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50. Re: Out of the Blue Jan 10, 2013, 22:57 jdreyer
Creston wrote on Jan 10, 2013, 18:20:
Dmitri_M wrote on Jan 10, 2013, 15:06:
In South Africa, a fairly rough country at the best of times, my grandmother had surgery under our universal health care system. She had no health insurance. It was done in a government run hospital. The surgery cost 3 dollars. In a private hospital with better conditions and higher staffing she would have paid 10 000 dollars. I guess from what I've read here all American hospitals are essentially "private"?

The costs of US hospitals are so out of control because their insurance cost is ridiculous. An average hospital probably pays 100 million dollars in insurance a year. They have to, because if a surgeon makes a genuine mistake that leaves someone with a chronic health issue, courts will award truly insane amounts of money to the victim.

(I'm not saying someone isn't entitled to compensation, but I fail to see why a small scar on your knee somehow needs to be rewarded with enough money to set up the victim's entire family for life.)


What you're talking about is tort reform: capping the payouts for malpractice lawsuits. There have been states that have tried that as a way of reducing medical costs. It hasn't worked. The entire state of Texas has done that since 2003, but it hasn't made any difference in medical costs.

The reason that our costs are so much greater than the rest of the world is simple: our prices our higher. We pay about $7600 per person year in medical costs while most of Europe pays about $5000. Healthcare is treated as a business here and it's hugely profitable, especially since most providers are monopolies or one of two or three providers in a region. It's not competition. That profit has to come from somewhere. In most other countries, it's a service that's run by the gov't. Or it's private, but it's very heavily regulated (the gov't sets prices and salaries). Also, b/c we have so many private insurance companies and hospital systems, administration costs are higher than anywhere else due to the overhead of maintaining so many different systems and continually reinventing the wheel. And lastly, Dr. salaries in the US are much higher than most other nations, even while quality is roughly the same. If Americans paid what Europeans paid, the deficit would be wiped out.

And even though we pay much more, the care, on average is about the same as Europe and Japan. It's funny, you know the most cost effective U.S. healthcare provider? Medicare. Administration costs are cheaper. Negotiation and buying power are stronger. It's transparent and accountable, whereas private insurers are not.
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