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I think your model of how insurance works is also slightly off, insurance companies do not want to pay more for the sake of paying more. In fact, their adjusters work extremely hard to work at paying less or nothing wherever feasible.


You are confusing two different issues here.

Ideally insurance wants to operate by providing coverage for any and all conditions, with minimum co-pays and deductibles and at the same time denying every single claim. This is rough model to maximize profit in ideal (to them) business environment.

We are not talking about denying claims here. We are talking about coverage. Coverage that insurance competes on. As such, I still stand by my assertion that chasing latest-and-greatest regardless of cost-effectiveness is forced on insurances by customer demands. This is mostly because customers are detached from individual purchasing decisions.

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Contrary to what some people seem to think - health care costs are in fact negotiable in most cases.


If you are paying directly, and in position to pay outright before the treatment, then yes, prices could be negotiated. Otherwise, not so much. Often times, the fact that you have insurance, even if they denied or only partially cover the treatment, locks you into inflated price due to how contracts for 'preferred provider' operate.

Anecdote - couple years back I had to get a treatment done. Insurance would only cover 50%. Doctor was not able to go down on the price as long as insurance paid any part of it. I negotiated direct payment deal that ended up saving me money over insurance coverage.

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There is no reason a person, often in conjunction with their primary care physician, should not be able and expected to make educated decisions regarding both insurance, and health options.


You can't claim this. Cost of individual coverage reserved to well-off and healthy. Majority of people are at the mercy of employer-provided health insurance plan. Your only choice is to opt in or opt out. As such, given that you are on the plan and have no choice about what this plan is, it is natural to consume up to the maximum within limitations of this plan and your personal health situation.


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If we step back, and look at the entire picture - from a birds eye perspective of society as a whole, it should be clear that using private insurance as a delivery means for social services is silly.


I agree. This why I see single-payer as an improvement over existing system. I also think that pure market driven system will happen to be improvement over status-quo (if you only consider monetary costs and ignore human costs).

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