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Acts of Corporal Charity, 3

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Well, let me see what I can do here.

First, I have never had to beg for medical care.  Not once.  Not with insurance, and not without it.  Every single doctor and hospital (but one) we worked with when Bill was dying, and every one my sister in law worked with in the same circumstances twelve years later, assumed that when medical care was necessary it was necessary and it was freely given.

And we were told–we’ll talk about the money later, when the crisis is over.  Even the providers didn’t want to talk about the money up front.

Second, all medical care in catastrophic cases is charity, and has to be.  Unless Canada’s system is unlike any other in the world, it has to supplement “what you put in” with tax funds outside the system to keep the system going. 

All catastrophic patients and patients with chronic illnesses take out more than they put in, and more than anybody else could be asked to put in, too.  That’s true of our Medicare system for seniors (a government program), and it’s true of our Social Security system.

An actual insurance program does not have this problem, but nobody in any of these cases wants an actual insurance program–it would leave you paying out of pocket for virtually everything, with the only things covered being the very costly and very unusual high-end major care that almost nobody ever uses.

Socialized systems are charity.  That’s what they are.  That they give people a reason to hide that reality from themselves–by having them pay in basically nominally amounts so that they can feel like they’re “entitled” to the benefits they eventually receive–doesn’t change their fundamental nature. 

I’ve got nothing against that–I’m the one here plumping for single payer–but I’m not deluded as to what’s going on when we institute such a system.

Third, the only way you can know that you can “never afford to pay” something is if you know what the price of it is.

But the only way to know what the price of any medical care in the US is, outside a few testing areas and entirely-out-of-pocket stuff like tummy tucks and liposuction, is by negotiating it.

There are no “prices” on these procedures.  No hospital knows what it actually costs to treat people in serious cases.  At best, they know what it costs them to hire their staff and keep their building running.

If the hospital accepts insurance from five different companies, each of those companies will pay a DIFFERENT price for the procedures in question.  If a doctor accepts five different kinds of insurance, each of those kinds of insurance will pay a DIFFERENT price for the same office visits and the same care.

And those same hospitals and doctors will paid yet two MORE different prices for treating patients on the Medicare (elderly) and Medicaid (poor) programs.  Government reimbursements for Medicare and Medicaid are so low that many doctors simply refuse to treat patients with that kind of insurance.

Fourth, Lymaree has it exactly right.

Patients with insurance are not being charged extra to cover uninsured patients in American hospitals.  Rather, the prices quoted to uninsured patients are far higher because insurance company payments are so low.

American insurance companies are enormous entities that span state lines and control reimbursements for thousands of patients.  Hospitals are local, small, and generally non-profit.   They don’t have “profit margins.”  Mostly, they operate at a loss–no matter what anybody is paying–with the shortfall being made up by their endowments or their local fundraising.

A local hospital that didn’t bite the bullet and accept pretty much anything the insurance companies wanted to pay it, no matter how inadequate, would soon find itself out of business as the insurance company sent its members over to the next county where the hospital was willing to play ball. 

It’s been decades since insured patients subsidized uninsured patients.  These days, it’s largely the other way around. 

Fifth, insurance is affordable to the extent that you can buy it as insurane.  This present health care bill will make plans like the one Lymaree and her husband have illegal, by requiring all plans to “cover” a laundry list of health care procedures–in other words, no more catastrophic-only policies.

And even what looks like some kind of actual reform–such as allowing patients to buy insurance policies from any state they want–isn’t really.

The reason buy-from-any-state brings down the cost of health insurance is that, if I can do that, I can choose to buy from a state that does NOT mandate coverage I don’t want.  So, if I don’t want to be insured for “mental health services,” I can go to a state that won’t require my policy to insure me for that.

But the bill mandates dozens of such forms of coverage on a federal level.  It won’t matter what state I’m in.  I’ll still have to have the mental health coverage.

There are people here saying that the point of this bill is to push through partial “reform” and then let it collapse, thereby “proving” the need for a single payer system–that is, that the people advocating for this bill know it’s going to make things worse and think that they can use that to get them where we’re going.

I think it’s a risky proposition.  Once things are worse, the electorate might decide that we need a single payer–or it might decide that they gave the government a shot and it was so bad, they’d better get it out of health care entirely.

Written by janeh

March 16th, 2010 at 8:09 am

Posted in Uncategorized

14 Responses to 'Acts of Corporal Charity, 3'

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  1. I may be wrong about the insurance. I know, of course, that in a single-payer system such as ours, I’m currently subsidizing other people’s health costs, and that eventually they may end up subsidizing me, and so it ends up as much charity as insurance. Which particular bits of the tax revenue go to pay for health care hardly matters; it all comes from the taxpayer in the first place.

    I very much doubt if no one knows the exact costs of various medical treatments. I know in Canada there have been numbers cited but even if I had time to dig them up, my computer software has been upgraded, and now some things aren’t working right. There are also lists of costs, which are charged to home provinces for out of province care, and to non-residents.

    And whether I beg for medical care or not, I would still end up in the position of asking or taking services I can’t pay for if I didn’t have medicare.

    It would take surprisingly little to go over my ‘can’t afford’ level, too, even at Canadian prices. I’ve been talking about the kind of care necessary to give a bit more life and control pain in a long, lingering disease like some cancers, but that’s an extreme case. I’d run out of money long before I reached that stage, and cut corners even now on uninsured services.

    And I think I agree with most of the negative comments I’ve read about the US proposals, as little as I know about them.

    Cheryl

    16 Mar 10 at 9:26 am

  2. The best proposal we’ve had here, since the Obama health care debate started, is that we should open up Medicare–which now covers people over sixty five, as a government program–to everybody, and let anybody who wants to buy supplemental insurance on the private market.

    I’ve got no use for the health insurance companies, but at the end of the day we’re asking them to do some things that no for-profit company could do and stay in business, such as paying the long-term care costs of people with conditions that are both catastrophic and chronic.

    But I’m right about nobody knowing the exact costs. The fact has been illustrated brilliantly recently in a couple of places–in one case, a writer who decided to pay out of pocket for everything for a year found that hospitals and doctors often would not give him a quote, at all. “How much does it cost?” he’d ask. “It doesn’t matter, you have insurance.” “If I didn’t have insurance, what would it cost?” “But you have insurance.”

    Total stonewall.

    At the end of the year, he hadn’t been able to find out the actual price of anything but some radiology tests, which were done by for-profit companies and therefore carried a set price that was advertised in competition with the prices of other for-profit companies in the area.

    We all consume more in health care than we can possibly afford. All significant health care provision is an act of charity.

    I don’t see anything wrong with charity.

    I just think that the only way to actually handle it is for something like a society-wide Medicare program.

    janeh

    16 Mar 10 at 9:52 am

  3. All that means is that they were unwilling to give a price, not that they (or, more likely, someone in their financial office) doesn’t know to a penny what it costs. I can’t find anything online, but in Canada, each province has lists of the amount that they pay medical personnel and what they charge other provinces/visitors for every procedure they carry out. Hospitals know how many sheets and drugs and pieces of equipment is found in every ward and how many people work there, and how much they’re paid. Periodically, people write reports saying that if people knew – or were told – that it costs $x for a doctor’s visit, they’d go less frequently, or if they knew the latest scan cost $Y they wouldn’t insist on getting one unnecessarily. And the groups that run the hospitals present reports to the government saying that if they are to do what the government wants and offer more cardiac surgery, they will need so many beds and such-and-such a price, ICU beds at a different one etc etc – it’s costed out. The data are there.

    I doubt, from what I remember of the extremely detailed bills my parents checked and filed with the insurance company, that it is impossible in the US to figure out exactly what everything costs rather than …what? picking numbers at random to decide on their charges.

    Charity is a great virtue. It doesn’t usually involve the person receiving it to engage in a business transaction running up a bill that they cannot pay as a kind of pre-requisite.

    Cheryl

    16 Mar 10 at 10:46 am

  4. Jane, I’m not sure that it’s even possible for a hospital to calculate cost per procedure in a lot of cases. I have a friend who spent a year and a half working at a large local hospital as a consultant, trying to help them get a handle on their costs. He basically couldn’t do it. And this is not a poorly run hospital – I’ve been hospitalized there myself and it’s well-run and professional on the medical level.

    The thing is, if you choose any procedure – say, a PET scan. You can know the cost of the equipment. You can know the cost of running it – you need a room, that costs X, and you need electricity and that costs X, and maybe you need a hydraulic air line, which costs X. You need a technician to run it, that costs Y. You need to have been diagnosed, which means a doctor visit, and you could set a price on the doctor’s time and the nurse’s time and arrive at that.

    But – how do you allocate the cost of the machine per procedure? If your hospital buys this huge thing and only uses it five times, do we charge each patient a fifth of the cost? Clearly not. If you use it ten times a day for a full year, that’s 3650 uses of the machine. Let’s say the machine cost $750,000. If you want to pay off your machine in a year you could charge $205.48 per procedure, plus the cost of the overhead and you’d be done.

    But then what do you do next year? Charge them only the overhead because the machine’s paid off? Maybe you wait till the machine is depreciated.

    Or maybe you have to disconnect the cost of the procedure from the cost of the machine altogether, which is what happens in practice. It’s all more or less market-based. As Jane said, if your insurance is part of a large plan, and the plan administrator’s a good negotiator, you get much lower prices. If you walk in off the street, you’ll get an initial price that will probably horrify you, but from what Jane describes they’re generally willing to work with you on it.

    My company doesn’t actually have insurance. There’s a large insurance company in the Minneapolis area that offers a service that works like this: we pay them an annual fee, based on the number of people that are covered under our plan. For that we get to be part of their negotiation pool; we get insurance cards that have their name on them, and as far as the doctor’s office knows, we’re part of their insurance plan.

    But in fact, our company pays the bills. All we’re doing is getting in on their pricing.

    It’s all what you can negotiate.

    MaryF

    16 Mar 10 at 12:54 pm

  5. I’m no accountant, but hospitals do come up with cost figures for their services, and so do any number of other businesses which use expensive equipment to provide services to customers, from tanning salons to carnival rides to airlines. There are ways to work the cost of the machine into the cost of the service, allowing for depreciation and so on.

    Cheryl

    16 Mar 10 at 1:18 pm

  6. Of course there are, Cheryl, I didn’t mean to suggest that there weren’t. Just that there are a lot of options, and pricing for hospital services seems to have a lot more to do with what they can get than it has to do with what it cost them.

    MaryF

    16 Mar 10 at 1:40 pm

  7. Which should make them much like any other business in a for-profit system.

    But for-profit or not, I’d expect them to have a pretty good idea of what it costs to run the various services they offer.

    Cheryl

    16 Mar 10 at 1:55 pm

  8. Even if everybody in the chain of people who will provide parts of a service actually knows what it costs him or her to provide the service, there may still be no way to figure out how much such a service costs.

    Let’s say you need a gall bladder operation.

    How much will it cost you?

    The hospital will charge for the operating room by the hour, different hourly rates for different insurers or patients it bills.

    It wil have other general costs (some personel, equipment) that it can figure.

    But the surgeon bills privately–the hospital probably does not know how much, and the surgeon does not bill through the hospital.

    Same for the anesthesiologist.

    Even if testing facilities, like X-rays, are actually located in the hospital, they’re often for-profit franchises that lease the space but ALSO bill separately. As with the two doctors above, the hospital will have no way of knowing what those charges will be.

    And on and on and on.

    I’m not saying it can’t be done–it is done, every day, with for=profit medical services that do not bill insurance companies (like cosmetic procedures, and some “boutique” hospital packages like “deluxe” birthing centers), but that nobody is doing it, and to do it would take a lot of work and possibly run up against roadblocks.

    Surgeons and anesthesiologists, for isntance, are within their rights to say–it’s none of the hospital’s business what I charge who, and I’m not releasing that information.

    Unless the patient knows exactly who had to be hired individually for the gall bladder operation, who has to be on call, and all the other ins and outs even most insurance companies don’t know, he’d have a hard time finding out what his gall bladder operation is going to cost, inclusive.

    And that’s assuming anybody is willing to give him the information when he asks.

    janeh

    16 Mar 10 at 3:47 pm

  9. I’ve been lucky (or not, according to how you look at it) in that I’ve always worked for libraries in large or small municipalities (and when not, for companies) that offer insurance. In my last three workplaces they have paid all insurance costs for me. I’m single but with family added in I would have had to pay for them. The city I work for pays $6700 annually for health insurance, prescriptions, life insurance and dental insurance (which I don’t use because even with it, dental costs are still too prohibitive.) Even though my salary would increase by that $6700, if I paid the entire premium I would pay higher income taxes, plus my copayments for office visits, meds, lab tests, hospitalization, etc. Once, years ago, I did battle with Blue Cross over a bill for my daughter and had it reduced. I’ve not done that since then. No doubt, many hospitals overcharge as do insurance companies. I looked at some information from the American Journal of Medicine back in the summer. According to the article, in 2007 2/3 of bankruptcies were at least partly due to medical debt. Public hospitals, which are government run or subsidized, are an alternative for those without insurance. They operate on a sliding scale according to income and family size. These hospitals are not the same as not-for-profit. Cooper Green in Birminghqam, AL is one, Grady Memorial in Atlanta is another.

    jem

    16 Mar 10 at 4:59 pm

  10. I do know what public hospitals are–we just don’t have them in Connecticut.

    When Bill was sick, even without insurance, he was seen at the best private hospitals in the state, all not for profits.

    And not for profits do do things like sliding scales and uninsured patient funds.

    That said, the bankruptcy situation is caused by two factors:

    first, by the fact that in order to go on Medicaid in most states, you have to “pay down” your assets. The best and most efficient way to do that is to declare bankruptcy, and in those states that protect your house (and there are more than Florida)) you don’t lose the homestead, either.

    Second, there are lots and lots of people who respond to large medical bills by freaking out and doing nothing about them, hoping they will go away. You WILL end up in bankruptcy that way.

    But I had over $300,000 in medical debt when I had not worked in two years because I was taking care of Bill. Our asssets (except for the house) were gone.

    And I did not need to declare bankruptcy.

    I’m all for a change in the way we do health care in the US.

    But THIS bill will make insurance more expensive for everybody–if your Florida insurance is really that cheap, it won’t be after the federal government finishes demanding that all policies contain a whole new list of “benefits” that Florida doesn’t now require (and CT does)–throw more people out of work, make health care more expensive, and result in even more people uninsured.

    Guaranteed.

    I’m not saying we should do nothing. I’m saying this bill will not help and is almost certain to make things worse.

    janeh

    16 Mar 10 at 5:19 pm

  11. Oh, and one more thing.

    I’m not insured.

    I’m not rich.

    I don’t use public hospitals.

    I don’t go without health care.

    I don’t beg for anything.

    Most uninsured people are not poor–they’re self employed, they own their own small businesses, they work on contract, and they make between $50,000 and $80,000 a year.

    I have no lack of health care and no restriction in my choices of what to get or who to get it from.

    And what’s more, I know LOTS of uninsured people, because I know lots of writers, artists, and freelancers generally.

    They don’t go to emergency rooms or restrict their care to public hospitals, either.

    Is what I get sometimes expensive?

    Yes, of course. But, again–so what? Lots of things are expensive.

    We seem to have arrived at a place where we feel we shouldn’t HAVE to pay for health care–as if it is for some reason illegitimate to expect to have to pay out of pocket for what we get.

    janeh

    16 Mar 10 at 5:52 pm

  12. I have to agree with Jane in her last statement. People who say they can’t afford health care, and don’t go to the doctor for minor or preventative care, which might cost them $500 a year, will still carry a cellphone, drink daily Starbucks, and eat out 4 nights a week. They act like not having everything paid for means they don’t get to go to the doctor or dentist *at all.*

    I spent many of my younger years uninsured, when I was quite healthy. I was dicing with chance, and did incur some bills when I fell and badly sprained an arm. Those were far cheaper than maintaining insurance all those years. Now I’m older, have heart damage, high blood pressure, a clotting problem and crippling arthritis. My meds alone cost about $300 a month after copays. I wouldn’t dare go uninsured for a single day.

    When my doctor tried to prescribe Lipitor for me, I found out the copay was $120/month. I CHOSE not to use that, and asked for a cheaper generic statin instead. But I realized at the time that I was making my decision based on cost, that I’d rather have that money for other uses.

    However, if my doctor told me “use Lipitor or die” I’d use the Lipitor, and either find some way to negotiate the cost, get some cost assistance, find a drug discount program, and if I had to, sacrifice something else.

    I don’t think anyone should have to choose between life-critical care or medications and food or rent. Those kinds of people certainly need help. (My sister is one of those people. Her insulin is not optional. So I’ve been subsidizing her for the last 6 months. I do not expect to be repaid. By anyone.)

    But people who are as Jane describes, self-employed, freelance, and making a decent living, and say that because someone else won’t pay for it, they don’t have health care is just simply wrong. They do. They just don’t want to pay for it.

    For some reason we all expect to pay for our next car, and for the repairs that car requires, but not for our next broken bone. Or the next sniffle that needs looking at. Or a regular checkup that might involve some blood tests.

    If more people didn’t think they were entitled to be covered for *every little thing* then we might not be in this fix.

    Lymaree

    16 Mar 10 at 6:31 pm

  13. I’m watching some of this in family right now. One branch, prescribed expensive medicine, phoned all over town, and found huge variance in prices–and, eventually, wound up with a stack of free meds and a prescription for a generic. Another branch takes their prescription to the nearest pharmacy and pays whatever is asked. But that branch couldn’t manage money even without medical bills.

    And yes, I also ran uninsured for something around a year ago in pretty much the condition Jane describes as typical–a small business and tight times. If I’d been run over by a truck it would have been awkward. Otherwise, I go to a Redi-Med for a sore throat about every third or fourth year.

    As for costs, any competent business knows total expenses to the penny, but MaryF is right–deciding how to allot the expenses among the various people who received services is not a cut and dried matter. And what happens if I decide to amortize my Superdiagnostician over ten years, but it turns out to have a service life of five–or gets banned by the CDC after three? Trust me, I can’t send a retroactive bill to the people who already paid me. That expense will be borne by future patients who never even saw the machine.

    That’s not just a medical thing, either. Watch Detroit “proving” they don’t make money on small cars by assigning the same share of fixed costs to each “unit of production” or Hollywood demonstrating that some blockbuster film still has no net profit. McDonald’s may have a cost figure they use for each hash brown–but that doesn’t mean they couldn’t use any of half a dozen other numbers and be equally right–or equally wrong.

    robert_piepenbrink

    16 Mar 10 at 8:12 pm

  14. “Most uninsured people are not poor–they’re self employed, they own their own small businesses, they work on contract, and they make between $50,000 and $80,000 a year.”

    My daughter, 26 and uninsured, does not fit this profile. Her hours are restricted to somewhat less than 40 so she is not considered full-time. Nor does she make between $40,000 and $80,000 per year. Certainly less, as do I for that matter. I am insured she isn’t. Decent coverage for her would be around $400, which is around half of her twice monthly pay.

    “Is what I get sometimes expensive?

    Yes, of course. But, again–so what? Lots of things are expensive.

    We seem to have arrived at a place where we feel we shouldn’t HAVE to pay for health care–as if it is for some reason illegitimate to expect to have to pay out of pocket for what we get.”

    Many other things, a car, insurance, etc are also expensive and she doens’t have those either. What is considered expensive for someone earning between $40,000 and $80,000 is more than that for someone earning under $30,000.

    “For some reason we all expect to pay for our next car, and for the repairs that car requires, but not for our next broken bone. Or the next sniffle that needs looking at. Or a regular checkup that might involve some blood tests.

    If more people didn’t think they were entitled to be covered for *every little thing* then we might not be in this fix.”

    I hardly think all of us “expect” everything, including sniffles to be paid for. I also don’t believe she feels entitled to anything, health care included. She works extremely hard at her job as a preschool teacher of three-year-olds, not just a daycare worker, she has a b.s. degree from the University of Florida and was an honor student there. With her background, this job is the best she can get at this time. Florida is a state with extremely high unemployment. What you consider expensive is prohibitive for others earning less money.
    Maybe this bill is flawed. I don’t know for certain. If the bill is defeated I doubt another attempt will reach the place this one has–about to be considered for final vote.

    jem

    17 Mar 10 at 10:19 am

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