Comments on: Higher premiums and lower wages http://keithhennessey.com/2009/10/12/pwc-study/ Your guide to American economic policy Tue, 16 Mar 2010 17:49:26 -0400 http://wordpress.org/?v=abc hourly 1 By: Senate floor #011: The “hidden tax” of the uninsured  |  KeithHennessey.com http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-13583 Senate floor #011: The “hidden tax” of the uninsured  |  KeithHennessey.com Wed, 02 Dec 2009 15:56:31 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-13583 [...] have written before that I have always been skeptical of the cost shifting argument.  Here’s the best response [...]
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]]> By: Erik Kain - White Papers – Health savings accounts, catastrophic coverage, and rising health care costs - True/Slant http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12728 Erik Kain - White Papers – Health savings accounts, catastrophic coverage, and rising health care costs - True/Slant Tue, 20 Oct 2009 19:54:52 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12728 [...] who have employer-based insurance — still the lion’s share of the working-age population — premiums could climb more swiftly than [...]
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]]> By: The Pasty Little Putz and Krugman « Marion in Savannah http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12673 The Pasty Little Putz and Krugman « Marion in Savannah Mon, 19 Oct 2009 09:56:34 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12673 [...] who have employer-based insurance — still the lion’s share of the working-age population — premiums could climb more swiftly than [...]
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]]> By: Keith Hennessey http://keithhennessey.com/2009/10/12/pwc-study/comment-page-1/#comment-12659 Keith Hennessey Fri, 16 Oct 2009 18:03:12 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12659 To my readers: I recommend SF's post. It's making me think hard about my view. <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12659','Keith Hennessey'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12659','Keith Hennessey','To my readers: I recommend SF's post. It's making me think hard about my view. '); return false;">Quote</a></div> To my readers: I recommend SF's post. It's making me think hard about my view.
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]]> By: J Mann http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12649 J Mann Fri, 16 Oct 2009 13:57:52 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12649 If Medicare was funded by simply taxing providers $2,000 per Medicare patient (and forbidding providers from turning away Medicare patients or increasing Medicare rates), I would expect a significant portion of that cost to get passed on to the non-Medicare patients over time. Doesn't cutting Medicare revenue by $2,000 per patient (and forbidding providers from turning away Medicare patients, etc.) produce the same result? <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12649','J Mann'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12649','J Mann','If Medicare was funded by simply taxing providers $2,000 per Medicare patient (and forbidding providers from turning away Medicare patients or increasing Medicare rates), I would expect a significant portion of that cost to get passed on to the non-Medicare patients over time. Doesn't cutting Medicare revenue by $2,000 per patient (and forbidding providers from turning away Medicare patients, etc.) produce the same result? '); return false;">Quote</a></div> If Medicare was funded by simply taxing providers $2,000 per Medicare patient (and forbidding providers from turning away Medicare patients or increasing Medicare rates), I would expect a significant portion of that cost to get passed on to the non-Medicare patients over time. Doesn't cutting Medicare revenue by $2,000 per patient (and forbidding providers from turning away Medicare patients, etc.) produce the same result?
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]]> By: J Mann http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12648 J Mann Fri, 16 Oct 2009 13:56:47 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12648 1) A given medical provider has three groups of patients - group A (public plans); group B (private plans) and group C (uninsured). 2) By law, if the provider accepts anyone from group A, then it can't discriminate in selling to group A and the other groups, and it is required to accept the fees set for group A without negotiating additional payments. 3) From the provider's perspective, if the public plans impose fee cuts that will result in $1 million less revenue over a given year, that's equivalent to an increase in fixed costs of $1 million. By law, the provider can't reduce the mix of group A patients to groups B and C (unless it's willing to drop out of group A altogether), and the provider can't negotiate with group A to increase revenue. 4) If you increase one provider's fixed costs by $1 million, then they might not pass on that cost because they don't have pricing power. But if you increase EVERY provider's fixed costs by $1 million, isn't it predictable the the market price is going to increase? (Continued in next post) <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12648','J Mann'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12648','J Mann','1) A given medical provider has three groups of patients - group A (public plans); group B (private plans) and group C (uninsured). \n \n2) By law, if the provider accepts anyone from group A, then it can't discriminate in selling to group A and the other groups, and it is required to accept the fees set for group A without negotiating additional payments. \n \n3) From the provider's perspective, if the public plans impose fee cuts that will result in $1 million less revenue over a given year, that's equivalent to an increase in fixed costs of $1 million. By law, the provider can't reduce the mix of group A patients to groups B and C (unless it's willing to drop out of group A altogether), and the provider can't negotiate with group A to increase revenue. \n \n4) If you increase one provider's fixed costs by $1 million, then they might not pass on that cost because they don't have pricing power. But if you increase EVERY provider's fixed costs by $1 million, isn't it predictable the the market price is going to increase? \n \n(Continued in next post) '); return false;">Quote</a></div> 1) A given medical provider has three groups of patients – group A (public plans); group B (private plans) and group C (uninsured).

2) By law, if the provider accepts anyone from group A, then it can't discriminate in selling to group A and the other groups, and it is required to accept the fees set for group A without negotiating additional payments.

3) From the provider's perspective, if the public plans impose fee cuts that will result in $1 million less revenue over a given year, that's equivalent to an increase in fixed costs of $1 million. By law, the provider can't reduce the mix of group A patients to groups B and C (unless it's willing to drop out of group A altogether), and the provider can't negotiate with group A to increase revenue.

4) If you increase one provider's fixed costs by $1 million, then they might not pass on that cost because they don't have pricing power. But if you increase EVERY provider's fixed costs by $1 million, isn't it predictable the the market price is going to increase?

(Continued in next post)

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]]> By: J Mann http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12647 J Mann Fri, 16 Oct 2009 13:55:35 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12647 Keith, on the pricing power argument, I have a question. You're much better at this stuff than I am, but isn't cost-shifting basic economics? (Not 100% cost-shifting, sure, but a significant percentage). (comment broken up for length - see next point for my actual argument) (I cross-posted at Megan McArdle's blog). <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12647','J Mann'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12647','J Mann','Keith, on the pricing power argument, I have a question. \n \nYou're much better at this stuff than I am, but isn't cost-shifting basic economics? (Not 100% cost-shifting, sure, but a significant percentage). \n \n(comment broken up for length - see next point for my actual argument) \n \n(I cross-posted at Megan McArdle's blog). '); return false;">Quote</a></div> Keith, on the pricing power argument, I have a question.

You're much better at this stuff than I am, but isn't cost-shifting basic economics? (Not 100% cost-shifting, sure, but a significant percentage).

(comment broken up for length – see next point for my actual argument)

(I cross-posted at Megan McArdle's blog).

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]]> By: Babinich http://keithhennessey.com/2009/10/12/pwc-study/comment-page-2/#comment-12626 Babinich Thu, 15 Oct 2009 09:37:24 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12626 I heard the most interesting piece of news over Bloomberg radio this morning. The government has commissioned a Harvard study that found dialysis given in-stage dementia patients at retirement homes does not add to their quality of life. Also from this same study: Dementia is a terminal illness and thus its been determined that palliative care, like dialysis, be discontinued. <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12626','Babinich'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12626','Babinich','I heard the most interesting piece of news over Bloomberg radio this morning. The government has commissioned a Harvard study that found dialysis given in-stage dementia patients at retirement homes does not add to their quality of life. \n \nAlso from this same study: Dementia is a terminal illness and thus its been determined that palliative care, like dialysis, be discontinued. \n '); return false;">Quote</a></div> I heard the most interesting piece of news over Bloomberg radio this morning. The government has commissioned a Harvard study that found dialysis given in-stage dementia patients at retirement homes does not add to their quality of life.

Also from this same study: Dementia is a terminal illness and thus its been determined that palliative care, like dialysis, be discontinued.

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]]> By: HlthConsult http://keithhennessey.com/2009/10/12/pwc-study/comment-page-1/#comment-12623 HlthConsult Wed, 14 Oct 2009 15:48:55 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12623 I think you are absolutely correct, Marty. <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12623','HlthConsult'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12623','HlthConsult','I think you are absolutely correct, Marty. '); return false;">Quote</a></div> I think you are absolutely correct, Marty.
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]]> By: steven http://keithhennessey.com/2009/10/12/pwc-study/comment-page-1/#comment-12619 steven Wed, 14 Oct 2009 09:22:42 +0000 http://keithhennessey.com/2009/10/13/higher-premiums-and-lower-wages/#comment-12619 The problem with what you are saying here is that you assume the insurance companies are going to pay what you assume they will pay in the event of a catostrophic illness...the reality is that too often they aviod paying, or it turns out that in the fine print you were not covered the way you thought you were...think Hurricane Katrina victims who had Hurricane policies, but who were shocked to hear that they were not going to recieve claims becuase their homes were destroyed by the flood of the hurricane instead of the wind of the hurricane. <div class="comment-remix-meta"><a href="#" class="replyto" onclick="replyto('12619','steven'); return false;">Reply</a> - <a href="#" class="quote" onclick="quote('12619','steven','The problem with what you are saying here is that you assume the insurance companies are going to pay what you assume they will pay in the event of a catostrophic illness...the reality is that too often they aviod paying, or it turns out that in the fine print you were not covered the way you thought you were...think Hurricane Katrina victims who had Hurricane policies, but who were shocked to hear that they were not going to recieve claims becuase their homes were destroyed by the flood of the hurricane instead of the wind of the hurricane. '); return false;">Quote</a></div> The problem with what you are saying here is that you assume the insurance companies are going to pay what you assume they will pay in the event of a catostrophic illness…the reality is that too often they aviod paying, or it turns out that in the fine print you were not covered the way you thought you were…think Hurricane Katrina victims who had Hurricane policies, but who were shocked to hear that they were not going to recieve claims becuase their homes were destroyed by the flood of the hurricane instead of the wind of the hurricane.
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