One of my chronically unintelligent commenters posted his fantasies that government health care is much more “efficient” than private health service provision. Here’s an explanation of why that’s nonsensical.
…the comparison between public and private plans is a false comparison. Private insurance and public benefits are not the same business. For all its warts, private insurance tries to manage care. Medicare is mostly about paying the bills presented to it.
Many who favor a public plan as part of comprehensive health-care reform dismiss the administrative “overhead” of private plans as having little or no value. Ways and Means Health Subcommittee Chairman Pete Stark (D., Calif.), for example, insists that “most private plans are poorly managed.” Contrasting them with the supposedly sleek and efficient Medicare program, he labels commercial insurance “the General Motors of medical care.”
In fact, the administrative expenses of private insurance plans represent money well spent for their members. Here are four reasons…
Whenever you find yourself agreeing the Pete Stark on anything, it’s a pretty good sign that you should rethink your position.
Is this the old public-managed-care vs. private-managed-care false dichotomy? Maybe there’s problems intrinsic with third-party-payer management of health care.
In the Netherlands we are moving away from semi-governmental “not-for-profit” healthcare precisely to curb ballooning costs. A friend of mine used to work for a medical insurance company and left a couple of months before the changes took effect. One of the immediate effects was considerable reorganisation and a number of compulsory redundancies.
Among the insurers or the insurees?
This WSJ op-ed is pathetic even by the sad pathetic standard of the WSJ op-ed page.
The WSJ claims that building a network is of critical value to an insurance company and it’s customers. As a consumer, I don’t care who is in the network, I care about who is my provider. A Good doctor I find who is well reccomended,
working with a reputable hospital and has a local track record is good enough. I don’t care if the network includes some butcher, as long as they are not my doctor. My only concern about who is in the network is if the Provider forces me to use that network provider, which Medicare does not do, but many private insurers do.
The WSJ Claims Private insurers must negotiate rates?
Um, they can use their Usual and Customary rates database that they run jointly which is a very minor cost to establish that rate, or nothing stops Aetna from saying (We will take the Medicare rate and pay 1.41 times that or whatever rate they find to be convenient. What value comes from negotiating rates? Is there some value that comes from a money grubber arguing with my Internist on how much they will pay for a minor surgical procedure?
Fraud, it would be nice if weems and sasse would cite their report on medicaid payment errors. They argue it is 10% of errors, but, there is a world of difference between payments in error and fraud. Most of the reports I have seen on Medicare Fraud shows 2%.
It’s a Pity Kerry Weems in his annual report on Medicaid Actuarial studies never mentioned Fraud or payment errors as a source of problems within the program
http://www.cms.hhs.gov/ActuarialStudies/downloads/MedicaidReport2008.pdf
i looked and didn’t find fraud in that report, nor did i find payments made in error as a line item.
Finally, Marketing. Sorry, all those ad campaigns are of no value to me as a consumer, same with all those ads by pharmaceutical companies for Olesta, lunestra, lipitor, etc… I would be perfectly happy as a consumer if pharmaceutical companies and insurance companies were prohibited from engaging in mass market advertising or hiring sales people.
“i looked and didn’t find fraud in that report, nor did i find payments made in error as a line item. ”
We should report your findings to a ombudsmen immediately.