patrick.net

Thanks for replying. It's likely to be both a man and woman working for a couple having a baby. Let's say the average couple has two kids, and they work for a ten year period around which both before and after they have a child (23-33 yrs old), that's $24K-$36K in premiums. Health insurers probably wouldn't pay out $10K to a hospital for a delivery, but maybe 70-80% of that, or $7K-$8K. Or the other option is putting maternity delivery under the Medicare for All plan with the same payout. Either way, I'm sure the actuaries can set premiums accordingly. Don't forget that the point of expanding Medicare to everyone is to have a much bigger risk pool, with bringing in a lot more healthy individuals (younger) to subsidize the older and less healthy population. Right now we dont have that because we segregate the two between private and public systems.

In terms of the entire population being healthy males under 30, good point, but if more people have the insurance to see a doctor for office visits BEFORE getting sick, you are likely to see fewer unhealthy individuals in the hospital for the major stuff like bypass surgery, diabetes, etc. Our current system rewards unhealthy behavior by people not visiting the doctor until it is too late to correct the problem, partially because they lack health insurance and also because they practice bad health habits, which preventive visits can cure. (I also think health insurance companies can reward people for good behavior with lower premiums).

As for the expensive asthma medicine, that would be part of Medicare For All. The program can set limits on what it will be paying like they do in a place like Canada. That's one reason why we have an issue with cost containment in this country. Private health insurance won't say no to outrageous prices for drugs for fear of their subscribers switching companies for drugs. If there is a single payer to these drugs, then big pharma has no choice but to charge less.

You cannot mandate a cost because we are not a command economy.

In other words you would have to levy a tax to pay for the amounts you have stated. In order to do that generally it would be income taxes..maybe a national sales but the money has to come from somewhere.

The problem with the concept of preventive care is that it is quite hard to make that assumption. Insurance is more about outside risk than internal risk.

Car insurance basically is to fix cars after damaged has been made. Technially we could try to mandate that it covers car washes, oil changes, filter replacement, new belts..and the list goes on..and on.

But preventive care for health starts with individual actions not mandates. How many people go to a gym vs those with a gym membership? How many smoke? How many don't eat right? How many drink heavily?

We have to do something about the war on drugs because that's the 900 lbs gorilla in the room. The easiest way to improve aggrate health is to promote rehab instead of jail. Other ways would be to simply make places more walkable..make more sidewalks, more public lighting at night.

The other thing you have to remember is competition drives costs down. Mandates don't. In Mass we had heavy mandates on car insurance companies to the point where only a handful of companies operated in the early 90's. Then we smartened up and loosened up the restrictions which allowed more companies to come back and prices went down.

Just to note we already have wellness programs in some companies to try to promote general health (they get a discount).

The issue with health is that the pleasures of vices are generally privitized (alcohol, tobacco etc) but the end results are subsidized (cancers, heart disease etc).

Thanks for replying, mdovell.

I agree with you on some of the points you make, specifically the war on drugs, which is an absolute failure. We spend a ridiculous amount of money on fighting the drug war, not only in dollars, but in human lives. Think about all the people locked up for marijuana possession, or the number of people killed just this year in Mexico due to the violence.

As far as a mandate, you are right--it would have to be a tax. Like it or not, corporations and individuals that purchase health insurance now are paying through the nose, and that is a tax by another name; it is a very expensive tax. You don't have to be a command economy to mandate costs--we mandate the costs of electricity and phone service, and no one screams socialism. They are necessities. Canada mandates drug costs and they are a capitalist country. The car care analogy is inaccurate because if you don't take care of your car, no one else is paying for the repairs. If you don't take care of yourself, society pays, either through Medicaid, Medicare, or higher insurance rates for the rest of us.

Your comment for preventative care sounds familiar. In fact, I heard this in the mid 1980s when states started to regulate the individual use of seat belts in cars. The federal government also mandated the use of air bags, and guess what?--the number of vehicular deaths as well as fatalities per million miles traveled have been plummeting:
http://en.wikipedia.org/wiki/List_of_motor_vehicle_deaths_in_U.S._by_year

It's interesting that you live in Mass, which according to this ranking is the second healthiest state in the US, and the #1 in insured people. The surrounding states are also very healthy and well insured, nearly all in the top 1/2:
http://statehealthstats.americashealthrankings.org/#/country/US/2010/Overall-State-Ranking

On the contrary, the states with the lowest number of insureds fair poorly, with the exception of Wyoming:
http://www.gallup.com/poll/122387/uninsured-highest-percentage-texas-lowest-mass.aspx

You can see that the two are linked, and my suspicion is those with health insurance visit the doctor more frequently. Whether it is through mandates or not, public or private, as long as people are covered and staying healthy, that should be our goal as a society.

I agree that competition is one factor that drives down rates, but so is controlling costs. We supposedly have a very competitive insurance industry in the US and have the most expensive healthcare in the world. (and yes, other countries get the same drugs and procedures as we do). Since the end results of the vices are subsidized, there is an obligation to control these costs.

"You don't have to be a command economy to mandate costs--we mandate the costs of electricity and phone service, and no one screams socialism. "

Um.. No offense but we don't mandate electrical costs or phone service. Both were deregulated years ago. California experienced some electrical price shocks back in 2000/2001 which were largely engineered by various companies (I think Enron after they bought out PG&E..I'm sure there are people here that remember that as it was not that long ago. Phone service isn't nearly as regulated as it once was as land lines are a utility. By that it means it must always be on. Cell phones aren't. Cell phone bills have FCC fees but I'm not so sure about voip services.

"The car care analogy is inaccurate because if you don't take care of your car, no one else is paying for the repairs. If you don't take care of yourself, society pays, either through Medicaid, Medicare, or higher insurance rates for the rest of us."

But a car can leak chemicals if it is to gradually decay. Those can leech into the ground. In Mass you are allowed one uninsured car on your property. In my town there was someone with eight cars on their property..they let everything go and eventually their house was condemned for sewage backup. It does not take that much to screw up a water supply. If a bird deficates in a water tower that can cause e.coli, a drop of oil can pollute 25 liters of water. In a city this might not be as noticed but in suburbs and rural areas it is harder to remediate oil pollution.

I think it might have been Freaknomics or its sequel but it basically laid it out that wearing a seatbelt is easily one of best things to assure safety. I am not for mandatory laws on it mostly because we have some of the lowest compliance here and that would slow down traffic. Here an officer won't pull over someone not wearing a seatbelt but if you are pulled over for anything and don't have it on then you are cited for it..of course those pulled over instantly put it on so the law is kinda weak.

I understand what you are saying in terms of insurance but it isn't exactly meaning that everyone is automatically healthy. I was in the waiting room for a hospital a number of years ago..a relative of mine was fine but people would actually dump people OD'ing by the doors..I saw a man do that with his girlfriend..it was like that scene with Jesse and Jane from Breaking Bad but not that far. If everyone assumes they have coverage they are more likely to use it. If electricity was free then the point of conserving would be nullified and people could leave things on all the time.

I am not saying or claiming that insurance is a bad idea but mandating with the idea of lowering costs is a bit odd. Car insurance premiums are lower in NH than Mass. NH is one of the few states that does not mandate it..so how can the cost be lower? If someone is not insured one could argue that are aware of that and thus might drive safer.

"You can see that the two are linked, and my suspicion is those with health insurance visit the doctor more frequently. Whether it is through mandates or not, public or private, as long as people are covered and staying healthy, that should be our goal as a society."

I think it might be more interesting if instead of mandating insurance what if we tried to mandate a nurse or nurse practioner at every worksite of say above 60. I'm still a tad amazed by places that have so many people but yet if there is an accident or something is wrong they have to ship them off to a hospital. I'd also add that drug stores are starting to have clinics in them but some states make that illegal..not sure why.

"We supposedly have a very competitive insurance industry in the US and have the most expensive healthcare in the world. (and yes, other countries get the same drugs and procedures as we do). Since the end results of the vices are subsidized, there is an obligation to control these costs."

Well insurance is an odd thing because we could not buy it across state lines. Now in a large state with a high population like CA or TX that might make sense but in RI, MA, CT etc it really doesn't make sense. It's a very weird concept because we can buy products made in other states and other countries..but if you peg someone to a state is just odd.

mdovell says

(I think Enron after they bought out PG&E..I'm sure there are people here that remember that

wat

Illegalize insurance.

Lower barriers to entry into medical field (med school selectivity, cost, and duration)

QED.

Where to start???

Here is the header from the PUC's website:
CALIFORNIA PUBLIC UTILITIES COMMISSION
The CPUC regulates privately owned electric, natural gas, telecommunications, water, railroad, rail transit, and passenger transportation companies. The CPUC serves the public interest by protecting consumers and ensuring the provision of safe, reliable utility service and infrastructure at reasonable rates, with a commitment to environmental enhancement and a healthy California economy. We regulate utility services, stimulate innovation, and promote competitive markets, where possible.

You just proved my point with your comment on Enron: that unregulated markets for a public necessity lead to gouging (insurance). BTW, Enron did not buy PG&E. PG&E is still around, Enron, not so much anymore. Cell phones are a luxury for most folks, although as they become more ubiquitous and necessary, you can bet they will be more regulated. Perhaps they should already be: http://arstechnica.com/gadgets/news/2010/10/us-canada-lead-the-world-in-expensive-cell-packages.ars

I have no idea where the car leaking analogy fits in to this discussion. I guess you could make anything fit your point, but I dont see how mandating safety or health insurance has anything to do with a car leaking chemicals or a bird deficating in the town's water supply.

As for your comment about health insurance crossing state lines, we had this recently with credit card companies (all the companies have headquarters in South Dakota or Delaware), where the laws are most lax, and with banks. I would imagine these days the public feels as warm and fuzzy about these kinds of companies as they do about Jeffrey Dahmer and Ted Bundy. The legislators during the Depression were pretty smart in figuring out how banks gamed the system, so they kept banks tied to states. We dismantled this, along with Glass Steagall, and now look what mess we are in. You allow health insurance companies to cross state lines and you will get even more crappy insurance, which is hard to believe compared to what we already have.

"The CPUC regulates privately owned electric, natural gas, telecommunications, water, railroad, rail transit, and passenger transportation companies."

But that's a bit of a stretch there..that's just for CA. It should say it does this for CA..the way that is worded implies the whole country. More importantly not all companies in those markets are private some are publicaly traded.

If we continue to limit providers of health insurance to state borders monopolies will gather up. Many people I know work and live in different states so that does make matters complicated. Even if 50 monopolies were established at least it means they would compete if the rules were taken off.

I thought it was PG&E but it was actually some wind plants (Cabazon Wind Generation Facility and Green power one)

Carter deregulated the airlines (now flying is pretty cheap..granted security is high), trucking industry and rail industry. We broke up the monopoly of AT&T in '84 although some can say it is just building back up. I wouldn't call cell phones a luxury for most as most people I know do not have a land line phone. If you are traveling on business, on the road or somewhere away from home it makes little sense to not have a cell phone. An employer could argue that land lines are for those that stay at home all day long.

Regulations make a presumption that businesses and people will follow it but in a sense it can create a moral hazard. The FDA regulates food safety but that's no assurance that people cook their food the right way. Heck farmers markets are technically exempt from this but they are now a booming business.

mdovell, I believe every state has a PUC. You mentioned Enron and California so I went to the state's PUC website. Every state has a PUC, even where electricity has been deregulated. In California, we are STILL paying for the mess of deregulation and manipulation of the electricity market by Enron ten years on.

There is no proof that allowing health insurance to cross state lines brings more competition. Competition means more companies competing to win market share of consumers. If state lines are crossed, you know there will be a ton more consolidation of the industry and companies will flock to states with the lowest regulation and lax regulations. It happened in other financial services--banks and credit cards, so why would it be different this time? Can you honestly say that the big banks now provide better customer service than the community banks from 30 years ago? Ever notice those pesky ATM and overdraft fees that go along with accounts have been creeping up? How about foreign transaction charges on your CC?

I acknowledge your point about Carter and the airlines, and flying in general has gotten cheaper, but:
a) it is much more expensive to fly to many hubs. I've seem $400-$500 to fly to Detroit from LA. Ive seen $800 to ATL. The budget airlines have made flying cheaper by reducing their operating costs, not only through deregulation.
b) flying overseas is ridiculous. $1500+ to Europe.
c) customer services is horrible on the different American airlines. Flying used to be a treat, but between security, airlines cramming more seats and cutting back services, and the surly attitude of attendants, flying is a nightmare now.

Also, flying for some people (business) is a necessity, but a luxury too (for pleasure). Electricity, phone service, food safety, and health care are life and death for many. I might put financial services in this as well.

Regarding food safety and airline safety, Im sure glad there is an FDA/Dept of Ag and FAA. We've seen what happens when there are fewer food inspectors out there to inspect plants; cases of salmonella, and now listeria are way up.

Don't get me wrong..Im very pro-business. I own my own business and have a business degree. I just think that one of the things we need more regulation and government participation in is health insurance. The system now is broke and expensive, and the market alone won't fix it.

Waitingtobuy says

I own my own business and have a business degree. I just think that one of the things we need more regulation and government participation in is health insurance. The system now is broke and expensive, and the market alone won't fix it.

Plus pro-government people can point to Canada, Sweden, Norway, Germany, etc etc and say -- let's do what they're doing, it's better than what we got now.

"There is no proof that allowing health insurance to cross state lines brings more competition. Competition means more companies competing to win market share of consumers. If state lines are crossed, you know there will be a ton more consolidation of the industry and companies will flock to states with the lowest regulation and lax regulations. It happened in other financial services--banks and credit cards, so why would it be different this time? Can you honestly say that the big banks now provide better customer service than the community banks from 30 years ago? Ever notice those pesky ATM and overdraft fees that go along with accounts have been creeping up? How about foreign transaction charges on your CC?"

Banking and medical industries are different. The major complaints about medical coverage is that in some states there is one company that has 90%+ of the market. That's a pretty strong monopoly. There is no incentive to lower prices if you are a company that dominates with 90% of the market. Heck otherwise Microsoft would have lowered prices in the 1990's.

Do big banks do things better? Well competition has brought online banking and ATM's. I've only paid a ATM fee once. My bank does not charge at its own and there are two right down the street from me.There are still plenty of smaller banks and credit unions around. I don't support Bank of America they are awlful (I won't get into it). So people simply move their money. There have been various movements with boycotts before. Before Walmart was a target (no pun intended) it was McDonalds for environmentally damaging packaging and it changed. South Africa was largely boycotted under apartheid and a tad against GE around twenty years ago. If anything I think that such actions would be stronger today due to communications.

Yes some companies would merge but competition generally can drive prices lower. In electronics we see new companies coming out every now and then. They have to perform or die. Sony used to be huge but now Samsung and Vizio are big. Maybe some new ones will knock them off.

"I acknowledge your point about Carter and the airlines, and flying in general has gotten cheaper, but:
a) it is much more expensive to fly to many hubs. I've seem $400-$500 to fly to Detroit from LA. Ive seen $800 to ATL. The budget airlines have made flying cheaper by reducing their operating costs, not only through deregulation.
b) flying overseas is ridiculous. $1500+ to Europe.
c) customer services is horrible on the different American airlines. Flying used to be a treat, but between security, airlines cramming more seats and cutting back services, and the surly attitude of attendants, flying is a nightmare now."

$1500 to Europe? Well out of where? Generally I find to fly to Asia that it is $1,000. I would generally assume you are flying to east coast for a stop first. When I went to China I had a stop in Vancouver..

I love to fly although I think much of the security is overboard. Domestic flights with really small planes I tend to not like. Put me on a 747 any day.
Usually international flights are better. I highly recommend Cathay Pacific. I have heard great things about Singapore Airlines as well.

Airline ticket prices are not just dependent on distance but volume. It will cost me more to fly to the midwest than LA..why? Well there's much fewer people going to the midwest.

"Also, flying for some people (business) is a necessity, but a luxury too (for pleasure). Electricity, phone service, food safety, and health care are life and death for many. I might put financial services in this as well."

It is a bit interesting because there is some case law that implies that flying is a right
http://codes.lp.findlaw.com/uscode/49/VII/A/I/401/40103 but I know what you mean I know a fair amount that if they told their employer "No" they'd be out of work fast.

"Regarding food safety and airline safety, Im sure glad there is an FDA/Dept of Ag and FAA. We've seen what happens when there are fewer food inspectors out there to inspect plants; cases of salmonella, and now listeria are way up."

I think working for the FDA must be some of the hardest work in the world. If you approve a drug that later on has side effects that kills people how would you feel? If a clinical trial takes longer and more die due to it then it's the same feeling. Damned if you do and damned if you don't.

I think that healthcare is such a broad based concept that it makes it hard to develop any top down central approach. Technically we could try to ban tobacco and that might lower costs but the loss of revenue and potential litigation from companies could mount. We could try to mandate more health classes and first aid to be known to everyone but that might not solve everything as well.

"Banking and medical industries are different."

Yes they are, except health insurance is not medical, it is financial. Therefore, banking and finance go hand in hand.

As for flying, try going to Kayak.com and put in flights to Barcelona from LA in June, July, or August. There, you will see the lowest priced flights are in the $1400-$1500 range. I never mentioned what time of the year (peak).

Airline tickets (domestic) are nearly always a function of yield, which as you know is a science called yield management. My roommate and several friends from business school went to work for Northwest in yield management, which was pretty interesting to hear about.
http://en.wikipedia.org/wiki/Yield_management

You could have a limited number of flights to SF from LA and charge more money, or have lots, but distance is independent of this. Like you said, it is more a function of consumer demand. You mentioned geography and the Midwest...there are tons of people flying to Chicago, and few people flying to Springfield, MA. I think distance mainly enters the picture on overseas flights with the cost of jet fuel.

Well, well, well...

Montana Governor Brian Schweitzer is trying to create a single payer insurance system in his state:
http://www.washingtonpost.com/blogs/ezra-klein/post/interview-schweitzers-plan-to-bring-canadian-health-care-to-montana/2011/10/03/gIQA025JIL_blog.html

Take the health care system out of private hands and make everyone covered and paid for by everyone as well as corporations.Canada has such a system and it works but the powers that be the ones with great wealth would like to make it like your system because they can't profit from it.The US is in trouble because they pay individually for everything like healthcare and toll roads etc..and this is why the country is broke. Nobody has the money to consume because they are all in debt and would not have to be if all where fairly taxed that would pay for such things as health care.

Waitingtobuy says

a) basic, preventative care insurance for doctor's visits, generic drugs, and fairly routine hospitalization; this insurance would be sold by the current insurance providers; they like this because it is fairly simple to control costs for things like doctor visits, vaccinations, maternity delivery, elective and outpatient surgery, and short hospital stays. This insurance could be affordable to the average Joe and Jane, likely not more than $75-$150/month for an individual or family.

The reason needed to break these apart is lobbying pressure which prevents eliminating private health insurance, and the fact that with everyone in Medicare for All, the younger, less sick patients, subsidize the sicker, older patients in a much larger pool than just for 65+ year olds.

Why would those lobbyists accept a system which gives their clients $75-$150 monthly for an individual or family instead of $300-$600 per person or $900-$1800/month for a family and reduce their power to negotiate prices with health care providers since they're paying for a smaller piece of the total pie?

As an individual why would I want to pay $900-$1800 annually to cover doctor visits/routine surgery when I'd otherwise average a few hundred dollars a year on such things?

Because to the lobbyists and their corporations, paying for doctor visits and short hospital stays is much more profitable than expensive drugs, experimental treatments, and end of life care. As is well known, 90% of medical expenses are in the final year of life. I believe now the average insurer pays out 80-85% of total premiums in claims, the great majority of which are for expensive procedures and drugs. They would still keep that profitability by not paying out for expensive claims, which would go tp Tier B (Medicare for All) in my plan.

Younger people as a whole are healthier, and the ones that aren't in this system are thrown into the larger pool of the insured in Medicare for All. If you have younger people joining a public system, you have more premiums to pay for the sick and elderly.

As for your question about paying the $900-$1800 annually, I would mandate this (I know--how socialist) and those that don't pay would be fined the amount to buy private insurance. (The fine would go into the Medicare for All pool since people that dont take care of themselves will draw off the larger pool.) Even a short hospital stay at $10K/day for 5 days could wipe many people out. People pay $75-$100/month in car insurance to insure a $25K car against an accident which may or may not happen every 10 years. The average person uses their health insurance much more by visiting the doctor at least 1-2 times/year, and gets vaccinations too.

drew_eckhardt says

As an individual why would I want to pay $900-$1800 annually to cover doctor visits/routine surgery when I'd otherwise average a few hundred dollars a year on such things

Because you just might be the unlucky one who needs 100k for something out of the blue. That's the whole problem with the system today. All the people who say "I don't need it" and when they do need it they stick everyone else with the bill.

All drugs have side effects that can injure/kill a person who doesn't tolerate it. The question is harm benefit ratio. Penicillin can harm or kill people, but the odds of having a bad effect was far outweighed by the potential of dieing from infection when penicillin was the only antibiotic. If you actually pay attention to the contraindications every drug has published on the box your danger is pretty minimal. Nothing is totally risk free. If all drugs that could cause problems were off the market there would be no drugs at all.

I looked up Provigil, it's for narcolepsy which is a real medical condition so the drug was created for a real purpose not convenience. It can be used for other people who need to stay awake like shift workers but that's not what it came on the market for. The only actual adverse reaction so far has been 6 cases of severe skin rash in 10 years. That's not all that scary to me. It's not very new either, just advertising a new usage.

There is where you actually hit on the problem without even realizing it. You heard a commercial. Why are drug companies allowed to advertise and brainwash consumers into buying the newest and most expensive drugs when there is almost always an older drug that is just as effective, but not nearly as profitable? Most new drug patents are just minor tweaks of older drugs to get another however many years (the patent clock starts at invention, not approval) of high profits off a drug that has already had it's highly profitable on patent time. Worse, big pharma companies are constantly challenging generics in court which automatically freezes the drug from generic sales. For example Bristol-Meyers kept generics out of taxol, a cancer treatment, for years this way. It goes on all the time.