Price fixing does not solve cost problems
posted at 9:30 am on October 21, 2009 by Ed Morrissey
Perhaps the leading economists of the US could convene a special remedial course for Congress to explain the difference between price and costs. One might have expected the political class to have learned that difference from the disastrous US effort to fix prices and wages in the 1970s during Richard Nixon’s term in office, but apparently not. Democrats hailed their new, revamped House version of ObamaCare and its $871 billion price tag, based on forcing more providers into existing Medicare reimbursement rates. They claim that this will keep costs low, which is absolutely incorrect (emphases mine):
House leaders have cut the cost of their health-care overhaul to around $871 billion over the next decade, Democratic sources said Tuesday night, and were working to line up votes for the package with the aim of bringing it before the full House early next month.
The $871 billion estimate — well under the $900 billion limit set by President Obama — is the latest of several versions scored by congressional budget analysts, according to a Democratic aide, speaking on condition of anonymity to discuss private talks. The measure would include a government-run insurance plan that pays providers at rates tied to Medicare, the aide added. That so-called “robust” public option is preferred by liberals because it would save the government money and could force private insurers to lower their own reimbursement rates, driving down the cost of health care overall.
But the idea is opposed by many conservative Democrats from rural areas, where Medicare rates are well below the national average. A new insurance plan that paid such low rates would be devastating to their communities financially, these Democrats say. Instead, they argue that any public plan should negotiate rates directly with providers, as private plans do.
Fixing prices does not lower costs. Let me repeat that: fixing prices does not lower costs. “Costs” are borne by providers, who get reimbursed by either consumers (in a rational market) or by third parties (American health care) for their goods and/or services. In a competitive market, providers have to set their prices at an attractive level in order to get business without missing out on profit opportunities, but their prices have to cover their costs — or they go out of business.
Not coincidentally, the latter is what happens when price-fixing is used. When government fixes the price of goods and services, it usually does so to mask costs, not reduce them. This is what Medicare has done for years, which is why doctors avoid Medicare patients now. When the fixed price becomes less than the actual cost to provide the service, the provider is forced out of business.
And what Medicare reimbursement schedule does the House use to show those cost savings, anyway? Would that be the schedule that will start dramatically cutting reimbursements over the next few years? Or will it use the Stabenow bill in the Senate that would eliminate those cuts, and which the Senate also ignored when calculating the cost of the Baucus bill?
Blowback
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With this adsministration fixing problems is telling people what they want to hear but never making them happen.
Just ask Joe the Plumber
or Joe the US Representative
They both know and understand things Olberman, Rachel or bambi don’t know.
bluegrass on October 21, 2009 at 9:33 AM
I think calling them illiterate when it comes to economics is too kind.
BadgerHawk on October 21, 2009 at 9:33 AM
At least we have transparency…..
mmmm mmmm mmmm
bluegrass on October 21, 2009 at 9:34 AM
This was always their ‘solution’. The easiest way to save money on health care is to not pay the providers. They talk about evil insurance companies not paying.
But even when Medicare pays, it isn’t enough to cover the services rendered. If Congress passed a law allowing private insurance to pay at the Medicare rates, your premiums would come down. . . but doctors and hospitals would go out of business.
If they create a public option tied to Medicare reimbursement, your hospitals will close and your doctors will go out of business. This is the health care ‘reform’ that they have always wanted.
ThackerAgency on October 21, 2009 at 9:35 AM
Liberal are people who always chose an emotional response over the hard lessons of history.
flyfisher on October 21, 2009 at 9:36 AM
I don’t get it, I thought health care was going to be free? Why worry about costs when something is free?
Bishop on October 21, 2009 at 9:37 AM
Econ 101.
Democratz – they doeznt haz it.
Good Lt on October 21, 2009 at 9:38 AM
You won’t hear anyone say that Medicare pays less to doctors and hospitals than private insurance. That will not be a talking point on any of the ‘non-Fox’ stations.
I’ve got an idea, why don’t we mark congress’ pay at the poverty level and don’t allow the CIVILLIAN government to take military transport. That’s what they are attempting to do to our health care system.
It’s not really the insurance companies that are taking all the money from health care. . . it is the DOCTORS AND HOSPITALS. . .this is the message from Her Majesty Pelosi.
ThackerAgency on October 21, 2009 at 9:38 AM
Has everyone seen this sign. Very cute.
http://kingobama.com/2009/10/09/ram-it-down-our-throat-in-09-well-shove-it-up-your-in-10/
Cindy Munford on October 21, 2009 at 9:39 AM
Only for those of us who haven’t drank the koolaid–we can “see through” the bill. It’s like zoombies have taken over the congress…or pod people–mindless individuals with the same fake smile pastered to their face–and the same lying words out of their mouths…
lovingmyUSA on October 21, 2009 at 9:41 AM
Pelosi and her flying monkeys, are just figuring out a different method to BEHEAD THE CONSTITUTION, RAPE THE CITIZENS, KNEECAP BUSINESS, AND ENRICH THEMSELVES!
Cybergeezer on October 21, 2009 at 9:42 AM
If anybody thinks that the actual cost will be what Nancy Pelosi says it will be, I’ve got a bridge to sell you.
WisCon on October 21, 2009 at 9:43 AM
Ok, I’m stealing that sign! I’m throwing away the two-sided one I made for our 4th of July tea party and making a new one!!!
PS–How are you? Still working on that project? I was going to ask you last night, but it got late.
lovingmyUSA on October 21, 2009 at 9:44 AM
Price fixing doesn’t lower costs…but it sure helps the people responsible for choosing who prices what and how much…just ask Dianne Feinstein how much it helped her husband.
Profits have to go somewhere, either to the businessman or the bureaucrat…
right2bright on October 21, 2009 at 9:44 AM
News flash, those on Medicare have a deductible to meet. They send you an advice statement, how much they will pay and what the provider may bill you. You then will get a bill from the dr. Medicare is not FREE. You pay a premium and still need to pay for a supplement. When you reach 65, you are almost forced into Medicare. Your current insurance co will no longer cover you as the first coverage. Medicare says take it now or pay a penalty later.
Kissmygrits on October 21, 2009 at 9:45 AM
Look Obama and Pelosi can bribe all the doctors in the country but this is never going to work. As soon as the AMA signs on and endorses this abortion of a bill, Obama will quietly withdraw all of his promises like he has in the past. I have been talking with my doctors at the VA and they are scared. They know what is coming and what will happen, and folks it is going to get ugly quickly when those Medicare reimbursement rates go down. The VA is already overloaded with Vets who can’t afford medical insurance or lost their jobs and pass the means test to get free care. More and more are coming into the system but no new doctors are being added.
Doctors are simply not going to take anymore patients who are using medicare, unless the government forces them to. And that I am sure will be placed into any billl that gets voted on.
Johnnyreb on October 21, 2009 at 9:45 AM
So the plan is to drive the insurance companies out of business so the government can take over the entire system. Yeah, that’ll work out great. That won’t lead to massive budget deficits, a shortage of doctors, or a reduced quality of care.
I can’t wait til they apply the same principles to other sectors of our economy. How about fixing the prices on cars so GM and Chrysler aren’t at a disadvantage against non-government run companies? And of course once they pass crap-and-betrayed, they’ll have to fix the prices on energy companies. We can’t have the consumers paying thousands more every year to power their homes. And let’s not allow big oil to keep screwing us at the pump. Let’s set a price limit on a gallon of gas.
What’s sad is I’m being totally facetious, but you know Congress would do every last one of those things. Hell, Maxine Waters already said as much to the oil companies last year.
Doughboy on October 21, 2009 at 9:45 AM
Obama/Democrat/Liberal math is 2+2=1
What could possibly go wrong?
Example: I wanted my house payment to go down, so I borrowed $50,000 from my neighbor at 10% to pay down my 5% mortgage. I’m saving money every month!!!! wowsers!!!
/sarc (for those who might be thinking I was serious)
Tim Zank on October 21, 2009 at 9:46 AM
I was in high school during Nixon’s failed price control attempts. At least that experience persuaded the country not to do that again for almost 40 years. Now we have a new generation who want to learn the same lesson.
It is amazing and discouraging how reluctant politicians are to let the markets work. When they don’t like the results, their kneejerk reaction is to close the market instead of fixing the actual problem (if there is one).
jwolf on October 21, 2009 at 9:46 AM
You have no idea how right you are. When Tennessee enacted TennCare it nearly bankrupted the State — and it did bankrupt all kinds of medical providers. I’ve posted this before, but I represented a company that went out of business not because they couldn’t turn a book profit, but because they couldn’t get their money from Tennessee. You can’t meet payroll with accounts receivable. That company had been profitable for decades, but soon after TennCare was enacted they were in trouble. Unless the Bankruptcy Trustee recovered the millions they were owed from TennCare, the money was never paid. Their ESOP owned roughly 50% of the stock. The hundreds of regular people (nurses, secretaries, janitors, etc) who had been counting on it for their retirement got nothing. That bankruptcy was a completely preventable disaster.
flyfisher on October 21, 2009 at 9:47 AM
A great sign…it will be back around in your email in just a few hours, about 30 friends were just emailed.
right2bright on October 21, 2009 at 9:47 AM
More precisely, liberals are always wrong.
highhopes on October 21, 2009 at 9:48 AM
Hot Air is obviously not a news blog. And would encourage all other blogs out there to avoid picking up stories or following their lead.
NickelAndDime on October 21, 2009 at 9:50 AM
good call. It would be like a GM for people without Medicare would cost the person 30,000. . . but if you are on Medicare, you could get a GM for 20,000 (through the government – same car).
If you were a car dealer, how long would it take before you said, ‘no more Medicare deals.’?
ThackerAgency on October 21, 2009 at 9:50 AM
As I understand it, even the $871 billion price tag is a sham achieved by manipulating the numbers. All of the “savings” are front-loaded over ten years, while the real costs are back-ended, only showing up in years 7-10. In other words, current projected costs only include four years of implementation and corresponding spending for Obamacare, not the true costs for ten successive years of providing health care to all.
We are being led down the golden path by snake oil salesman. If nothing changes and this is shoved down our throats, we will not have avoided catastrophe, rather we can expect to experience a man-made catastrophe, engineered by the Democrat swine in congress.
fogw on October 21, 2009 at 9:50 AM
Obama sitting on the panel that decides if my grandma, mom, and me get denied services? No thanks.
Alinksi’s rules for radicals…..#11
Rule 11: Pick the target (Obama), freeze it, personalize it, polarize it. Don’t try to attack abstract corporations or bureaucracies (congress). Identify a responsible individual (Obama). Ignore attempts to shift or spread the blame (Booooosh!).
We need to do it guys! Every aspect of Obama care needs to be personally attached to Obama. He’s trying to own the parts he thinks makes him look good. It’s time to get into making him the face of government stupidity and excess.
csdeven on October 21, 2009 at 9:51 AM
Oh I think they get the economics just fine. They just lie about it. I firmly belive that the entire health care issue today is about finding a way to get their political hands on such a large pool of money. That is the long and short of it. Everything else is just smoke and mirrors.
MikeA on October 21, 2009 at 9:51 AM
Yeah, there’s that.
flyfisher on October 21, 2009 at 9:51 AM
I just let loose on the HHS website healthreform.gov. I doubt they’ll print my “story” but it felt good to just let someone have it.
These people are idiots
gophergirl on October 21, 2009 at 9:52 AM
You are thinking like an American, not a liberal politician. In their world, they are fixing the actual problem- too many of their supporters are finding the welfare checks just don’t go as far as they used to.
highhopes on October 21, 2009 at 9:52 AM
Thanks for asking, so far so good. Hoping to be done by Christmas. I got the picture of the sign in my email as an attachment which I couldn’t pass on. I had to do the six degrees of Kevin Bacon to find where it was posted.
Cindy Munford on October 21, 2009 at 9:53 AM
Has everyone seen this sign. Very cute.
http://kingobama.com/2009/10/09/ram-it-down-our-throat-in-09-well-shove-it-up-your-in-10/
Cindy Munford on October 21, 2009 at 9:39 AM
Love that sign!!!!!!!!!!!!!!!!!!!!!
bluegrass on October 21, 2009 at 9:53 AM
It is not economic illiteracy, it is a purposeful use of a tool that intended to destroy the free market. Stop attributing ignorance to intentional sabotage.
True_King on October 21, 2009 at 9:54 AM
Congress and the White House are unqualified. Period.
They don’t have the knowledge, they don’t have the experience and they don’t have the skill set.
This is what happens when Americans elect representatives based on celebrity, on who was the son/daughter/wife of who, on bone rotten incumbents being preserved through the miracle of gerrymandering.
In short, the current crowd is the problem, not the solution and the entire lot needs to be thrown out of office.
You want people who know how the government works and who can get things done?
Elect retired military officers.
Career politicians suck.
NoDonkey on October 21, 2009 at 9:55 AM
Here’s why you’re wrong, Ed: A provider’s price is a consumer’s cost. If the insurance industry has been colluding to set premium prices, then the antitrust exemption has probably increased the overall cost of insurance to consumers.
If GM, Ford, Chrysler, Toyota and Honda get together and decide they will sell their cars at a price, that will increase the cost of cars to consumers.
Jimbo3 on October 21, 2009 at 9:56 AM
+ 1000! I just sent that pic all over! Nice one Cindy!!
Tim Zank on October 21, 2009 at 9:56 AM
Banana-Republic-onomics.
Banana-O and the economics of fascism.
Healthcare is too costly? Force them to lower prices! Yeah!
jhffmn on October 21, 2009 at 9:58 AM
Bingo. These fools make fairy tale decisions in a vacuum, twisting and distorting stats to enact an agenda which a few powerful voices claim we want. The house of cards will collapse but they don’t care, once enacted and private insurance is destroyed it will never be repealed and the grip over the populace will be ensured, cradle to grave.
NickelAndDime on October 21, 2009 at 9:59 AM
The HealthScare fearmongers (Demorats) ACCUSED Republicans of wanting to cut medicare and social security,
Now that they are in power, just like when Bill Clintoon taxed SSI for the first time evah, the Demorats are putting in place policies to do just that which they accused republicans of WANTING to do.
Wake up American Jewish voters, African American Voters, senior voters of all stripes where’s your SSI increase this year?
Did congress increase their wages? How about yours?
Now they will cut your medicare and leave you to die,
To fund their experiment of giving healthcare to young people who could pay for it but don’t want to and illegal aliens here for your tax dollars, jobs and benefits!
Government Healthcare + Cap and Tax + Amnesty for illegals = slavery for taxpayers today and for your children and gerandchildren!
Don’t let a congress that can’t run an in house resturant or post office run 1/6th of the US economy.
dhunter on October 21, 2009 at 10:00 AM
Someone get in touch with the Soviet Politburo to find out how they do it.
N. O'Brain on October 21, 2009 at 10:00 AM
first you ASSertion is laughable. prove the price fixing. you cannot. second, we are not slaves of the insurance company, we can actually pay for our healthcare ourselves. your idea of price-fixing is idiotic.
and yes you do get a different rate, if you ask for it, if you are paying cash.
right4life on October 21, 2009 at 10:01 AM
And here’s where you’re wrong Jimbo. There is no such thing as collusion in health insurance. Why? Because EVERY year in EVERY state for EVERY policy, the price increases or changes and policy changes MUST BE APPROVED BY THE STATE DEPARTMENT OF INSURANCE.
Insurance companies negotiate rates with doctors and hospitals. Hospitals want 100 dollars/aspirin, Insurance companies want them to give it to their subscribers for free. . . somewhere in between is where negotiations land.
Medicare doesn’t negotiate. Medicare says this is what we will pay. In large hospitals, they play this out in the media and newspapers. Hospitals say insurance makes too much, insurance says hospitals make too much. If they don’t come to an agreement, then the patients on the insurance don’t get claims paid at the facility.
It happened here recently and the negotiations nearly bankrupted one of the largest hospitals in the state in 3 months.
Jimbo, you represent people in Congress who know little to nothing about this issue and how it works. Our health care system is the best in the world. All these cures aren’t cheap.
It is breast cancer awareness month. . . but nobody talks about how much the treatment costs. Why not interview a survivor and ask to see her Explanation of Benefits (EOB). If it is private insurance, don’t be shocked to see the bill come to over 200,000 dollars. Every survivor has used 200,000 in expenses and will likely use more.
ThackerAgency on October 21, 2009 at 10:02 AM
Jimbo3 on October 21, 2009 at 9:56 AM
There are 1700 health insurance companies operating in the US, think they’re all colluding?
Fact is, medical providers are expensive. You don’t work your ass off to go through medical school and pay $500K for the priviledge, in order to make $100K a year, which is what the feds think they should be paid.
And that’s just the docs. The RNs make a lot, the X-Ray techs, the pharmacists, etc.
If you don’t want to pay them well, guess what? The shortage we ALREADY HAVE will get worse!
And that’s not even mentioning the multi-million dollar technology we have here, or the outrageous malpractice insurance rates hospitals/providers have to maintain (thanks to the DEMOCRAT PARTY’s BIGGEST DONORS).
You can either have quality health care or you can have cheap “health care”, but not both.
NoDonkey on October 21, 2009 at 10:02 AM
When I lived in Hawaii, they tried putting caps on gas prices. Epic fail! At least they came to their senses and ditched the program.
NavyMustang on October 21, 2009 at 10:03 AM
And your evidence that collusion in the insurance industry has occurred? Seriously, just how stupid are you to base an entire premise on something that would be illegal if true? Put up or shut up moron and prove collusion or STFU once and for all.
highhopes on October 21, 2009 at 10:03 AM
But even when Medicare pays, it isn’t enough to cover the services rendered. If Congress passed a law allowing private insurance to pay at the Medicare rates, your premiums would come down. . . but doctors and hospitals would go out of business.
If they create a public option tied to Medicare reimbursement, your hospitals will close and your doctors will go out of business. This is the health care ‘reform’ that they have always wanted.
–When the Japanese, Koreans and Chinese came into the US with cheaper goods, it forced the American manufacturers to either change or die. That ultimately reduced the overall prices to consumers and increased the qualities and features. At this point, there really isn’t any effective competition in segments of the health care market. Perhaps setting up some competition would be a good thing.
(And sorry about my earlier post. I thought Ed was talking about removing the antitrust exemption from insurance, which is planned by Congress.)
Jimbo3 on October 21, 2009 at 10:03 AM
Jimbo3
Dude, it costs what it costs. An MRI is $1200. That includes operating the machine, paying the tech, pushing thru the paperwork, plugging it in, etc. Medicare/Medicaid says we are going to pay you $800 for that, so there. The hospital says ok, b/c they can’t not take it. Just b/c the gubmint wants to pay $400 less, doesn’t mean that it doesn’t actually cost $1200. What don’t you get? So we make up the difference in our premiums. What happens when Medicare/Medicaid is the only game in town? Rationing.
JAM on October 21, 2009 at 10:04 AM
Michele Bachmann just told Laura Ingraham we need to call both of our senators every day, Mon-Fri and tell them to vote against health care and to permanently de-fund ACORN. She re-emphasized the importance of calling every day.
OmahaConservative on October 21, 2009 at 10:04 AM
And your evidence that collusion in the insurance industry has occurred? Seriously, just how stupid are you to base an entire premise on something that would be illegal if true? Put up or shut up moron and prove collusion or STFU once and for all.
–Look at Drudge. The insurance industry was exempt from antitrust regulation by law. That will apparently change quickly.
Jimbo3 on October 21, 2009 at 10:04 AM
Great sign. Thanks.
TXUS on October 21, 2009 at 10:05 AM
dolt
One entry found.
Main Entry: dolt
Pronunciation: \ˈdōlt\
Function: noun
Etymology: probably akin to Old English dol foolish
Date: 1553
: a stupid person
— dolt·ish \ˈdōl-tish\ adjective
— dolt·ish·ly adverb
— dolt·ish·ness noun
MES401067 on October 21, 2009 at 10:06 AM
another laughable ASSertion…all those companies aren’t competing…what are they doing then???
and no company can compete with the government, because the goverment sets the rules, and isn’t subject to the market, like companies are. the whole concept of government ‘competition’ is idiotic.
right4life on October 21, 2009 at 10:06 AM
Dude, it costs what it costs. An MRI is $1200. That includes operating the machine, paying the tech, pushing thru the paperwork, plugging it in, etc. Medicare/Medicaid says we are going to pay you $800 for that, so there. The hospital says ok, b/c they can’t not take it. Just b/c the gubmint wants to pay $400 less, doesn’t mean that it doesn’t actually cost $1200. What don’t you get? So we make up the difference in our premiums. What happens when Medicare/Medicaid is the only game in town? Rationing.
JAM on October 21, 2009 at 10:04 AM
–All depends on what cost you’re using: Variable, fully-loaded or something else. The variable cost of operating a MRI is the electricity, the technician to run the machine, the film (or whatever they use), insurance processing and the cost of the doctor to read the results. The fully-loaded cost includes an allocation of the overhead for the site and the estimated cost of the machine spread over the expected uses.
It doesn’t cost $1200 if you use variable cost.
Jimbo3 on October 21, 2009 at 10:09 AM
Exemption from anti-trust regulations does not prove collusion.
ICBM on October 21, 2009 at 10:09 AM
So you’re saying that fixing prices DOES lower costs?
Maybe you should try READING the posting sometime.
Juno77 on October 21, 2009 at 10:09 AM
another laughable ASSertion…all those companies aren’t competing…what are they doing then???
and no company can compete with the government, because the goverment sets the rules, and isn’t subject to the market, like companies are. the whole concept of government ‘competition’ is idiotic.
right4life on October 21, 2009 at 10:06 AM
–Can you call four hospitals in your metro area and get an all-in cost for a procedure, including doctor fees? If you can’t do that, how can there be effective competition?
Jimbo3 on October 21, 2009 at 10:10 AM
Exactly. There will be fewer radiologists to run and interpret the results, and probably fewer machines. Welcome to Canada where the waiting list is 4-12 months to get an MRI.
ProfessorMiao on October 21, 2009 at 10:10 AM
–Look at Drudge. The insurance industry was exempt from antitrust regulation by law. That will apparently change quickly.
Jimbo3 on October 21, 2009 at 10:04 AM
Exemption from anti-trust regulations does not prove collusion.
–Why would they have wanted (and fought to keep) the antitrust exemption if they weren’t doing that. Of course they were talking to each other.
Jimbo3 on October 21, 2009 at 10:12 AM
Please tell the Ontario government they can reduce MRI wait times by using “variable costs” instead of rationing.
ProfessorMiao on October 21, 2009 at 10:12 AM
Both variable costs and fixed costs are components of total costs. Obviously, business is not your strongpoint. No business makes pricing decisions based on only a part of the cost.
ICBM on October 21, 2009 at 10:12 AM
Exactly. There will be fewer radiologists to run and interpret the results, and probably fewer machines. Welcome to Canada where the waiting list is 4-12 months to get an MRI.
–Are you sure that all the MRI machines available are being used 100% of the possible time? If they’re not, then maybe it’s a good idea not to buy more machines until the current ones are fully utilized.
Jimbo3 on October 21, 2009 at 10:13 AM
The posting was about: ‘Price fixing does not solve cost problems’
Now, are you asserting that Price fixing DOES solve cost problems’?
Juno77 on October 21, 2009 at 10:13 AM
Both variable costs and fixed costs are components of total costs. Obviously, business is not your strongpoint. No business makes pricing decisions based on only a part of the cost.
ICBM on October 21, 2009 at 10:12 AM
–Airlines price tickets in some cases at variable cost because they view fixed costs as sunk costs. Several other industries use variable costs (hotels, iron smelters, etc.) because they figure anything they can get above variable cost contributes to their profits.
Jimbo3 on October 21, 2009 at 10:15 AM
Went to Drudge, nothing there about anti-trust regulation. Anyway, as ICBM pointed out to you, exemption to anti-trust does not prove collusion and there are other reasons that would explain why they want to keep their status.
You have yet to prove by fact that insurance companies collude to drive up premiums. Put up or STFU time.
highhopes on October 21, 2009 at 10:15 AM
Jimbo3 is right, the rest of you, including Ed, are wrong. The end.
Protip: If you don’t know what you’re talking about, don’t talk.
Proud Rino on October 21, 2009 at 10:16 AM
As far as I know this was done because insurance pricing, as well as just about all aspects of their business, are already very heavily regulated at the state level. So antitrust was redundant. My opinion — we’d be much better off removing the heavy state hand, let insurance companies operate and compete nationally, and then apply normal laws (like Sherman) if there is actual evidence of wrongdoing.
jwolf on October 21, 2009 at 10:16 AM
Jimbo3 is right, the rest of you, including Ed, are wrong. The end.
Protip: If you don’t know what you’re talking about, don’t talk.
Proud Rino on October 21, 2009 at 10:16 AM
–No. I was wrong because I thought Ed was talking about the antitrust exemption.
Jimbo3 on October 21, 2009 at 10:17 AM
you really should take your own advise….
right4life on October 21, 2009 at 10:18 AM
So now you know better how to run a hospital and an insurance company, better than the people who run hospitals and insurance companies.
Do you play quarterback for your local NFL team as well? Jack of all trades.
NoDonkey on October 21, 2009 at 10:18 AM
Also, I’m not sure how govt provided insurance plan tied to another govt program is “price fixing.” I’m on 2 hrs sleep in 2 days so I’ll admit that maybe I’m missing something.
Proud Rino on October 21, 2009 at 10:18 AM
http://apnews.myway.com/article/20091021/D9BFEN3G0.html.
Here’s the link that Drudge has to the antitrust exemption. It’s under his “deepening cancer” headline.
Jimbo3 on October 21, 2009 at 10:19 AM
where is your proof of this? when the prices are different between insurance companies???
right4life on October 21, 2009 at 10:20 AM
If you’ve gotten this far in your life without knowing how to spell “advice,” you have failed.
Proud Rino on October 21, 2009 at 10:20 AM
I have more than 4, but yes I can go do different doctors at different hospitals and get different rates for a procedure.
right4life on October 21, 2009 at 10:21 AM
I may not know how to spell…but I sure know stupid when I see it…
right4life on October 21, 2009 at 10:22 AM
Why do you think you have to run a hospital to know that if you’re not using a machine at its full capacity, you shouldn’t buy another one of those machines? That doesn’t seem to require any expertise, unless you consider “not being a blithering idiot” expertise.
Proud Rino on October 21, 2009 at 10:22 AM
The posting was about: ‘Price fixing does not solve cost problems’
Clearly Jimbo3 thinks that is a severe knock against O’crapcare, and therefore is attempting to distract the thread into some BS about insurance companies colluding.
And thereby taking the argument that damages Ocrapcare away.
Everyone note that Jimbo3 refuses to address the Original point of the posting.
Juno77 on October 21, 2009 at 10:22 AM
Oh? Go look in the mirror. Let me know how it goes.
Proud Rino on October 21, 2009 at 10:23 AM
So now you know better how to run a hospital and an insurance company, better than the people who run hospitals and insurance companies.
Do you play quarterback for your local NFL team as well? Jack of all trades.
–So, why, for instance, do we have relatively small cities with two large hospital chains? Competition would say that there should only be one chain in those circumstances, because the more ineffective one would have gone out of business.
Jimbo3 on October 21, 2009 at 10:24 AM
I’m not sure if reading comprehension is really your thing. Clicking on the “strong” button is, though, so that’s something.
Proud Rino on October 21, 2009 at 10:25 AM
There are more MRI machines in the city of Philadelphia than there are in most provinces in Canada. Whether they are being utilized 100% of the time is irrelevent apparently to the cost controls Canada has put in place. They ration b/c they must. Red herring much?
JAM on October 21, 2009 at 10:25 AM
at least I don’t break the mirror when I look in it…
right4life on October 21, 2009 at 10:25 AM
Dear Jimbo,
We have fewer MRIs/capita than the US. That’s a part of the problem. The other, though, is the cost of running them (the technicians and radiologists). No, they are not run all the time. If you are willing to pay the full bill, you can get an MRI in a day or two for your cat or dog. But if you are human you have to wait (or go to the US).
It is primarily the cost of the technicians and radiologists that leads the government to ration access to MRIs (and pretty much everything else). Radiologists are among the highest paid medical specialists and are in scarce supply. You pay them well or they leave the country to practice elsewhere. Our government says that it can’t afford to pay more (about half the province’s budget goes to health care), so we pay a few and make people wait for a very long time for critical diagnostic tests.
Anyone who is a proponent of a government-funded system should know the basic facts about how the one just north of your border works (or, too often, doesn’t).
ProfessorMiao on October 21, 2009 at 10:25 AM
That doesn’t even make sense. You have no idea what I look like. Whereas I can say with a fair amount of confidence that, based on your posts, you’re kind of an idiot.
Proud Rino on October 21, 2009 at 10:26 AM
because the market supports them…do you think there are 2 hospitals when only 1 is needed? this is idiotic reasoning.
if there was only 1 hospital chain, you’d say there is no competition….
right4life on October 21, 2009 at 10:27 AM
Competition necessarily leads to monopoly? Great lessons in economics from Jimbo.
ProfessorMiao on October 21, 2009 at 10:27 AM
Moreover, what happens when supplier hit a price ceiling that does not allow for an acceptable profit? They ration. Now, where have I heard that before?
Kafir on October 21, 2009 at 10:28 AM
people as ugly as you on the inside, are ugly on the outside.
I may be stupid, but I make you look stupid regularly…so what does that say about you? hmmmm sweetie??
right4life on October 21, 2009 at 10:28 AM
The posting was about: ‘Price fixing does not solve cost problems’
Clearly Jimbo3 thinks that is a severe knock against O’crapcare, and therefore is attempting to distract the thread into some BS about insurance companies colluding.
And thereby taking the argument that damages Ocrapcare away.
Everyone note that Jimbo3 refuses to address the Original point of the posting
–If the government were to set up a competitor to the private insurance companies, and were to fix a rate, then the private insurance companies and hospitals would either need to figure out how to change their operations to reduce costs and become more effective or go out of business, just like when the Chinese, Koreans and Japanese products came to the US originally and the US manufacturers had to change. In that way, price fixing can reduce costs to consumers.
Jimbo3 on October 21, 2009 at 10:28 AM
Did you actually READ the posting?
Do you know what it is about?
Did you understand the point of the posting?
Juno77 on October 21, 2009 at 10:30 AM
again the government can never be a fair competitor to business.
the government never has to worry about going out of business or losing money.
we will end up with a government monopoly, because no company can compete with business. but thats what people like you want..so the government can decide who lives and dies…its all about power.
right4life on October 21, 2009 at 10:30 AM
So, why, for instance, do we have relatively small cities with two large hospital chains? Competition would say that there should only be one chain in those circumstances, because the more ineffective one would have gone out of business.
Jimbo3 on October 21, 2009 at 10:24 AM
Competition necessarily leads to monopoly? Great lessons in economics from Jimbo.
–Competition with significant fixed costs involved tends to lead to only a few survivors because of the high barriers to entry as a result of the fixed costs. Think of the airline industry.
Jimbo3 on October 21, 2009 at 10:31 AM
Precisely. Thank you.
JAM on October 21, 2009 at 10:31 AM
The original point of the posting was that price fixing does not solve cost problems.
Can you cite an example of when price fixing has solved cost problems?
Juno77 on October 21, 2009 at 10:31 AM
Moreover, what happens when supplier hit a price ceiling that does not allow for an acceptable profit? They ration. Now, where have I heard that before?
Kafir on October 21, 2009 at 10:28 AM
–Or you find other ways to change your operation, not use that supplier, etc.
Jimbo3 on October 21, 2009 at 10:32 AM
you are using the presence of competition (2 hospital chains) as evidence of a lack of competition…you don’t understand the talking points your are parroting…
right4life on October 21, 2009 at 10:32 AM
And if you had been following the debate about a “government competitor” for the last 6 months, you would know that people have been arguing that a government subsidized health plan will mask the true costs of health care long enough to drive private insurers out of business. What will ensue will be rationing because the government will not be able to afford the true costs, either.
Duh.
ProfessorMiao on October 21, 2009 at 10:33 AM
Try this again:
The posting was about: ‘Price fixing does not solve cost problems’
Clearly Jimbo3 thinks that is a severe knock against O’crapcare, and therefore is attempting to distract the thread into some BS about insurance companies colluding.
And thereby taking the argument that damages Ocrapcare away.
Everyone note that Jimbo3 refuses to address the Original point of the posting.
Juno77 on October 21, 2009 at 10:33 AM
Can you cite an example of when price fixing has solved cost problems?
–What price fixing are you talking about? Government or private industry?
Jimbo3 on October 21, 2009 at 10:33 AM
Now children….
lovingmyUSA on October 21, 2009 at 10:34 AM
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