Alarming News

August 25, 2009

Let’s talk about greed (Jessica)

Whenever I debate healthcare reform with someone, they always go back to this idea that there is some sort of inherent evilness in a for-profit system. They argue that if there are bonuses given out to employees, there will inevitably be customers who are going to be screwed over at whatever cost as though these companies are not held accountable for their actions in any way.

The beauty of the free market is that the reason companies do not charge whatever they want and screw customers over at whatever cost is because the market holds these companies accountable. That’s what competition is all about. We, as consumers, are holding companies accountable by not doing business with them. That is, given that we have the choice to do so.

The important thing to note here is that we do not by any means have a free market health care system which is why insurance companies aren’t exactly pleasing the consumers. It is not a free market because individuals are disconnected from the costs they incur. In fact, how many times have you gone to the doctor or dentist and they try to upsell you with a whole bunch of unnecessary procedures just because insurance will cover them? I think it’s despicable that these doctors who complain about insurance companies not coming through with their payments are the same doctors who incur tons of costs on the insurer by blatantly taking advantage of them. And I’m sorry, the consumer who agrees to this is no better. As my friend says “People who get unnecessary medical procedures just because the insurance company will pay for it are the same people who would stand in line for hours if they saw a sign announcing ‘free rocks.’ Mindless fools.”

So, consumers don’t have a choice in their insurer, and they don’t care about the costs they incur. Seems like anything but a free market if you ask me. So what do we do? Well, there are small changes we can make which would have a significant impact. For years people have been suggesting things like higher deductibles, less employer-tied insurance, encouraging consumers to save for their healthcare by not taxing health care savings, etc.

I maintain that people do not want these changes because they want free access to healthcare so they do not have to worry about any costs incurred, how this will affect future generations, and how this will affect long term medical innovation. I think that these are the ‘greedy’ people we have to worry about.

Posted by Jessica at 05:29 PM |
Comments

Good final point, Jessica.
The people who demand that the American taxpayer must pay for their government entitlements ironically keep projecting the “greedy” label onto everyone else.
The anti-capitalists fail to understand that capitalism is merely a gauge of determining what people “want.”
All these lefties are screaming about how we must put “checks and balances” on capitalism.
They don’t grasp that competition and the demands of the consumer ARE the checks and balances.
If a good is poor, or priced too high, or the service is poor, or it is too expensive, then the consumer will take his/her business to an entrepreneur whom satisfies his/her desires for quality and service.
Competition keeps everyone on their toes.
On the other hand, if a government service is poor….then….then….well, oops, there is no consequence for the government—since there’s nowhere else for the “consumer” to go.
The anti-capitalists keep whining that private insurance is too expensive—but their solution is to throw the baby out with the bathwater, rather than pull the drain on the bathwater alone.
There’s a lot of dirty bathwater to be drained from the current situation.
One of the major reasons for the reason private medical insurance is expensive is because the feds only reimburse doctors and hospitals PENNIES ON THE DOLLAR for Medicare patients.
As a result, the doctors and hospitals MUST re-claim some of that lost income, and they do it by tacking it onto what consumers of private insurance are charged.
So, in effect, those of us whom purchase private insurance are paying for the health care of people on Medicare and Medicaid TWICE….once, in the form of taxes, and a second time when we are charged “more” to compensate for the lack of what the feds reimburse doctors and hospitals for each of their Medicare patients’ medical procedures.
Also, we’ll never hear Democrats calling for tort reform—the trial lawyers are all in their pockets.
If we could achieve tort reform, that will decrease the cost of health care because the doctors won’t have to pay such high malpractice insurance, and likewise the doctors won’t be forced to practice “defensive medicine” by ordering additional tests in order to protect themselves from potentially unwarranted malpractice lawsuits.
Also, people need to accept that the newest breakthroughs in medical technology and pharmaceuticals are just going to be expensive, just as the “newest” breakthrough is in every other arena. And again, with every NEW medical technological breakthrough, comes the inherent risks of NEW angles in unwarranted malpractice lawsuits.
Many people want the benefit of 2009 medical technology—but they only want to pay 1959 medical technology prices.
Sure, health care was not as expensive back then…but they didn’t have all the pre-natal care or the MRI machines, or the wonder drugs, etc.
Another thing to consider in bringing down the cost of private medical insurance is that we should consider using the car insurance paradigm.
With car insurance, we pay out of pocket for our oil changes, our new fuel pumps, our new sets of tires, our new brakes, et al.
And then in the case of a “catastrophe,”—generally an accident—our insurance pays for those costs.
But can you imagine how expensive an oil change would be if our insurance company was paying for it ?
So, if we would consider paying out of pocket for regular check ups, antibiotics, x-rays, and lesser expensive procedures, and we merely defer to insurance to pay for the more expensive and “catastrophic” scenarios (after a high deductible), it would keep our overall monthly insurance costs down.
Also, there should be portability with insurance.
As it stands, you can only purchase insurance from within the state you reside.
We need to open it up to competition and allow people to purchase insurance, regardless of state boundaries.
Government is the problem, not the solution.
Competition is the solution.

Posted by: IamTheWalrus at August 26, 2009 at 12:38 am

Can you tie capitalism to health care?
In the case of emergencies you’re not exactly in the state-of-mind to choose where you go, what doctors will take care of you, and what procedures to partake in.
Perhaps with things like physicals, eye checks, teeth cleaning you can choose your “tier” of care you feel you need but sitting with a compound fracture bleeding all over the place makes it difficult for the consumer/patient to say “take me to Mercy hospital over North Memorial because they’re better/cheaper”.
Also, the hospital billing/pricing system needs an overhaul. Doctors and Nurses deserve their well-earned salaries but paying (or charging the insurance company) $300 for a 5oz. tube of ointment found for $2.99 at Target while in their business isn’t going to allow the lower/middle-class to afford to pay for things out-of-pocket.

Posted by: Drizztdj at August 26, 2009 at 8:57 am

Good points Jessica and walrus. You’re respective comments on the disconnect of payment for medical procedures and paying for minor tune-ups out-of-pocket are synonymous with my own thoughts. I have a high-deductible health plan myself and couldn’t be happier. Yes, I have to pay for all my doctor visits myself, but that just gives me incentive to stay healthy–something many people lack these days. I know I’m covered in case of a catastrophe, and that gives me piece of mind. My employer actually puts more into my HSA each month than I pay in premiums and I use that money to pay for said doctor visits, plus I can use it for simple OTC items like Advil.
Yes, greed may be a deadly sin–but so is envy. All these people talking about “greedy capitalist” this and “greedy capitalist” that need to realize that their own “equality-for-all” tendencies, left unchecked, can result in just as dire of consequences; if not worse.

Posted by: Jason at August 26, 2009 at 10:06 am

I also don’t understand what’s so greedy about paying already ridiculously high taxes and not wanting to pay anymore.

Posted by: Karol at August 26, 2009 at 10:06 am

Couple of quotes to start off:
“The point is, ladies and gentlemen, that greed, for lack of a better word, is good. Greed is right. Greed works. Greed clarifies, cuts through, and captures the essence of the evolutionary spirit. Greed, in all of its forms, greed for life, for money, for love, knowledge, has marked the upward surge of mankind. And greed, you mark my words, will not only save Teldar Paper, but that other malfunctioning corporation called the USA.” – Gordon Gecko
“The direction of all economic affairs is in the market society a task of the entrepreneurs. Theirs is the control of production. They are at the helm and steer the ship. A superficial observer would believe that they are supreme. But they are not. They are bound to obey unconditionally the captain’s orders. The captain is the consumer. Neither entrepreneurs nor the farmers nor the capitalists determine what has to be produced. The consumers do that.” – Ludwig von Mises

It is not a free market because individuals are disconnected from the costs they incur. In fact, how many times have you gone to the doctor or dentist and they try to upsell you with a whole bunch of unnecessary procedures just because insurance will cover them? I think it’s despicable that these doctors who complain about insurance companies not coming through with their payments are the same doctors who incur tons of costs on the insurer by blatantly taking advantage of them.

Actually, a system of insurance — no matter how comprehensive — can still be part of a free market. A free market means only that there is no government hindrance. If people want to enter into contract so that one makes certain payments in exchange for a service that harms no one, then that should be the freedom of both parties. If the insurer doesn’t charge sufficiently high premiums, or the insured pays far more than what he receives, then the contract can be adjusted at the next renewal.
Some system of “government” could possibly exist alongside a free market if and only if the former is confined purely to punishing force and fraud, but as we know, that isn’t what we have today. Government wants to step in and make sure that nobody makes a bad choice from the beginning. What it does is make the contract unnecessarily expensive and inconvenient for both sides.

And I’m sorry, the consumer who agrees to this is no better. As my friend says “People who get unnecessary medical procedures just because the insurance company will pay for it are the same people who would stand in line for hours if they saw a sign announcing ‘free rocks.’ Mindless fools.”

In a free market, consumers are free to avail themselves of whatever benefits the contract offers. Then they are penalized when their premiums repeatedly go up. It works: the free market can always “regulate” itself in supply and demand. Government, though, wants to force companies to lower premiums, and eliminate procedures.
A few years ago, my department was moving to a new floor. I was organizing some things in our legal library when I overheard a couple of hired movers talking. One had managed to schedule a few appointments on the same day. “If you’ve got the coverage, you might as well use it.” These are the same idiots who will complain about “price-gouging insurance companies,” rather than recognizing that their premiums reflect what their medical coverage costs the insurer.
But there’s a problem with the generalization of “unnecessary procedures.” If I think something serious is wrong with me or someone in my family, you’re damned right I’ll go for any test that I think is worthwhile. In a free market, that’s my choice, and I alone should reap the consequences.

So, consumers don’t have a choice in their insurer, and they don’t care about the costs they incur. Seems like anything but a free market if you ask me.

As Walrus and I have pointed out, that’s because we can’t buy insurance policies from across state lines. Dear Leader Barack was emphatic during the debates that people can’t be allowed to do that, lest someone buy a policy that doesn’t give him good coverage. That’s because he doesn’t believe people are intelligent enough to decide for themselves. Instead, I should turn the decision of my minimum coverage over to those…brilliant men in Albany?
Maybe people really are too stupid to determine what’s a “good policy.” But if government keeps mothering them, they’ll never learn.

I maintain that people do not want these changes because they want free access to healthcare so they do not have to worry about any costs incurred, how this will affect future generations, and how this will affect long term medical innovation. I think that these are the ‘greedy’ people we have to worry about.

Yes. Capitalist greed is what made this country into the powerhouse it is today. Our medical care that is expensive, but we do get what we pay for. It’s socialist greed that is destroying us. What’s the difference? The capitalist wants more and so creates it. The socialist can only take from what is already created.

Posted by: Perry Eidelbus at August 26, 2009 at 10:31 am

I’d like to add a point that we already have socialized medicine, just not a very efficient system for doing it. Right now, I cannot name a single hospital that will deny a patient emergency care. All of my doctor friends (yes, I have tons of them) describe ER triage lines that often go down the block, frequently with un-insured people who need some kind of care. Many many of these people cannot pay for anything.
Guess who pays? Well, I do, with my fancy PPO health plan that pays for my “oil-changes” as a previous person noted. A percentage of my premiums is being re-directed to those people. Think about it. The input of money into the system is from my premium. The insurance company needs a cut, the hospital needs a cut, and the suppliers need a cut. The consumer is, well, me. If it was just me, and other insured people, we would simply have a closed working system. However, we have consumers who do not provide input. The end result is my input has to cover them.
I should say that I consider myself to be left-of-center on this issue, so full disclosure of my bias on this issue. But I really don’t see how all the ideology discussions here matter, when the *reality* is that unless hospitals simply won’t treat the un-insured, we basically already have universal health-care. Just a *very* *very* expensive version.
I’d be curious to hear from conservatives on this point :)
Cheers everyone,
Jon

Posted by: Jon Whitney at August 31, 2009 at 9:11 pm
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