Tying health insurance to your employer is incredibly dumb. It means insurarers compete for your employers business, not yours, which influences their incentives. It means if you don't like your insurance company, your only option is to change jobs. It disincitives people from being self employed, because then health insurance is prohibitively expensive.
No, it works exactly as it was designed. Health insurance keep s costing more, cover less and not care about helping people in the time of need. That is not an accident. It is a result of concentrated effort of lawyers, lobbyists, salesmen, etc... - a whole system that maximizes profits and market share at all costs, and not the quality, breadth and affordability of healthcare. It is like that by design. So the results are logical - we pay more and get less. And will continue paying more and getting even less. There will be a point in future when this approach will "meet its maker", the hope is that will happen sooner rather than later.
It's an efficient market. It's efficient at collecting money from customers who little or no choice, and at not providing those customers with a service - because providing a service costs money, which takes a cut out of profits.
This is what markets do. They amplify political and financial inequality.
Anyone who thinks that competition will somehow magically fix this isn't paying attention to how markets actually work.
You are conflating markets with meta-markets. The market for healthcare has been corrupted by activities outside of the market.
The market has been intentionally manipulated to set up little choice for individuals and even worse, little transparency on cost and benefits.
Markets DO work, but you have to set them up to succeed. Customers need to be able to choose between providers, customers need to know what the full cost of healthcare is prior to committing, and customers need to be able to walk away or find an alternative if a price is unattractive.
> Anyone who thinks that competition will somehow magically fix this isn't paying attention to how markets actually work.
If you allowed foreign doctors to come and practice in USA the problem would get fixed extremely quickly. Competition is the solution. The problem isn't the free market here, but that the incumbents gets to control legalization and hence stifle competition. I'm not sure why private money has so much more influence in USA than other western countries, but it is the main source of this problem.
Isn't it illegal to move drugs across the border? Importing other goods seems much simpler. I mean, according to this you can only import drugs into USA if you are the manufacturer, meaning USA doesn't permit global market forces.
Say you have a drug that you need to charge $100 to make it worth your time. Other countries say they will only pay $20 for it. Since the US doesn't have price controls, they will charge $180 here to make up for missing revenue in other countries. So in effect, the US subsidizes countries with universal healthcare.
drugs are very expensive everywhere it's possible, and implicitly expensive drugs are not available where they're unaffordable (and hence no market at the high price). This leads to bigger group buying programs and a focus on generics, but has the unfortunate effect of shifting the focus of drug companies to very high price, small-market specialty drugs and lifestyle & vanity drugs that a broad, public healthcare system would never cover.
we can both complain about the final outcome and disagree on how we got here. I think it's a stretch to call healthcare an efficient market. There are huge upfront and switching costs for almost every component making it rife with opportunities (intentional) and mistakes (mistakes) that erode efficiency. I also feel you conflate what markets can do with what their intent is. You seem to imply that markets have no role in a huge swath of our economy and lives, yet I look at my medical experiences in Canada (almost 100% public) and wonder if many people actually know how it works and what the outcomes look like. In a nutshell it's both harder to die and harder to get better under our system, and I think markets could help with the later without hurting the former.
No, it was during he Second World War. There was a labor shortage as many men were drafted or even signed up, but the federal government had instituted wage and price controls. As wages could not be raised, benefits like health care were offered to try to lure workers.
Some big companies, like the car companies, ran (and I believe may still run) their own medical systems. Most of course outsourced.
Nowadays a company would be insane to drop this because it’s a very sticky incentive. We’d probably have more innovative startups if we had ACA which is a reason the big companies lobbied against it and why having a company to simply pay your ACA premium was made more expensive than the company running a health plan the old way.
It was older of a trend than that I believe back to post-WW2 when private sector was hobbled. To keep people incentivized to stay longer with employers they offered more benefits that were employer tied such as pensions and health insurance programs not available to job hoppers or self employed.
But more complex is that when people argued for a nationalized health plan a lot of people agreed with it until opponents argued that white people would be paying for minorities’ health insurance with their tax increases. These days it’s difficult to outwardly tell whom opposes public welfare policies requiring some solidarity based upon fiscal principles or social ones first.
Right, the initial were benefits offered by employers to sweeten their compensation and improve retention. Later unions demanded these everywhere and that’s what led to employer sponsored health insurance being normalized.
Separating the consumer of a insurance (the employee) from the decision of which insurance to use (the employer) is where this all went sideways.
Otherwise, in a competitive market, people would be free to jump to any provider with a better offer, forcing other providers to respond and preventing the disaster that we have now.
But now it’s a national mess to unravel and we have union demands to thank for it.
Yes, the unions are 100% to blame for the current state of affairs.
Providers, trial lawyers, drug/device companies, and insurance companies are absolved of blame!
I used to tell people that when the subject of "why is healthcare so expensive" comes up, these four pigs feasting at the trough point to whomever is to their right.
Now they have someone to point to that's not even eating, and arguably died a long time ago.
Yep, the more producers and consumers of products and services are separated the more markets are improperly incentivized even without any government involved. B2B has a place in commerce obviously but much of the problems of enterprise software is because it’s designed for a lengthy sales process to meet decision-makers’ needs rather than for those that work under the decision-makers.
Exactly. I don't understand why people don't understand this.
It's a huge chilling effect on employee turnover. Until ACA pre-existing conditions was a huge aspect of that. Even now IIRC when I changed jobs once I recall any existing conditions would not be covered for 1 month.
And it's the biggest cost increase over the past 2 decades and has soaked up almost all the profits that could have gone to employee salaries.
Suppose your employer is less than ideal but you’re not particularly confident in your ability to get another job should you be laid off. A lot of people feel trapped in this situation every day.
Not everyone has the skills and experience to be in demand. A lot of people feel their current job is the only thing standing between them and the food stamp line. These people should not have to worry about getting sick and losing everything after losing their job.
Not all providers and plans are the same, so some treatment for some health condition you have that is 75% paid for by insurance might go down to 25% or even 0% (not covered) with your new employer's health insurance plan. You also might just not have another job to go to immediately, like what happened at the beginning of Covid-19, in which you'd either need to pay for your previous insurance in full or cancel treatment.
This happened recently to someone I know. They were offered a significant pay bump and a leadership position in a well-respected organization that lines up with their personal goals, but the new employer doesn’t offer insurance.
They eventually decided to take the job, but having to even consider healthcare access in that calculus is ridiculous.
No. They offer what they offer. Even when plans seem similar, are you willing to pay out of pocket for a $4k/month medicine that you've been taking for years and only paying $250/month now for, all because the new insurance doesn't cover it?
This is even more pronounced with lower-wage employees. I didn't switch jobs for years because of benefits: At best, I'd have to pay for COBRA for 60-90 days, which would basically take all of my money and then some. But mine was also fairly cheap and I had good coverage, something that similar jobs usually didn't match.
I do not leave my current employer specifically because of health insurance. No other employer in the area provides comparable coverage. It would take about a $30,000.00 per year premium to get me to even consider leaving. Healthcare is my number one consideration on all employment decisions.
Before 2014 plans were required to cover pre-existing conditions as long as you had “prior credible coverage” and didn’t have a lapse in coverage for more than a short period of time.
If you let coverage lapse, plans were allowed to impose a waiting period before coverage for the existing condition would start.
Since 2014, the “fix” is that now it’s just required to always have insurance, or else you pay a penalty.
Then for the last couple years the penalty was repealed but the coverage for pre-existing conditions is still guaranteed, which does open up a hazard that people will only buy insurance after they get sick... but really the risk of a sudden health issue is still high enough that most healthy people will still want coverage.
As is not allowing interstate competition, and not requiring pricing to be published, and not paying rebates for seeking out less expensive treatments.
I'm my own employer, and the exchange choices are shitty beyond belief. I pay $15K/yr for a family of 3 (that's excluding the considerable deductibles), and I'm not even sure to what extent I will be covered if I e.g. break a leg. The premiums go up every year like clockwork, and will likely go _way_ up this year, due to C19.
I'm thinking of just finding a clinic somewhere abroad if shit really hits the fan, and going without insurance in the US at all, covering my yearly physical out of pocket. It boggles the mind that politicians are proposing to sink trillions more into the bottomless money pit that is the US "healthcare" system.
I was paying about $1.5k / mo for a terrible plan for just a family of two in NC under ACA. The public risk pool is completely terrible and large corporate employers’ risk pools are separated from the general public and self employed.
More and more employers are now self insured. Making your employer your negotiate with healthcare providers directly for care. They might also us a TPA (third party administrator).
Thing is, your boss may know way more about your health than you’d expect.
Let's say HR really does care about employees interests. It could be that they chose an insurance program that is best for 90% of employees, but is a terrible choice for you. HR is unlikely to change anything because of a few outliers.
