I pay a certain amount for prescriptions. It is much lower than the cost would be without the secondary insurance.
        I also pay a amount for doctor visits which is also much lower than without the secondary.
        I know I am one of the lucky ones but why couldn’t it be that way for all.
        The insurance companies would still make money The people would have health care

        WOMEN WITH INTELLIGENCE AND EXPERIENCE,MEN WHO SUPPORT THEM AND COUNTRY BEFORE PARTY ALWAYS

  7. It’s almost criminal how many opportunities Dems have missed that could have helped sell the heath care argument to the general public. Cost for sure, we’re already paying for it, so lets redirect the money so people actually have access. But also the threat of pandemic, here we are worrying about the swine flu. Germs are contagious, do you want your neighbors sneezing on you for six weeks because they don’t have access to health care?

    There’s also the matter of defense. Bush spent 8 yrs telling us that we were under threat from biological and chemical weapons. Isn’t congress supposed to support the general welfare? So when smallpox is dropped on a major American city, do you want to leave 40% of the population untreated?? Do mass outbreaks of disease not threaten the country? Should universal health care not be a matter of defense?

    And of course, my pet peeve. Dismissing the critics as bitter small towners and un-American, instead of simply addressing their genuine fears of being forced to depend on a government that does not always have a good track record of compassion or logic. Did we not just see the government fail to care about those trapped in the superdome after katrina? Did we not just see the government abandon those at Walter Reed Army hospital? Don’t dismiss these concerns, address them and show people how you plan to protect them from the government’s occasional lapses of compassion.

    • What makes you think they want to sell health care reform?

      • Not one damn thing because they don’t want it! If they did, it would not be a terribly hard or even complex sale. Just lay it out with comparisons to other countries and you’re done.

        Hell, in Germany people have a choice of over 200 insurance plans in addition to the basic coverage. You can’t find that kind of choice in our lovely system for love nor money.

  8. Here’s a novel approach. First say, hey, you guys like to think about the country as a business and it should be run like a business. Reduce waste, be efficient, etc. OK then. So let’s think of the country as a business. And that of course means we’re all employees of this business. Now what’s the most efficient and effective way to manage the employees health care if you were running a business. Why it would be to make a group and put everyone in it and negotiate prices for the entire group, there by getting a better price per person (since you’re grouping health and unhealthy together).

    Let’s run the country like a conservative runs a big business and have universal health care for everyone. If you don’t want to do that, then why do you hate business and capitalism and america?

    • I understand people mistrusting government. But the same people who are afraid to trust government with health care want to let Uncle Sam spy and torture and make war.

      • And keep women from controlling their own bodies….

      • Well myiq, that’s because they want the Gov off of American soil and out of American lives. They wish “big government” on the enemy so to speak, not on themselves.

        Dandy Tiger makes a good point. What critics refer to as socialized medicine is actually the same thing we do with private insurance. Everybody pools their resources and everybody gets coverage. It’s almost like wealth redistribution, LOL.

      • Simple answer to that one myiq2xu, because they are insane.

    • When attending the next Health Care Forum and you support Single Payer, don’t for get to tell them: HEY YOU GUYS!! We Want a Public Option, HR 676 Single Payer!

  9. As soon as our Senators and Representative figure out a way to line their campaign contributors pockets with the proceeds we will have a single payer system.

  10. Hey, what happened to the podcast? You didn’t show up for the last episode.

  11. Okay, totally OT, but look at this article about the Clintons’ vacation in Bermuda. (I am going to post it in other threads too, because it warms my heart to see old people who are still in love.)

    http://www.bermudasun.bm/main.asp?SectionID=24&SubSectionID=270&ArticleID=42616

    The Clintons were given a quick tour of the property and Mrs. Clinton commented to her husband “look darling, it’s so romantic.” They were “very keen to see the room” they had stayed in 30 years ago, but unfortunately didn’t have the time.

    It is the same island where they conceived for Chelsea. Isn’t that sweet? They wanted to see the actual room where they spent the night.

    • Wow, I think if Hillary Clinton said “look darling” to me about anything, I would burst into flames and be reduced to a softly sighing puff of ash….

    • Yup! I love seeing old folk walking down the street holding hands, because it’s like a timeless love or something. Tee hee!
      (just kidding bb. ILU.)

    • and can you believe they wanted to see the same room Chelsea was conceived in? That’s kinky and I like it!

  12. I am normally a huge fan of this site. I have to say, though, that I don’t really agree with this analysis. The real issue in healthcare is that it’s a cartel where everyone colludes to raise prices together. The high number per capita you report reflects that strategy. It used to be that healthcare represented something like 6% of GDP. Now it represents 20%. It’s not that we’re using more healthcare, necessarily. It’s that the cost of healthcare is artificially high in this country. Unfortunately, what’s on the table now from the government won’t fix that, given the drug companies will profit immensely from what Congress is now proposing, thus their willingness to pony up $150 million to advertise how good it is. Raising taxes on the wealthy doesn’t fix it either. Until you start capping prices, salaries, and busting up the healthcare cartel, you won’t reduce the cost per capita. Does it matter who bears that cost? The argument you make is someone has to pay, might as well be the wealthy. But the price is still artificially far too high. Brittain caps doctors’ salaries. Canada caps drug prices. The area to apply effort is in industry price control, not in raising the money to pay for it all, regardless of the source. The latter is just a game in shifting around the burden of who pays. Think of it like this: if oil suddenly rose to $500 a barrel, would we all be calling on the rich to pay for gas we can no longer afford at $10 per gallon? No. We’d be calling for the heads of the cartel that colluded to raise the price artificially. Until you control pricing in the healthcare industry, and bust up the cartel, no plan will work under artificially escalating prices.

    • You did an excellent job refuting a bunch of stuff I didn’t say.

      Britain has socialized medicine. Price caps and other cost controls are possible with single payer because of bargaining power.

      The only people who can pay are people with money. They are already paying for our health care. Poor people can’t pay for anything.

      We could save 33% right away by eliminating health insurance companies.

      BTW – who is this cartel you are talking about?

      • actually, I’d classify the AMA as a cartel

        • We should put RICO on them then.

          • you could, but they get away with it by arguing that restricting the number of doctors coming out of med schools is for quality purposes, but basically they are exactly that

          • We could build more medical schools – it won’t happen overnight but if there is a shortage of doctors we need to grow more doctors.

            Since we are the last major English-speaking nation to enact UHC where will all the disgruntled doctors go if they can’t make as much money here as they used to?

            A doctor making 80% of what he/she is making now will still be making more than 99% of the population.

          • myiq,

            Yes. US doctors’ salaries drive up world prices.

            s

      • Hey Myiq,

        The cartel I refer to = doctors + equipment manufacturers for the medical industry + drug companies + hospitals + anyone else in healthcare industry I didn’t call out specifically that raises their prices arbitrarily.

        I agree that you need power to break up such a group bent on doing nothing other than raising their own profit margins. But single payer may not be the way. I am thinking the feds need to get back into the business of trust busting, like they did with Ma Bell in the 80’s, OPEC in the 70’s, and the robber barons in the 10’s. The biggest problem with healthcare in the US is that it’s now a luxury item. Only those who can pay, either by insurance companies, employers, personal wealth…can get it. For those who can’t pay, as you point out, the rest of us pick up the tab somehow. But rather than looking at the tab and who should pick it up, I am saying focus on the price-gouging that’s been going on FIRST. Get costs in line with other industrial nations. It’s clear we’re way off base there because Congress is instituting nothing of the sort at present, and is instead going to fund the whole thing out of debt.

        We need a better strategy.

    • It’s really pretty obvious that paying $7290 per person is artificially high, considering everyone else’s expenditures. Without a huge negotiating factor, like a government run plan, it will stay thay way. With Medicare for All and a private option, it doesn’t have to be that way forever.

    • Inelastic demand has a lot to do with this plus you have a third party payment system. Third party payment systems always lead to issues. They’re a pathology that signals a market can’t be a ‘free market’. They arise because of market frictions like information asymmetry, adverse selection, moral hazard, inability to price risk, etc. This market will NEVER not have issues with quantity and price given that alone. Also, Price fixing at this point, with third party payers negotiating those prices, isn’t very workable. But, it’s an interesting idea. Still doesn’t solve the root of the problem though, does it?

      • Interestingly enough, with everyone in the same system I think there might be a bit less effect from paying with someone else’s money. Perhaps people would take some ownership.

  13. And the premiums the employer pays are also deducted as a business expense so the employer pays less taxes which amounts to extra taxes for everyone else. Whether you have insurance or not, you’re still paying for it. The employers should use the money saved, when they don’t have to foot that bill any more, for new job creation, in my perfect world anyway. lol.

    • Chances are they will use it to create more jobs in India, China, and Brazil. If they create any new jobs at all.

    • What’s the point of creating new jobs if nobody can afford to buy anything?

      In addition to enjoying universal health care, European workers make more money and work less.

      • Have you ever taken a look at their productivity per hour in France and Germany compared to the US? For engineers at least, they are comparable in total output with fewer hours.

        • Do they have internet porn in Europe? That’s the #1 on-the-job time waster here in the US

          • And the #1 and #2 States for downloading p0rn are Utah and Mississippi

          • Sexual repression and sexual perversion are conjoined twins.

          • With the advent of corporate spying on employees, a lot of that has gone by the wayside. What you find here is lots of generally unproductive meetings and conference calls which hurt some, but that’s management’s fault.

            A huge time waster is bs’ing with each other about God knows what and that’s very understandable since it’s really hard to keep your head down and code, or whatever, for the ridiculous hours worked in the US. Human nature will out most of the time.

          • I used to have a bookmark of a site that kept track of the Southern
            Baptist preachers arrested for rape, child molestation, etc. They had
            passed the RCs by a mile.

  14. Does anybody know about the mechanism used to pay providers in other countries? One thing to consider is that Medicare, Tricare, RRB Medicare, FEHB all use fiscal intermediaries. These fiscal intermediaries are insurance companies. For instance, if a federal employee covered under FEHB lives in PA but receives a service in TN, then the claim is submitted to the TN carrier for payment under TN payment rules. Fees are not standardized under Medicare. The amount paid varies by region.

    • I have some academic research on all of that but I’ll have to go find it on my flashdrive. I’ll do it in the morning for you.

    • Fees can’t be standardized in the USA, because cost of living varies so greatly from region to region. Providers in NYC are going to be paid more than providers in Alabama.

      I’m not sure to what degree cost of living varies wildly in smaller European countries, so it may not be as big an issue for them. We’d have to address it, though.

  15. DAKINIKAT
    I posted a question downstairs about banks. I did not put it here because it is not about health care.

    WOMEN WITH INTELLIGENCE AND EXPERIENCE,MEN WHO SUPPORT THEM AND COUNTRY BEFORE PARTY ALWAYS

    PUMAS,BUBBAS,EQUALISTS AND THOSE PEOPLE RULE

  16. A great post; opponents always seem to picture a govt. plan as something they have to pay for on top of or separate from everything else.

  17. Great point! GOP-ers are fiercely defending the right of Insurance companies to fleece us to death.

  18. Great post, myiq. I have to correct misconceptions evident in some things said upthread about the cartel, though, as well as in your main body: Doctors as a whole have very little to do with setting the prices for healthcare.

    When someone declares bankruptcy on medical bills the medical providers do what all businesses do – they raise their prices to compensate. Whatever your doctor charges for his or her services includes a calculation for bad debts. That’s just business.

    Not really. I mean, they could raise their prices, but it would be a pointless fantasy exercise. Doctors do not get paid what they charge, or even a percentage of what they charge. They get paid what Medicare and the insurance companies SAY they will be paid. Medicare sets their fees, then the other companies say they will pay anywhere from 80% to 150% of what Medicare pays, with the vast majority staying about even with Medicare.

    So no, that bad debt does not get passed on. It gets written off at the end of the year, and you can get a tax break on it. But unless a doc is seeing a lot of cash patients, there is no way to “pass that on” to anyone. The only way to make up for those kind of losses is to just see more patients. Hence the “shove ’em in the door, shove ’em out the door” practice of medicine.

    In the years hubby was in private practice, we ate anywhere from $30,000 to $70,000 in bad debt every single year, and he’s no surgeon or specialist doing tons of procedures, that’s just routine office visits and stuff in a small solo family practice.

    This is why the canard of “doctors will not be able to control their salaries under UHC” is such bullshit. Doctors have no control over how much they are paid for their services NOW. The only thing they can control is volume, and how many hours they work, how many patients they can see.

    Medicine does not work like other businesses. Almost ALL the pricing leverage is in the hands of the insurers, whether private or public. Doctors don’t set fees, and patients don’t set the fees – the insurers do.

  19. “the feds need to get back into the business of trust busting, like they did with Ma Bell in the 80’s”

    Ugh. That was a disaster. Didn’t lead to any cost controls or improved service at ALL. I lived through it, everyone missed the Bells.

  20. “In addition to enjoying universal health care, European workers make more money and work less.”

    And get tons of vacation time, generous maternity (and in some cases paternity) leave, solid pensions, and inexpensive education and/or vocational training. Oh, and their kids aren’t routinely sent off to slaughter and be slaughtered in foreign countries–not recently, anyway.

    One of the most prosperous, best-educated countries in the world today is Finland (where Nokia phones come from), which has a colossal array of government-sponsored social safety nets including, IIRC, free childcare. (And yes, I know it’s a tiny country with a mostly homogenous population bla bla bla).

    But God forbid we should in any way emulate those godless commies.

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