Last week we talked about variability. And even that variability is variable. Say what???? At the end of the day the final variable is location. Where you live determines cost — not how sick you are. Whatever the market can bear in our FOR-PROFIT HEALTHCARE INSURANCE MODEL.
And that variable variability is augmented, aided and abetted by our old friend THE THIRD PARTY. And there’s a third party —the insurance company —who pays for the service, but they don’t pay those listed charges. They negotiate for lower prices with each hospital and doctor on every plan. And these negotiated prices can even vary within an insurance company, depending on which plan a patient has.
Variability also comes from administrative costs. Remember our FORTH PARTY decision makers?
Not to mention our complicated and over-lapping healthcare programs. This next picture literally tells a thousand tales.
Remember out six teams of HEALTHCARE PAYORS? Imagine you are at Healthcare Ballpark. Your team has provided you the seat at the ballpark. You, of course have paid indirectly for the cost of admission. Where would your seats be in the stadium? Why is this important? Because your seat determines how good your healthcare coverage is. How good is your seat when it comes to meeting the healthcare needs of you, the HEALTHCARE CONSUMER?
Where is your seat at HEALTHCARE BALLPARK?
Now sit back in your seat. Order a hot dog. Drink a beer. Now you can enjoy the ball game. No. not quite. Health Care Ball Park happens to be sitting on a TECTONIC PLATE. In reality, many tectonic plates. The lithosphere of the earth is divided into a small number of plates which float on and travel independently over the mantle and much of the earth’s seismic activity occurs at the boundaries of these plates. Can you spell EARTHQUAKE?
And why is this important? The overriding VARIABLE is COST. In our metaphor, the cost of admission to the Health Care Park. the cost of health care which the magnified by the tectonic plates we ride. So, the question becomes:
I will discuss this question in the next blog.