But the same motive applies to co-ops. The member-owners of a co-op don't want their costs to be inflated by improper billing or inflated prices, because if they are able to reduce their expenses, then the member-owners benefit in the form of lower premiums.
In both cases, the shareholders want to get their money's worth, it's just that in the case of a for-profit company, those shareholders are often external investors, but in the case of a cooperative, all shareholders are also members.
Healthcare costs are so bad they're now a large, direct competitor to the Amazons and Berkshires and JP Morgans in a business well-being sense, as resources are finite. I like having these giants stepping up to the plate and targeting the healthcare system on cost. They tend to get their way; if a political rock (eg insurance companies) gets in the way, it'll get moved out of the way.
It reminds me of the 450 hospitals getting together to set up a not-for-profit generic drug company recently -
https://www.cnbc.com/2018/01/18/hospitals-plan-to-create-the...
And one of the reasons for the most complicated billing system in the world is for-profit Insurance companies.
Whenever I want to feel sad, I think about how the most brilliant minds of our times are probably making a fortune at such zero sum transactions as gaming the health system and tax code.
Not really. In fact, Medicare is responsible for most of the current billing system, not private insurers.
Insurance providers write custom lines of business for employers per state and allow those employers to customize the coverage however they like. This happens annually with revisions done to exclude or include coverage as the employer dictates.
Insurance companies, and employers, come up with byzantine rules for what's covered, when it's covered, where it's covered, who is allowed to provide care, prerequisites before approving coverage, what brand of products are permitted in treatment, and on and on.
The net effect is that the rules are multi-variant to the point that they cannot realistically be validated or tested by humans. There are entire industries dedicated to maintaining rules management engines specifically for validating policies, coverage, and claims.
As someone who's actually had to deal with this complexity and implement software to facilitate it, I can assure you that Medicare is not at all simple, by any stretch of the imagination. It's not even standard or consistent within Medicare within a geographical region, even if you limit the scope to Part A and Part B, excluding coverage provided under Part C and Part D.
> Insurance companies, and employers, come up with byzantine rules for what's covered, when it's covered, where it's covered, who is allowed to provide care, prerequisites before approving coverage, what brand of products are permitted in treatment, and on and on.
This is exactly what Medicare itself does. The private insurers generally structure their terms in ways that are similar to what Medicare does. They're not identical, but it's not like Medicare is some haven of simplicity by itself that the private insurers complicate. Medicare itself is unbelievably complicated and abstruse by itself.
> There are entire industries dedicated to maintaining rules management engines specifically for validating policies, coverage, and claims.
Yes, that's true. And that would be true even if you only looked at Medicare patients.
Medicare is by volume the larges provider but size is actually a benefit because it means that it's dealt with more frequently and is more familiar to care providers.
A care provider isn't multi-regional, thus when they deal with Medicare it's mostly consistent. The interface is at least similar. However they can have 100 patients with United Healthcare and each patient will have a unique and different line of insurance.
Medicare isn't simple, it's just a small piece of a very big shit sandwich.
This is dead wrong. It's easier to deal with a small ha regional insurers than it is to deal with Medicare on the whole. And as I said in the original post, even within a region, Medicare is very heterogeneous.
> Medicare is by volume the largest provider.... Medicare isn't simple, it's just a small piece of a very big shit sandwich.
As you said yourself, it's the largest single piece of the sandwich. It also happens to be the core of it as well. Most of the complexity in the billing process stems from how Medicare structures and organizes its own billing, not the other way around.
I'm saying that the marginal complexity introduced by private plans is actually quite small compared to the complexity that Medicare already creates. Furthermore, the complexity that private insurers introduce is both directly and indirectly linked to the way Medicare structures its billing and reimbursement policies.
They are actually overlapping problems, since some of those private lines are Medicare Part C or D plans (and some are Medicaid managed care plans, and some are both Medicare Part C and Medicaid managed care plans.)
Medicare, Medicaid, Private Insurers, and the need for all of them to coordinate between each other all contribute significantly.
The need for all of them to sometimes coordinate with non-healthcare payers (e.g., property and casualty insurers) for some claims also adds some complications.
The ACA requires insurers to spend 80% of the premiums they take in on direct healthcare costs for their members. Inflated billing and high drug costs are actually helpful if they want to make a nice big profit. To a point, at least - they've gotta find the right balance between profit and people being unable to pay their premiums.
Higher medical expenses don’t help. It only creates higher premiums, which members then blame on greed.
There are plenty of legitimate problems with providers, drug laws, and insurers. But insurers definitely don’t benefit from higher expenses.
AKA, 10% of 2 trillion is more than 10% of 1 trillion.
They are interrelated, yes. But fundamentally we are at a place where providers, especially hospitals, are billing insanely high rates for services compared to other countries.
What Americans think of as “health” “insurance” fits this model. Providers are in the business of soaking their customers the various tax-favored third-party payers for all they can. Of course prices rise continually. People are stirred into a frenzy about rising costs and demand that politicians just do something! The insurers get more tax-favored money that providers happily mop up.
Out of network means the insurer and provider have not previously negotiated a rate. And emergency services are among the most expensive bills out there.
Unrelated: one of the worst parts of insurance is the customer service quality. How does an internal, non-profit insurer staff itself to do this well? If they commit to this even at the risk of it being unprofitable, that would be most awesome —- but I’m skeptical.