this thread probably needs a bump as discussion that belongs here is now taking place in the sausage making thread.

I have a question and it may have been adressed already, but this thing is so big that you'll have to excuse me, if it has been answered already.

Would it be possible, under current or future legislation, to set up a private health insurance program and sell it throughout the US, that only covers catastrophic health care expenses? E.g. a coverage that would pay only expenses above app. 10% of your yearly income, and only those expenses that are not elective? Possibly with an added optional coverage for loss of income through a catastrophic health event?

Right now states are responsible for regulating insurance companies, so a national insurance company wouldn't fly, you'd have to set a separate company up in each state and negotiate payment rates in every market which likely wouldn't be very good since you'd start with a small subscriber base in each market. What the big players did was just buy the existing insurers (about two thirds of the Blue Cross Co's which were non-profit have been bought by for profit companies for instance.) If a reform bill gets passed its unlikely that a straight catastrophic plan could be sold to the individual market (although there is talk of letting young people buy something less feature packed in the Senate's version that's tba) but companies like AFLAC already sell suplemental insurance to cover non-medical losses when you get sick and those policies will still be available.

OK, so it's not really realistically possible. It would seem like a good market opportunity though, if you consider that a large % of the currently unisured should be interested in hedging against catastrophic medical emergencies (that should not be high premium), while paying for "regular" medical care out of the pocket, as they are already doing anyway.

thanks for the answer

wow, how many police per poster is there? muahahahahahahahaha
FYI: health care should be provided by a doctor EOS
(sry) feeling froggy

NOTICE IT SAY FOR ILLUSTRATIVE PURPOSES...lol, but probably not far off

Can't resist. Notice *why* it's not realistic...

HSA programs are already existence (catastrophic health care coverage, high deductible requirement). I'd like to see a little more on the "preventative" side covered but aside from that they seem to do the trick. Of course I wont really know until I get a major illness.

I used to work for a statistical consulting firm that works on all the big tobacco cases. One of the latest groups to sue the tobacco companies is hospitals, for uninsured patients who's health problems could be linked to smoking. The interesting thing about this is that in a lot of cases where the hospitals did get a partial payment, they were actually paid more by the patient than they would have gotten from insurance anyway.

IE - some woman had an $1800 bill for an MRI. She had managed to pay about $1k of it. The other $800 went into the claim on the lawsuit. But if the woman had had insurance, the hospital only would have collected $600 as total discounted payment for the MRI. So obviously the defense is calling foul on that.

What I found interesting was the price disparity. It seems to me that in response to ins. cos. demanding a deeper discount, hospitals have just simply jacked up their prices.

I went in to a Quest Diagnostics office get a blood test the other day and my Dr. forgot to check the box to bill it to her. I asked what the difference was, and it was going to cost me 4 times as much if I just paid it myself. Wtf?

Doesn't that seem like a massive inefficiency in the system that would be corrected if everyone had insurance? Should health care be priced like a Moroccan rug? How out of whack are the medical retail prices and actual costs right now? It's not like there are economies of scale on an MRI that large customers can take advantage of.

How should Health Care Should Be Provided ?

private rather than public.

This is very true. Prices in healthcare have pretty much no meaning anymore.

Good interview with a President and CEO of a HealthCare company talking about prices:

http://www.econtalk.org/archives/200...in_on_hos.html

NYT has piece that was helpful for me.

"One might hope that such a large climb in marginal rates is a bug in the Senate Finance bill, one that could be fixed before the legislation became law. But there is no simple fix. Higher marginal tax rates are an integral part of the Obama health plan."

http://www.nytimes.com/2009/11/01/bu...view.html?_r=1

Argument by corner case. Awesome. The people who might be affected by Mankiw's scenario are:

1) Currently uninsured by choice (ie they will only be purchasing health insurance because of the mandate.)
2) Making an amount which qualifies for a subsidy.
3) Have the ability to make enough additional income to disqualify themselves for the subsidy.

Some very small percentage of people may find themselves in this situation, but this is more than offset by the elimination of the hidden tax we all pay for the cost of uncompensated care. BTW, getting lectures from the guy who headed GWB's Council of Economic Advisers while the budget was being blown up via ******ed tax cuts, unnecessary wars and unpaid for entitlements is pretty hilarious.

Frontline re-aired their piece from last year looking at 5 wealthy democracies and how they handled healthcare. Yes I realize Frontline is extremely left-biased, but the basic facts of each system were interesting. http://www.pbs.org/wgbh/pages/frontl...rld/countries/


United Kingdom

Percentage of Gross Domestic Product (GDP) spent on health care: 8.3

Average family premium: None; funded by taxation.

Co-payments: None for most services; some co-pays for dental care, eyeglasses and 5 percent of prescriptions. Young people and the elderly are exempt from all drug co-pays.

What is it? The British system is "socialized medicine" because the government both provides and pays for health care. Britons pay taxes for health care, and the government-run National Health Service (NHS) distributes those funds to health care providers. Hospital doctors are paid salaries. General practitioners (GPs), who run private practices, are paid based on the number of patients they see. A small number of specialists work outside the NHS and see private-pay patients.

How does it work? Because the system is funded through taxes, administrative costs are low; there are no bills to collect or claims to review. Patients have a "medical home" in their GP, who also serves as a gatekeeper to the rest of the system; patients must see their GP before going to a specialist. GPs, who are paid extra for keeping their patients healthy, are instrumental in preventive care, an area in which Britain is a world leader.

What are the concerns? The stereotype of socialized medicine -- long waits and limited choice -- still has some truth. In response, the British government has instituted reforms to help make care more competitive and give patients more choice. Hospitals now compete for NHS funds distributed by local Primary Care Trusts, and starting in April 2008 patients are able to choose where they want to be treated for many procedures.



Japan

An interview with an expert on Japan's system +

Percentage of GDP spent on health care: 8

Average family premium: $280 per month, with employers paying more than half.

Co-payments: 30 percent of the cost of a procedure, but the total amount paid in a month is capped according to income.

What is it? Japan uses a "social insurance" system in which all citizens are required to have health insurance, either through their work or purchased from a nonprofit, community-based plan. Those who can't afford the premiums receive public assistance. Most health insurance is private; doctors and almost all hospitals are in the private sector.

How does it work? Japan boasts some of the best health statistics in the world, no doubt due in part to the Japanese diet and lifestyle. Unlike the U.K., there are no gatekeepers; the Japanese can go to any specialist when and as often as they like. Every two years the Ministry of Health negotiates with physicians to set the price for every procedure. This helps keeps costs down.

What are the concerns? In fact, Japan has been so successful at keeping costs down that Japan now spends too little on health care; half of the hospitals in Japan are operating in the red. Having no gatekeepers means there's no check on how often the Japanese use health care, and patients may lack a medical home.



Germany

Percentage of GDP spent on health care: 10.7

Average family premium: $750 per month; premiums are pegged to patients' income.

Co-payments: 10 euros ($15) every three months; some patients, like pregnant women, are exempt.

What is it? Germany, like Japan, uses a social insurance model. In fact, Germany is the birthplace of social insurance, which dates back to Chancellor Otto von Bismarck. But unlike the Japanese, who get insurance from work or are assigned to a community fund, Germans are free to buy their insurance from one of more than 200 private, nonprofit "sickness funds." As in Japan, the poor receive public assistance to pay their premiums.

How does it work? Sickness funds are nonprofit and cannot deny coverage based on preexisting conditions; they compete with each other for members, and fund managers are paid based on the size of their enrollments. Like Japan, Germany is a single-payment system, but instead of the government negotiating the prices, the sickness funds bargain with doctors as a group. Germans can go straight to a specialist without first seeing a gatekeeper doctor, but they may pay a higher co-pay if they do.

What are the concerns? The single-payment system leaves some German doctors feeling underpaid. A family doctor in Germany makes about two-thirds as much as he or she would in America. (Then again, German doctors pay much less for malpractice insurance, and many attend medical school for free.) Germany also lets the richest 10 percent opt out of the sickness funds in favor of U.S.-style for-profit insurance. These patients are generally seen more quickly by doctors, because the for-profit insurers pay doctors more than the sickness funds.



Taiwan

Percentage GDP spent on health care: 6.3

Average family premium: $650 per year for a family for four.

Co-payments: 20 percent of the cost of drugs, up to $6.50; up to $7 for outpatient care; $1.80 for dental and traditional Chinese medicine. There are exemptions for major diseases, childbirth, preventive services, and for the poor, veterans, and children.

What is it? Taiwan adopted a "National Health Insurance" model in 1995 after studying other countries' systems. Like Japan and Germany, all citizens must have insurance, but there is only one, government-run insurer. Working people pay premiums split with their employers; others pay flat rates with government help; and some groups, like the poor and veterans, are fully subsidized. The resulting system is similar to Canada's -- and the U.S. Medicare program.

How does it work? Taiwan's new health system extended insurance to the 40 percent of the population that lacked it while actually decreasing the growth of health care spending. The Taiwanese can see any doctor without a referral. Every citizen has a smart card, which is used to store his or her medical history and bill the national insurer. The system also helps public health officials monitor standards and effect policy changes nationwide. Thanks to this use of technology and the country's single insurer, Taiwan's health care system has the lowest administrative costs in the world.

What are the concerns? Like Japan, Taiwan's system is not taking in enough money to cover the medical care it provides. The problem is compounded by politics, because it is up to Taiwan's parliament to approve an increase in insurance premiums, which it has only done once since the program was enacted.



Switzerland

Percentage of GDP spent on health care: 11.6

Average monthly family premium: $750, paid entirely by consumers; there are government subsidies for low-income citizens.

Co-payments: 10 percent of the cost of services, up to $420 per year.

What is it? The Swiss system is social insurance like in Japan and Germany, voted in by a national referendum in 1994. Switzerland didn't have far to go to achieve universal coverage; 95 percent of the population already had voluntary insurance when the law was passed. All citizens are required to have coverage; those not covered were automatically assigned to a company. The government provides assistance to those who can't afford the premiums.

How does it work? The Swiss example shows that universal coverage is possible, even in a highly capitalist nation with powerful insurance and pharmaceutical industries. Insurance companies are not allowed to make a profit on basic care and are prohibited from cherry-picking only young and healthy applicants. They can make money on supplemental insurance, however. As in Germany, the insurers negotiate with providers to set standard prices for services, but drug prices are set by the government.

What are the concerns? The Swiss system is the second most expensive in the world -- but it's still far cheaper than U.S. health care. Drug prices are still slightly higher than in other European nations, and even then the discounts may be subsidized by the more expensive U.S. market, where some Swiss drug companies make one-third of their profits. In general, the Swiss do not have gatekeeper doctors, although some insurance plans require them or give a discount to consumers who use them.

Yeah, but they're socialists!!

So who is the second richest non-socialized medicine country? http://en.wikipedia.org/wiki/Universal_health_care

I've been looking up places like India, Brazil, Argentina, Mexico. Honestly I am still looking for a country that sounds like the US, where a large segment isn't covered by any plan, and you can go bankrupt from health bills. Anyone know who's the next richest country with something resembling our system?

Ok I found this. They say India does not have universal healthcare, so it might be them. Otherwise just rough eyeballing it I'd say take your pick from Iran, Turkey, Vietnam.

http://www.gadling.com/2007/07/05/wh...l-health-care/

In response to suzzer99's posts, this healthcare bill that Obama is proposing does NOT decrease the costs of healthcare, instead raising them by another 2% of GDP. So even if Obamacare does pass, its not like the US suddenly saves any money on healthcare.

http://www.politico.com/livepulse/11..._.html?showall

I still think the US has a problem however and needs to reform healthcare and lower healthcare costs but this is NOT how to do it. Instead we should relaxing standards for becoming a doctor (which these other countries do and can be achieved by undermining the AMA and making more medical schools) and limiting medical malpractice lawsuits. These two things are a big reason why those other countries have lower healthcare costs.

Well my main argument is simply that every other wealthy country has decided that access to health care should be guaranteed for everyone, like access to education. The PR firms that work for big insurance companies have managed to convince a large chunk of Americans that this idea = socialism. So I guess we're the only non-socialist wealthy country on earth. Vive la différence!

But as far as costs, in most of the systems covered on Frontline fixed prices for all medical procedures are negotiated between the insurance providers (either govt or private companies) and the health care providers. Can you see how this might bring costs down - the bargaining power of the whole country? If I rupture my spleen tomorrow, I will still get medical attention. I might have to go bankrupt, but someone, somewhere is going to pay for it. Can you see how this adds inefficiency and friction to the system?

I don't necessarily think we'll save money from this system up front because we're too wrapped up in appeasing the insurance companies right now. But eventually if we can force them to the margins, along with their PR firms, executive salaries and huge screening and claim-scrutinizing administrative costs, I think we could see some real savings.

In short, I think the free market falls down pretty hard when it comes to health care. And every other wealthy country on earth agrees. Hey I know, let's privatize our high schools! Poor people have been leaching off our education system for too long.

I really don't think you want to go there. Government education ftw!

http://www.cato.org/pub_display.php?pub_id=9319

justify this please. need to elect the right people?

CANADA FTW

so basically your argument is that if we pass this bill, someday somewhere down the road, if the insurance companies play nice.. we MIGHT save money.

sounds like a great idea!

The real reasons the US has expensive healthcare:

1. doctors get paid too much here because the number of medical schools is artifically limited by the AMA. In all the universal healthcare countries, doctors are paid much less. Yet their healthcare doesnt seem to be worse. The US should do this too.

2. medical malpractice lawsuits

3. people leeching off the system and abusing the ER room that are homeless/mentally ill/drug abusers/illegals

Price of an appendectomy in the US is $20,000-50,000. In other countries it's $1,000-$3,000. I wonder which countries are closer to a free market...

Poor high schools aren't even offering an education... good idea suzzer.

I say doctors make voluntary arrangements with patients, who make voluntary arrangements with the world to get the money to fund their end of the voluntary arrangements with the doctors. What does everyone think of this idea, and could it use more theft and forcing other people to pay for my fat ass getting a triple by pass?

No I think the insurance companies will be gone eventually, or turned into non-profits--like most other countries that still have insurance companies participating in universal healthcare. Most of these countries have made the determination that the free market really just isn't suited to healthcare, and I agree.

I love how you guys never really address my key point. Do you really honestly think every single one of those countries have got it dead wrong? The people like their systems and would never choose ours over what they have. So that argument is out the window. So now we have to fall back on every single one of those countries, in a socialist hell and they don't even know it - and/or - heading for financial ruin. Again, I will ask someone to address the question, and most likely no one will: do we really think every single wealthy country in the world is headed for financial disaster due to universal healthcare?

Here is the list in print form: Argentina, Austria, Australia, Belgium, Brazil, Canada, Chile, China, Cuba, Costa Rica, Cyprus, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Israel, Italy, Japan, Mexico, Luxembourg, the Netherlands, New Zealand, Oman, Portugal, Russia, Saudi Arabia, Spain, Sweden, South Africa, South Korea, Sri Lanka, Thailand, Ukraine and the United Kingdom


I completely agree that all of this contributes. But so does hospitals/Dr. jacking up their "stated rates" to 4x what they charge insurance companies so that they can claim they're giving a deep discount. Why does an MRI cost $98 in Japan and $1800 here?

I don't understand the point here. Either way I'd take 'other countries' over us if I have a choice. If that means removing the free market from healthcare so be it.


Well in the private market kids wouldn't even be guaranteed an education at all, unless they can pay for it. Many would think a crappy education is better than none at all. I would rather have a crappy HMO than the zero health coverage I have right now.