Warren Buffett says health care costs are a bigger problem than corporate taxes

Re:Warren Buffett says health care costs are a bigger proble... by richardthered on Tuesday May 09, 2017 @02:30PM (#14302657)

But knowing the price of a procedure doesn't change my need for it. If I need heart surgery, I still need it regardless of whether it's $10k or $100k.

In other words, demand is inelastic.

And, most people can't afford to pay 10k or 100k out-of-pocket. So, it's not like managing your household budget. The funds have to come from somewhere else (insurance).

Also, healthcare is not easy to evaluate for a layperson. If my doctor says that I need 'procedure X', I'm relying on their expertise. Healthcare recommendations are not fungible products. If I'm buying a car, I can read reviews about the different models, reliability, etc. But my doctor's recommendation for me is highly specific to my personal health history.

So, for a lot of healthcare spending, it's not me that's choosing a medical procedure. Instead, I'm choosing to trust a doctor's recommendation. The doctor is the one that's recommending the procedure.

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Re:Warren Buffett says health care costs are a bigger proble... by squozzer on Wednesday May 10, 2017 @01:10PM (#14309794)

I think the elasticity of the demand depends pretty heavily upon the urgency of the problem.

And the demand - as you pointed out - also depends heavily on trust. That said, most health problems aren't unique enough to require a completely bespoke solution.

So at least hypothetically, it's possible to shop around IF pricing and other data were available. But they are not, at least generally.

I found this book rather interesting -- https://www.amazon.com/dp/B01DRXKWRM/ref=dp-kindle-redirect?... -- where a company compiled their health care expenditures and made the data available to their employees.

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