Stephen Black
Aug 28, 2017 · 3 min read

We recently had to find a new Dr due to our prior Dr leaving the area. Looked at health grades, started down the list, first question — are you accepting new patients, answer yes. What insurance do you have — Medicare. We are not accepting any new Medicare patients at this time. This repeated multiple times before we found a Dr that had decent reviews and would accept Medicare.

Then there is the issue of the Medicare trust fund insolvency being predicted by 2029, suggesting costs are running ahead of revenue, and that is only covering 17% of the US population. This is inspite of low reimbursement rates that are causing many providers to avoid treating Medicare patients. So this leads to the point I would like to make — the number one problem with health care in the US is cost. I am not sure anyone really knows where the money goes, and that is important since from my professional experience it is difficult to fix a problem when you don’t understand it. Many will argue it’s the “$&@#” insurance companies, but looking at their financial statements doesn’t bare this out, nor does the fact that they are pulling out of multiple markets due to loosing money.

Frankly the current costs and rate costs are increasing are unsustainable, and discussions of insurance and coverage while ignoring costs are akin to fiddling while Rome burned. Insurance will be a series of ever diminishing alternatives unless costs are brought under control. It’s interesting, but not surprising that congress has focused on coverage, after all the health care industry spent something like $900M in 2016 (opensecrets.org) on contributions and lobbyists to make sure nothing of substance changes.

I have no hard data, but I suspect that high costs are the result of government actions:

  • There are a morass of regulations covering every aspect of health care. What people may not realize is every regulation creates a “parallel universe” in the regulated industry, consisting of policies, procedures, training programs, audits and reports back to the government. All of this costs money, none of it improves your health
  • By limiting the import of pharmaceuticals the government has basically protected the US market from global competition
  • By prohibiting the interstate sale of health insurance, the government has limited economies of scale and potential competition.
  • By a variety of licensing laws that limit which providers can provide which service, government has in effect limited the supply of health care providers, which increases cost
  • By requiring prescriptions for many pharmaceuticals, Dr’s visits are required even for routine issues, further increasing costs.
  • The government funds universities to perform health related research. When something is discovered, the universities are able to patent this work. The patent is then licensed to the highest bidder, who in turn is able to charge pretty much whatever the market will bare, even though the underlying research was taxpayer funded.

To those who advocate for Medicare / single payer for all, please explained how:

  • This will reduce costs
  • How we will not create the worlds largest bureaucracy, staffed with indifferent civil servants who have no accountability for performance or productivity and are largely immune to being fired.
  • Why this won’t end up being like the VA

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    Stephen Black

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