We're not quite there yet. But there is a new website that is getting close. Posted on 02/25/2012 5:15:49 AM PST by Kaslin
We're not quite there yet. But there is a new website that is getting close.
A small, emerging online service called MediBid is creating an actual market that puts doctors together with patients who need care.
Here's the best thing about it. Patients who use this service can cut their health care costs in half. No, that's not a misprint. Patients who obtain care through MediBid pay about half as much as BlueCross pays. Ditto for all the major employer plans as well as the other big insurance companies. Patients frequently pay even less than what government pays under Medicare.
Here's the worst thing about it. Once ObamaCare kicks in, entrepreneurial ventures like this one will probably be nipped in the bud. That's because the Obama administration doesn't believe that patients can or should be able to buy care in an open marketplace. In fact, once they get through implementing the 2,700-page bill with 159 regulatory agencies and 10,000 pages of regulations, patients are unlikely to ever see a real price for any type of care.
At least for the time being, however, a market for medical care is emerging. Here's how it works.
Patients who are willing to travel and able to pay cash, can request bids or estimates for specific medical procedures. They fill out medical questionnaires and they can upload their medical records. The patient’s identity is kept confidential until a transaction is consummated. MediBid-affiliated physicians and other medical providers respond by submitting competitive bids for the requested care.
Business at the site is growing. For example, last year the company facilitated:
•More than 50 knee replacements, at an average price of about $12,000, almost one-third of what the insurance companies typically pay and about half of what Medicare pays.
•Sixty-six colonoscopies with an average price between $500 and $800, half of what you would ordinarily expect to pay.
•Forty-five knee and shoulder arthroscopic surgeries, with average prices between $4,000 and $5,000.
•Thirty-three hernia repairs with an average price of $3,500.
MediBid facilitates the transaction, but the agreement is between doctor and patient, both of who must come to an agreement on the price and service.
One key component of all this is the willingness to travel. If you ask a hospital in your neighborhood to give you a package price on a standard surgical procedure, you will probably be turned down. After the government suppression of normal market forces for the better part of a century, hospitals are rarely interested in competing on price for patients they are likely to get as customers anyway.
A traveling patient is a different matter. This is a customer the hospital is not going to get if it doesn't compete. That's why a growing number of U.S. hospitals are willing to give transparent, package prices to out-of-towners; and these prices often are close to the marginal cost of the care they deliver. Interestingly, a lot of the out-of-towners getting the cut-rate prices are foreigners.
North American Surgery has negotiated deep discounts with about two dozen surgery centers, hospitals and clinics across the United States, mainly for Canadians who are unable to get timely care in their own country. The company’s
cash price for a knee replacement in the United States is $16,000 to $19,000, depending on the facility a patient chooses.
But the service is not restricted to foreigners. The same economic principles that apply to the foreign patient who is willing to travel to the United States for surgery also apply to any patient who is willing to travel. That includes U.S. citizens. You don't have to be a Canadian to take advantage of North American Surgery's ability to obtain low-cost package prices. Everyone can do it.
The implications of all this are staggering. The United States is supposed to have the most expensive medical care found anywhere. Yet many U.S. hospitals are able to offer traveling patients package prices that are competitive with the prices charged by top-rated medical tourist facilities in such places as India, Thailand and Singapore.
All of this illustrates something many of my readers already know. Markets in medical care can work and work well — provided government gets out of the way.
I’ve worn out my liver.Now,where’s that Chinese prisoner
website?
I can understand if someone saves a lot of money on a surgical procedure, they can travel. But even if you save 50% on a colonoscopy, that's still only $500-$800. That would barely pay for the travel costs, unless it's only a few hours away by car.
I'm also curious about how patients handle preparatory and follow-up appointments for surgical procedures. There are typically all kinds of lab tests that are required before surgery is scheduled, and you don't get the results overnight. The cost of repeated trips can mount quickly.
I hope something gets better because we have an HSA which Rick Santorum loves. We used to too! Our premiums just went up another $100 a month...to $740 a month with a $6,000.00 deductible.
What has happened is that the FEDS have mandated mammo’s, life insurance and a lot of other things be a part of HSA’s and it has DRIVEN the premiums HIGHER AND HIGHER! Not to mention that we actually had to USE our insurance the past couple of years and we are very healthy for our age...no prescriptions. This past year, we both had colonoscopies and four years ago, the local hospital charged our insurance $1200 just for the surgery and the few hours you are there. This last time they charged...get this...$5,000!!!! Since we had alread paid our deductibe from mine, my husband decided to get his done in that year instead of waiting until spring. It’s a never ending situation. One we are just about ready to DROP! Please don’t tell me to get catastrophic insurance. We’ve looked into that and it’s NO cheaper and not easy to find. It is very frustrating!
Didn’t the Ryan plan for Medicare involve direct patient/doctor negotiation?
Medical Tourism is already doing this.
http://www.medretreat.com/ and similar websites allow you to shop for services overseas.
Thanks Kaslin.
Remember that your friendly labs and MDs will deal with you today, or a lot of them will. For not having to go through insurance hoops, you can deal with them with cash. Make them a fair offer.
I agree: the more the market values are in medical care, the better that care will be. We need to destroy Obamacare.
It seems that a healthy competitive medical industry with government out of the way could result in the same sort of competition we see in other businesses. Maybe "buy one EKG get the second for half price". Or "free prostate exam with blood work up".
Without the government stifling creativity we could do a lot of good things. I also remember when their used to be vending machines in airports where you could buy flight insurance. Maybe a service like that for medical mishaps could cause trial lawyers to have a little less impact.
I moved two years ago....got a new doctor. Small operation....two doctors run this small office...three nurses, a records gal, and a receptionist.
I went over twice the first year....no issues with billing. 2011...I went over and discovered a whole new staff around the two doctors. Some big issue occurred, which no one would go into. The billing business....totally screwed up. I got the impression that the budget lady who did things for the doctor, had not gotten the insurance companies to pay them on time. I had to sit there and write out a check for the prior visit....for the guy to accept me at that point.
I suspect alot of these small doctor operations have screwed up business staffs and it’d be better to have a clinic structure around them, with professional accountants.
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