By on September 3, 2015

UAW Member Assembling Corvette in Bowling Green Circa 2015

Automakers may try to negotiate a massive health care co-op with the United Auto Workers — similar to the one it has with its retirees — and potentially change private health care in the U.S., Bloomberg is reporting.

At issue are the roughly 300,000 workers and beneficiaries, and 750,000 retirees and their families who rely on the UAW for health care.

The pool of more than one million workers and their families could give the Big Three unprecedented negotiating power with U.S. hospitals and clinics.

The health care co-op, already in place for retirees, has significantly cut costs for the automakers. According to the Wall Street Journal, similar cooperations between employers and health care providers — Boeing, Wal-Mart and Lowe’s — have reduced health care costs by 10 percent to 20 percent.

According to Bloomberg, the $61 billion trust established in 2010 for the UAW retirees has cut drug costs, added care and retained its assets.

The potential pool of 1 million auto workers and their families would give the group considerable leveraging power in the health care marketplace and could lead to other direct employer-provider cooperations in the future, side-stepping traditional insurance administrators.

Blue Cross Blue Shield of Michigan, which currently handles the current auto workers, may stay on in some capacity to administer the benefits, but its role would likely shrink.

During the last round of negotiations with the UAW, automakers were cool to the idea of a health care co-op, but may be warming up to the idea in an effort to further cut labor costs on cars produced in the U.S.

Of course, there are always horror stories about similar organizations like this.

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96 Comments on “Big Three Health Care Co-op Could Change How You Buy a Car, Get Surgery...”


  • avatar
    highdesertcat

    I thought it ironic that American labor which was so supportive of the Affordable Care Act is now fighting tooth and nail to keep from implementing several of the mandates that threaten their Cadillac Health Plans.

    And the only way they can do that is to alter health care for everyone in America.

    I have noticed that the Advanced Beneficiary Notice has become standard issue for doctor and/or lab visits.

    Seems like in America decent healthcare is being taken away from those who have it and are paying for it, and who in turn receive less of it and are forced to pay more for it.

    Go figure.

    • 0 avatar
      mmreeses

      —ironic that American labor which was so supportive of the Affordable Care Act is now fighting tooth

      the UAW leadership are like jilted lovers in an abusive relationship, they get thrown under the bus by the Democratic Party at nearly every opportunity. but then say next time will be different when the Democrats ask for UAW help.

      at least Republicans deliver when they sell out to their moneyed interests.

      • 0 avatar
        highdesertcat

        Since 1985 I am an Independent and have voted for the best qualified candidate regardless of political party.

        The only thing I can factually address is that the Affordable Care Act has affected me negatively. As a business, we were insured through the business of my wife’s family, and it was truly outstanding care. Never any hassles!

        When O’care was passed, the rates for the business group health insurance went from ~$4800 per month to >$6100 per month, for less coverage we needed, but with mental health and pre-natal care included, which we did not need.

        So the business gave up that insurance and we have to suffer with second-rate single-payer health insurance provided by Medicare and Tri-Care for Life.

        Hence the Advanced Beneficiary Notice since the onus is now on the patient to pay the bill when Medicare disapproves it.

        • 0 avatar
          Truckducken

          But HDC, the government keeps assuring us that health care costs are going down! It must be true, after all it can’t be called the “Affordable” Health Care Act for nothing.

          Seriously, you and I are in the same boat. My company’s health care costs were skyrocketing before the ACA, and skyrocketing even faster since. I sincerely hope that whatever the UAW cooks up can actually make a dent in costs. However, it’s likely that any effective cost-cutting measures will promptly be blocked by congressional fiat, at the behest of the healthcare-industrial complex that clearly owns our legislators and continues to vacuum up more GNP every year at the expense of the ordinary working stiff.

        • 0 avatar
          bball40dtw

          Everyone has a vested interest in paying for prenatal care and health care for children. They are relatively inexpensive things that make total health care costs less over time.

        • 0 avatar
          highdesertcat

          Td & bball, The ACA works real good for SOME people who get subsidies. Not so well for others who had to pay their own way, LIKE ME AND MINE.

          Maybe the increased minimum wage will kick out some of those recipients of subsidies and force them to pay their own way.

          That would be a good thing.

          bball, prenatal care is provided free of charge in a sanctuary state like mine (New Mexico) to all illegals and indigents. It’s the law (Es La Ley).

          Anchor babies, don’t you know?

          • 0 avatar
            bball40dtw

            It’s free pretty much everywhere. I could take my daughter to the Oakland County Health Department for pretty much everything, but child well visits don’t cost anything on my insurance plan.

          • 0 avatar

            The subsidies go well past 15/hr for families I think only some single people would get hit. They would be lowered but still out there. Oddly enough i work for a small business (50 people) after double digit increases almost every year since 2007 it slowed in 2013 and last year it actually went down 1%. My big issue with ACA is the amount of deductible and coinsurance it allows to be dumped on the consumer. This was thanks to the fact that health insurance company reps wrote more then half the law.

        • 0 avatar
          krhodes1

          The flip side of ACA is that people like my brother and sister-in-law, who could never have afforded any kind of insurance previously as a self-employed landscaper and waitress, now can actually afford decent insurance. My health insurance costs went up too, but nothing remotely in the same universe to the amount that theirs went down. I can afford it easily, and chances are, you can too. Use some of that cash you allegedly have stashed around, and maybe have the company buy a slightly less nice truck for your wife.

          Ultimately, there needs to be a single payer for all 350M people in the country. This is how the rest of the civilized countries in the world do this. We have a great start with Medicaid, it just needs to cover everyone. Let the private insurance companies eat cake. They can still sell supplemental policies.

    • 0 avatar
      TW5

      Good healthcare is under-siege because businesses and employees all accepted public funds via income tax exclusions for health insurance premiums. In this instance, the subsidies have also poisoned the market for healthcare so the government is particularly apathetic towards the plight of businesses and consumers.

      Basically, the Obama admin and the Pelosi/Reid Congress were thwarted in their attempt to create single-payer and a public option. They flipped us all the bird by passing ACA, before we escorted them from Congress. The act signaled to businesses and the public that Congress is beyond help, and the Animal Farm must be abandoned. Sad that healthcare got so bad. Sickening that our government is openly antagonistic towards its own citizens. Somewhat amazing that the US continues to overcome the legislative blight. Strange that the people who often vote for the most severe beat downs of American commerce are also the people most likely to succumb to attrition.

  • avatar
    psarhjinian

    “The pool of more than one million workers and their families could give the Big Three unprecedented negotiating power with U.S. hospitals and clinics”

    So would single-payer.

    • 0 avatar
      bball40dtw

      That’s what I was thinking.

      Between my insurance premium and what my employer pays, it costs $1750 a month to cover my family. Now this is a better insurance plan than I have had in the last few years, but my premium costs are a bit less than they have been. That’s $21000 for those keeping score at home. Single payer can’t cost any more than that.

      • 0 avatar
        psarhjinian

        “Single payer can’t cost any more than that”

        If you look at what the US spends per capita, single-payer would be a bargain. And no “Americans are fat” doesn’t cut it as an excuse for excessive costs, not when the UK and Canada are a) also fat, b) almost half as expensive and c) better at service-delivery anyways

        The ACA is better than what preceded it, but man, the US healthcare system just sucks.

        ETA: The costs paid to the service-delivery providers (hospitals, doctors’ officers, labs, etc). In single-payer, a big, thick layer of rent-seeking bureaucracy is eliminated. This is reflected in the price you pay; The OECD-measured costs for Canada is something like $4-5k/capita; the US is nearing $10K. A lot of that $10K is rent.

        • 0 avatar
          bball40dtw

          The ACA still sucks. It doesn’t address the cost issues that are bankrupting Americans. Also, High-Deductible Health Plans can go [email protected] themselves.

          • 0 avatar
            28-Cars-Later

            It was DOA from day one because it was predicated on an influx of “young healthy people” to pay for it in yet another Ponzi scheme.

          • 0 avatar
            bball40dtw

            It’s a poorly thought out and constructed law that doesn’t really do anything for health care costs. It makes insurance companies cover things that they should have forever ago, but cost…no.

          • 0 avatar
            VCplayer

            I loved my high deductible before ACA killed it. I’m young with no health problems and never get sicker than the sniffles. Paying for a huge amount of coverage literally makes zero sense for me.

            I only needed insurance for.. insurance. Basically If I was in a horrible accident or something.

          • 0 avatar
            bball40dtw

            I was fine with mine when I was single. I’d be fine with one now for myself. For a family, they suck. Instead of a $2500 deductible, it’s $5000.

            I did the math on the current HDHP option we have at work. In order for it to save me money, we would need to file zero claims for almost 3 years. Then, if we did get sick, all the savings would be eaten up. Have another kid? Say bye to the $5000 you saved up. Oh, and once you get into the deductible, insurance only covers 70% instead of the 90% on the PPO.

          • 0 avatar
            Pch101

            “Paying for a huge amount of coverage literally makes zero sense for me.”

            I wish that I could avoid having car insurance until the day that I have an accident. I’m going to forecast when that day is and drop my coverage until the day before because that would be the smart thing to do.

            (Yes, I used the sarcasm font for that.)

          • 0 avatar
            VCplayer

            @bball40dtw

            Yeah, I couldn’t get away with that if I had a family. As is though, it was great for my bachelor life.

            @Pch101

            I don’t think that’s an accurate comparison. I think it’s more like if I decline to have collision insurance on my car because it’s not actually worth all that much. Yes, I’m unprotected in the event I lose my vehicle, but since I’m confident in my ability to replace it, I might consider it an acceptable risk. (And I’ve certainly driven cars where paying for collision WAS stupid unless I wrecked it in the next couple of months).

            Likewise, I would have liability insurance (even if not required by that state) since I want to be protected against the possibility of being on the hook for a very large bill. I’m taking a risk on a small bill but not taking a risk on a large bill.

            If I’m healthy, young, and single, there’s no reason I shouldn’t do this with health insurance. I mean, besides the government regulating that particular avenue nearly out of existence.

          • 0 avatar
            bikegoesbaa

            I love high deductible health plans, and wish I could still get one.

            I’m young, single, healthy, and well-capitalized. I don’t care if I have to pay $500 out of pocket for stitches, or even $5,000 out of pocket for a broken arm or MRI.

            I just want coverage for when I get eaten by a bear or hit by a bus and rack up $2 million in medical expenses.

            A low-cost plan that covered nothing under $10k and then everything up to several million would do me just fine.

            I don’t want all my medical care to be free or near-free, I just don’t want to be ruined by a major expensive injury or illness.

            America does this stuff backwards where we pay for care for old people – why pay for the time in somebody’s life when costs are highest and ROI is lowest?

            We need a cutoff age. Cover everything from birth to 65 or 70, after that you’re completely on your own. No more taxpayer-funded major expenses for people who should’t be buying green bananas.

          • 0 avatar
            bball40dtw

            “Why pay for the time in somebody’s life when costs are highest and ROI is lowest?”

            Seriously?

            Because providing people access to quality health care shouldn’t be about ROI.

          • 0 avatar
            Pch101

            My comparison was dead-on. You don’t understand how pooling or risk management works.

            Someday you won’t be young or healthy. The latter might happen today, for all you know.

            If you don’t want to be in the pool now, then you’re just going to make it more expensive when it’s time for you to join in later. That’s not magic, just actuarial math.

          • 0 avatar
            bikegoesbaa

            “Because providing people access to quality health care shouldn’t be about ROI.”

            Resources are not unlimited, so under any system somebody is going to have to make the decision as to who gets what care (and who doesn’t).

            $XYZ spent on somebody who likely has decades of active life ahead of them is a better use of not-unlimited resources than spending the same money to buy somebody a few more months at the very end of their life.

            Under our current system a young adult may have to go without important care due to costs, but we’ll happily pay the full amount to put new knees in a 75 year old who likely won’t be around by the next Olympics.

            What sense does that make?

          • 0 avatar
            dtremit

            +1 on what pch101 said. On a single-year basis, ACA may not end up being a good deal for a young, healthy person — but if it works as it’s designed, that young, healthy person should end up coming out ahead over a lifetime.

            The implementation has a lot of issues, but the basic theory is sound.

        • 0 avatar
          highdesertcat

          ” the US healthcare system just sucks.”

          Funny you should mention it, psar. My in-laws moved back to Germany in Jan 2015 and they rave about the healthcare system there, even though they have to pay their own way, outside of the German National Healthcare System.

          It would appear that Germany’s healthcare providers provide better health care services at lower costs and without co-pays in addition to health insurance.

        • 0 avatar
          jkross22

          The ACA is better for people who could previously not afford insurance and now receive subsidies, and is better for people who had PEC’s and now are able to get coverage.

          Everyone else is worse today for it. Smaller networks, higher premiums, higher deductibles.

        • 0 avatar
          VCplayer

          “better at service-delivery anyways”

          Eh, that’s debatable. In some cases sure, but there are plenty of horror stories of people waiting months for really serve problems to get fixed.

          Still, I’d rather single-payer than the zombie-hybrid system we have at this point.

          • 0 avatar
            psarhjinian

            “Eh, that’s debatable. In some cases sure, but there are plenty of horror stories of people waiting months for really serve problems to get fixed.”

            It actually isn’t debatable; there’s not a single objective study that proves the American system is/was good at anything, other than enriching insurance companies.

            Rich people have to wait just like the punters—or go abroad—but denials are rare, or at least comparatively rare versus the pre-ACA US, where people would either go bankrupt and/or die.

            Personally, I think that’s a humane tradeoff.

            Where many health-care systems fail is in primary and palliative care: it’s an easy one to cut by writ of policy, which works great on balance sheets until you realize that the lack of accessible primary care is what drives up acute care costs.

            Single-payer, fully-private and hybrids all suffer from this, but the temptation and bureaucratic costs of penny-pinching are much worse outside of single-payer.

      • 0 avatar
        jkross22

        Would you pay $1750 if you had to pay for the entire monthly premium?

        I’m betting not.

        What’s the most you would pay per month?

    • 0 avatar
      Pch101

      The way to save money would be to have a single pool of 300+ million people, instead of allowing medical providers to divide-and-conquer us with smaller pools and “networks.” But Americans aren’t smart enough to figure out something as basic as that.

      • 0 avatar
        MBella

        I actually agree with you for a change. I don’t understand why healthcare shouldn’t be like the fire department. You don’t go shopping for fire coverage.

        The only problem I see with a single payer system, is the complete ineptitude of the federal government. The government has to be fixed first before we can trust them with our healthcare.

        • 0 avatar
          Pch101

          The system can be operated by private insurers. That’s what happens in many of these “socialist” systems, contrary to what you might read in the right-wing opinion press.

          The thing to do is to get insurers out of the pool and network business. If there is no bifurcation of the pool and there are no networks, then the insurer’s job is limited to administering benefits. Individuals could pick their insurer based upon customer service, as there would be no difference in providers or the underlying pricing of services.

          • 0 avatar
            MBella

            That would likely still be a large improvement over what we have now. We also need to reform the legal system to cut down on the frivolous lawsuits. Malpractice insurance prices are also out of control.

        • 0 avatar
          Dan

          “I actually agree with you for a change. I don’t understand why healthcare shouldn’t be like the fire department. You don’t go shopping for fire coverage.”

          Not a good analogy. If you have much to lose in a fire or any real expectation of one, you exactly go shopping for private fire coverage. The fire department didn’t issue me my fireproof safe, or my smoke detectors, or my fire extinguishers.

          Awfully hard to find someone of means without what amounts to supplemental private police coverage too. Whether that’s ADT or an armed guard at the gate.

          • 0 avatar
            dal20402

            “Awfully hard to find someone of means without what amounts to supplemental private police coverage too.”

            What kind of dystopian hell do you live in? South Africa?

            I live in a neighborhood that’s a mix of roughly $500k condos and $900k-$1.2M homes. Almost no one has an alarm. I think there’s been one break-in in the neighborhood since I moved here over a year ago.

      • 0 avatar
        ClutchCarGo

        At least we could have a single pool/single payer system for basic healthcare needs, covering everything up to and including minor surgeries like appendectomy. Higher level services like organ transplants, coronary bypass and high expense cancer treatments would have to be covered by supplemental insurance, possibly available through an employer. This way people could get health issues addressed earlier, preventing or deferring more elaborate and expensive interventions later.

        • 0 avatar
          MBella

          I would actually prefer it the other way around. I don’t think there is too much of a problem paying the day to day expenses. People could pay that themselves or with private insurance. The big surgeries are what kills everyone financially at a time they can least afford it.

          • 0 avatar
            pragmatic

            Big surgeries are a piece of the cost that everyone thinks is whole thing. That’s why there are advocates for high deductible plans. I’ll only get a new knee once so I can afford the deductible. Where this fails big time is when we move from acute problems to chronic conditions.

            Ask some one with MS what there treatment costs are or someone with RA, type I diabetes, etc. These and other conditions can be well managed (in some patients) but not at low cost. Without my treatments I could not function (I was bed bound, could not drive, function or work). With treatments I am leading a productive life, skiing, motorcycling, swimming and most importantly working and contributing to society. What is the cost of this? Annual drug cost of $26,000 plus another $5,000 to $6,000 for doctors and blood work. I’ve been under treatment for 4 years and expect to be under this for the next 40 years. So how does a health plan cover this cost for one person? Only by having a large pool and some sort of drug price negotiating system.

          • 0 avatar
            ClutchCarGo

            MBella, the day to day expenses create a psychological barrier. If it costs $100 to see the doc, people wait until problems become unbearable, but if a visit is free, people will get in and get early (cheaper) care. A stitch in time, you know. Putting big ticket items on supplemental insurance would also be an incentive to address issues early. Watch your blood pressure and cholesterol and you’re unlikely to need bypass surgery.

          • 0 avatar
            Dan

            “MBella, the day to day expenses create a psychological barrier. If it costs $100 to see the doc …”

            That’s exactly the point, if seeing the doc is zero deductible “free” then hypochondriacs and the idle unemployed will – and where they’re able, already do – go in every time they get a hangnail.

            See the Self-Care white paper describing the NHS’s problems in the UK: 18% of GP visits are fundamentally wasting the doctor’s time.

            http://tinyurl.com/oo7fksq

          • 0 avatar

            There needs to be a balance there because many never go to the dr here now that copays are up around $45 a visit. This really hurts people with on going conditions the most. I have family members that see a DR every month that ends up hurting after a while

      • 0 avatar
        Charliej

        The US is supposed to be the richest country in the world, and yet many can’t afford health insurance. Since I moved to Mexico, I have been paying out of pocket for my health care. I do have health insurance provided by the government, but I will only use it if I have a catastrophic illness or injury. About a month ago, I tripped and fell, a hazard to any older person. I landed on my face, literally. I broke my nose and my teeth. When I fell, I put my hands out to break my fall. I drove gravel into my palms and injured my wrists and arms. I also skinned my knees. After some workers got me up out and out of the street, my wife drove me to the hospital. The doctor cleaned my face, taped my nose, picked the gravel out of my hands, dressed my knees. He packed my nose to stop the bleeding. He told me to come back the next day. The following day he removed the packing, checked my nose was straight. Made sure that I was not more seriously injured than he first thought. My cost was 550 pesos. At 17 pesos to the dollar that comes to just over $32.00. The dentist charged 1600 pesos to fix my teeth. That is about $95.00.

        My health insurance is with Seguro Popular. This is an insurance program that is free to all who are over 60. If you are under 60, the maximum cost is $300.00 per year. Medical school is free here in Mexico. In return, a doctor works for the government for a few years. After his government work he can go into private practice or continue to work for the government. Even private practice is very inexpensive, as my example shows. Here doctors are not expected to become millionaires. They are respected members of society. One other thing, if a doctor commits malpractice, there is not a monetary settlement. The doctor goes to jail. Doctors ten to be very careful here.

    • 0 avatar
      TW5

      In theory, single-payer only costs as much as Medicare, Medicaid and state healthcare spending.

      In reality, we have one of the least competent governments in the OECD; therefore, single-payer would cost the same or more than private health insurance, and the cost of single-payer would double every 10-15 years.

      The problem is not single-payer. The problem is the troglodytes and spendthrifts who weasel their way into the federal bureaucracies.

      • 0 avatar
        dal20402

        So you’re asserting with absolutely no reasons to back it up that 1) the government runs an insurance program covering old, poor, and disabled people at adequate cost, but 2) adding healthier, better-off people to that program would somehow bring out latent incompetence in the government and make the program into a nation-bankrupting disaster.

        Doesn’t pass the laugh test.

        • 0 avatar
          TW5

          The federal government spends more (per capita) to cover 1/3 of the US population than other OECD nations (excluding Norway) spend to cover the entire population. Clearly, the cost containment of the US system is not “adequate”. Instead, cost containment is virtually non-existent. HHS would have to triple the beneficiaries without increasing costs.

          You’re merely reinforcing the conservative stereotype of shameless low-information Democratic voter.

          • 0 avatar
            Pch101

            Go easy on the low information comments, unless you’re looking at a mirror while you’re uttering them.

          • 0 avatar
            dal20402

            I see. So your point wasn’t quite as stupid as I thought, but you wrote so badly I couldn’t hope to understand it. And you’re calling *me* low-information?

            Why is the cost so high? Mostly legislative policies that hamstring cost control efforts in public and private sector health care alike. And a failure to allow the public system to negotiate lower prices using its enormous pool. Overhead in the public system is quite low.

          • 0 avatar
            jkross22

            TW5, Cost containment was not a primary goal of ACA – despite it’s name. It’s goal was to ensure health insurance coverage for those who had been deemed uninsurable by insurance companies and to give subsidies to those living within a certain percentage of the poverty line. I recall subsidies were available to people earning roughly 300% or some number close to that and had a sliding scale of the benefit you could get.

            Despite ACA’s sales pitch, there is no savings. As with anything labeled ‘free’, someone somewhere paid for it.

          • 0 avatar
            dal20402

            ACA was a big bill that tried to do a lot of things at once. Its biggest goal was to get coverage to uninsured people, but it also has other separate measures that aim to slow the rise of medical costs. Medical costs are rising more slowly than they have in some time, but it’s unclear whether or not the ACA has anything to do with the change.

          • 0 avatar
            jkross22

            What medical costs are rising more slowly?

          • 0 avatar
            ect

            One example of why Medicare/Medicaid is so expensive is that, during the first Bush43 administration, a Republican House and Republican Senate passed, and President GW Bush signed, a law that forbids Medicare/Medicaid from negotiating drug prices- they have to pay whatever Big Pharma wants to charge.

            In Canada, by contrast, the Drug Prices Review Board negotiates the cost of every prescription drug to the government health care system, which then automatically becomes the retail price charged to consumers.

            The result is that prescription prices in Canada are typically 1/3-1/2 of US levels. And Big Pharma still makes money.

            So yes, there is clearly room for Medicare/Medicaid to improve cost containment. The problem is that the Republicans won’t allow it.

          • 0 avatar

            The real issue is medicare is working within our half assed insurance bureaucracies that would not exist in single payer.

    • 0 avatar
      raph

      Single payer would be nice but I don’t think I will ever see that in my lifetime (like a simplified tax code).

  • avatar
    CoreyDL

    My company with Anthem BC-BS for years, until they kept jacking the prices higher and higher. Now we’re with Aetna.

    Course now Aetna is going to merge with Humana, and CIGNA merging with Anthem. Whiddling the number of group health providers from 5 to 3. I’m sure that’ll be great for premiums!

  • avatar
    Slawek

    High insurance premiums are because of high costs of healthcare in U.S.
    I got MRI done in Europe this Summer for 150 Euro out of pocket, while I was on vacation there. The same MRI in WA is $2600. Thank big government for setting among others yearly quota on new doctor licenses.

    • 0 avatar
      jkross22

      I hear this argument from time to time. While it might be true, it conveniently ignores one sector of healthcare in the US where prices have fallen – elective procedures.

      Funny how the cost of LASIK hasn’t been impacted by the massive inflation in healthcare.

      Funny how when consumers pay for a medical procedure themselves, they can comparison shop and pick which doc works best for them. Prices are up front.

      US healthcare in its current state is akin to walking into a Honda dealership and seeing that none of the cars have window stickers. No mileage info, no msrp, no list of options, no warranty info. The average consumer would be completely in the dark.

      Better yet, imagine a grocery store with no prices on anything – you find out what you owe when you’re in line to pay.

      • 0 avatar
        Pch101

        The cost of lasik eye surgery works out to be about $200 per minute, and it’s a procedure that nobody really needs. Yeah, that would be a great price to pay for extended cancer treatment that one needs to survive.

      • 0 avatar
        bball40dtw

        The pricing thing is what pi$$es me off the most. My daughter had tubes put in her ears last September. The only part of that procedure that I could get a price for was the doctor. I happily paid his fee upfront, before even involving my insurance. I could not get a price for the facility fee, anesthesiologist, or other care givers that all billed separately for a surgery that took under 10 minutes. Total cost for the surgery ended up being over $5000. Where else can you buy a service for $5000 without knowing the price beforehand?

        • 0 avatar
          psarhjinian

          “Where else can you buy a service for $5000 without knowing the price beforehand?”

          Law*

          And although with lawyers you might know the rate, you certainly won’t know the outcome or the time. Medicine is similar, though with medicine the time is generally a known quantity and the capital costs are often astronomically higher.

          * And possibly accountancy, but I would put that under “Law” most of the time.

          • 0 avatar
            bball40dtw

            I would equate the surgery my daughter had to having a lawyer prepare a will or trust. It’s a common thing that lawyers straight bill for because they know how long it’s going to take. At least, when I had a will set up, I was able to get a flat fee.

          • 0 avatar
            greaseyknight

            Not even law is that bad, attorneys are tending more towards flat fee agreements where possible. I work primarily on a flat fee arrangement. Some cases take longer, others are shorter both are the same low price. We bill hourly for the cases that we can’t predict the time investment. Even then, I give you an hourly figure and some sort of estimate. Best way to keep the cost down? Don’t spend a bunch of time on the phone yacking with your attorney…go to a shrink!

        • 0 avatar
          dtremit

          In MA we actually have passed a medical price transparency law to address that.

          Implementation is…still a work in progress.

          • 0 avatar
            Pch101

            The price of a Ferrari is transparent. That doesn’t make it affordable.

            One of the problems with healthcare is with the lack of substitutes. If you can’t afford steak, then you can eat chicken or canned tuna or whatever. If you can’t afford insulin or chemotherapy, then you can’t just adjust your tastes and buy a cheap remedy at the drugstore.

            Knowing the cost of open heart surgery won’t make it a bargain. The essence of the problem is that we overpay providers who want to make Wall Street level incomes. We can’t afford to pay them what they want.

          • 0 avatar

            PCH it my help. I used to work next to a workers comp unit when i worked in insurance. They explained to me how he pricing systems at hospitals work. They are giant database that was created in the 70’s and 80’s that constantly adjust for additional costs but is never really reviewed against actual costs. There are also huge variations in these databases. She said a heart attach in one hospital in CT might be billed at 35k in one hospital and 15k in another for the exact same treatment plan. Some of it comes down to coding and some comes down to the database. In other words many medical procedure costs have no actual basis in reality. This is why they won;t tell you how much it costs up front.

      • 0 avatar
        psarhjinian

        “Funny how when consumers pay for a medical procedure themselves, they can comparison shop and pick which doc works best for them. Prices are up front.”

        That does not work for health care: it’s a seller’s market, not a buyer’s one, especially for things like cancer or cardiopulmonary disease. You can’t shop around for a cheap oncologist or neurologist, and you really, really don’t want to.

        “Better yet, imagine a grocery store with no prices on anything – you find out what you owe when you’re in line to pay.”

        This is the problem. Healthcare isn’t a market, it’s a utility. Trying to treat it like a market and incentivize it is why it’s ruinously expensive in the US versus elsewhere.

        To use your analogy, it doesn’t matter what the price in the store is when you’re starving and can’t afford to shop there anyway. Health care is much more complex than food because, frankly, oncology is a **little bit** trickier than chopping vegetables.

        Other nations, with single payer, tend to just pay doctors for the work they do and buy the equipment and facilities directly. There is no haggling or negotiation (and when it happens, it’s usually when costs spiral) there’s just services and delivery.

        • 0 avatar
          bball40dtw

          Someone should still be able to tell me how much it will cost for my daughter to have surgery at their center for a procedure that they perform dozens of times a day with little to no complications.

          • 0 avatar
            psarhjinian

            “Someone should still be able to tell me how much it will cost for my daughter to have surgery at their center for a procedure that they perform dozens of times a day with little to no complications.”

            In a civil society, you shouldn’t even have to ask the question. You would just get it done.

          • 0 avatar
            Pch101

            It’s like buying an airline ticket or a car — the prices aren’t uniform. But the airline uses a predictable algorithm and the car dealer uses predictable tactics, while the pricing of medical procedures is all over the map.

            The network system drives up prices because medical providers can pick and choose and play the insurers against each other. The medical providers become the customers, instead of those who pay the premiums.

          • 0 avatar
            bball40dtw

            psar-

            I agree.

            Pch-

            Well they can tell me how much it costs without insurance, or when I give them my insurance info, they know how much they bill that company.

            They could have just given me any number. I wasn’t expecting something legally binding. Anything was better than, “I don’t know”. They at least have a [email protected] range.

          • 0 avatar
            Pch101

            Most of their customers have insurance.

            If you want to pay cash to a doctor, then you are probably best off haggling with him or directly. Their staff is generally not equipped to do that — they don’t have an MSRP to which to refer.

            Healthcare is not a typical product that works in a free market. Other countries use pooling to create buying power, but the US had done exactly the opposite by dividing everyone into a myriad of pools, some of which are more appealing to insurers and medical providers than others. That is a core problem that ACA did not fix.

          • 0 avatar
            bball40dtw

            I understand all that.

            However, we had a HDHP at the time, and I was going to have to eat a significant portion of the bill. The fact that no one at my insurance company or the outpatient facility could provide me with any kind of pricing or cost information. Since a myringotomy is THE MOST COMMON surgical procedure performed on children, the place that does then, and the insurance company that pays for them would have an idea of what the average myringotomy cost.

            Asking for that info is not unreasonable. Anyone who thinks that is unreasonable is wrong.

          • 0 avatar
            Pch101

            I’m not defending it, just explaining. The healthcare payments system that we have is a horrendous joke.

            If someone paid me to design a healthcare system that was inherently costly and inefficient and that transferred maximum dollars into the pockets of healthcare providers while not improving care, my answer would be to copy the United States. It would be difficult to do a worse job, and ACA only dealt with small aspects of the problem.

          • 0 avatar
            bball40dtw

            Oh I understand we have a problem. I just don’t like it, and I find the current system infuriating at best. I don’t want to spend my time arguing what constitutes a level 1 and level 2 emergency room visit (It changes the bill by $750 if the emergency room gives your kid an oral antibiotic that costs $.0001). This is not an intelligent and civilized way to spend my time and our health care dollars. It is sheer lunacy.

        • 0 avatar
          dal20402

          “Healthcare isn’t a market, it’s a utility.”

          For definitions of “healthcare” that don’t include purely elective procedures, this is right, and the nations that recognize it are the ones that manage to have both reasonable healthcare costs and quality outcomes. It doesn’t matter if the insurance is provided by the government (Canada) or private companies (Germany/Switzerland); it matters that it’s available to everyone at rates that reflect the use of the entire population as the risk pool.

        • 0 avatar
          jkross22

          Setting a broken arm can cost between x and y as can heart surgeries, most ER care and many medically necessary procedures. Your point on cancer care makes sense, but does not and should not absolve hospitals, specialists and other clinical care providers from being more transparent with patients and potential patients on the cost of care of procedures and treatments that can be ballparked.

          Keeping patients in the dark on the cost of medical procedures benefits the providers and insurers.

      • 0 avatar
        MBella

        The problem is that you can live without Lasik. Even as prices have dropped, they haven’t dropped enough for me to get it done. I’m nearsighted, and get by without glasses just fine day to day. I only wear them in the car, and those are usually my prescription sunglasses. My vision will have to deteriorate way more, and the price for Lasik will have to substantially drop more for me to get it done.

        Now compare that to the guy who needs open heart surgery. He isn’t exactly in a good bargaining position. He can’t hold off until he finds a better price.

        • 0 avatar
          Pch101

          If all other healthcare was priced as Lasik is, it would be even more unaffordable.

          Not many of us could afford to pay $200 per minute for healthcare over an extended period. It may be tolerable for ten minutes of your life and a one-time optional procedure, but few could afford to treat a chronic condition at that price.

        • 0 avatar
          ClutchCarGo

          Healthcare also does not lend itself to market forces the way that food, clothing or appliances do. If I need an oven, I can do some research and find one that meets my needs and budget. If that choice doesn’t work out, all I’m out is the cost of the oven, and I can replace it again. If I’m having chest pains, I can do some research but I really need more info that I can only get from a doctor, and even if I got the same sort of info I could get about the oven (options and the attendant costs), making the same sort of decision is nearly impossible. Do I watch and wait, or have one of multiple interventions, each more expensive than the last? If I choose wrong, I’m dead or crippled. I can’t just eat the expense and make a different choice.

          • 0 avatar
            bball40dtw

            My daughter wasn’t going to die from ear tube surgery. I had already selected the Dr and he worked out of two facilities affiliated with the health system nearby. The fact that neither could give me a price is ridiculous. Either one was perfectly reasonable. He worked at both on different days.

          • 0 avatar
            ClutchCarGo

            bball, you’re right that the charge info was known and should have been available to you, but the system simply isn’t set up for people like you. We’ve been in the current insurance model for so long that pricing info in the charge master has absolutely no bearing on reality, and no one at the desk has any experience on giving quotes. As PCH suggested, you might get somewhere with the Dr or an office mgr, but you’ll just get blank stares from everyone else. This is also the result of the point I was making about market forces. Altho you just wanted to know what your bill might be, would you have tried to shop around the price, looking for a better deal? Not likely, and therefore, no office has any experience with giving out pricing.

          • 0 avatar
            bball40dtw

            I just want to burn it all to the ground.

          • 0 avatar
            jkross22

            Clutch,

            If it’s an emergency, I would hope someone with chest pains is getting to the ER. Cost is irrelevant at that moment.

            Once a problem has been identified and a treatment plan recommended, it’s irresponsible to move forward with the thought that cost is irrelevant. For non emergencies, providers ought to be compelled to tell patients the cost and what their insurance will and won’t cover. ACA should have required this.

            Bball,

            You’re spot on with your frustration. There’s a price for everything a hospital or surgical center does. It may not be known to the people you spoke with, but it’s absurd that no one could have told you the cost of the procedure.

          • 0 avatar
            ClutchCarGo

            bball – I would like to burn it down as well, and med billing is what I do for a living. If a single payer system replaced the ACA, I would have to find another use for my programming skills, and I would do it happily.

            jcross – It’s irresponsible to you for me to move forward on my chest pain with the thought that cost is irrelevant. You wouldn’t think so about your own chest pain. That’s why market forces are not very useful in controlling costs. We all want whatever it takes when our own irreplaceable health is on the line, costs be damned.

        • 0 avatar
          jkross22

          True, if he’s taken to the ER because he’s had a heart attack. If he’s told by his doc he’s a high risk and he needs stents, of course he can shop around, or at minimum, talk with his doc about paying for the procedure.

        • 0 avatar
          jkross22

          Maybe that’s why hospitals don’t share information regarding the cost of care. If they did, people would drop dead on the spot.

      • 0 avatar
        rpn453

        “Better yet, imagine a grocery store with no prices on anything – you find out what you owe when you’re in line to pay.”

        More like, you find out what you owe after you’ve taken it home and finished eating!

  • avatar
    dtremit

    Random but tangentially related fact: the first successful open heart surgery was performed at Harper Hospital in Detroit in 1952, using a pump built by General Motors. So in a sense, they’ve been involved in surgery for years.

  • avatar
    gasser

    I have been practicing Anesthesiology in Los Angeles for almost 40 years. In the last 30 years, our fees have gone down, NOT up. That’s right, lower fees than in 1984. Right now Medicare pays us about $90/hour, with the time counted from into the operating room to out. I don’t get paid for reviewing big, complicated charts or for speaking with families. I don’t get paid for paper work or for the classes every time our computer system is updated. I don’t get paid for the time between cases when the nurses are preparing the rooms or when we are waiting for equipment, lab studies to be completed, for late surgeons to arrive or for time when patients are stuck in the paperwork of the admitting office. For every 8 hours that I am at the hospital, I estimate that I have 5 1/2 hours of billable time. Medicare pays me about $90/hr. ACA has offered about $53/hour. This is before billing and Malpractice Insurance expenses, my own health insurance, my retirement funds or mandatory medical education time. All the money in health care goes to Insurance carriers who now have about a 30% overhead, compared to 4% when Blue Cross of California was non-profit. Drug costs are obscene. Chemotherapy doses can be over $100,000 per month. Don’t feel sorry for me. I just retired last month. Good luck to all of you trying to find a new physician. Try the Honda dealer. Mine gets $112/hour, twice what ACA wants to pay me and they don’t handle holiday or emergency work.

    • 0 avatar
      dtremit

      Fact check: According to the Bureau of Labor Statistics, the average anesthesiologist makes $246,320 per annum. The average automotive service technician makes $39,980. (I’d quote percentile wages, which are a better figure — but those for anesthesiologists above the 10th percentile are higher than the maximum wage the BLS tracks.)

      According to the American Society for Anesthesiologists, the average cost for malpractice insurance is about $20k a year, or about half of what it was in 1985, after adjusting for inflation.

      So I think your colleagues still suffering in the business are maybe doing just a little better than your Honda mechanic.

      • 0 avatar
        gasser

        Good luck to those guys. You can “fact check” all your want. That average income may include those supervising large number of other health care provides. Here in L.A. that $90/hour from Medicare won’t keep most of us working beyond 65 years of age.(P.S. 40% of American physicians are over 55)

        • 0 avatar
          dtremit

          Check the numbers yourself, if you’d like:

          http://www.bls.gov/oes/current/oes291061.htm (anesthesiologists)
          http://www.bls.gov/oes/current/oes493023.htm (mechanics)

          Medicine isn’t all that different from the rest of the economy. The $112/hr you pay at the Honda dealer mostly ends up with the middlemen, too; statistically speaking, the mechanic’s likely to clear less than $20/hour. Indeed, the best-paid 10% of mechanics make half as much per hour as the worst-paid 10% of anesthesiologists.

          As for the looming shortage you elude to, it would probably be more effective to uncap residencies (one of the reasons so many physicians are over 55) than to drastically increase reimbursements. I doubt a whole lot of doctors are going to want to work too many years past 65 at any price, when they can mostly comfortably retire.

        • 0 avatar
          Len_A

          Then, gasser, it’s all the more reason to look at single payer. I have three doctors in my family, one here in the USA, two in Europe, one in Great Britain, one in Malta. All three are general practice physicians. Guess what? The two in Europe greatly out earn the one in the USA. All are in their late thirties to very early forties. And all the horror stories about single payer systems are universally disputed by my European cousins.

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