14 comments on “On the first day success of Obamacare

  1. Obama is the living embodiment of presentation over substance. So this is “government cures all ills but actually gets nothing done.”
    However, I do have a problem here. The U.S. Spend on healthcare, as a propertion of GDP is ahead of European levels, way ahead of the UK. Yet the outcomes most definitely are not. So something is broken and it jkust isn’t good enought to shout ‘Socialism’ at any proposal to reform.

  2. Ironman: I think the problem is that healthcare in the US is very expensive because of litigation – either real or potential – over malpractice. Firstly, the insurance premiums doctors must pay are very high, and secondly doctors prescribe procedures which are probably not needed in order to avoid potential lawsuits. I know a doctor in the US, he had to move state when his insurance premiums rocketed, and he dare not skip a full scan if somebody comes in with no more than a headache. Shoot a few lawyers, and US healthcare might get cheaper.

  3. Tim Newman

    And there might have been found a micro-solution – probably not the only one to be fair – that gov’t could have looked at, far more cost effectively and, well, just effectively.

    Moving on slightly, I have a good friend in Zurich who I have never questioned about health insurance etc in Switzerland, because he thinks he’s a socialist – in reality he isn’t of course. What is the system for health care in Switzerland? Are there any issues with providing universal coverage.

  4. If you read Karl Denninger on the US healthcare system he reckons its a cartel that needs breaking up, with the anti-competition rules applied to it, which they are currently not. Preventing doctors and hospitals from offering different prices depending on how you pay for example, stopping the drug companies from selling drugs at vast markups in the US but cheaply abroad, stopping uncompetitive practices, such as doctors owning other medical service companies (its been shown that doctors who own a screening company are far more likely to refer their patients for extra tests if they own the company that will be getting the business).

  5. Ironamn : CH has a compulsory, individual private insurance sytstem. There’s a compulsory minimum coverage level, with deductibles from 600 – 2500 CHF p.a. per person which can be chosen at will, plus a 10% copay up to a total of CHF700 (i.e. 7k in costs). There are topup insurances if you want a private room in a hospital, Voodoo therapy or some other idiocies they’ll take your money for.

    You either pick the 600 franchise if you’re a sicky, or 2500 if you’re healthy. Something inbetween if you are dumb, since there’s no level of costs in which neither 600 or 2.5k is cheapest overall. Even the 600.- deductible is basically catastrophic cover – a doctor’s consult is about CHF 35, so unless you have a seriously expensive repeat prescription you’re basically paying all your healthcare out of pocket, cos 600.- is 17 doctor’s visits……..

  6. The first month of Obamacare for me:

    7 unsuccessful attempts to create an account for a client of mine. Time expended in those 7 attempts: 4 hours. I’ve told him, as well as others who attempting to use the web site, to simply forget about it for at least another month.

    My guess is that it won’t be working for at least another two months… and that my be wishful thinking.

  7. Jim – “Preventing doctors and hospitals from offering different prices depending on how you pay for example”

    Sorry but why the hell would you want to do that? Different means of paying do have different impacts on the bottom line. Why not encourage people to pay in cash? One of the recent success stories in medical care in the US have been those doctors who have flatly rejected dealing with insurance companies and only take cash. It lifts a huge bureaucratic burden from them – and so reduces their costs.

    “stopping the drug companies from selling drugs at vast markups in the US but cheaply abroad”

    Which is to say Americans are subsidising the world’s supply of new drugs. As they only really recoup their costs by selling in the US market. The Europeans have a large government-run central purchasing authority that makes sure they do not make money in Europe. Or Canada. Good for Europeans. Bad for the rest of the world. New drug production is coming to a halt. Be slow to embrace the new world of miltiple resistant drugs and no incentive for anyone to do anything about it.

  8. “Jim – “Preventing doctors and hospitals from offering different prices depending on how you pay for example”

    Sorry but why the hell would you want to do that? Different means of paying do have different impacts on the bottom line.”

    Really? In this day of instant money transfer it really makes any difference if your hip replacement is paid for via cash, credit card or by invoicing your insurance company? Nonsense. If a procedure costs X then it costs X, not two three or four X depending on what the hospital think they can screw out of the insurer. I mean I could see the point if the insurers were getting a quantity discount because of the volume of trade they were putting a particular hospital’s way, but for the insurers to be billed many times the cash price for the procedure is racketeering, pure and simple. The US health care sector has been specifically exempted from many of the anti-monopoly laws in the US – they should be forced to be open about all their pricing and prevented from conspiring with other providers to fix prices, both of which they do now.

  9. The typo should be “enlightening”, as more Americans suddenly become aware of the inability of the government to perform any major organisational task.

    Oh well, one can dream …

  10. Jim – “In this day of instant money transfer it really makes any difference if your hip replacement is paid for via cash, credit card or by invoicing your insurance company? Nonsense.”

    It may not matter to you, but it sure as hell matters to the doctor. Talk to a doctor about the paperwork he has to do to charge an insurance company for anything. If you impose a higher – and much higher usually – burden on one form of payment, people will prefer another form and they may offer an incentive to use it.

    “If a procedure costs X then it costs X, not two three or four X depending on what the hospital think they can screw out of the insurer.”

    That is true. There is no denying the sad state of American insurance and the over all medical system. But the obvious fact remains that the hospital would love to be paid in cash and would, I bet, pay a premium if people did so. Certainly smaller doctors’ practices feel it.

    “but for the insurers to be billed many times the cash price for the procedure is racketeering, pure and simple.”

    True. But that does not mean the solution should be so heavy handed. What America needs is a genuine market in insurance. Paid for by individuals, not by their employers.

  11. This was the simple US healthcare system pre-Obamacare:
    1. The poor got covered for free through Medicaid.
    2. The old got covered by Medicare, partially funded by the payroll taxes.
    3. These two programmes cost ~ 5% of US GDP.
    4. Most of the rest got employee-paid health care through insurance companies.
    5. Self-insurance was not an option for those remaining, since health care providers charged them vastly higher fees than they charged insurance companies.
    6. And so the uninsured who were not in perfect health bought their own insurance policies. But these were expensive because the maladies they covered were mandated by the Feds and States, usually as a result of lobbying by medical specialisms. So, for example, you had to get mental health coverage even if you didn’t expect to need it.
    7. As Tim N says, costs for all of the above were inflated by malpractice insurance costs.
    8. And, finally, the insurance system provided false incentives to carry out heroic interventions, notably on the old.

    Obamacare has complicated this scheme.

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