I suspect we could do decently by requiring insurance to purely reimburse the patient (possibly without the patient needing to pay first). If an insurer pays up to $1k for an MRI, and a hospital charges $15k but an outpatient imaging center charges $700, there will be a strong incentive for patients to stop using the hospital’s MRI.

Combining this with an auto-service requirement for a binding estimate before services are rendered would be amazing.

(Dealing with actual emergencies in this model may be hard.)

Most people can't afford $500 in America.

Which isn’t necessarily a problem because of insurance. If insurance reimburses $500, than that $700 MRI costs $200. If insurance reimbursed $800, then the $700 MRI is free. (Presumably the rules should be that providers may not discriminate on price except for genuine charity and that insurers must advertise the extent to which their coverage is sufficient for, say, the lower 40% percentile costs in the area.

The goal here is to remove incentives for various forms of corruption:

Providers (especially pharmaceutical companies) to charge outlandish amounts and then reimburse copays.

Providers to optimize pricing to extract money from insurers, when insurers have very little say as to where patients go.

Patients to simply not care what procedures cost at different places (right now, patients often can’t even find out).

Providers to invent charges after the fact. (If a patient gets a binding estimate in advance with a line item that makes so sense, the patient will argue. If a patient’s insurance is billed for nonsense, there may not be anyone paying attention who knows better.)

You don’t need to have the state pay. Make them charge the same price to all customers. Then you can have insurances compete. My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work.

> My body shop doesn’t charge one insurance $10/hr and another insurance $100/hr for the same work.

Do you know that for a fact?

In my experience auto insurers assess damage and award $X for repairs. You can either go to their contracted body shop or pick your own. If you pick your own, they typically take the $X as payment.

So many don't realize that this is entirely because Medicaid pays less than the cost of treatment. So hospitals make it up by charging other customers more.

If you actually wanted this then your taxes would go up because Medicaid expenses go up dramatically.

Maybe it's worth it - but at least be aware of what you are asking for.

"So many don't realize that this is entirely because Medicaid pays less than the cost of treatment. So hospitals make it up by charging other customers more."

I would like see an accounting of that. I bet they charge way more than they have to if they want to make up for Medicaid.

I'd be interested in reading more about this. A lot of the cost of medicine is overhead interfacing with insurance providers and all the layers of profit therein, but I don't know exactly how much.

The how would all the hospitals afford to build all those fancy new buildings? Think of the architects!