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Where is the money in US healthcare going to?

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greedyspectator Since: Sep, 2011
#1: Nov 21st 2011 at 4:37:04 AM

During the Keynesian economics thread revival, someone (I forgot whom) claimed that the reason US healthcare sucks despite having the most healthcare spending in the world is due to greedy insurance companies and the subsequent bureaucracy costs. Turns out it's not so simple.

The total costs in healthcare insurance, including bureaucracy, is $11.7 billion, or 0.5% of the total healthcare costs.

Likewise, greedy drug companies are also the usual scapegoats. Yet, despite the increase of the use of generic drugs from 57% to 75% on all prescriptions (except for a few patents), paradoxically, over those same years, the total amount Americans spent on drugs actually increased by 31 percent — the same rate as overall health care expenditures.

This of course, begs the question: Where is the money going to?

USAF721 F-22 1986 Concept from the United States Since: Oct, 2011
F-22 1986 Concept
#2: Nov 21st 2011 at 4:38:58 AM

Advertising.

We pay a metric fuckton so the corps can advertise their worthless overpriced brand-name garbage.

USAF713 on his phone or iPod.
Balmung Since: Oct, 2011
#3: Nov 21st 2011 at 4:42:57 AM

That and the insurance companies will cease support for prescriptions of drugs they feel are being overprescribed (read: costing them more than they think they should), and it's not uncommon for these to be drugs that are often very expensive. Also, there are costs other than the medication. For instance, use of emergency rooms as normal medical treatment.

edited 21st Nov '11 4:43:31 AM by Balmung

greedyspectator Since: Sep, 2011
#4: Nov 21st 2011 at 4:47:48 AM

[up][up]I cannot believe that advertising would cost that much. Seriously, how could it exceed insurance costs? I need statistics. I just can't compute it in my brain.

[up]Well, the insurance cost statistic I just wrote includes for everything.

Source: http://opinionator.blogs.nytimes.com/2011/11/03/less-than-26-billion-dont-bother/

USAF721 F-22 1986 Concept from the United States Since: Oct, 2011
F-22 1986 Concept
#5: Nov 21st 2011 at 4:49:41 AM

You haven't been to the US, have you?

Every third commercial is for some stupid drug...

USAF713 on his phone or iPod.
greedyspectator Since: Sep, 2011
#6: Nov 21st 2011 at 4:54:21 AM

[up]No, I haven't been to the US. But I just can't compute it's possibility! How could more than half of the costs of healthcare be stupid advertising costs? It's just impossible for a guy from Asia!

USAF721 F-22 1986 Concept from the United States Since: Oct, 2011
F-22 1986 Concept
#7: Nov 21st 2011 at 4:56:28 AM

They're absurdly aggressive about it. It's literally everywhere.

If you didn't know better you'd think we're the United States of Astra-Zenica...

USAF713 on his phone or iPod.
storyyeller More like giant cherries from Appleloosa Since: Jan, 2001 Relationship Status: RelationshipOutOfBoundsException: 1
More like giant cherries
#8: Nov 21st 2011 at 7:28:52 AM

And it's not just consumers. Drug companies also spend a fortune "advertising" to doctors.

And this is why I have 0 sympathy when they complain that allowing the government to bargain over prices would make them unable to afford research.

edited 21st Nov '11 7:29:39 AM by storyyeller

Blind Final Fantasy 6 Let's Play
breadloaf Since: Oct, 2010
#9: Nov 21st 2011 at 8:55:42 AM

Your number is inaccurate. It was 11.7 billion in "profits" not total insurance cost. That article is using bad statistic and sleazy words to slip it past. How much does total insurance actually cost?

From Wiki:

Of each dollar spent on health care in the United States, 31% goes to hospital care, 21% goes to physician/clinical services, 10% to pharmaceuticals, 4% to dental, 6% to nursing homes and 3% to home health care, 3% for other retail products, 3% for government public health activities, 7% to administrative costs, 7% to investment, and 6% to other professional services (physical therapists, optometrists, etc)

An oft-cited study by Harvard Medical School and the Canadian Institute for Health Information determined that some 31% of U.S. health care dollars, or more than $1,000 per person per year, went to health care administrative costs, nearly double the administrative overhead in Canada, on a percentage basis

That quote is based on a study by a few doctors. Found at: http://www.pnhp.org/publications/nejmadmin.pdf

The US spends roughly $2200 more than Canada per capita on healthcare. Administrative costs alone make up 1000 of 2200 of that. And they say capitalism is efficient :)

edited 21st Nov '11 8:59:34 AM by breadloaf

Inhopelessguy Since: Apr, 2011
#10: Nov 21st 2011 at 11:21:06 AM

Well, advertising?!

Holy fuckerel.

...

The NHS public service adverts are frickin' scary. I'm never going to take drugs, have unprotected sex, or do any of that stupid shit. Ever.

So, if the government spends so much... how much does Medicare/Medicaid cost? If it's just for poor people and old people...

RadicalTaoist scratching at .8, just hopin' from the #GUniverse Since: Jan, 2001
scratching at .8, just hopin'
#11: Jun 17th 2013 at 7:21:54 PM

I know this is a necro from hell, but this thread actually is relevant to a link I wanted to post: it's going to rewarding people like this.

Based in part on surreptitious tape recordings, an FBI affidavit lays out allegations that a Sacred Heart pulmonologist kept patients too sedated to breathe on their own, then ordered unneeded tracheotomies for them — enabling the for-profit hospital to reap revenue of as much as $160,000 per case.

The Sacred Heart case is unusual because of the troubling nature of some of the allegations, said Ryan Stumphauzer, a former federal health care fraud prosecutor in Miami who reviewed the affidavit. “A typical indictment might allege phantom billing or improper coding,” he said. “This complaint alleges the hospital and doctors were performing unnecessary invasive surgery to justify false billing.”

Share it so that people can get into this conversation, 'cause we're not the only ones who think like this.
Zendervai Visiting from the Hoag Galaxy from St. Catharines Since: Oct, 2009 Relationship Status: Wishing you were here
Visiting from the Hoag Galaxy
#12: Jun 17th 2013 at 9:18:00 PM

That is...completely insane. I wrote a character who does that and he's a psychopathic villain!

Not Three Laws compliant.
DrunkGirlfriend from Castle Geekhaven Since: Jan, 2011
#13: Jun 17th 2013 at 9:32:42 PM

Eh, that's capitalism for you.

"I don't know how I do it. I'm like the Mr. Bean of sex." -Drunkscriblerian
johnnyfog Actual Wrestling Legend from the Zocalo Since: Apr, 2010 Relationship Status: They can't hide forever. We've got satellites.
Actual Wrestling Legend
#14: Jun 17th 2013 at 11:46:00 PM

Sacred Heart, eh? Bob Kelso strikes again.

I'm a skeptical squirrel
midgetsnowman Since: Jan, 2010
#15: Jun 18th 2013 at 12:19:48 AM

Yep. hell, advertisers send reps out to doctors specifically to shower them with free samples of medicine and tons of sales pitches.

joeyjojo Happy New Year! from South Sydney: go the bunnies! Since: Jan, 2001
Happy New Year!
#16: Jun 18th 2013 at 6:42:39 AM

Remember when such acts of corporate villainy use to be shocking?

hashtagsarestupid
Karkadinn Karkadinn from New Orleans, Louisiana Since: Jul, 2009
Karkadinn
#17: Jun 18th 2013 at 7:11:10 AM

No.

No, I do not remember a time when corporations ever had the public good in mind.

Furthermore, I think Guantanamo must be destroyed.
joeyjojo Happy New Year! from South Sydney: go the bunnies! Since: Jan, 2001
Happy New Year!
#18: Jun 18th 2013 at 7:24:38 AM

No, but there was a time when such acts of cartoonish over the top corporate villainy were met with cries of public outrage then apathetic remarks about capitalism. (Nothing personal DG).

hashtagsarestupid
Euodiachloris Since: Oct, 2010
#19: Jun 18th 2013 at 8:52:34 AM

[up]Actually... no. Do a bit of digging: it's nothing in comparison to some of the health... fads (read "scams")... during the Victorian and Edwardian periods. <shrugs>

And, before that... <shudders>

Health and Safety is relatively new, and easily ignored as a waste of time and money as a result. tongue

edited 18th Jun '13 8:54:12 AM by Euodiachloris

midgetsnowman Since: Jan, 2010
#20: Jun 18th 2013 at 12:33:40 PM

Yeah..before the FDA we had people going around peddling miracle tonics that at best were useless and at worst were downright poisonous.

Thats the era the term "snake oil salesman" comes from, incidentally.

joeyjojo Happy New Year! from South Sydney: go the bunnies! Since: Jan, 2001
Happy New Year!
#21: Jun 18th 2013 at 12:54:52 PM

Con men aren't new. But intentionally crippling people simply so you can charge them for the service is with out precedent.

inb4 slavery

hashtagsarestupid
Madrugada Zzzzzzzzzz Since: Jan, 2001 Relationship Status: In season
Zzzzzzzzzz
#22: Jun 18th 2013 at 2:53:26 PM

Ok, folks, as this thread is going right now, it's a complaining thread and it should be locked.

But I'll give it a bit more time to see if it can turn around, because the OP does raise a question that could lead to some interesting discussion: Where does the money paid for health care go?

edited 18th Jun '13 2:55:23 PM by Madrugada

...if you don’t love you’re dead, and if you do, they’ll kill you for it.
RadicalTaoist scratching at .8, just hopin' from the #GUniverse Since: Jan, 2001
scratching at .8, just hopin'
Madrugada Zzzzzzzzzz Since: Jan, 2001 Relationship Status: In season
Zzzzzzzzzz
#24: Jun 18th 2013 at 2:56:32 PM

Glad you noted it, now please edit out the comment that will serve to keep the complaining going? sad

...if you don’t love you’re dead, and if you do, they’ll kill you for it.
DrunkGirlfriend from Castle Geekhaven Since: Jan, 2011
#25: Jun 18th 2013 at 7:58:30 PM

Relevant article here about how a house call program is cutting costs in Medicare, and nobody wants to implement it.

"I don't know how I do it. I'm like the Mr. Bean of sex." -Drunkscriblerian

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