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Old 01-30-2018, 10:07 AM   #21
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I hope this rattles ups the medical care system quite a bit. With all the focus on insurance, we often forget that it is medical costs that are driving up insurance rates. When a 1/2 hour exam at a specialist costs $424 (such as one I had a few years ago) it is no wonder that insurance rates are booming.

Maybe they will figure out why a joint replacement that costs an uninsured American 20K in Belgium costs the insurance company $50K+ in the USA.
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Old 01-30-2018, 10:14 AM   #22
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While I agree, costs can be driven down by the power of negotiating leverage. You can see this in local markets where the big dog insurance company pays less for the same procedures than a smaller insurance company. Conversely, big hospital systems can demand higher rates from smaller insurance carriers, with less leverage.
IMHO, there should not be any "negotiations" necessary. Why have one person pay less for same level of services. Again, that's where ACA failed by continuing to allow each company negotiate rates. Doesn't it make more sense to have one rate, regardless of who the insurer is? Government should/could get involved by regulation costs that hospital's and medical groups can charge be no higher than the lowest rate charged to other insured patients. Those who have no insurance would then have same rates plus additional charge to based on delinquency/charge-off factors.
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Old 01-30-2018, 10:15 AM   #23
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I hope this rattles ups the medical care system quite a bit. With all the focus on insurance, we often forget that it is medical costs that are driving up insurance rates. When a 1/2 hour exam at a specialist costs $424 (such as one I had a few years ago) it is no wonder that insurance rates are booming.

Maybe they will figure out why a joint replacement that costs an uninsured American 20K in Belgium costs the insurance company $50K+ in the USA.
+1000

A large number of insurance companies don't do their own claims adjudication. These folks are too busy to collect the money owed to them. Companies make millions doing it for them.

IMO any company that can't be bothered to efficiently gather revenues is overcharging everyone!
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Old 01-30-2018, 10:18 AM   #24
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I hope this rattles ups the medical care system quite a bit. With all the focus on insurance, we often forget that it is medical costs that are driving up insurance rates. When a 1/2 hour exam at a specialist costs $424 (such as one I had a few years ago) it is no wonder that insurance rates are booming.

Maybe they will figure out why a joint replacement that costs an uninsured American 20K in Belgium costs the insurance company $50K+ in the USA.
There are various reasons why, such as medical malpractice insurance costs, US is very aggressive at lawsuit recoveries.

But I get what you are saying.... so going further, it needs to be figured out why same doctor performing replacement costs $35K to one insurance company and $50K+ to another insurance company. Who provides the coverage should not constitute what the cost is to perform the procedure or surgery.
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Old 01-30-2018, 10:23 AM   #25
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Curious if after jumping through all the hoops for your Wellness plan if you felt you actually achieved a better level of health. My former employer had similar plan (hint, my former employer is one of these companies). Yes, I went through the horse and pony show for getting my Wellness credits, but honestly, in the end, I was no healthier. After years of basically the same 'education' I was no more health smarter. I felt it was just a way for them to increase rates, let those who were too lazy or had more than enough money pay the higher rates, and those who were more financially concerned jump through the hoops in order to save some money.
I think, If you need a financial incentive to “do the right thing” from a health perspective, it is much less likely to be effective in improving your health. On the other hand, many health conscious people don’t need a financial incentive to get “healthy”. So in the end, I think financial incentives might be dubious. You can usually find ways to game the system. Although that would be pretty short sighted in my view.
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Old 01-30-2018, 10:33 AM   #26
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If this initiative takes itself down to the level of practice management - both in hospitals and physicians' offices, then that is a game-changer. There are already other technology companies who are attempting to link claim info to health info to a specific employee/member for a 'seamless' experience. Marketing talk.

This initiative is nothing more than looking for ways to reduce the employer's cost of coverage for the employees of these companies.

These employers are large enough that today they negotiate the rates and sometimes the coverage language on the employee healthcare benefit. This can also include reporting the health outcomes back to the employers (if the insurance company will do it, I know one that refused knowing they would not win the contract for benefits).

So, the market reaction? Just traders taking advantage of news.
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Old 01-30-2018, 10:38 AM   #27
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This is interesting news. Bloomberg reports https://www.bloomberg.com/news/artic...pany-for-staff
This is an interesting initiative. The three companies employ more than 1M, so they have critical mass. They also consider themselves as premier employers, so they are motivated to look for health care options that are high quality but lower cost. I suspect they will find lots of opportunity to do, and only wonder if what they find or achieve is scalable or transferable.
Hot dog! Hopefully more competition in health care will turn out to be a big advantage to the consumer.
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Old 01-30-2018, 10:39 AM   #28
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I got a news clip notice this morning & read this; very interesting, and encouraging too. I’m in favor of smart people (with lots of resources) trying to solve problems.

Also, thanks for the Kaiser Wiki link; it’s been a long time since I read that. They’re right across the Bay from us so, they’re kind of omnipresent out here.

Anyway, a few initial thoughts:

1. At the risk of underestimating Bezos, Buffet & Dimon (BB&D), I think they have a long hard road ahead if they plan to make major changes to US healthcare as a whole. Because, they first have to make the model work for just their 1M+/- employees, doable in my view. Then they have to find a way to expand it to millions more people, which I expect to be much more difficult because they will be fighting the US Healthcare Industrial Complex every step of the way.

2. If BB&D are wildly successful with #1 above, they will have addressed only ~50% of US Healthcare spending (the private portion; see the table @ 0:27 in the video below). Although there would likely be knockon effects to Public Healthcare spending (Medicare, Medicaid, VA, ext), it would still have to be addressed directly for meaningful & lasting improvement.

3. On the encouraging side though, it’s all about negotiating a fair and reasonable price for a service (see video below), which BB&D have proven themselves masters at doing. They’ve (mostly Bezos) also proven themselves effective “disrupters” of established business models.

Personal Responsibility for Healthcare?

4. Also on the encouraging side, we (the USA) have demonstrated that we can do this - effective health care at a reasonable price; Kaiser being a prime example. So, that’s encouraging.

Excerpt:
Results
The per capita costs of the two systems, adjusted for differences in benefits, special activities, population characteristics, and the cost environment, were similar to within 10%. Some aspects of performance differed. In particular, Kaiser members experience more comprehensive and convenient primary care services and much more rapid access to specialist services and hospital admissions. Age adjusted rates of use of acute hospital services in Kaiser were one third of those in the NHS.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC64512/

In the end, I’m hopeful.
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Old 01-30-2018, 10:41 AM   #29
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There are various reasons why, such as medical malpractice insurance costs, US is very aggressive at lawsuit recoveries...
IMHO, this is a large issue in healthcare. It drives all those extra tests and services. I don't see how these companies can control the external lawyers. I know I spend a lot of time signing legal waivers any time I do anything with a health care provider. There is a difference in litigating every nit pic and litigating true malfeasance but I don't know how to separate the two.
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Old 01-30-2018, 10:50 AM   #30
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Why does a doctor need to spend so much for tuition and education? Why does anyone? With almost $1.5 trillion in student loan debt (average of over $37K per borrower), you've tapped into another underlying issue. Let's lower costs for getting education, that will drive real wage increases (imagine someone not having to pay $700-1000/mo in student loan payments). But that's getting off topic. Until then, perhaps doctors who are members in health care groups can get their debt forgiven based on years of service. Some teachers have this benefit, some companies offer similar reimbursement plans, so maybe now's the time to find ways to lower and cover the cost of doctors becoming doctors.
The wife of a coworker was studying for an advanced degree in medical research. As I recall, she paid about one third the amount of tuition as the prospective doctors taking the same course! Seems everyone is on the "take a little extra from the medical field" bandwagon. How are these companies going to stop this type of attitude that permeates the whole society?

BTW, having the Government control and manage prices has never worked. I don't think it would work in this case either.
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Old 01-30-2018, 10:50 AM   #31
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I’m in favor of smart people (with lots of resources) trying to solve problems.
This sums it up for me.
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Old 01-30-2018, 10:51 AM   #32
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What a noble idea!! I like it! The more competitions there are, the better.
+100.

The plot could get interesting .
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Old 01-30-2018, 10:59 AM   #33
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IMHO, our ability to provide health care exceeds our ability to pay for it. To use an analogy, we can produce Ferraris, but we can't afford to buy everyone a Ferrari. Accordingly, I think we either have to let market forces (price) allocate care or we have to let the government allocate care. A combination would also work. And, we can afford for everyone to have at least a Chevrolet (safety nets for the poor). But the days of unlimited care for most/all are probably over at some point in the near future.
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Old 01-30-2018, 11:01 AM   #34
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I'm no expert, but IMO malpractice insurance is a red herring as a driver of health care costs. Malpractice claims and awards have been on the decline for the past decade, in part because numerous states have placed caps on non-medical awards.

Here's an article by Dr. David Belk that has an interesting take on the subject: Medical Malpractice: Myths and Realities - True Cost of Heathcare
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Old 01-30-2018, 11:03 AM   #35
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It will be interesting, but the three companies are pint-sized to the Medicare group, or even the Federal employee group. Both of which could be combined. I have to believe those groups may have negotiated something too.

I am guessing they may create a plan that focuses on preventative care. Probably they will create a disincentive to using emergency care, and go with mail-order drugs. In the end, the companies will subsidize the premiums and have a lower cost for the employees.

Maybe they save a small amount in the long run, maybe not. Odds are, no one will notice any changes. Sharp negotiating tactics could hurt salaries of lower paid healthcare providers, especially if they outsource/import labor as they do with their IT departments.

Maybe they will buy an Hospital group, or an insurance or pharmaceutical company?
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Old 01-30-2018, 11:04 AM   #36
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I’m in favor of smart people (with lots of resources) trying to solve problems.
My thought EXACTLY!
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Old 01-30-2018, 11:22 AM   #37
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I think, If you need a financial incentive to “do the right thing” from a health perspective, it is much less likely to be effective in improving your health. On the other hand, many health conscious people don’t need a financial incentive to get “healthy”. So in the end, I think financial incentives might be dubious. You can usually find ways to game the system. Although that would be pretty short sighted in my view.
I agree to some extent- in my case, I was in the gym every day anyway before I started working there, was at a good weight, ate healthy most of the time, etc. I can't say it changed my behavior that much. I turned down the points to lower my borderline-high cholesterol because I'd had a bad reaction to statins a few years before and that seemed to be the only way to do it.

A wellness program MIGHT be a way to attract more people like me, who see it as a reward for doing something they already do- so a healthier workforce with less absenteeism due to sickness.

And yes, there are ways to game the system. The local municipality had a badly-monitored wellness program and before they caught up with them, employees were getting $200 gift cards because their 4-year olds were completing marathons. I've also read joking remarks about how you can get in your 10,000 steps by putting your FitBit on your dog or on the ceiling fan. Never tried either.
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Old 01-30-2018, 11:26 AM   #38
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'Your margin is my opportunity.' What a gargantuan opportunity. Perhaps not the best solution but who knows where it may lead.
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Old 01-30-2018, 11:33 AM   #39
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I've also read joking remarks about how you can get in your 10,000 steps by putting your FitBit on your dog or on the ceiling fan. Never tried either.
I stuck mine in the pendulum of our grandfather clock for a day and made up for a few days of being lazy.
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Old 01-30-2018, 11:42 AM   #40
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... I suspect they will find lots of opportunity to do, and only wonder if what they find or achieve is scalable or transferable.
Very interesting. I think the only way for something like this to work long term is if it is run like a credit union. A true non-profit, run by and for the members.

They are large enough to gain economy of scale and too large to ignore. I sure hope they can bring some sense to the health care market. Fingers crossed.

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