Monday, November 21, 2016

Yeah, About That Cost Curve

We were promised from the outset that The ObamaTax would "bend the cost curve down;" that is, reduce the costs of both providing and paying for health care.

Here at InsureBlog, we've also blogged extensively about Medical Tourism, where folks go across the border (or the ocean) in search of cheaper health care.

Reason I bring these up is because our friend Holly R tipped me to this interesting piece at CNBC:

"Here's where you can get health care a lot cheaper than in the US"

The article gives several examples of care purchased in France versus here. For instance:

"[A] single day in a hospital in the U.S. costs, on average, $1,514 (up to as much as $12,537), while in France it costs $853."


"Hip replacement surgery costs an average of $25,061 (up to $87,987) in the U.S., but just $10,927 in France."

Of course there are various travel expenses involved, but depending on the time of year, and how far ahead one booked, it seems likely that the total cost would still be a (significant?) net savings.

To be sure, this really only works for elective (non-emergency) procedures, and it's also only available to those with the resources to pay for flights and lodging, plus the fact that one's going to have to front the money (no insurance billing back to Blue Cross or Humana). And follow-up care may be an issue, as well.

But what really piqued my interest was that the author focused on why costs here in the US varied so widely from area to area, city to city, and the role insurance companies play in negotiating prices. It does acknowledge the role that tort-reform could play in reducing the cost of (for example) malpractice insurance.

But it completely missed the elephant in the room (and to be fair, that's perfectly understandable: it is about the advantages medical tourism, after all). So what goes unsaid here?

"Remember the President's assurances that his ACA would finally “bend the cost curve”?"

That is, one of the explicit promises of ObamaCare was that not only would insurance rates go down, but so would the overall cost of health care itself.

So how's that working out?
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