Repeal or replace?
- Thread starter Diogenes
- Start date
Life is Golden
The Sage
No way to fix it now, it's already ruined.
Life is Golden
The Sage
The downfall of healthcare actually begain with the creation of the HMO.
The downfall of American healthcare began with the introduction of health insurance, IMO.
Life is Golden
The Sage
True, but the HMO really ruined it. And wow, you caught my only typo of the year. Congratulations, you get a cookie.
Consider this, @Life is Golden.
The introduction of employer-sponsored health insurance during World War II marked the pivotal shift that decoupled patients from the direct costs of care, inflating prices, reducing competition, and creating a bloated, inefficient system.
This third-party payer model, where neither patient nor provider bears the full economic burden, fundamentally distorted market incentives, leading to the unsustainable costs, administrative waste, and access barriers plaguing American healthcare today.
The introduction of employer-sponsored health insurance during World War II marked the pivotal shift that decoupled patients from the direct costs of care, inflating prices, reducing competition, and creating a bloated, inefficient system.
This third-party payer model, where neither patient nor provider bears the full economic burden, fundamentally distorted market incentives, leading to the unsustainable costs, administrative waste, and access barriers plaguing American healthcare today.
- Before the 1940s, healthcare operated like most goods and services. Patients paid doctors directly (often in cash, barter, or modest fees), fostering price transparency and competition. In 1929, average per capita healthcare spending was about $30 (roughly $500 in today's dollars), and most care was affordable without intermediaries. Doctors competed on quality and cost; hospitals were often charitable or community-funded.
- To circumvent wage controls during WWII, employers offered health insurance as a tax-free benefit. The 1942 Stabilization Act and subsequent IRS rulings (1954) made employer contributions tax-exempt, incentivizing widespread adoption. By 1950, over 50% of Americans had some form of insurance; today, it's ~90% through employers, government, or private plans.
- This wasn't organic market evolution but government intervention via tax policy, creating a subsidized middleman that removed price constraints.
Life is Golden
The Sage
That was over a hundred years ago. In 2025, most people can’t pay cash for these inflated healthcare services.
Huh?
Healthcare service costs are inflated because of insurance, IMO.
- With insurance, patients (customers) are insulated from costs and tend to overuse services (e.g., unnecessary tests, ER visits for minor issues). Providers, paid per procedure, incentivize profits and volume over value.
- Data: U.S. healthcare spending per capita is ~$12,914 (2023 OECD data), double the OECD average ($6,651), with no proportional health outcomes (e.g., U.S. life expectancy ranks 40th globally at 77.5 years vs. Japan's 84.8).
- Comparison: In cash-based systems like cosmetic surgery (largely uninsured), prices have fallen ~30% since 1990 due to competition, per the Bureau of Labor Statistics.
- Third-party payers negotiate opaque rates; patients see "list prices" inflated 300-500% above actual reimbursements. This hides true costs, preventing bargaining.
- Evidence: A 2021 RAND study found U.S. hospital prices are 2.5x higher than in other developed nations for the same procedures. Pre-insurance, fees were posted and negotiable; now, a simple blood test can vary 10x by provider.
- Billing, coding, and compliance with thousands of insurers create overhead. U.S. spends ~8% of healthcare dollars on administration vs. 1-3% in single-payer systems like Canada.
- Stats: Physicians spend 15-20 hours/week on paperwork (AMA surveys); total admin costs exceed $800 billion annually (CAHI estimates), enough to cover all uninsured Americans.
- Insurance mandates (e.g., via ACA) force coverage of non-essential services, raising premiums. High-deductible plans leave patients bankrupt despite "coverage."
- Outcome: 28 million uninsured (2023 Census); medical debt is the #1 cause of bankruptcy (affecting insured and uninsured alike). Pre-1940s, indigent care was handled via charity or sliding scales without systemic collapse.
Life is Golden
The Sage
We can't go back to the system in place in the 20s or 30s. Too late for all that. The last bullet point is false.
They could repeal it.
Life is Golden
The Sage
And then what will people do?
Depend on others to pay for their health care.
What people did before health insurance existed.
Life is Golden
The Sage
Pay cash? lol That's not gonna happen with the exorbitant, inflated medical costs of 2025. I'm wondering if you even understand how insurance works.
Life is Golden
The Sage
That's what Obamacare does. There is no easy replacement at this point. We can't go back to the way it was because things are too screwed up now. What do you suggest?
People didn't just "pay cash" before health insurance was invented. Scroll up and read.
Why not, since exorbitant, inflated medical costs of 2025 are due to insurance companies and government mandates.
Scroll up and read.
Same here.
Going back to pre Obama care would reduce taxes on you and me and help pay our healthcare.