US Health Care Reform

[Red1530]

It appears that the bill contains a provision that would prevent the repeal of the Independent Medicare Advisory Board created in the bill. As this appears to be a rule change it would need a two-thirds majority to pass. I am also linking to The Weekly Standard story.

 

[Lana.]

So I read that the Senate finally got the bill passed early this morning. Here is the story I found.

 

[Red1530]

Now that Senate has passed it version health care reform, it must be reconciled with the House version in committee. However there has been some talk that the House may pass the Senate version as is. Also there has been some talk of Republican Attorney Generals suing if the Senate version of the bill is signed into law because of the agreement that allows Nebraska to have its expansion of Medicare payed for by the Federal Government.

 

[Ivysaur]

By the way, to all the people who want to know why the US Health Care system is economically inefficient, I'd recommend you reading chapter five (The hidden truth) from the book "The Undercover Economist", by Tim Harford. There he makes a simple but surprising explanation of how the system works, and how it's the most expensive sanitary system in all the world, and yet it's absolutely inefficent.

 

[Red1530]

Personally, I think the reason that health care is so expensive is three fold. The prohibition of the sale of insurance across state lines, state mandates and not paying the direct cost.

Right now it is illegal to buy insurance from different states. This means that instead of one national market for health insurance, there are 50 isolated markets. This leads to the situation of one or two health insurance dominating the market. If this barrier was to be lifted it would overnight put the 1,700 health insurance companies into competition against one another. This new found competition would cause cost to come down.

Another factor is that is driving up the cost are state mandates. In order to be able to sell insurance in that state it need to cover certain things. While some things make sense like mammograms for women others do not. Some examples are botox and hair plug transplants. This also makes it hard to sell health insurance that covers only catastrophic events, similar to how auto insurance only pays out is you are in a crash. By reducing the mandates, it can cause the cost of insurance to go down a fair amount.

Lastly, most consumers are not paying the true cost of the medical care, but a co-pay. This means that consumers are not shopping around to find the lowest price like they would any other good. If consumers are faced to paying closer to the true cost the medical treatment, they would more likely shop around.