Health insurers/PBMs

[rogermunibond]

4 hours ago, Luke said:

I think a base layer of care should be set by the government that is accessible to everyone regardless of job situation. This only covers emergencies and life threatening care. Routine visits should be paid out of pocket by a fund you have that is paid by your wage similar to whats going on in singapore to make healthcare consumers price conscious. Private insurance should only exist at the extra level of care - care that is not proven effective yet, extra luxury rooms, alternative treatments etc. This maintains some budget for RnD and pharmaceutical innovation while presevering a healthy workforce and demand for goods. So yeah, the US system is dysfunctional and we need to take the best from countries like the netherlands, singapore and northern european countries whil adding a small private insurance layer on top. This is my personal political belief, i live in a country where healthcare is mandatory and guaranteed also to jobless types and it is relatively affordable. 

 

Agree on this 100%.  There are large parts of Obamacare that could have gone this way but they chose to side with the insurance companies (payor side) as the hope for driving value based care in the US.  I think that experiment has largely been proven to have failed.  We do have higher coverage rates but cost containment is for shit.  Some of the Obamacare architects wanted a German or Swiss system iirc but they weren't successful.

 

 

 

[Gregmal]

There’s been a huge shift with MDs moving to big corporate practices mainly driven by ambulance chasers and subsequently getting raped by the insurance companies. No one wants to run their own small or mid sized practice anymore 

[changegonnacome]

Its a crazy system......the biggest issue when you get down to it....is price has been abstracted away from the end consumer of the healthcare itself and indeed the insurance premiums being paid .

 

When you think about it:

 

(1) the cost of care itself is obscured behind layers and layers of bureaucracy & administration.........no consumer of healthcare really knows the cost of care, at the point of care....co-pay is not a price signal....

 

(2) then the US takes it a step further.......and makes the cost of insurance itself opaque to the insured.....via the employer benefits system where lots of Americans get their insurance through their employer.......which means the insured person has no idea how much their insurance actually costs and doesnt think of it as a true cost to them but rather their employer.

 

The price/quality signal across the whole stack has been lost to intermediaries, administrators and agents.

[rogermunibond]

A lot of MD primary care doctors are moving to concierge/direct primary care, which involves much less hassle with insurance, and more direct payment from patients.  If you stay in private practice, you need to have your electronic health records, billing systems, etc. on point to avoid the payor pitfalls.  It requires a lot more investment and training for doctors and for their front office staff.

[LC]

42 minutes ago, rogermunibond said:

Nothing against NPs, but the whole expanded scope of practice thing is largely to preserve doctor pay/scarcity.  We don't need more NPs, but need more MDs providing primary care. 

 

Yep exactly. NPs are great, my aunt is an NP. But they are not doctors.

Not that doctors are needed in many cases, but the knowledge gap is pretty large between a Dr and NP. 

I go to a NP for my annual physical, but anything of concern I take to a doctor. 

 

I agree with your point on private practice - the fixed costs are also burdensome. 

I think work needs to be done at federal or state legislatures to address outdated bureaucracy (record keeping) and out-of-whack malpractice costs. 

[Gregmal]

Ironically enough one of the biggest beneficiaries has been liberal super donor John Morgan. But after previous liberal super donor Harvey Weinstein went down I can imagine they just need to keep the coffers flush. Especially after Willie Browns lover blew a cool billion on a failed campaign inside of 4 months…

Edited December 17, 2025 by Gregmal

[Luke]

The problem is that healthcare is such a big and rich part of the market in the US, as a politician you have a lot headwind if you want to regulate here. You will face the backlash of rich shareholders, managers, clinics that take part in the cashflow. If you disrupt it (which a politician should IMO) you will create a lot of change where some already very wealthy people will make less money, some people who just joined the system will loose and get angry (new doctors that took on hundreds of thousands in debt with the promise of reimbursement from insurances) etc. 

 

Now all of that aside - with a few new laws - a one time payout to insurance companies and a stimulus that will help those losing employment in the insurance sector - you could completely revamp the system, safe thousands in administrative costs and margin that was pocketed by private insurance while making healthcare better for large part of the majority in the US.  

 

But this sector is 17% of US GDP - combined marketcap of health insurers is 800b-1T...you have structural barriers of US medical school debt so you need loan forgiveness too. Insurance employs 2m people, billing coding as already said -- you need government aid and restructuring to help these people find new work and help them financially through those times. if you do a forced deleveraging (which would be good longterm) you still face insane hurdles...

[Cod Liver Oil]

Where the hell is DOGE in all this?

[Gregmal]

3 minutes ago, Cod Liver Oil said:

Where the hell is DOGE in all this?

Can you imagine the headlines and the reactions from the uneducated and poors? Try to fix healthcare waste woulda been met with “they’re trying to steal your universal right(says who? Lol) to healthcare!

[Gregmal]

See free or universal right to healthcare is one of those grandly stupid liberal ideals that with 1/7 of a working brain can easily be deduced to something that makes no sense. Healthcare essentially translates to people, resources and time. Once you start assigning names to whose resources and time, you need participants. And those participants likely aren’t doing it for nothing. So you’d either need to pay them(hence not free) or steal from them. So non starter.

Edited December 17, 2025 by Gregmal

[dwy000]

57 minutes ago, Luke said:

The problem is that healthcare is such a big and rich part of the market in the US, as a politician you have a lot headwind if you want to regulate here. You will face the backlash of rich shareholders, managers, clinics that take part in the cashflow. If you disrupt it (which a politician should IMO) you will create a lot of change where some already very wealthy people will make less money, some people who just joined the system will loose and get angry (new doctors that took on hundreds of thousands in debt with the promise of reimbursement from insurances) etc. 

 

Now all of that aside - with a few new laws - a one time payout to insurance companies and a stimulus that will help those losing employment in the insurance sector - you could completely revamp the system, safe thousands in administrative costs and margin that was pocketed by private insurance while making healthcare better for large part of the majority in the US.  

 

But this sector is 17% of US GDP - combined marketcap of health insurers is 800b-1T...you have structural barriers of US medical school debt so you need loan forgiveness too. Insurance employs 2m people, billing coding as already said -- you need government aid and restructuring to help these people find new work and help them financially through those times. if you do a forced deleveraging (which would be good longterm) you still face insane hurdles...

You cannot revamp the system solely from the insurer side. Insurers have profit margins of 1%. And thats enduring all the hate of society (people cheering Luigi). You need to revamp it from the provider side where increased amounts of care lead to increased income and there is little control on reducing that or lowering pricing (except for insurers).  

[Spekulatius]

More supply , deregulation, tort reform would go along way to solve the cost problem. I don’t think for profit is a problem, because for profit creates an incentive for efficiency which is lacking from non profits.

[dwy000]

11 minutes ago, Spekulatius said:

More supply , deregulation, tort reform would go along way to solve the cost problem. I don’t think for profit is a problem, because for profit creates an incentive for efficiency which is lacking from non profits.

Thats true in almost every industry except healthcare because its difficult to price shop.  If youre urgently ill, price is not a decision factor. Its also a "everyone but me" case.  I dont want providers ordering 5 tests at $1000 each to rule out a 1% concern - unless its my kid and then I want every test known to mankind. 

 

Deregulation is especially tough because having shady providers is not acceptable to society - esp when most people put 100% trust in those people.  

Edited December 17, 2025 by dwy000

[tnathan]

On 12/16/2025 at 2:37 PM, dwy000 said:

This. Everyone loves to hate on the health insurers but they are the only ones who are actively trying to reduce excess costs and unnecessary spend. 

This is partially true. If you think more about the insurer model, they are incentivized to keep their costs below the current year's premiums. However, some consistent medical price inflation (if it is relatively uniform and they can easily plan for this) is a nice boost to insurer profitability. Simplified, but if they can plan for medical pricing increasing at 6% per year, and they have the ability to raise premiums by that same amount to keep their operating margins steady, this a good business outcome for the providers as well as the insurers. The big issue is when medical prices are highly volatile and the planning / pricing models insurers use get out of whack (many insurers would have to return funds if their MCOs are <85% so there is not major upside for them if things go very well). 

 

In order to actually get the behavior we want, the right incentive is to remove the 85% MCO threshold within certain limitations (if patient care ratings are terrible you lose access to certain market, etc - like the star rating system in MA). This would encourage insurers to potentially be much more aggressive (within reason) instead of just accepting high medical inflation as long as they could pass it along

[dwy000]

1 hour ago, tnathan said:

This is partially true. If you think more about the insurer model, they are incentivized to keep their costs below the current year's premiums. However, some consistent medical price inflation (if it is relatively uniform and they can easily plan for this) is a nice boost to insurer profitability. Simplified, but if they can plan for medical pricing increasing at 6% per year, and they have the ability to raise premiums by that same amount to keep their operating margins steady, this a good business outcome for the providers as well as the insurers. The big issue is when medical prices are highly volatile and the planning / pricing models insurers use get out of whack (many insurers would have to return funds if their MCOs are <85% so there is not major upside for them if things go very well). 

 

In order to actually get the behavior we want, the right incentive is to remove the 85% MCO threshold within certain limitations (if patient care ratings are terrible you lose access to certain market, etc - like the star rating system in MA). This would encourage insurers to potentially be much more aggressive (within reason) instead of just accepting high medical inflation as long as they could pass it along

I agree with most of this. Unfortunately, having insurers push back on procedures and costs, while good for the system as a whole, adds to their hatred by society.  Look at Luigi and people cheering a murder because they hate insurers so much. 

 

I think the proposal to add supply is a good one, albeit with caveats.  If insurers could move coverage to new,.lower priced suppliers with some ease it would certainly help cap unchecked price increases.  But a lot of people like their doctor more than their insurer so you risk losing customers even if the pricing is.better. 

[nsx5200]

I see a lot of people bought into the arguments that AMA pushed when they fought against single-payer back in the 40's in order to keep Doctor's pay high.

 

I would recommend these 'liberal' podcasts for those that want a quick ramp-up on, IMHO, the biggest cost components in healthcare:

https://www.npr.org/sections/money/2019/03/12/702500408/are-doctors-overpaid

"Trade groups for doctors have also been lobbying against allowing nurse practitioners, physician assistants and other medical professionals to play a larger role in treating patients"

https://www.npr.org/transcripts/1253891564

"MA: Which makes sense. I mean, these specialists have really valuable skills and knowledge. But now, doctors don't want to lose that money.

HELM: And so they fight back through an interest group, the California Medical Association."

 

It's been a while, but The Healing of America still seem pretty relevant as a quick guide to other systems in the rest of the world.

 

Reading people's comments, it's still pretty clear that Big Medicine is still winning the narrative, and there won't be enough political will to actually make any significant change to the system.

[Spekulatius]

1 hour ago, nsx5200 said:

I see a lot of people bought into the arguments that AMA pushed when they fought against single-payer back in the 40's in order to keep Doctor's pay high.

 

I would recommend these 'liberal' podcasts for those that want a quick ramp-up on, IMHO, the biggest cost components in healthcare:

https://www.npr.org/sections/money/2019/03/12/702500408/are-doctors-overpaid

"Trade groups for doctors have also been lobbying against allowing nurse practitioners, physician assistants and other medical professionals to play a larger role in treating patients"

https://www.npr.org/transcripts/1253891564

"MA: Which makes sense. I mean, these specialists have really valuable skills and knowledge. But now, doctors don't want to lose that money.

HELM: And so they fight back through an interest group, the California Medical Association."

 

It's been a while, but The Healing of America still seem pretty relevant as a quick guide to other systems in the rest of the world.

 

Reading people's comments, it's still pretty clear that Big Medicine is still winning the narrative, and there won't be enough political will to actually make any significant change to the system.

Good post. I think we need to be totally clear that doctors earn too much in the US and if we want to make healthcare more affordable, the salaries for doctors need to come down. The easiest way to do this is to make it easier to become  a doctor and increase supply.  Both go hand in hand.

 

Tort reform is another cornerstone. The insurance costs are insane. A legal shield needs to be created that everyone treated within public healthcare has capped damage awards that are low enough to discourage tort/billboard lawyers. Want to sue your doctor? Fine, but works only if you pay private.

Edited December 18, 2025 by Spekulatius

[nsx5200]

For those that like Freakonomics, there's an old 2018 podcast on this as well:

https://freakonomics.com/podcast/nurses-to-the-rescue/

"The A.M.A., as you might imagine, is not the biggest fan of retail health clinics[like MinuteClinic] — especially when they’re not supervised by a physician." [note that the podcast was in 2018, and we've seen many retail health clinics pop up since then].

 

I appreciate if somebody on the "other side" supply objective analysis to push back on this line of "liberal" analysis as well to make sure I'm not locked into some tendency.

 

 

[DooDiligence]

4 hours ago, nsx5200 said:

I see a lot of people bought into the arguments that AMA pushed when they fought against single-payer back in the 40's in order to keep Doctor's pay high.

 

I would recommend these 'liberal' podcasts for those that want a quick ramp-up on, IMHO, the biggest cost components in healthcare:

https://www.npr.org/sections/money/2019/03/12/702500408/are-doctors-overpaid

"Trade groups for doctors have also been lobbying against allowing nurse practitioners, physician assistants and other medical professionals to play a larger role in treating patients"

https://www.npr.org/transcripts/1253891564

"MA: Which makes sense. I mean, these specialists have really valuable skills and knowledge. But now, doctors don't want to lose that money.

HELM: And so they fight back through an interest group, the California Medical Association."

 

It's been a while, but The Healing of America still seem pretty relevant as a quick guide to other systems in the rest of the world.

 

Reading people's comments, it's still pretty clear that Big Medicine is still winning the narrative, and there won't be enough political will to actually make any significant change to the system.

 

"the average American doesn't want to be educated, but there are ways you can interest him in a campaign that we have ever found successful. You can put up a fight, or you can put up a show."

 

https://wrestlenomics.com/2023/12/05/audience-composition-income-and-education-demographics-for-wwe-aew-impact-new-japan-wow/

 

Pretty sure the same demographics disproportionately feed partisan politics.

 

" I love the poorly educated" - Mango Mussolini

[rogermunibond]

Generic drug price fixing from 2012-2014 that's still winding its way through the court system.  Pretty blatant behavior from a slew of generic drug manufacturers.

 

https://conversableeconomist.com/2024/03/15/the-generic-drugs-antitrust-case/

[tnathan]

Maybe not the right thread, but highly recommend the book "Bottle of Lies" about the issues with generic drug manufacturing outside the U.S. ... legit scary stuff

 

https://www.amazon.com/Bottle-Lies-Inside-Story-Generic/dp/0062338781