I'm not necessarily opposed to a single-payer system but the margin that for-profit insurance companies take is a tiny fraction of overall healthcare spending. You could zero it out and it would barely move the needle. And many of the largest commercial health plans such as most Blue Cross Blue Shield Association members are non-profit. There is literally no margin.
Provider organizations spend a huge amount of effort dealing with Medicare and Medicaid, which are pretty close to being a "single-payer solution" already in many cases. From an administrative overhead perspective they aren't always easier to work with than commercial health plans. Plus they have enormous problems with fraud, waste, and abuse.
The mandated low margin is part of the problem. When your margins are regulated, the only way to increase profits is to just make everything more expensive. More revenue, same margin, more profits. Humane health care is incompatible with free market economics.
Perhaps its not compatible. But that’s tangential to the situation in the US, at the very minimum you need to have price transparency in any ‘free market’ system.
I think the point is that we might as well just give up the pretense of a free market healthcare solution and just focus on what's humane.
Is it humane to leave a patient to die in an ambulance when a single-payer nationalized healthcare system is over capacity?
https://www.theguardian.com/society/2025/apr/06/englands-nhs...
I'm not trying to be snarky here, the point is that there is no easy solution and optimizing based on what politicians subjectively consider "humane" isn't going to get us anywhere. If we want to actually fix the problem then we need to focus on what's economically feasible rather than low-effort hot takes and sound bites. Free markets, with reasonable limits, can be part of that solution by revealing consumer preferences and allowing for efficient allocation of limited resources.
> Is it humane to leave a patient to die in an ambulance when a single-payer nationalized healthcare system is over capacity?
I think painting the inhumanity of that as a consequence of the structure of the healthcare system is disengenuous at best, especially as the implicit solution you're proposing is to artificially lower utilization rate and access. Deflecting patient deaths into "technically not our fault, they didn't try to get help" by exploiting economics is in no small terms extremely inhumane.
The answer to that is that near universally in the world, our labor pool of medical personnel is too small, and almost all of it has to deal with an arbitrary restriction of labor supply. Stupidly, I have felt this many times in America, so trivially it's a problem no matter the structure of the healthcare system. Optimizing towards maximizing the number of nurses, doctors, pharmacists, the whole spread, in a society is underdiscussed but obviously beneficial (for everybody but those who profit off of the labor scarcity)
> I'm not trying to be snarky here, the point is that there is no easy solution and optimizing based on what politicians subjectively consider "humane" isn't going to get us anywhere.
On the contrary, most politicians seem very adamantly against what I'm proposing. I don't know why you think I'm suggesting that we delegate how we determine what's humane to politicans.
That is the inevitable consequence of your suggestion. In any national healthcare system, it's ultimately the politicians who have to make choices about the incentives that drive the behavior of every other participant.
Is it humane to spend $100K of public funds to extend the life of a terminal cancer patient by 6 weeks? Some would say yes, others no. Those are real choices that have to be made and in the most expensive parts of the healthcare system there is no clear consensus on what is "humane".
is it humane to solve that problem by excluding people based on income? that's what your proposing, as that's how markets solve problems like this: if more people need a product/service than the market can provide prices go up and the poor are excluded. also not trying to be snarky but that's the choice in front of us. part of the problem with free market solutions to healthcare is the feasibility of walking away from a bad deal. in every other space prices are regulated downward by the buyers' ability to either buy something else or do without but there is no doing without emergency care and doing without preventive care is just deferring the cost until it's emergency care at punitive interest.
Stop lying, I haven't proposed anything of the kind. Free market solutions often include giving cash subsidies to certain participants (and you would be aware of this if you had bothered to do even basic research on serious healthcare system reform proposals before commenting). I'm simply pointing out that it's a complex problem with multiple causes and there is no simple solution.
Even cash subsidies can be a kind of chain. Why wouldn't we just subsidize the whole thing for everyone then? And if the purpose of a health insurance plan is to collect groups of people into "risk pools," then why wouldn't we just put everyone in a global risk pool? And if the purpose of a health insurance plan is to negotiate rates on behalf of a bunch of people, why wouldn't we have someone like CMS determine those rates? And if the purpose of a health insurance plan is to make sure everyone has health care, why would we create a system where people are excluded by means-testing?
They're not lying any more than you were when you responded to my suggestion that we should prioritize what's humane with some sort of interpretation that I was saying something about politicians.
I don't think the core issue is the health insurance companies stealing money, it's the deep inefficiencies that come from the position the insurance companies hold.
How many man-hours are spent dealing with insurance paperwork? How much do hospitals and doctors spend each year just dealing with that interaction, rather than treating patients?
> Plus they have enormous problems with fraud, waste, and abuse.
I'd say "enormous" requires some evidentiary proof. Obviously there is fraud and waste. But almost all large scale systems have that. We should certainly try to minimize it wherever we can but I don't think "waste and fraud exist" are a reason to not pursue a path.
>I'd say "enormous" requires some evidentiary proof. Obviously there is fraud and waste. But almost all large scale systems have that. We should certainly try to minimize it wherever we can but I don't think "waste and fraud exist" are a reason to not pursue a path.
Are you living in the same country as the rest of us? There is plentiful evidence of the enormous fraud and waste. It’s not even a point of debate anymore.
For what it's worth I know you've worked on FHIR and probably know a lot of details I don't. Actually I'd be interested in talking to you about FHIR.
That said!
1) In the big picture isn't the US clearly paying more than other countries? I'm sure some of this is eg a janitor in the US costs more than a janitor elsewhere, but still...
2) Isn't the cap for the margin that insurance companies can take 20%? That is, they have to pay out 80% as claims take 20% for overhead
3) Doesn't insurance also induce more work done by everyone else who has to deal with them? So the margin the insurance company itself takes is not the only cost they add. Maybe they make providers do more paperwork, or let patients order tests etc that they would not if they were not spending other people's money, or some other reason. Say insurance pays out 80%, but 30% of documentation or actual work is not done by insurance but only exists because of them, now we're down to 56%.
I say this because literally yesterday, my wife, a pediatrician, after she spent the day seeing patients and got home to go through notes, had to leave a message with an insurance company: she saw they faxed her clinic on Saturday, when the clinic was closed, to cancel care for a patient with an ongoing chronic condition with no changes unless the insurance company got a reply in 48 hours (again, while the clinic was closed!). Now she has to schedule some kind of I don't even know what with them, to confirm the condition is the exact same, except she sees patients all day so it's a pain to schedule...
idk the fact that BCBS is a non profit and has no margin in some technical sense does not seem like a big consolation, something is rotten no?
(edit - the insurance company in the anecdote is not BCBS)
I've worked on a lot of healthcare interoperability standards, including HL7 FHIR. Those can be part of the solution in terms of making the system operate more efficiently and cutting administrative overhead. In many cases payer and provider organizations are still doing things manually that could be automated using existing standards. But they fail to do so due to lack of vision and insufficient technical resources. Literally everything that can be done with a fax can be done faster and better with X12 / NCPCP / DirectTrust standards that have been around for years and are widely supported by commercial EHRs.
It's true that no matter how you look at it, the USA spends a lot more per capita on healthcare relative to outcomes. But you have to be careful what outcome metric you look at. Like we're not doing great on life expectancy, but much of that is due to factors largely outside the healthcare system like violence, vehicle crashes, and lifestyle choices. And in other areas like 5-year cancer survival rates or new drug development we're at or near the top. Part of the problem in the USA is that we seem to be culturally incapable of admitting that rationing is needed, and that it simply isn't feasible to deliver excellent care to everyone, so political reform debates devolve into sound bites about "death panels".
The Affordable Care Act (Obamacare) set a minimum health plan medical loss ratio of 80%, or actually 85% for larger plans. And in practice most come in higher than that due to competitive pressures.
https://www.cms.gov/marketplace/private-health-insurance/med...
There's a huge amount of administrative overhead in dealing with health plans for things like claims and prior authorization. Much of that is imposed not so much by insurers themselves but by employers who want to hold down costs. Like a commercial insurer would be happy to sell a plan that would pay every claim immediately at 100% with no questions asked. It would be less work for them. But no one would buy it because costs would explode. Medicare and Medicaid plans also have prior authorization and peer review processes. Something like a quarter of all healthcare services are "low value care" which doesn't align with evidence-based clinical practice guidelines and may even harm the patient, so when health plans apply review processes the right way then ideally it's better for patients and holds down costs for everyone.
To be clear, I'm not here to defend commercial health insurance companies. They are part of the problem and some reforms in that area are sorely needed. But let's have an honest debate about it and stop pretending that eliminating them would solve the deeper systemic problems.
Admin inefficiencies between orgs definitely exist and maybe better interoperability and standards is the solution, but wouldn't there also be less of a problem in the first place if there were fewer different orgs all complicating workflows?
Also not saying you're wrong about many healthcare services being unnecessary or even harmful, and someone has to be the one to say no to patients asking for low value care which is definitely a real hard position to be in and a real problem. At the same time insurance companies aren't making a great case for themselves as the solution imo bring on the government death panels.
Yes, provider organizations waste a lot of resources dealing with differences between health plans. Reducing the number of different payers would certainly reduce that overhead, at least in the short term. Mandating increased health plan transparency and use of open interoperability standards can also help by allowing providers to deal with those health plans in a more consistent way and automating much of the current manual work.
In general though I'm just skeptical that a single payer solution is the best possible long-term approach. US federal and state governments are already under tremendous fiscal pressure. So if we forcibly route all healthcare payments through governments then there's going to be constant pressure to hold down costs through blunt measures. And decisions will inevitably become even more politicized with special favors or punishments given out based on party loyalty. Do we really want to put someone like Xavier Becerra or Robert F. Kennedy Jr. in charge of centrally planning something like a fifth of the US economy?
The current US healthcare system is unnecessarily wasteful and cruel. But on the positive side we produce far more innovation per capita than any other country. Let's find a way to incrementally fix the worst problems without killing the golden goose.