CFP:
Two years too late a senator has finally taken a tentative step toward increasing competition in the healthcare market, lowering insurance costs and removing the dead hand of Obamacare from the nation’s throat. It’s partial implementation of a plan I’ve advocated, but it repeats my mistake and unfortunately adds a new one.
It’s unfair to blame Sen. Mike Braun (R–IN) for being late since he wasn’t in the Senate when Republicans frittered away Obamacare repeal. The problem is his bill attacks cost from the wrong end.
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Braun’s plan is called the True Price Act. As he told Breitbart.com, his plan “would require insurers to disclose the negotiated price for each medical service covered by a person’s insurance plan and any cost-sharing amounts (co-pays or deductibles)…The bill would require the prices to be posted on the insurer’s website and in paper form.”
That’s backwards because the insurance companies can’t predict what hospitals charge for a procedure because charges vary according to the rapacity of the facility. Braun says he wants to reverse concentration in the health insurance market by “by making it transparent and competitive, letting the best providers survive.”
His bill would only encourage concentration and limit consumer choice because the only way an insurance company can be certain of a procedure’s cost is if the insurer limits coverage to hospitals it controls or with which it has negotiated an agreement.
The People’s Republic of Maryland proves my point. The Maryland Health Care Commission has a limited program that compares turnkey prices for common procedures affecting patients who are either women, old or both. It found Sinai Hospital charges $32,500 for a knee replacement, while UMD Medical Center at Easton charges over one–third less at $22,700, with fewer readmissions from complications.
Braun would accomplish more by requiring hospitals that accept federal money to post turnkey charges and forget the insurance companies.
Then Braun repeats my initial mistake and ignores consumer motivation. more here
Does the Senator not realize that huge piece of bill settlement in the States is not done between Insurer and Hospital but rather between a claim processor(a firm that negotiates every item on a patients bill to get the lowest and most reasonable cost for both sides) hired by the Insurer to process all the Hospital claims submitted to them by their clients. With this sort of relationship the claim processor has access to prior billed/settled numbers from all over the country in detail by hospital and by procedure. The processor takes either a flat fee, percent of savings negotiated or a variable fee based on claim complexity.
It strikes me that this listings of costs that the Senator proposes cuts out the claim processor and their knowledge and expertise basically messes up a functioning system that keeps bills as low as they can.