Savage_Rob wrote on 08/23/12 at 07:37:10:srinath wrote on 08/22/12 at 15:57:29:Actually if we banned Insurance to doctor/hospital direct payments it will make a huge difference. In fact you pay for everything with cash. Then you submit the bills to your insurance. No BS like in network or one rate for 1 insurance and another for another insurance and a third for no insurance.
I get the idea in principle but hospitals will usually want to verify ability to pay before they do anything else. For a whole lot of stuff, most of us would need to show them insurance information. Otherwise, some things would require taking out loans in order to pay cash and banks are going to want interest and fees on any loan, even if they agreed to use your insurance policy as collateral (which is questionable). Unfortunately, some stuff requires direct payments for anyone other than the wealthy.
Well you assume that prices will stay the same, like 6g total for a root canal for example ... I can fly to india and get the Root canal and get back for less than 1/3 that. 1500 of which is the plane ticket.
Prices on the wall and no back door insurance deals will do this ... almost in this order and very rapidly ... like in a few weeks.
The doctor will evaluvate how much insurance companies pay them for each procedure. They would add the deductible ... and doctors I know make more $ out of your $20 @ each visit than they collect from the insurance co.
Since there is no insurance processing, you dont need 20 admins in each office, so they will be cut down to 1-2. The doctors figure out they can do the exact same thing, and make more $ if they charged you 30 bucks. You would see that price go on the wall first. Then as the do some more procedures, it will result in more prices.
Hospitals are a bit more complicated, however it is going to be done very quickly there too, I'd guess 1 week for a small doctor's office, 2 weeks for a big doctor's office or a hospital. Since there will be no defaults, you wont be paying for other people's care. Since you charge people @ the door, you wont be supporting the vast illegal population. Somethings would get a bit iffy but we still get a system around it too, like you have an accident and other driver is @ fault ... what I;d anticipate is a charge card from that insurance company and you use it when you have a doc treatment due to injuries. Same with workers comp etc.
People who pay for things, set prices of stuff ... its a little longer term in case of things like gasoline and even medical, a doctor would set his price @ what he now has it @, and will spend the whole day there with not 1 patient. Soon enough he'd get the hint, oooo the other doctors are charging 30 bucks I am trying to get 100 like I used to try to get with insurance.
I am nearly certain my doctor makes ~40 for a visit, 20 from me and 20 from ins. The beauty of this system is, they could charge me 40, send 1/2 the admin staff home cos they're not fighting wiht insurance co all the time, and still come out ahead.
I could say screw insurance, I'd pay $40 and kill this insurance crap. Some one who is a bit more needing of ins, could just buy an insurance that will cover 80 or 90% and they would send their bills in for reimbursement.
The market will then truly set the price ... you and I will my friend. You walk into the store, tomatoes cost $30 a lb, potatoes cost $1 a lb, you dont walk out with a cart full of tomatoes do you ? Yes.
Or, you walk into a store where everything is $30 a lb ... you obviously are going to try every store in town ... heck I can even see an app developing around that. Find the cheapest medical procedure, like those dating apps.
Cool.
Srinath.
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