The Stakes, Cont'd

by publius

Sorry for non-posting (almost finished with outside project), but I thought this Post article was worth noting.  In addition to domestic violence, insurers have adopted a few other noteworthy pre-existing conditions:

Health insurers have issued guidelines saying they could deny coverage to people suffering from such conditions as acne, hemorrhoids and bunions.

One big insurer refused to issue individual policies to police officers and firefighters, along with people in other hazardous occupations.

Some treated pregnancy or the intention to adopt as a reason for rejection.

Comments

[cleek]

immoral, yes. but it's very important that we maintain the profits of these companies.

without these companies, we would surely _____ ?

[Nombrilisme Vide]

"sap our precious bodily fluids"?

[Benjamin]

When necessities for a quality standard of living are left to the mercy of profit incentives, what else should we expect?

[Doctor Science]

without these companies, we would surely _____ ?

Not have as many rich people. Duh.

[efgoldman]

I guess this is the analog of home insurers no longer writing coverage in areas where there might be, you know, actual claims.

Or, excluding so many perils. No floods near the water, no wind in hurricane risk areas, like that.

Why we love insurance companies.

[Yukoner]

Best health care system in the world right?

A couple of months ago I had a very interesting conversation with a fellow from Indiana who was the owner/manager of a small manufacturing company with 200 employees.

His description of annual efforts to keep the increases in the health insurance premiums he pays for his employees down to a bearable level was interesting. He has changed insurance companies twice in the past 6 years (which is not cost free). And almost every year he has had to reduce the level of coverage offered and/or increase the employees' payments toward the insurance. And even with all of that he still had to pay average annual increases of around 8%. (That would mean doubling your cost in 10 years). Last year he had to go to a shop floor meeting with all employees and explain that their health coverage was being reduced (again), that they would have to pay a bigger share (again) and that there would be no pay increases at all. This would reduce that year’s increase in health insurance premiums from 18% to 9%. There was a near riot at this news and one of his employees actually took a swing at him but was hauled back by his co-workers.

Late last year the downturn forced him to lay off an entire shift, nearly 100 employees. He said that most of them would be screwed as far as keeping their health insurance and almost none of them would be able to find any work that included coverage any time soon. And, to cap it all off, he was going to have to renew the coverage for his remaining employees. But the risk pool was now half its former size and he was shuddering at how big the increase was going to be this time.

When I asked him what the solution was he didn’t know. But he kept insisting that things had to change somehow. His business has no debt and he was seeing the bright side of the downturn as a possible opportunity to expand in the future as his debt-ridden competitors go under. But the relentless increases in health care premiums and the administration and management time wasted on trying to keep those increases down to single digit percentages is just not sustainable.

Talk about a burden on business!

[wonkie]

Yukoner--the solution?

Move to Canada. That's what my husband I will probably do if the public option fails.

[bob mcmanus]

The Stakes

[Ugh]

I hope I'm not supposed to hate the insurance companies as a result of this, am I?

[zizi]

Being alive itself will soon be a pre-existing condition

[John Thullen]

Universal single payer ... or just blow it up.

[Noni Mausa]

This is what puzzles me -- with so many exemptions, for such common conditions, why do these companies have any customers at all?

Noni

[Lizzy L]

Noni -- because they are the only game in town. They own the table, the chips, and the cards (which are, of course, marked), and the dealer and the sheriff both work for them.

If we get the public option, the game changes completely -- they have competitors. We don't like their game, we go down the street.

If we don't get the public option, but we do get a new dealer and a new sheriff, and a fresh deck -- well, the odds improve significantly.

[Jacob Davies]

Also, these exclusions don't apply for employment-based insurance (or at least not in the really big group plans that large employers have). So, just so long as you have a job, you're fine. Lose the job and you're thrown into the individual market where all these exclusions apply.

This is one of the reasons why big business has sided with the insurance companies for so long, I think, even though they're the ones paying the bills. Because individual coverage is so much more expensive than employer-based coverage (and even more so because employer-based coverage is effectively paid for with pre-tax dollars), the value to an employee of a job with health insurance is much higher than the cost of the health insurance.

Basically, if it's going to cost you $10,000 to buy insurance on the individual market, and you're paying with post-tax dollars, "health insurance" is worth say $13,000 in pre-tax income. But the cost to the employer of providing you with health insurance might only be $5,000.

So, let's say you had a choice between two jobs, one with health insurance paying $50,000, and one without paying $60,000. Now because after buying insurance your income in the latter case would only be $47,000, you would probably rather have the job paying $50,000 with insurance - but the cost to the employer of that offer is only $55,000.

Even better, if you have an employee who has a pre-existing condition and can't get individual coverage at all, he'll be willing to work for peanuts just to get insurance coverage, because the value to him is enormously high.

So you can see why employers like it. Or rather, liked it - the rapid inflation in costs even of employment-based coverage means that the cost to them of that "$50k plus insurance" offer is getting more and more expensive, but they can't cut coverage without their employees getting disgruntled.

(All numbers pulled from thin air, McArdle-style - I think they are plausible but they're just to illustrate the effects of individual coverage being more expensive than individual coverage.)

[mattH]

I figure it has to do with the sudden glut of all those CEOs out of jobs when the insurance industry goes under. Imagine the downward pressure on CEO pay then.

[Jesurgislac]

If we get the public option, the game changes completely -- they have competitors. We don't like their game, we go down the street.

Exactly. Which is why right-wingers hate the idea of a public option. It's not so much it's "government": it's the idea that their cash crops could have the ability to put corporations out of business.

A public option changes ordinary people from a cash crop for health insurers to citizens with a right to choose - and Republicans hate the idea that anyone could have a right to choose.

See Von's incoherent posts on healthcare, passim.

[bobbyp]

The perfect private health insurance model: Birth is a pre-existing condition in the event of a claim.

[mythago]

Jacob, it's not true that all employers hate a public option; but large companies certainly have a reason to hate it. It makes smaller companies and start-ups competitive. Small companies don't have the leverage to get affordable health-insurance options for their employees.

[Older]

"I'm sorry. If you're gonna have children, we can't cover you."

"But that's why I need medical insurance! I'm willing to take my chances, but I want the best care for my children!"

"Nuh-uh. No kids. So sorry."

Good grief.

[Mr Furious]

Yukoner,

That's an excellent example of the biggest problem with the current system (aside from the uninsured).

Concern or a moral argument to cover everyone is noble, but more easily dismissed, even by those who agree: "Sure, that'd be great, but can we afford that right now?" Not to mention the fact that talking about the uninsured means talking about "someone else" to most people.

Nobody is effectively making the case that every one one of us is one step away from a loss of coverage, a massive increase in premiums or slashing of coverage.

That and the fact that the vast majority of people still don't really use their insurance—you might think you're covered because your job gives you insurance, but you're in a world of hurt when you find out how easily that policy will toss your claims.

If Obama and the Democrats were making THAT case instead of focusing on covering the uninsured, this debate might be much closer to over.

[russell]

The folks who are making these policies are 100% rational actors. It's uneconomic -- which is to say, it costs them money -- to insure people who are likely to make significant claims. And there is no incentive whatsoever for them to do anything uneconomic.

In fact, they are professionally and perhaps legally obliged not to do so -- it would expose them to significant professional and even legal damage to incur losses through insuring riskier applicants.

The more that the cost of health care rises, the more that this will be so.

There's a pretty straightforward solution for doing things that are broadly needed, that have significant social impact, and that are uneconomic to provide through private means.

We won't get that solution, or any step in the direction of that solution, because the Congress of the United States of America is captive to the private business and industrial sectors, period.

Contributions to members of the Senate Finance Committee in this election cycle include about $25 million from the FIRE sector and not quite $14 million from the health industry.

Note that those numbers are for only the members of Senate Finance, and only this election cycle. 23 Senators, two economic sectors, one year, not quite 40 million bucks.

When you and I can put that kind of dough on the table we'll get to set the direction of policy.

Until then, we can pound sand.

Either that or we need to change the rules, but compared to getting that done a public health insurance option is a walk in the park.

Fail.

If Obama and the Democrats were making THAT case instead of focusing on covering the uninsured, this debate might be much closer to over.

Obama and the Democrats are not going to make that case, because their bread is buttered by the same folks.

Fail.

[Jay Jerome]

publius says: "One big insurer refused to issue individual policies to police officers and firefighters, along with people in other hazardous occupations."

Let's talk about hazardous occupations. If under Obamacare everyone is covered, should those who have dangerous jobs pay higher premiums?

What about habitual smokers? Or alcoholics? Should they be required to pay more?

[Jay Jerome]

mattH saysI figure it has to do with the sudden glut of all those CEOs out of jobs when the insurance industry goes under. Imagine the downward pressure on CEO pay then.

Not to mention all those out-of-jobs people in the health care insurance industry, thousands and thousands and thousands of them, on the dole (but at least they'll have options to buy single-pay from their unemployment checks).

But that'll be OK. We'll have a lot more people to hang out with in the afternoon, trading stories about the good old days when we all had steady work and unemployment was at 7% and not at 15%

[russell]

So Jay, if the private health insurance industry can't make money without excluding people who have hemorrhoids, acne, or bunions, or who might have kids someday, or who work in dangerous but socially essential professions, what would a free market purist say *should* happen to that industry?

Aren't they expected to provide some kind of value for the money they receive?

What would Adam Smith say?

[Jay Jerome]

Russell says: "We won't get that solution, or any step in the direction of that solution, because the Congress of the United States of America is captive to the private business and industrial sectors, period."

Yes, that's always the backdrop of American politics. But it's not the determining factor in this debate.

Too many Americans are worried about making the kind of profound changes to their health care as are being suggested. Especially in this time of economic uncertainty.

Here's Rasumussen, as of Friday:

Fifty-six percent (56%) of voters nationwide now oppose the health care reform proposed by President Obama and congressional Democrats. That’s the highest level of opposition yet measured and includes 44% who are Strongly Opposed.

Just 43% now favor the proposal, including 24% who Strongly Favor it.

But the overall picture remains one of stability. While the numbers have bounced a bit following nationally televised appearances by the president to promote the plan, opposition has generally stayed above 50% since early July. Support has been in the low to mid 40s.

The number who Strongly Oppose the plan has remained above 40% and the Strongly Favor totals have been in the mid-20s. This suggests public opinion is hardening when it comes to the plan that is currently working its way through Congress.

[russell]

But it's not the determining factor in this debate.

Sez you.

Fifty-six percent (56%) of voters nationwide now oppose the health care reform proposed by President Obama and congressional Democrats.

Based on what information? From what sources?

[Jay Jerome]

russell says: "So Jay, if the private health insurance industry can't make money without excluding people who have hemorrhoids, acne, or bunions, or who might have kids someday, or who work in dangerous but socially essential professions, what would a free market purist say *should* happen to that industry?"

I'm in favor of a law that says everybody should be covered, and nobody excluded for preconditions. If that's the law, all companies will be required to abide by it. But that increased covererage will raise the cost of healthcare, across the board. There's no way to provide more service for people with some of the serious health problems that are excluded now, without it costing more. Which means we'll pay for it, one way or another.

But being covered doesn't mean everybody should pay the same premium. For sickness or disease or debilitating injuries you shouldn't have to pay more.
But if you're involved in behaviors or professions of high risk, you should pay a higher premium. Otherwise that risk will translate into more cost for the taxpayer.

I don't think that's fair, do you?

[Jay Jerome]

"But it's not the determining factor in this debate.

"Sez you."

Also sez half the panelists on George Stephanopoulos's show this morning, who reiterated a litany of uncertainty they've heard across the country about the these health care proposals.

And also sez most of the people I've been talking to -- few of them Republicans -- who don't think this is the right time to radically change the system. This includes LAUSD middle-school teachers and administrators, who overall are happy with their current health cared coverage, and are fearful the proposed changes will effect it negatively.

In other words, most people I know are in favor of fixing the system in principle, but not in practice.

[magistra]

But if you're involved in behaviors or professions of high risk, you should pay a higher premium. Otherwise that risk will translate into more cost for the taxpayer.

I don't think that's fair, do you?

Because it's not as if any country wants to encourage people to become firefighters needlessly, is it? That would be a distortion of the market.

[Jay Jerome]

"Because it's not as if any country wants to encourage people to become firefighters needlessly, is it? That would be a distortion of the market."

You're overreacting. The 'risk' factor for firefighter and police insurance should be subsidized by the cities and municipalities that do that now. In other words, local taxes should pay for whatever risk is involved -- not the ordinary taxpayer who is going to have a hard enough time affording insurance under the new 'mandatory' premiums that we've heard about this past week.

[russell]

I'm in favor of a law that says everybody should be covered, and nobody excluded for preconditions. If that's the law, all companies will be required to abide by it. But that increased covererage will raise the cost of healthcare, across the board.

Quite right, the only incentive that will induce private insurers to cover higher risk folks is the force of law.

That won't raise the cost of health care -- the cost of care will be the same. The same people will be getting sick, in the same ways. It will just reallocate who pays for it, and how.

Via Yglesias, the Kaiser Foundation's 2009 Employer Benefits Survey finds the following:

The average health-care coverage for the average family now costs $13,375, according to Kaiser. Over the past decade, premiums have increased by 138 percent. And if the trend continues, by 2019 the average family plan will cost $30,083.

That's $13,375 average cost in a world where median household income is somewhere in the neighborhhod of $60K.

We are approaching, or perhaps have achieved, the point where private insurers will be unable to provide coverage for a useful percentage of the population at a price that those folks can afford.

Providing it through employers doesn't change that calculus, it just comes off of salaries. Household income is stagnant or perhaps slightly down in a period when productivity and revenue per worker has risen dramatically. There are a number of reasons for that, but the cost of health care is one of them.

It doesn't matter who writes the check, it costs the average family a bit over $13K a year to get insurance coverage. Period.

We all pay, out of one pocket or another.

There are some significant savings we can achieve without tearing the whole thing up and starting over, but I'm not sure they will be sufficient to bring the per-family cost of health care down to an affordable number.

I guess my point overall is that the basic model we have for providing health care insurance in this country is fundamentally unsustainable. It's not a matter of political point of view, or whether too many people smoke or eat Twinkies. It's just unsustainable, and the unsustainability is baked in. It's structural.

The cost of care is too high. It's uneconomic to insure for it, so private providers end up threading the needle by denying coverage to people with hemorrhoids. The top proposals on the table for trimming costs appear to consist of putting limits on care, either directly or through tax disincentives.

But any challenge to the fundamental model is off the table. It's gonna be band-aids and baling wire, and we'll cross our fingers and hope the wheels don't come completely off.

Obama is not going to be the last President to address this. He's kicking the can down the road to his successor. Don't know how much more he could have done than he has, but he has decidedly not taken the bull by the horns. Neither have the Congress.

Fail.

Regarding high risk behaviors and professions, I'd say it behooves us to encourage people to reduce or eliminate high risk behaviors and to give them whatever help they need to do that, and it behooves us to make sure that cops and firemen can get health insurance for themselves and their families.

We could, of course, just give them a hearty "screw you, nobody told you to eat that Butterfinger", or "smoke that Lucky", or "be a cop", but that seems a little short-sighted to me. My two cents.

[russell]

Also sez half the panelists on George Stephanopoulos's show this morning, who reiterated a litany of uncertainty they've heard across the country about the these health care proposals.

And those people form their opinion based on what information?

From what sources?

[russell]

In other words, local taxes should pay for whatever risk is involved -- not the ordinary taxpayer who is going to have a hard enough time affording insurance under the new 'mandatory' premiums that we've heard about this past week.

Who pays the local taxes?

[mattH]

Love how my comment was an attempt to (sarcastically) address a reason why large businesses resist divorcing themselves from health care, and what do I get? Tangent.

[Nombrilisme Vide]

But that increased covererage will raise the cost of healthcare, across the board. There's no way to provide more service for people with some of the serious health problems that are excluded now, without it costing more. Which means we'll pay for it, one way or another.

Two points: first, we're already paying for care for some of those excluded folk with emergency room care when their conditions go terminal.

Second, it sounds an awful lot like you're making the case for the abolishment of private health insurance in favor of single-payer in order to diffuse the cost of high-risk individuals across as broad a pool as possible. Or isn't that what you mean to be arguing for?

[Bernard Yomtov]

Who pays the local taxes?

Not ordinary taxpayers, just the extraordinary ones.

[russell]

we're already paying for care for some of those excluded folk with emergency room care when their conditions go terminal.

Actually (and, frankly, hopefully) long before they go terminal.

And the cost comes in a variety of forms. Direct care via emergency room or public clinic, but also the loss of whatever contribution those folks might have made if they weren't ill.

[Jay Jerome]

russell says: It doesn't matter who writes the check, it costs the average family a bit over $13K a year to get insurance coverage. Period.

We all pay, out of one pocket or another.

I mostly agree with what you're saying here, Russell, but if your'e employed by a governmental or state agency or a corporation or some similar entity, the salary you're making subsidizes the cost and ameriolates it somewhat because the amount for the premiums, buried in your check, covers it. But if you're a small business person or self employed you're paying more for the same coverage, and that's an inequity in the system.

There are some significant savings we can achieve without tearing the whole thing up and starting over, but I'm not sure they will be sufficient to bring the per-family cost of health care down to an affordable number.

No, I don't agree with that. There are no significant saving that can be achieved without rationing health care. There may be some cosmetic savings, but no real savings.

"I guess my point overall is that the basic model we have for providing health care insurance in this country is fundamentally unsustainable. It's not a matter of political point of view, or whether too many people smoke or eat Twinkies. It's just unsustainable, and the unsustainability is baked in. It's structural."

This is a yes and a no. The only way to sustain the quality of care now, and to extend it to the entire population, is to reestablish our economy, and become wealthy enough to afford the kind of health care we have now for all citizens.

Again, really, it's the economy. We need to reestablish ourselves as a manufacturing nation, and earn more money than we spend. We're now a debtor nation, with diminishing prospects. Poor nations, like poor folks, can't afford high quality health care.

[Jay Jerome]

"Who pays the local taxes?"

Local taxpayers. Who decide what to pay and how much.

If the local taxpayers in upstate New York (or any other locality in the US) want to subsidize the 'risk' premium for police or fireman where they live, fine; but why should I pick up the extra risk as part of my premium for them, or vice versa.

[russell]

There are no significant saving that can be achieved without rationing health care. There may be some cosmetic savings, but no real savings.

Actually, I think you're factually wrong on this. There appear to be plain old operational efficiencies to be had.

Just not enough to solve the whole problem.

if your'e employed by a governmental or state agency or a corporation or some similar entity, the salary you're making subsidizes the cost and ameriolates it somewhat because the amount for the premiums, buried in your check, covers it. But if you're a small business person or self employed you're paying more for the same coverage, and that's an inequity in the system.

"Buried in your check" here means "I get a smaller gross annual salary to make up for the cost of health insurance".

But you're correct, folks buying insurance as private individuals pay more, for less, than folks who buy insurance as part of an employer's group plan.

The state-sponsored pool idea would provide individual consumers with more leverage, which ought to translate into a lower premium.

But net/net, some number of folks get sick, it costs some amount of money to treat them, and somebody has to pay for it.

If it's uneconomic for private insurers to pick up the tab, they won't do it. They can't, it conflicts with their raison d'etre.

Local taxpayers. Who decide what to pay and how much.

The distinction you're drawing here is between local and federal level control.

Yes, any given person has greater leverage at the local level than they have at the federal level.

What I'd like to suggest is that the actual impact of the folks in Cooperstown, NY deciding to not pay for their police force's insurance premium is more or less noise in the big picture.

In other words, you're straining at a gnat.

Look, some people, for any of a 1,000 reasons, present a higher risk than others as far as health insurance.

The normal model of insurance is that you spread that risk across the whole population of insureds. That way nobody ends up taking the full hit.

In some situations, for instance car insurance, we actually charge different premiums for people who clearly present a higher risk. Men under 25, for instance, will pay more for car insurance than other folks.

Do we want to penalize cops for being cops by charging them a higher insurance rate?

If we do, police salaries are paid out of taxes. Local taxes, yes, but still taxes. So, you and I pay for it, one way or another.

We could squeeze the toothpaste back and forth in the tube a few times and pass the burden from one set of potential payers to another, but fundamentally it boils down to the fact that it costs a certain amount of money to provide health care to the folks that live here.

That "certain amount" is now, and will increasingly be, more than anyone will be insure against in a profitable way.

Talking about excluding cops, or smokers, or fat people, is just another form of excluding people with hemorrhoids, or bunions, or kids.

It's an attempt to simplify the problem by eliminating the harder cases.

We need to find a way to make a basic level of health care available to everybody. Even cops, smokers, and people with hemorrhoids. Even people with ingrown toenails. Even deep sea fishermen and lion tamers.

Everybody.

If the private market can't make that happen, then we need to find another way.

That's what I'm saying.

[russell]

why should I pick up the extra risk as part of my premium for them, or vice versa.

And not for nothing, but if we're talking about cops and firemen, I'd think the answer to this would be kind of obvious.

Just saying.

[Turbulence]

Jay Jerome, do you understand that under all the bills currently being considered, insurance companies would be able to charge old sick people significantly more than young healthy people? In some cases a factor of five? Is there some reason to believe that that factor is insufficient? Because your comments seem to assume that everyone will pay exactly the same premiums, and that's just not so.

[russell]

Jay Jerome, do you understand that under all the bills currently being considered, insurance companies would be able to charge old sick people significantly more than young healthy people? In some cases a factor of five?

So, if you're an older person, perhaps living on a fixed income, instead of paying the average of $13K for a household, maybe you're paying $20K, or $25K.

Hell, a factor five puts you at $65K.

How's that gonna work out?

To me, it seems like we're trying to find a way to fit ten pounds in a five pound bag.

It ain't working now, and I haven't seen anyone put anything on the table that seems like it's gonna make it work.

Health care costs a lot in this country. The private insurance market is trying to manage that by only covering the folks who aren't going to be that expensive.

Thanks for nothing.

If we've reached the point where it's not economically viable to provide a decent level of coverage to everybody through private markets, we need to find another approach.

That ain't gonna happen with this president and this congress, apparently, so we're gonna ride the same played-out horse for another five, ten, or twenty, or fifty years, and a lot of people are going to get sick and die because they can't go to the damned doctor.

And make no mistake about it, that is how the shortfalls in the existing system are going to be addressed. People will get sick, suffer, and die. We'll all watch the human interest story on the TV and wring our hands, and they'll be dead.

The Humana study I cited upthread predicts an *average* household health insurance cost of $30K per year by 2019.

Thirty thousand dollars a year. Who the hell can come up with $30K for health insurance? What other investments -- education, infrastructure, what have you -- are going to go begging to pay for that?

But we will maintain the profitability of the private insurance industry. So there's that.

It just all seems like horsesh*t to me.

[CharlesWT]

"...so we're gonna ride the same played-out horse for another five, ten, or twenty, or fifty years, and a lot of people are going to get sick and die because they can't go to the damned doctor."

In ten to twenty years we may have robotic and nano surgeons that can take you apart and put you back together before you can say, "ouch!" And only charge you $10.95 in today's dollars. :)

[Doctor Science]

There are no significant saving that can be achieved without rationing health care

This is not just untrue, it is *profoundly* untrue.

All the other rich countries have health care that is *both* cheaper *and* available to more people (=less rationed) than that in the US. *All* of them.

There is only one thing the US health care system is producing that other countries are not, only one thing we are getting for our money.

Rich people. We have more expensive, more rationed health care than any other developed nation; we also have more people who are getting rich out of the health care market. Insurance executives, hospital executives, pharmaceutical executives, lawyers, and some doctors: that's what we're buying with our money. If we can save on them, we can *really* save.

[Turbulence]

So, if you're an older person, perhaps living on a fixed income, instead of paying the average of $13K for a household, maybe you're paying $20K, or $25K.

The factor 5 in the Baucas plan is the maximum factor by which the cheapest premiums and the most expensive premiums can differ. So taking the average health care spending today and multiplying it by 5 will just give you nonsense. You probably want to take the cheapest relatively comprehensive plan offered today and multiply its cost by 5 to get the highest cost plan after HCR goes through.

Note that the HR 3200 limits that multiplier to 2 rather than 5. I think there are good arguments for different multipliers, but that's really besides the point: the point is, NO ONE is talking about a multiplier of 1. So any conversation premised on the notion that we're all going to be paying exactly the same premiums no matter what is silly. Premiums are going to differ substantially between communities and between individuals in the same community.

In ten to twenty years we may have robotic and nano surgeons that can take you apart and put you back together before you can say, "ouch!" And only charge you $10.95 in today's dollars. :)

I know this point is made in jest, but it is really not true. Neither robotics or nanotechnology is anywhere close to the sorts of developments you'd need to see these substantial medical interventions. We can't even make a robot that walks in a vaguely human way without consuming a tremendous amount more power than a human. Heck, we can't even get our hospitals and doctors' offices to use information technology from the 1980s -- doctors literally refuse. That means patients die because pharmacists misread doctors' handwritten prescriptions. Our medical culture's ability to integrate proven low cost technology for saving lives is...more theoretical than practical.

[CharlesWT]

"Neither robotics or nanotechnology is anywhere close to the sorts of developments you'd need to see these substantial medical interventions."

Depends. The difficulties of some interventions may be relatively easy to overcome while others may take decades.

In May 2006 the first AI doctor conducted unassisted surgery on a 47 year old male to correct heart arrythmia, the results were rated as better than an above average human surgeon. The machine had a database of 10,000 similar operations and so in the words of its designers was "more than qualified to operate on any the patient", the designers believe that robots can replace half of all surgeons within 15 years.
Robotic surgery: Artificial Intelligence and the dawn Fully Autonomous Robot Surgeons

[Hartmut]

But who will be able to pay for the AI doctor/surgeon? One reason for the exploding costs of healthcare is that 'mechanized medicine' is extremly expensive. And even stuff that started relatively cheap (early x-ray machines) is now an investment that a single average resident doctor can barely afford (leading to pooling, overuse*, rare replacing** etc.). And let's not talk about the costs of e.g. an MRI scanner.
I would even say that the mechnization in many cases lowers the actual quality of care because the doctor does not look at the patient anymore but at the printouts of the machines (and a good experienced doctor can see a lot that is not in the usual tests).

*pay per use => quicker amortization
**older machines usually have higher radiation levels

[russell]

So taking the average health care spending today and multiplying it by 5 will just give you nonsense.

That's cool. My only point was that if the average family's annual cost for coverage was $13K, some folks will be paying even more.

In ten to twenty years we may have robotic and nano surgeons that can take you apart and put you back together before you can say, "ouch!" And only charge you $10.95 in today's dollars.

Well then, Bob's your uncle.

[liberal japonicus]

Hartmut, I'm not so sure about that. Mechanization, as I understand it, is not so much to remove the doctor, but to give the doctor better information more quickly so s/he can deliver a correct diagnosis more quickly and with less room for doubt.

You mentioned MRIs, and while the cost of a neck MRI is about $1,500 in the US, the same scan costs about $98 in Japan.

TR Reid's new book talks about some of the reasons why this is the case. via Marginal Revolution and here is an excerpt from the book.

[Hartmut]

That does not make the MRI machines cheaper, though. I do not claim that the mechnanization is intended to get rid of doctors but I see over-reliance on the machines as an unintended consequence. That US citizens are also much more likely to sue doctors imo aggravates the situation. Even over here many more xrays than necessary are made 'just to be sure' and until recently it was almost impossible to not leave some of one's blood at the doctor's office for testing at each visit. I think a lot of money could be saved there (even if real costs and not inflated profit margins are considered).

[Slartibartfast]

10:38 comment is not mine.

[Fran in Virginia Beach, Va.]

Wouldn't it be nice if we could all become inured to the idea of a public option in health care in the way that we never question the cost of the Pentagon. Maybe fifty years from now it will be un-American to question the cost of health care in the way that no one dares question the cost of an "industrial militaray complex". Everyone is complaining about the reality of paying for health care. I never hear anyone complain about the price that future generations will be paying for wars we are not winning today...Just saying...

[mythago]

but if your'e employed by a governmental or state agency or a corporation or some similar entity, the salary you're making subsidizes the cost and ameriolates it somewhat because the amount for the premiums, buried in your check, covers it

Stripped off all the handwaving, what you're saying is that if you have a job, the premiums are taken out of your paycheck. So? What's your point? That they don't actually cost money because they are "buried"? That if you work for a corporation you're rich and health care doesn't actually cost much at all? Other than handwaving did you have a point?

[Marty]

"You mentioned MRIs, and while the cost of a neck MRI is about $1,500 in the US, the same scan costs about $98 in Japan. "

Is that what it costs to do the MRI, or is it the amount charged for it? If only the second I am sure that the numbers are really comparable.

[liberal japonicus]

Well, what happened (as I understand it) is that the original MRIs were made for full body. What Japanese companies have done is make smaller and cheaper models, which is why Japan has twice as many MRIs per capita as the US. There are a number of other points about the way US and Japanese companies entered the market (the technology belonged to neither of them, but was developed by EMI, more famous for music) Also, because scans prices are determined by the government, there is a lot of pressure to find ways to scans more quickly and process more people, which Japanese researchers have been able to do.

Ironically, the pressure from the government has encouraged/forced manufacturers to find ways to reduce costs, which then fuels the export market, so now, Japanese companies dominate the low tesla MRIs.

This doesn't get at your question of how much does an MRI cost (vs how much is charged), but with health, I'm not sure you can answer that in the way that you answer it for something manufactured. However, in my experiences with the US health care system, the prices that are charged for procedures and supplies is marked up far and above what they would cost on the open market.

If I've misunderstood your point, apologies, my acquaintance with the topic is only thru proofreading a colleague's papers on diffusion of MRI technology in Japan, so I am not an expert by any means.