Aug. 28th, 2016

redneckgaijin: (respectable political)
Insight of sorts- not that the idea is new to me, but the explanation might help some people understand the problem with Obamacare.
The key point is that Obamacare is NOT socialized medicine. Obamacare is an example of "privatized profits and socialized losses."

You might have heard that phrase in 2008 and 2009, in regards to the Wall Street TARP bailout. What it boils down to is this: the people who own stock in or run the biggest corporations in the country, especially financial institutions, can make wild gambles and blatantly stupid business decisions, because if it works they keep the profits, and if it fails government will step in to prevent the consequences from crashing the economy and throwing millions of people into poverty. In short, a few excruciatingly rich and powerful people can hold the common people hostage to their own shortsighted greed- all nice and legal.

The concept behind Obamacare is that, by getting more people insured and by raising co-pays on that insurance, people will force insurance companies to compete with one another, and insurance companies will have to do hard negotiating with health care providers and pharmaceutical companies. All this competition will, in theory, lower the cost of health care and make things better for the common American.

It's not working out that way at all.

There wasn't much competition in the public exchanges at the start, and that competition is shrinking fast. One of the things Obamacare did do was make health insurance a less profitable business to be in- not unprofitable by any means, but enough so that insurance corporations are beginning to seriously consider abandoning the field to focus on other, more profitable forms of insurance. By their standards, health insurance in a county or state is only profitable enough to "bother with" if there's only one company in the market. Which, of course, means no competition, and thus no pressure to lower premiums- and nobody's lowering premiums at all.

In fact, health insurance companies are demanding that caps on how much premiums can go up from year to year be lifted, because it turns out that all those healthy uninsured workers who would pay for the uninsurable sick... aren't so healthy at all. The number of previously undiagnosed ill working-class people has, apparently, overwhelmed the companies offering insurance in the public exchanges, to the effect that those policies really aren't profitable. (Remember, the whole point of insurance is to AVOID paying off. Every claim that is paid comes out of shareholder profits.) Yet another reason for insurance companies to bail out of the exchanges... which is why we're now seeing counties where the HealthCare.gov exchanges offer no policies at all for anybody.

But, you say, at least those fewer companies will have more buying leverage to negotiate with hospitals, doctors and pharmaceutical companies, right? Well... no.

You see, there are three things playing together, all factors that have been in play long, long before Obamacare came along, but which Obamacare blew up like charcoal lighter on a grass fire.

Item #1: HMO and medical networks. The original idea of HMOs and medical networks was that, by restricting patients to a small group of doctors and clinics, special negotiated deals would lower costs. This was a brainchild of the 80s and 90s that the Clintons loved and almost everybody else hated, but Obamacare actively ENCOURAGED them to form and get larger. What actually happens is, patients with an HMO or in a medical network get locked in. They lose all power of competition and negotiation; if some part of the system charges too much, the only way they can protest is to walk away from ALL OF IT, which means a massive amount of time and effort to find new doctors, get new prescriptions, transfer records, etc. etc. etc. In practice HMOs and medical networks stifle competition and raise prices while making it much, much harder for patients to choose somebody else.

Item #2: Insurance companies need health care providers a lot more than vice versa. Although hospitals and pharmaceutical companies can and do negotiate massive discounts from their inflated cash-and-carry rates, even those discounted prices go steadily up every year. This is not because it's more expensive for them to perform their services- aside from costs of college education, it's not. It's because, if an insurance company negotiates too hard, the health care providers can simply choose not to accept that coverage- and since Obamacare, a lot of providers have done exactly that. The buying leverage Obamacare relies upon to put pressure on health care corporations simply hasn't materialized- and it never will.

Item #3: Payor disconnect. The fact is, for many Americans even a simple, no-complications visit to a general practice doctor will run anywhere from $75 to $200- a very significant portion of monthly wages, and generally unaffordable except for emergencies. The idea that your average working American can do price comparisons for X-rays, MRI scans, blood work, surgery, hospital boarding, etc, is ludicrous, because they simply haven't got the pocket money to pay for any of it. So instead they get insurance, pay one or two or three checks a month, and hope the copays don't bankrupt them. The trade-off is that, for all those big ticket items, most Americans pay no attention to the amounts, because they're not the ones paying them. The outrage over $500 per pill of aspirin becomes background noise, an item to run on a slow news day in the second segment of the evening local news. This takes away much of the incentive to hold insurance companies accountable for not negotiating down those prices- so, of course, the insurance companies don't negotiate harder than they need to to maintain their profit margin. Health care providers, in turn, use this disconnect as a blank-check to charge what they feel like, regardless of how rapcious the resulting profits are. By expanding Medicaid and subsidizing private insurance policies with tax dollars, Obamacare throws more fuel on this problem, too. End result: even if ordinary Americans had leverage to negotiate costs down (they DON'T), they have little impulse to, so long as the matter is taken care of.

End result of all of this? Health costs continue to skyrocket, and increasingly the government is left to foot the bill, which enables health care costs to skyrocket even higher.

At this point conservatives will nod their heads and say that I've just proven that the only reasonable policy is to abolish all government funding of health coverage and go to a full laissez-faire open market.

Yeah, that's an idea... if you favor health care being a luxury good. Otherwise, not so much.

The problem isn't the idea of socialized medicine. The problem is that the United States's spasmodic efforts in health care policy have gone in a direction no other country on Earth was so stupid as to attempt; funding health care without really regulating the market. We pay the bills without doing much about how much those bills are, so of COURSE each bill gets bigger than the last. But the solution is not to stop paying the bills. The bills need to be paid. Everybody needs proper health care, and (though conservatives refuse to admit this bit) we need to have everybody around us as healthy as possible too.

We have privatized profits (health care companies hiking prices without apparent limit) and socialized losses (tax dollars footing the bill for much of it). The free market will not fix this problem- or, at least, it won't do it without a mountain of sick and dead.

What we need is socialized medicine as every nation who actually has it practices it- strict, strong, harshly enforced regulations and restrictions on the medical industry (especially pharmaceuticals), publicly funded hospitals and clinics, cheap or free college and training for medical professionals, the whole bit.

The Affordable Care Act, by design, touched NONE of that.

Adding the "public option" to it won't help, either. In fact, it will speed the process of collapse up, as providers either refuse to accept it or use its bottomless pockets to pay for ever-increasing profits.

We need socialized medicine and nothing else. Unfortunately, Trump is of the abolish-it-all party, and Clinton thinks a bit of duck tape and good wishes will fix Obamacare. Neither is actually interested in attacking the true problem in America's health care industry.

We need something else. (And, BTW, neither Johnson nor Stein is it.)

Profile

redneckgaijin: (Default)
redneckgaijin

September 2017

S M T W T F S
     12
345 6789
101112 13141516
171819 20212223
24252627282930

Most Popular Tags

Style Credit

Expand Cut Tags

No cut tags
Page generated Sep. 22nd, 2017 03:21 pm
Powered by Dreamwidth Studios