Where would you like your tax dollars to go?

[pocaracas]

In Portugal, every medical procedure is on a table together with its cost. This cost is, of course, agreed with the medical order, but the table is set by the government and those costs cannot be unreasonable as they are used for the annual health budget on public hospitals and clinics.

From what you say, pappy, it seems to me that these procedures are somewhat more expensive in the US than elsewhere.
What's the reason for such an extra cost?
From my uninformed POV, I think it has to do with the fact that American hospitals are private for-profit companies. Couple that with the existence of insurance and the hospitals end up charging almost whatever they want.... regardless of the actual cost of each procedure. The insured patient only has to worry about having that particular procedure covered.
Who is insured? mostly workers that have insurance as part of their income... and rich people...


With a table set by the government, for use in public hospitals, you get to apply only reasonable prices to the required procedures.
This cost is mostly covered by our Social Security budget.
It's not a perfect system, but it helps regulate healthcare prices.

I don't know how that could be translated to the US reality... but I do believe that it would require a massive restructuring of healthcare... do you guys have public hospitals at all?

I've already mentioned a couple of the big additional cost drivers in liability insurance and education costs.

Profits of health insurance and health providers are of course another target for cost reduction. But those profits are probably not as big a portion of the overall cost as many assume. For one thing only 18% of American Hospitals operate as for profit enterprises. 20% are government facilities, and 62% of American hospitals operate as non-profits. So in 82% of our hospitals there are no profit margins to cut. The 18% that do operate as for profits average a little less than a 9% margin. That means the most savings you could see cutting the profits of hospitals would be 1.62% of the total. Reality is it would be a lot less than that because hospital revenue doesn't account for 100% of the total cost.

Insurance companies operate at a lower margin than hospitals. According to some sources as low as 3.3%. But once again health insurance revenues aren't even close to 100% of the total so zeroing out those margins altogether might save another 1.6% of the total. Best case scenario we'd probably be looking at a 3% savings by getting rid of hospital and health insurance profits. Maybe none at all if the government can't manage billing and payments at least as efficiently as the for profits.

Drug company margins are another cost reduction target. One that could pay some substantial dividends since US pharmaceutical companies averaged a 23.5% margin last year. But once again drug costs account for less than 10% of total healthcare expenditures so at the most we'd be looking at a 2.35% savings off the bottom line. Add all those profits together and we'd be looking at a maximum savings of maybe 6%. That would have brought last years per capita healthcare expansive down from $10,335 to $9,715. It is something but not nearly enough to supply healthcare to Americans that don't currently get any without raising the overall cost.

I see those numbers and have no cause to doubt them.
But something must be wrong somewhere, because it's obvious the US is spending much more on healthcare per capita than most other countries, while leaving a large swath of the population unable to access medical care.
The money is going somewhere... somewhere it doesn't go on this side of the Atlantic.
Maybe there are redundancies in place that double or treble the actual cost of procedures?
Maybe the non-profits are doing some creative accounting?
Maybe something else, or a messy combination of many bits and pieces?...
You guys tell me.

[popeyespappy]

Find out how much it costs and get that back in tax, preferably from the extremely wealthy.

According to Forbe's latest list the combined net worth of America's 536 billionaires is $3.126 trillion. That's $134 billion short of paying our healthcare bill for 2016 alone. Taxing the rich isn't going to cut it by itself.

According to the chart I posted earlier the fed got $1.1 trillion in social security and medicare revenue last year. The rates for those taxes are 12.4% for social security and 2.9% for medicare. The numbers get funny here because social security taxes are only collected on the first $127,200 in regular earnings and medicare is collected on all regular earnings. Capital gains aren't burdened with social security and medicare taxes. Anyway let's just say the medicare portion of that $1.1 trillion was $250 billion. That means we would have needed to raise another $3.1 trillion to pay our 2016 healthcare costs. That would take a increase in the medicare tax rate from 2.9% to 35.96%. That's 35.96% on top of the 12.4% social security tax, 10-39.6% income tax rate, plus whatever else people pay in state and local taxes. Not to mention the social security fund is now operating in the red so that rate needs to go up too. Most Americans (not just the extremely wealthy) would be looking at federal tax burdens between 50 and 80%. That would crash our economy and probably yours too.

It can't be done without lowering costs. Removing profit margins from the equation wouldn't be enough by itself to make it workable either so we have to find other areas to reduce costs. I'm open to suggestions on how to do that...

[vorlon13]

Hmmm, here's an interesting idea to bat around . . .


Allow states and municipalities to collect sales taxes (on their residents) for their purchases of stocks. It's a revenue stream on the 'right' people, AND it would act as a damper on market volatility.

Might be a win-win.

[popeyespappy]

I've already mentioned a couple of the big additional cost drivers in liability insurance and education costs.

Profits of health insurance and health providers are of course another target for cost reduction. But those profits are probably not as big a portion of the overall cost as many assume. For one thing only 18% of American Hospitals operate as for profit enterprises. 20% are government facilities, and 62% of American hospitals operate as non-profits. So in 82% of our hospitals there are no profit margins to cut. The 18% that do operate as for profits average a little less than a 9% margin. That means the most savings you could see cutting the profits of hospitals would be 1.62% of the total. Reality is it would be a lot less than that because hospital revenue doesn't account for 100% of the total cost.

Insurance companies operate at a lower margin than hospitals. According to some sources as low as 3.3%. But once again health insurance revenues aren't even close to 100% of the total so zeroing out those margins altogether might save another 1.6% of the total. Best case scenario we'd probably be looking at a 3% savings by getting rid of hospital and health insurance profits. Maybe none at all if the government can't manage billing and payments at least as efficiently as the for profits.

Drug company margins are another cost reduction target. One that could pay some substantial dividends since US pharmaceutical companies averaged a 23.5% margin last year. But once again drug costs account for less than 10% of total healthcare expenditures so at the most we'd be looking at a 2.35% savings off the bottom line. Add all those profits together and we'd be looking at a maximum savings of maybe 6%. That would have brought last years per capita healthcare expansive down from $10,335 to $9,715. It is something but not nearly enough to supply healthcare to Americans that don't currently get any without raising the overall cost.

I see those numbers and have no cause to doubt them.
But something must be wrong somewhere, because it's obvious the US is spending much more on healthcare per capita than most other countries, while leaving a large swath of the population unable to access medical care.
The money is going somewhere... somewhere it doesn't go on this side of the Atlantic.
Maybe there are redundancies in place that double or treble the actual cost of procedures?
Maybe the non-profits are doing some creative accounting?
Maybe something else, or a messy combination of many bits and pieces?...
You guys tell me.

Nonprofits earn extra money they just can't pay it out to investors. Most of it is reinvested in the nonprofit or used to fund charitable activities.

Yes a messy combination of many bits and pieces. I don't know how to fix it, and as far as I know no one else does either. As I said, I'm open to suggestions.

I'll ask those of you with single payer systems this. What you have now is apparently working now, but is it sustainable? What will your per capita costs for healthcare be in another 30 years?

[Jesster]

Hmmm, here's an interesting idea to bat around . . .


Allow states and municipalities to collect sales taxes (on their residents) for their purchases of stocks.  It's a revenue stream on the 'right' people, AND it would act as a damper on market volatility.

Might be a win-win.

That's not the worst idea I've heard. I'm wondering two things now: how well would it work and how much would that piss off the rich people? The second question tickles me.

[vorlon13]

Yeah, the more volatility it takes out of the market, the less tax revenue it brings in.

But then consider the staggering losses of those periodic Dow Jones meltdowns that would presumably be smaller and occurring less often, and there is another big money payoff for those rich folks who otherwise would be facing more and bigger wipe out events.

Enlightened rich people might even be in favor of this idea . . .

[popeyespappy]

Hmmm, here's an interesting idea to bat around . . .


Allow states and municipalities to collect sales taxes (on their residents) for their purchases of stocks.  It's a revenue stream on the 'right' people, AND it would act as a damper on market volatility.

Might be a win-win.

That sounds reasonable, but here is something to consider. Stockholders already pay taxes twice on their investments. Once as corporate taxes then again as capital gains. Are we willing to forgo corporate taxes if capital gains are taxed at regular income rates?

[vorlon13]

. . . and this revenue stream goes to the states and the cities, not the feds.

More locally managed spending I'm considering as a +

[popeyespappy]

As far as I can tell most states and cities aren't any better at providing services or managing budgets than the fed.

[Jesster]

As far as I can tell most states and cities aren't any better at providing services or managing budgets than the fed.

Yeah... I can confirm this. I only have to look outside my window to see that. Hello New Mexico.