Great Time article on the cost of healthcare in the US

[Acanthus]

Its called "cost shifting" and is illegal in just about every other industry except for the medical industry. Why is it legal, because we passed laws stating they must treat people who can not pay without compensating them. There are many other reasons and forms of cost shifting in the medical industry but that is why prices vary so insanely and some minor crap is absurdly expensive.

So now that Obamacare is going to increase coverage to over 90%, we can do away with cost shifting, right?

My bet is on costs continuing to rise without justification, even with more people covered under subsidized bronze plans.

 

[BoberFett]

Good article that gets to the heart of the matter. It's a complex issue that lawmakers don't have any intention of fixing. Crap like Obamacare and it's cost-shifting is all we'll get.

 

[HeXen]

product qualification and sterilization. There is an absolutely HUGE cost associated with ensuring products are clean due to FDA regulations. Im not saying this is bad. Its merely why your syringe is $17 - its guaranteed to be free of germs (likely went through an autoclave)

Whatever, an autoclave isn't very expensive. And i'm pretty sure the ones at Walgreens say their guaranteed sterile. likely every syringe manufactured goes through an autoclave. No it's the same BS as to what everyone else is saying. I know for a fact the large bottles of Tylonol at the hospital costs $10 to them, but they charge crazy prices for 2 pills. My sister in law is RN

 

[wirednuts]

hahah, yeah i would bet even the american made medical products use all chinese made parts... its like that for everything else anyway. actually i wouldnt doubt most of it is internationally sold stuff thats just rebranded and marked up for american markets.

 

[Fenixgoon]

Whatever, an autoclave isn't very expensive. And i'm pretty sure the ones at Walgreens say their guaranteed sterile. likely every syringe manufactured goes through an autoclave. No it's the same BS as to what everyone else is saying. I know for a fact the large bottles of Tylonol at the hospital costs $10 to them, but they charge crazy prices for 2 pills. My sister in law is RN

autoclaves are like $1M, not including maintaining the damn things.

a professor of mine was the CEO of a small biomed company and the costs of qualification and sterilization were very significant for them.

 

[nanette1985]

Last month I had my 5th stroke. My regular neurologist who is familiar with my situation, was not allowed to see me in the hospital and was not allowed to speak with the hospitalist.

This is a different hospitalist from my last major hospitalization.

Both times there were some serious complications.

Has anyone had a good experience with a hospitalist?

 

[WhipperSnapper]

Lawsuits and the fear of them which cause healthcare providers to issue out unnecessary procedures...

How do you suggest that we reform medical malpractice laws? If a hospital's or doctor's negligence or recklessness results in $2 million worth of damage to a patient, who should shoulder the $2 million cost? If we were to absolve hospitals and doctors of liability, what incentive would they have to not be negligent? (It can be argued that the tort system, if functioning properly, reduces the overall cost of accidents by reducing the amount of accidents.)

Food for thought:

http://en.wikipedia.org/wiki/Calculus_of_negligence

http://en.wikipedia.org/wiki/U.S._v._Carroll_Towing

 

[Brainonska511]

How do you suggest that we reform medical malpractice laws? If a hospital's or doctor's negligence or recklessness results in $2 million worth of damage to a patient, who should shoulder the $2 million cost? If we were to absolve hospitals and doctors of liability, what incentive would they have to not be negligent? (It can be argued that the tort system, if functioning properly, reduces the overall cost of accidents by reducing the amount of accidents.)

You could change the standard (such as providing the safe-harbor defense described in the article) a little to fight back on the frivolous lawsuits while protecting those suing for legitimate negligence.

 

[HeXen]

autoclaves are like $1M, not including maintaining the damn things.

a professor of mine was the CEO of a small biomed company and the costs of qualification and sterilization were very significant for them.

You can buy one for you home for $400, they go up from there. You know you can buy a car for $1m too, but obviously it's a broad market.

 

[Pray To Jesus]

Ripping people of makes a lot of money. Whowouldathunkit?

 

[DCal430]

What I found even better was how Medicare, despite being hamstrung by being forced to pay obscene rates for drugs, pays what seems to be fair prices for most hospital procedures. Hospitals (especially all those 'nonprofits') gripe about how little it pays (but it covers their real costs and the little overhead), but I don't see them turning away Medicare patients.

The article is wrong Medicare is NOT required to cover their cost, in fact without the yearly patch it would cover only around 65% of the real cost. Medicare reimbursement is limited by the SGR formula, which has required a yearly patch or reimbursement would collapse by around 30%, which is far bellow average cost.

Right now it covers around 90 to 100% of the hospitals cost, but if congress ever fails to make the yearly patch it would fall too low, and many hospitals would stop seeing medicare patients for nonemergencies.

 

[Brainonska511]

The article is wrong Medicare is NOT required to cover their cost, in fact without the yearly patch it would cover only around 65% of the real cost. Medicare reimbursement is limited by the SGR formula, which has required a yearly patch or reimbursement would collapse by around 30%, which is far bellow average cost.

Right now it covers around 90 to 100% of the hospitals cost, but if congress ever fails to make the yearly patch it would fall too low, and many hospitals would stop seeing medicare patients for nonemergencies.

According to who? If we go by those absurd chargemaster lists, then no, it isn't covering their costs.

But even if both costs are wrong (Medicare's reimbursement vs. the chargemaster), I'd bet that it isn't Medicare that is more wrong.

 

[DCal430]

According to who? If we go by those absurd chargemaster lists, then no, it isn't covering their costs.

But even if both costs are wrong (Medicare's reimbursement vs. the chargemaster), I'd bet that it isn't Medicare that is more wrong.

According to every major study and the law it self, author is wrong the law does not require it to reimburse for real cost. The author completely ignores the SGR which reduces reimbursement to below cost.

 

[TechAZ]

autoclaves are like $1M, not including maintaining the damn things.

a professor of mine was the CEO of a small biomed company and the costs of qualification and sterilization were very significant for them.

I don't believe autoclaves are that much, but they are above 500k including installation costs and maintenance is under 30k a year (including parts/labor).

Sterilization is dirt cheap, validation with the FDA is another matter. Syringes would not be autoclaved, most likely ETO gas sterilized as it's lower temp and wouldn't melt the syringe. They sterilize these supplies in bulk so once supplies are validated via FDA, the manufacturing and packaging costs are not very expensive.

I really wish an article like this would be follow up from a healthcare organization to refute any points. Healthcare is crazy, a ratcheting screwdriver handle can cost $900, an ortho power saw/drill set is $35k, basic scissors are $25, robotic surgical equipment 1 mill+.

So while stats on how much an aspirin costs seem outrageous, hospitals have extremely high overhead. Everybody from insurance companies to hospitals to manufacturers have a hand in this and all need to make a profit.

I do not see the drastic rise in healthcare costs being fixed....ever.

 

[Brainonska511]

According to every major study and the law it self, author is wrong the law does not require it to reimburse for real cost. The author completely ignores the SGR which reduces reimbursement to below cost.

How do you explain this though:

Janice S. was also charged $157.61 for a CBC — the complete blood count that those of us who are ER aficionados remember George Clooney ordering several times a night. Medicare pays $11.02 for a CBC in Connecticut. Hospital finance people argue vehemently that Medicare doesn’t pay enough and that they lose as much as 10% on an average Medicare patient. But even if the Medicare price should be, say, 10% higher, it’s a long way from $11.02 plus 10% to $157.61. Yes, every hospital administrator grouses about Medicare’s payment rates — rates that are supervised by a Congress that is heavily lobbied by the American Hospital Association, which spent $1,859,041 on lobbyists in 2012. But an annual expense report that Stamford Hospital is required to file with the federal Department of Health and Human Services offers evidence that Medicare’s rates for the services Janice S. received are on the mark. According to the hospital’s latest filing (covering 2010), its total expenses for laboratory work (like Janice S.’s blood tests) in the 12 months covered by the report were $27.5 million. Its total charges were $293.2 million. That means it charged about 11 times its costs. As we examine other bills, we’ll see that like Medicare patients, the large portion of hospital patients who have private health insurance also get discounts off the listed chargemaster figures, assuming the hospital and insurance company have negotiated to include the hospital in the insurer’s network of providers that its customers can use. The insurance discounts are not nearly as steep as the Medicare markdowns, which means that even the discounted insurance-company rates fuel profits at these officially nonprofit hospitals. Those profits are further boosted by payments from the tens of millions of patients who, like the unemployed Janice S., have no insurance or whose insurance does not apply because the patient has exceeded the coverage limits.

 

[DCal430]

How do you explain this though:

I never said the uninsured weren't being way overcharged, only medicare was not required to reimburse for real cost, and the author is completely wrong about how medicare fees are calculated. He ignores the SGR which is the main factor in medicare reimbursement.

The reason they must lobby each year is to make sure congress acts in time to block the SGR from taking full affect and seeing reimbursement drop by 30%.

 

[Lithium381]

People don't look at the cost of things. When people go to get drugs, "give me the name brand" even though to the patient, the cost is the same as the generic, but on the backend, it's 4 times as much.... they are oblivious to it. They don't care because they're being subsidised somewhere somehow by the other patients in the companies ledgers...

 

[Oldgamer]

http://healthland.time.com/2013/02/20/bitter-pill-why-medical-bills-are-killing-us/

The hidden chargemaster that screws us all - things like $77 charges for a gauze pad that costs 5 cents and all that kind of crap. Highly recommended reading.

Medicare getting screwed on drug prices, uninsured patients really getting screwed on everything, "Obamacare" not being a great fix since it didn't really address pricing...

I saw an interview that was done with the author who did that Time article and he said most of the enormous cost is due to the outrageous salaries and bonuses of the executives and CEO's of the hospitals.

He said the doctors and nurses are not the ones making all the money, it is the folks at the top. Despite what people may think about doctors making lots of money, not really so, it is the folks running the hospital who make out like bandits and drive the costs up.

 

[Lithium381]

In terms of doctors charges(for their time, not material things like gauze-pads) they pay out the nose for insurance . . . . i think i heard somewhere 30% of what you pay is just insurance . . .let me go dig a link

Malpractice Premium Spending

Your physician spends 10 cents on malpractice insurance from every dollar you pay for health care, according to Diana Furchtgott-Roth, a senior fellow at the Manhattan Institute. Furchgott-Roth notes that premiums vary from $20,000 annually in low-cost states to $200,000 annually in high-cost states. According to a survey published November 2011 in "Modern Medicine," family and general practitioners paid premiums of $12,100, and pediatricians' premiums averaged $11,800. OB-GYNs paid an average of $46,400, and plastic surgeons reported median premiums averaging $30,000.

10% according to http://work.chron.com/much-doctors-pay-insurance-7304.html

 

[Oldgamer]

One of his interviews on youtube http://youtu.be/I4yIlbh0CwE

 

[nehalem256]

I saw an interview that was done with the author who did that Time article and he said most of the enormous cost is due to the outrageous salaries and bonuses of the executives and CEO's of the hospitals.

He said the doctors and nurses are not the ones making all the money, it is the folks at the top. Despite what people may think about doctors making lots of money, not really so, it is the folks running the hospital who make out like bandits and drive the costs up.

In terms of doctors charges(for their time, not material things like gauze-pads) they pay out the nose for insurance . . . . i think i heard somewhere 30% of what you pay is just insurance . . .let me go dig a link


10% according to http://work.chron.com/much-doctors-pay-insurance-7304.html

Obviously single-payer would solve this :whiste: