All it takes is being a human to sympathize-- for example, the pause in the recorded music for advertising to the captive audience thing.
I've dealt with Lab Corp as a impatient, and it's all the same, except for leaving out the number of times it took calling them when they had no record of having talked about the problem before.
But remember, all this is done for your convenience and safety, customer! It's certainly not so we can cut costs by removing real human operators to talk to people!
I wonder if upper management has ever tried calling their own service centre. Probably not, and they have their own direct access.
Or maybe when they call, they're such experts it doesn't seem like a burden. Just speed dial 2, hit 3, #, 2, enter 6969 to bypass the menu, say "speak to human" press # again, press 2. Takes 2 seconds. Why can't users figure that out?
You know, I don't think lack of humans is the problem. There are plenty of humans, they just aren't helpful. I think it's a design issue. It isn't trivially easy to make a great help service.
The companies that succeed in doing so are the ones whose bottom line is harmed by bad customer service. If Rocket Mortgage made it difficult to fill out a mortgage application, they would go out of business tomorrow. Good customer service is probably the most important feature of their business. On the other hand, almost no one selects their insurance carrier based on customer service (indeed, many people don't select their insurance carrier at all). So why on earth would they spend time and effort making their customer service better?
There's probably a startup in here somewhere, gluing together speech-to-text (Openai Whisper), a large language model, and text-to-speech (Amazon Polly or similar).
I'm (in Germany) privately insured with a health insurance that's basically a non-profit.
I.e. no owners/shareholders who expect profit (they still can have internal incentive structures to encourage good management).
(Disclaimer: private health insurance "cooperatives" like this are not the norm & generally speaking more expensive than the public option. I'm merely describing a different model for health insurance.)
Any money they have above certain reserves at the end of a year, they have to distribute to its customers/members; also, if you don't make any claims for reimbursement of treatments within a given year, you get a non-insignificant part of your premium back.
Iirc, towards the end of the year, if you haven't claimed any reimbursement yet, they sent you a friendly letter
telling you what the amount of premium refund for you would be this year. Then they suggest it could be a good idea to, if you have any medical bills you'd planned to get reimbursed that year, to compare their total amount to the refund, and if it's lower, do nothing and wait for your refund to arrive.
Like, this actually *saves* work.
These non-profit insurance companies aren't without their problems, but at least they don't have an obvious incentive to deny as much coverage as they can get away with without losing their customers or getting branded "impossible to work with" by too many doctors.
The only thing they can do with the money they save denying coverage for patient A's treatment X is paying for patient(s) B's treatment(s) Y, otherwise it gets thrown into the redistribution-bucket at the end of the year.
I guess in some ways, it's more similar to the system most Amish use, these sort of church-organized mutual aid collectives?
Except it's anonymized, and coverage is set out in regular insurance plan contracts.
They do have some disgressionary¹, but my experience (and that of others I know insured there) is that the insurance is, in most cases², quite forthcoming and easygoing in covering bills, both guaranteed and disgressionary.
A lot of other (non-health) insurances seem to work a lot more like in the US, though, trying their best to either deny coverage, or make it out like it's someone else's responsibility².
¹Relevant to this blog's interests: my plan covers a guaranteed amount of psychotherapy, no questions asked - basically half a year of weekly sessions per year - and only if I want/need more than that do I need any kind of prescription/psychotherapist's explanation why it's indicated. And (from what I heard) these are often mostly a formality.
I expect if I would lodge claims for, say, the no-questions-asked-amount plus four sessions, they would just pay, bc it's not worth the work.
Overall, it feels like there are actual human beings working there.
²The only category of cases that easily comes to mind, where my health insurance would try to divert responsibility, is if the medical issue might be due to an accident covered by relevant insurance (as a majority of Germans have - public - accident insurance), as then the responsibility to pay for necessary medical treatment lies with the accident insurance.
But it's very much a "if they won't pay, we will" scenario.
A fair number of insurance companies in the US are non-profits. Including Blue Cross/Blue Shield, which "Blue Helmet" in the OP is riffing on. My own plan--which I get from my job with the federal government--is through Kaiser Permanente which is also a non-profit. At least on the customer side, you still have exactly what you see in the OP.
This is one of those "not without problems" issues.
I think the most appropriate English term for what I'm talking about is "mutual insurance" (like what the original guy who took actuarial tables and calculated the projected financial requirements for a life insurance, and instigated the founding of the first
proper, "professional" life insurance), where the whole enterprise is owned by the insurees (that a word?).
I'm pretty sure they have some clauses in their charters or whatever intended to limit how much money executives can extract from the whole thing. And as the insured are legally the boss, if someone is discovered trying to sneakily/creatively extract excess money, there's likely some personell and/or rule changes on the horizon.
Huh. I feel like there must be something I'm missing about the incentive structure operating there?
Or legal constraints?
Or just standard "the larger the organization, the worse they are at things" and/or simplistic middle management-style decisions ignoring many possible/probable 2nd etc order effects?
Eg, someone thought "If we cut cost in the customer service (ie "people calling in with their problems") department, we can lower the insurance premiums, which is good for our customers!"
...only now they or (probably worse) their doctor is spending a lot more time doing this kind of silly BS, and as other doctors don't operate on a "subscription service" like Scott, they can then presumably bill patients/insurances for that work?
At the very least, more BS busywork = less time to actually interact with patients.
But even if customer service was made this way starting with benevolent intent, why would it still so frequently lead to these phone trees from hell?
(Literally - it's easy to imagine some sort of eternal punishment, where you're set some seemingly trivial thing to clear up, and then you're just navigating and endless maze of OP-like BS. Like Sisyphus, just without the open air, mountain views, exercise, and sense of progress at least between the bottom and the rolling-back-down point.)
Point is: I am slightly confused about this, would appreciate explanations by people who know more about the US healthcare thing.
Blue Cross/Blue Shield is an association made up of for-profit insurance companies, the largest of which Anthem/Elevance is publicly traded on the NYSE. Their non-profit status as an association is misleading in terms of understanding the commercial operations of their member insurance companies.
The other large health insurers in the US -- United Healthcare, Aetna, Cigna -- are all publicly-traded for-profit corporations.
All of these companies are optimized to maximize returns to shareholders, not to provide service to patient/members.
Actual non-profits were created in some states under ACA. We have one here in my state. As a provider, I've gotten consistently better service from the non-profit insurance company than any of the private insurance companies. No long wait times on the phone, prompt responses to specific questions via email, very quick escalation to higher ups where things could not be quickly resolved, etc.
Kaiser is a consortium similar to how Blue Cross/Blue Shield is a consortium. Kaiser has a mix of for-profit and not-for-profit entities in its consortium. I haven't looked closely at their corporate structure; it looks like they are criticized for retaining excessively large cash reserves rather than putting them back into the community.
Certainly non-profits can optimize for things other than their actual mission (executive compensation instead of patient care, for instance) and they often do. But it seems at least they may not be optimizing for short-term shareholder value. But I haven't looked to see which parts of Kaiser are actually for-profit.
The healthcare consortia are confusing because the outer shell can be a non-profit while all the businesses operating inside the shell are for-profit. The outer shell I assume is mainly for throwing political weight around.
Non-profit healthcare companies that act as both insurer and provider -- there are huge ones like Kaiser and small state-level ones -- tend to do what's called patient dumping in order to control costs and maximize profits. The profits in this case may return to the providers rather than the patient/members in the form of higher compensation.
I know the one here in our state engages in patient dumping because I have friends and family dumped by them. Patient dumping may mean discouraging people from getting medically necessary treatment, encouraging people to go to the emergency room of the hospital (not part of the non-profit's system) over non-urgent things, or referring on people to other practices when they are perfectly capable of treating them.
No that is basically illegal (seriously). The rules are so tight in the US to survive you basically need to stay on these tiny railroad tracks, because the medical system has so few options as regards its policies.
Hmm, well, Anthem makes about $4B a year in profit, so apparently they're surviving ok. Also, One Medical charges a small annual fee and provides better service. So it seems doable to me.
I'm very curious about how Scott's "model company" is gonna work out, that seems meaningfully different?
Although (particularly non-hospital) psychiatry is very cost-bounded compared to general coverage, as it's mostly "just" psychotherapy and prescribing drugs - it's not like some doctor within that model is suddenly gonna be called on to perform brain surgery within that subscription model!
In the US at least, the person having to make these calls is almost never the person who decides what insurance company to contract with, so there's not much way for that to translate into a market advantage.
Yeah, maybe not. It would be interesting to see if it could be turned into a provider network advantage (e.g., include all those doctors who don't take insurance because it's too much of a pain) and/or establish a premium brand that would be meaningful to employees/employers. I've seen companies switch providers because of perceptions of poor service, although I agree it's probably uncommon currently.
I think this just leads to an AI arms-race where 40% of the world's electricity output is dedicated to AIs trying to crack obscure customer service phone trees to get an actual resolution, and 40% of the world's electricity output is dedicated to AIs trying to create increasingly obscure customer service phone trees to avoid having to actually provide the services their company is contracted for.
Startup, hell. This is Microsoft Bot Framework with Microsoft Cognitive Services Speech Recognition and Microsoft Cognitive Services Speech Synthesis. Contact your Microsoft Sales Representative for a quote.
There really has to be a way to like a post more than once. This phenomenon is part of the shared human experience c.2022 and it really needs to die in a fire.
Experiences like this seem so common place, even in other industries, but it's extra tragic to see people suffer when it's medicine. A good friend of mine lost access to his psych meds and we basically had to take turns making sure he was ok for a month due to pharmacy bs. Finally his relative drove him a few hundred miles away to a pharmacy with someone manning the counter whose soul hadn't been double-mortgaged yet and he got the meds needed to function. It could have easily gone the other way with him jumping into traffic or something though during a bad spell. At least we know Hell is real because we're there.
I’ve always had this naive idea that sure they keep the ordinary consumers like me on hold in these terrible systems, but if only I could opt for the “physician” option it would zip me right through to a helpful representative. No way the VIPs have to deal with this.
This was very funny but also extremely depressing. I had a lesser version of this dealing with some medical bills, figuring out that a two of a hospital's different departments billed different claims separately and didn't communicate, that they sent things to the wrong address, etc. HOWEVER: I was pleasantly surprised that there were notes documenting my interactions on the hospital's call-center billing side, which meant that I didn't actually start from scratch every time. Confirming names and keeping a record of calls might not help you, but if the operation is at least somewhat legitimate, it can.
If this is reflective of your style.... again I'm just a rando who encounters this on a consumer side, in privileged circumstances. But perhaps there are ways to phrase your initial requests to get more traction with the representatives? I don't know. Also when you call you should probably have maximum info from the patient available, including any claims information and explanations of benefits. The patient should have access to those, possibly online these days, establishing more of a paper trail than a fax or a phone contact. In fact, it may be that the patient might get better traction if they do the calling? It's a start....
But then who's got time and energy for that, if you're working during their working hours and also need to be on a medication to be functional anyway, which you're not getting?
So it's a catch 22. This is really horrible and I don't expect the bureaucracy to improve anytime soon. So good luck.
It’s sad how realistic it is. I once had to go through 30+ phone calls, over several months, to get a surgery covered that my insurance specifically said ahead of time that they would cover, but which they claimed afterwards that they weren’t covering at all. Ultimately I also had to fill out some special exception form too. It was terrible.
If only you could resolve the problem by getting the patient’s prescription tattooed on your body over and over again for hours until it covers every bit of your skin.
I know this group tends to skew libertarian, but this really *really* seems like something that needs regulation. It's so widespread across every industry, to the point where bad customer service is an accepted standard and everyone is racing to minimize customer service expenses to the collective detriment of the entire society.
This is literally a tragedy of the commons situation that damages labour productivity across multiple sectors.
If I thought regulation could fix it I'd be all for that but how exactly do you propose to do that?
Pass a law saying it can't take more than X minutes on average on the phone to resolve an issue - incentive: don't fix simple issues so average stays low.
Pass a law preventing automated phone trees? The insurance companies have same incentives to make it difficult to get them to cover things and to minimize their risk of lawsuit in abuse so now they just pay humans in India to do it. Same effect but more pricey. And some amount of automated phone trees helps everyone.
Pass a law saying that all medications with a valid physician script must be covered?
The nation just demanded (and got) blood from Walmart etc from daring to believe that doctors not pharmacists are best places to decide who needs what meds. First time someone steals a physician pad or someone dies of an OD after their insurance let them fill multiple scripts and the insurance company says their hands are tied it will get repealed.
Also what about the effect of the physicians who just write scripts for crazy expensive brand name drugs and check don't substitute (bc they had a hot pharma rep or bc they once had a patient who responded better and why not bc neither they or the patient pay). Without national coverage the benefits might not be worth increase in price for those buying own insurance.
I agree something should be done but I fear there is a real chance that you try to regulate it and you add an extra layer of fuckery.
But come up with a well designed reg and I'm on board.
Definitely a tricky one to regulate well, but I think a starting point might look something like this:
-you get a live human with a max hold time of x minutes, or a callback within x hours of a request
-hold time limits include time on hold after getting a live human (no taking the call to reset the clock then throwing people in a different queue)
-if the type of call has been correctly pre-sorted by phone tree, some very high percent of calls (90ish) must be concluded by the initial human without transfer (reduce to some.much smaller percent if the call is not pre-sorted)
-information collected over the call must be available to all persons receiving the call, requiring customers to re-enter information is not oermitted
-disconnected calls must be contacted back within x minutes.
Failure in each of these cases should result in a small fine. 100 bucks or so. Customers can flag bad calls at the end of an interaction, or call a seperate number/web form to report an incident.
The key incentives.that companies.have is to make talking to a human hard (humans.cost money) and to waste as.much time as possible in hopes.customers will go away (or at least not pursue higher level support from LVL 2 agents who can actually make decisions ).
Once you force an actual human on the line, you are costing the company money for every minute they don't resolve the problem. Making it expensive (via fines) to transfer calls incentivizes empowering LVL 1 CSRs. I think once you disable the strategy of "don't let customers talk to a human" providing decent service is in their best interest.
I like the no requesting info again thing but . You'd have to make a more complex to handle security concerns rule but that seems good.
Limitations on xfers seem bad as you'll literally never get to the person who really knows you'll just do everything through your first contact who will text the info to higher levels.
On the charge for exceeding weight times I have some objections below. I like the general idea but im not sure how we can get the data to figure out what works and what makes behavior even worse. Maybe something along these lines will work but I don't see how we can figure out what given the difficulty of changing regs especially given lobbying. But if selected right it might help somewhat...but I feel there has to be a more elegant general solution.
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Regarding the limits on hold I don't think you appreciate just how cheap call center workers overseas truly are..I fear the natural result of this is just literally having some guy in India sit on the line with the doctor while he holds saying "sorry I'm waiting to hear back from my manager"...indeed the social awkwardness might be a very effective deterrent to calls itself.
Also, I worry that this ensures that once you pass the threshold they move you to the back of the line and keep you on hold. I'm particularly worried what happens when some national pharmacy fucks up or there is a medication shortage and the system gets overloaded.
Also, does the insurer rack up huge fines when that happens because tons of ppl are calling repeatedly? If the fines are low enough that's not a huge deal then I fear they might be low enough just to eat. After all a bad experience on the phone deters future calls too.
I definitely saw that kind of gamesmanship in the call center I ran the doctor-relations side of. The supervisors/dispatchers on the call-taking end would manually prioritize calls that were under X rings and let others go long and hope for an abandon, since the targets were Y% under X rings and under Z% abandon. Obviously not every call was like this, and not every supervisor, but it happened a lot and the people who did it invariably had better stats even if they had a slightly higher (but still acceptable) abandon rate.
Sigh...yes its hard...i think we need to just let insurers incentivize with limited cash to docs (levelized per specialty/patient demo) in kind of nhs imitation. Sounds bad but no worse than now given time is money and a doc could lose several times duration of visir.
Not many people stick around for a post-call survey (or click the links at the bottom of the email saying that it was a good/bad job). Maybe because they assume it doesn't do anything while tipping would. I haven't eaten at restaurants in non-tipping countries / outside of tourist areas where they still expect US tips, is service genuinely better there than here? Taxis were tipped before Uber but the service there was pretty bad...
I tried one year to do a pay-for-performance scheme where we literally paid people a few pennies for every call that met target length (I know, not the same as customer satisfaction, but it was something we could monitor easily) but it never got traction... and honestly it would have been subject to the same gamesmanship (although I had a good strategy in mind to detect it... we had a hard time firing poor performers because hiring was so hard).
I guess my internal economist thinks that the fundamental problem is trying to use temporal investment to allocate limited supply.
My solution sketch would be twofold. First, pass a bill making the feds responsible for abuse monitoring and not the insurance companies. It doesnt make sense to have them do it anyway and let docs override flags online on the fed system.
Second, replace the implicit costs in time with explicit charges in some way with certain caps. I mean it feels wrong but the doctor's time is money and its wasted and now at least the time isnt wasted.
I think we are also looking at two different problems when we compare insurance service to Verizon. In Verizon's case the cost of actually good service is negligable to their bottom line EXCEPT the literal cost of providing good service (wages, giving up the occasional overage charge).
For the insurance companies, if you can get someone to kill themselves while on hold you might be saving a grand of medication.
The mechanic that enables this ehavior in both cases is a lack of accountability: libertarian economist types might describe it as a lack of competition, but only because they tend to think of competition as the only legitimate/functional form of accountability.
An interesting tension: by spending that grand on medication, the insurance company is allowed to make more profits. (Their profits are capped as a percent they spend on claims.)
I'm not sure if they are really trying to prevent the spend by making the call aggravating. But I'd go to trade shows or workshops with people that ran other call centers and... often they just weren't that bright, or maybe they were, but not in the logical sense. And the budgets were often very low (a dollar spent on a claim increases profitability, but one spent on overhead I don't believe does).
How about a simple per minute tax for time spent by customers on the phone without a human on the other end? You could have a threshold so that it would only hit businesses that are reasonably large and make heavy use of phone trees and wait times. Then we wouldn't have to decide what is reasonable and what isn't; we just charge for the use of other people's time.
This is also the technical solution to robocalls. Collect a tax of just a few cents per call or text. It can be applied evenhandedly to everyone and collected through the phone bill, but will only really affect high volume robocallers and scammers.
The hard part would be a regulation requiring that, when you get to a person, you get someone with enough sense, knowledge, and authority to solve your problem.
Requiring conference calls on request would be nice.
"I'm sorry sir, that's a pharmacy issue and you'll have to call the pharmacy."
"Well, let's call the pharmacy together, then."
"They have very long wait times!"
"I hope you weren't doing anything else today, because I sure wasn't."
Once you have three representatives actively sitting on the line, I'm pretty sure they would find a way to solve it besides waiting *another* twenty minutes for a fourth.
Regulation = even worse fuckery, because at that point there is no way out. No to mention there is no incentive for those designing the system to make it make sense. Obamacare roll out anyone? Do you people actually have to recreate the USSR before you realize bureaucrats don’t fix anything? They just make the fuckery mandatory. How come no one sees that this fuckery comes from an excess of corporate bureaucracy? No one understands that the corporate apparatchiks who design this shite for their corporate overlords will design the same sort of shite for their governmental overlords? Gah, I’m so sick of well meaning people who don’t think things through. Calls for regulation amount to the cry “let’s get someone else to fix this! I know, let’s go to the well of kind selfless people who staff our government bureaucracies to figure it out! Then if it still sucks, we can say oh well, we tried!”
I think it's important to distinguish between knee jerk regulation that sees something bad and tries to ban it (think rent control bc rent is too high) which often makes things worse and piles up red tape and systemic design to align incentives that can actually reduce the amount of red tape by ensuring incentives are aligned.
For instance, I'd count things like FDIC insurance and some mandatory standardization laws in the later category.
The world doesn't magically provide ideal conditions for markets (externalities not internalized, tragedy of commons, natural monopolies) and there is no reason why regulation can't simply better align incentives for action so ppl acting in their own interest result in more societal good.
Unfortunately getting those regs enacted in our system is virtually impossible. The left hates them because it feels too capitalistic and based on selfishness not virtue. The right (well old libertarian right) hates it because it's regulation and they think of it as no different than the patchwork kind. Established biz prefers complex regs to resist competition and it's virtually anathemic to passing via grand political compromise.
I think it may not be an accident that we don't have a simple national health insurance system and that we don't have a parliamentary system.
How about, if a prescription or procedure is denied, there's a government agency that reviews the contract and rules on whether the denial was proper or not, and if it was improper, the company has to cover it plus pay the insured $5,000,000 in damages.
I agree with you that the problem here is that the system incentivizes obfuscation to avoid covering things, and as long as that is true companies will find new ways to obfuscate. But it's not actually hard to remove that incentive. Removing incentives to do bad things are what fines, penalties, and jail time is *for*.
I think that will make things way worse. Ultimately the base rate of errors that insurers can't avoid gets added to our cost. At those figures rather than building a system that has 99.9% accuracy they'll go for 99.9999% accuracy/uptime (a global sys crash could deny millions) and it will look like NASA rockets in terms of cost.
Worse, the strong incentive is for patients and doctors to delibrately script things they think insurance company might deny wrongly in hopes of getting a pay day.
The inevitable uncertainty of subsequent review means insurance companies will have to approve a bunch of stuff that should have a small amount of friction. For instance, a doctor should have to do a bit more work to script an expensive name brand rather than a generic (if u pass the extra cost on to patient insurance isnt working for the small frac who really need the name brand bc of allergy etc) or they'll just script it bc the pharma rep flirts with them (or bc patient asks in hope of a big pay day).
You'd be better just mandating coverage for all meds on some list for any reason.
Ultimately, the problem isnt that there is some cost for doctors making some kinds of scripts. Its that insurers have to run abuse detection, the system is opaque random and that the cost comes in terms of time generating pure social loss.
They don't need 99.9999999% accuracy, they just need a policy of 'approved unless we say otherwise'. Also clearly-written, unambiguous contracts that avoid the possibility for confusion or error.
This is literally what the word 'failsafe' means, design the system so that its failure states are safe. If the penalty for false denials is too high, design the system so the fail state is approval. I doubt it's actually hard to do if the incentives are aligned that way.
>Worse, the strong incentive is for patients and doctors to deliberately script things they think insurance company might deny wrongly in hopes of getting a pay day.
What you're describing here is committing fraud by submitting your fraudulent documents directly to a government agency specialized in evaluating such cases. Doesn't seem smart.
> For instance, a doctor should have to do a bit more work to script an expensive name brand rather than a generic
The proposal isn't that they have to cover every prescription, it's that they have to cover every prescription that their contract says they will cover. As I said, I expect those contracts to become much less ambiguously-worded as a result, and that's a good thing.
>You'd be better just mandating coverage for all meds on some list for any reason.
I mean obviously I just want a nationalized healthcare system like a civilized nation, but I was sticking to the limited scope of the hypothetical.
>Ultimately, the problem is... that insurers have to run abuse detection,
That's *a* problem, but it's not the problem with the current system. The problem with the current system is that insurers directly profit from denying as much coverage as they can get away with, and I'm talking about how to solve *that* problem. Yes, that doesn't sole *every imaginable possible problem relating to the entire process all at once*, but solving the biggest problem *is* a big improvement.
The very fact of having to go through a physician, pharmacist, and health "insurer"* - typically coupled to your employer - to get medication is itself a product of regulation; my prior is that more regulation would make this worse, although path dependence does make it non-trivial to unwind the current state without causing unacceptable collateral damage.
*Insurance is fundamentally a financial product, but so many other things have been shoehorned into it that health insurance isn't.
I don't see how that is a product of regulation. In a perfect free market we'd expect specialization and there is almost no overlap between the skills needed for the three services so it's natural they'd be seperated.
Indeed, vertical integration here would be potentially quite dangerous. You want honest advice from your doctor and if they are part of same corp as insurance company you can't even figure out how to evaluate the quality of your insurance (are they covering the drugs best for you or inducing your doc to favor the drugs they do cover). Similar concerns with stocking and ordering meds at the pharmacy.
In that sense there is a natural antisynergy here so in a ideal market of rational agents we'd expect these to be handled by seperate companies.
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If what you mean is that in a perfect market insurance would primarily be only catastrophic ...maybe but I think for creatures of limited mental capacity and akrasia we are willing to pay more to limit the variability of our health costs and ensure we are never caught short.
None of the three roles are required intermediaries when I go buy a bottle of ibuprofen; regulation puts them in the way for all but a privileged few medications.
I absolutely agree you should be able to show up and just purchase whatever med you want with cash (perhaps for the addictive ones once you've been informed in some way about risks) but I don't think it will stop ppl wanting insurance and once you have insurance they need cost controls so they don't pay out tons of money to cover someone who gets a crazy idea they need to take 60 brand name prozac a day and that brings in this whole problem again.
Unless you plan to let ppl die who don't have the money for meds at the bottom you need a program for the poor. And if those who aren't poor dont buy insurance at all the poverty program effectively insures everyone.
But wouldn't a perfect market result in everyone only buying catastrophic insurance? No, utility isn't linear in money so we rationally want to limit the downside more than improve the upside so it's rational to want to limit your exposure to medication cost by buying insurance even at non-catastrophic levels.
In a perfectly rational world without employer insurance and ACA limits on preexisting conditions everyone would pay a regular fee to option the ability to keep their medical bills relatively small and those insurers would need to both limit costs while meeting people's desired health needs.
We'd still want to consult experts and insurers would still use them to limit costs. Though we might eliminate the abuse holds.
Kaiser Permanente is trying vertical integration. Their HMO lets you see their doctors and use their pharmacies. I know some people that use it and like it (in spite of HMOs getting a really bad name in the '90s). Haven't used it myself (I prefer high-deductible plans and just paying cash for everything, but thankfully I don't have chronic diseases that require medication management, whenever I run the math on other plans than HDHPs are cheaper when costs are small, are cheaper when costs are large, and are usually only a little less expensive when costs are in a narrow range, and seems more complicated, not easier, than just taking the money I would have paid in premiums and putting it in an HSA automatically), but wanted to add the anecdata.
I have mixed feelings. I just moved to an area where vertically integrated HMO is only option (we picked ppo insurance but virtually all docs through IU health). It's great and efficient if you fit into their categories.
Unfortunately, I've been taking buprenorphone for last 20 years (some issues in grad school subsequent to depression and I found trying to go off brought depression back). Everywhere else I've lived either in states or Israel I could eventually just find a private doc to handle it (tho not always on insurance). Here in southern Indiana I've been shunted off to some horrible company that's literally entered multiple pleas to medicaid fraud that treats me like a criminal.
Here in a decent sized uni city in us I literally had a healthcare worker express surprise when I told her everywhere else I'd lived I could just look up a psychiatrist and pay them money to see me.
They are never going to be ok for that for controlled substances. Too likely ppl who stop needing it build up huge stockpiles and sell them. Even if you agree drugs shouldn't be illegal recreational use probably shouldn't be subsidized by insurance.
Based on anecdata I've heard about Kaiser, it sounds like they're well-optimized for people with what might be terms "Newtonian" health problems: i.e. it's a relatively common problem with clear-cut diagnostic criteria and a pretty good standard protocol for treating/managing it. For example, if you've got high cholesterol or type-II diabetes, they're set up to diagnose it, recommend appropriate lifestyle changes, and keep you supplied with appropriate doses statins or metformin or whatever.
They're also decent at administering PRATFOs (Patient Reassured and Told to [expletive deleted] Off) to patients with minor complaints and no underlying disorder.
Where they're not so good is if you've got legitimate health problems that are rare, tricky to diagnose, or hard to treat. They seem to try really hard to pattern match you to either a common, easily-treatable complaint, or if they can't shoehorn you into one of those, default to PRATFOs.
This failure mode is not unique to Kaiser by any means (particularly since hard-to-diagnose and hard-to-treat complaints are by definition difficult to deal with appropriately), but they seem to fall into it pretty consistently among people whose experiences with Kaiser I've heard about.
Do you know anything about the age profile of doctors at Kaiser. The docs I've seen at these massive integrated facilities (tho I haven't used kaiser) tend to be younger than the one's I've seen in private practice so I wonder how much of that is Kaiser employing docs that are relatively fresh out of residency who then migrate to private practices as they age.
I've actually had the opposite experience in terms of younger docs being more interested in playing Dr. House, while older docs tend to be more apt to expect the familiar patterns.
The biggest example in my own experience was several years ago when I went to the ER with what I feared to be a detached retina but instead turned out to be an ocular migraine. After a long wait, the ER nurse tried to diagnose me as a lying non-compliant diabetic until my wife vouched for my non-diabetic status. Then a resident came in, and I gave him a very detailed and precise history of my symptoms. He got very excited, told me it was the best history he'd ever gotten from a patient, did a full neuro workup, started asking questions that seemed intended to explore the possibility of brain cancer or other similarly exotic causes, and then left to talk to his attending.
The ER attending came in a bit later and basically diagnosed me with "probably not going to die or go blind tonight" [he phrased it more diplomatically, but that was the gist] and prescribed a course of "go home and rest, then call your regular eye doctor in the morning and ask for the first available appointment". My eye doctor was the one who diagnosed ocular migraines.
That was exactly my experience with Group Health, a WA-based HMO that Kaiser took over somehow. They were great for all the normal stuff, but once I developed something out of the ordinary, I bounced through years of misdiagnoses and medications that made my condition worse.
Regulations get Goodharted. That's how this mess came to exist. The fix is to align incentives. This usuallu means less regulation, but it's not the amount of regulation that's essential, but where each party's interests are.
Do you think that the environmental regulations which prevent dumping raw chemical efluent into rivers have been Goodgarted? Goodharts law is typically a problem of operationalizing a problem definition, which isn't always an impossible task.
Regulation: making it very expensive to act against the public interest. As long as you can properly define the prohibited acts, a realignment of interests will follow!
Goodhart's law states that when a measure becomes a target, it ceases to be a good measure. It says nothing about not setting targets if a target is what you want!
It is not less or more regulation. It is the *wrong* regulation.
The US system spends a huge amount of regulatory and bureaucratic window dressing taking what looks like a competitive market of private insurers, and making it in effect a near single payer system where they are all the same, the systme is basically resdistributive (and barely insurance at all really since the risk pooling isn't happening before the risk actualization).
So you cannot get together with a bunch of other healthy people and make a new insurace pool, literally illegal. You cannot cover this sort of thing and not that sort of thing, and so on and so forth.
In exchange for all this bureaucratic madness the legislation mostly insures everyone still gets their full cut. So costs stay high, all the efficiencies are lost, and it is a nightmare.
You need real competition and real market forces for the "private" nature of of our system to do any good, but there is none. When I look for insurance plans I have a choice of maybe 4-6 providers, all overing a few levels of plan which are more or less exactly the same product excpet a few minor details. There is no competition.
So the "insurers" make their giant pile of money, and so does pahrma, and doctors, and hospitals, and people mostly get care, but it is all a nightmarish hellscape becuas eyou are having the costs of both a public system and a private one, but almost none of the benefit sof a private one.
I agree our system is a mess. But I think really giving people what they want in a competitive private system is essentially impossible.
What people want insurance to provide is safety. They want to be sure that if things go bad it won't turn out they fucked up some detail in the plan they choose or forgot to pay the premium for a few months while abroad and now they are fucked.
Without these regs a competitive market forces insurers to deny converge to preexisting conditions. So the only way this market could possibly offer ppl the thing they want is if you contracted very early in life (arguably B4 your parents conceive you) to do something like exchange a percent of your lifetime income for permanent coverage. Any pay by the month/year system just isn't letting ppl insure against the risk they primarily want insured: the possibility they get unlucky and they get diagnosed while uncovered.
But if you have to commit at the start of your life the normal informed consumer choice can't really happen (even your parents would be limited by very imperfect info about the future). Moreover the notion of individual tailoring to preferences doesn't apply since the choices must be made before those exist.
So yah stop pretending it's a free market and just choose a national health insurance scheme (tho maybe more Germany style than UK).
I am not remotely convinced a system with a much freer market of actual insurance where pre-existing conditions are not covered and where the residstributive aspects are just done as straight handouts to the less well off wouldn't be a lot easier.
I would also pull almost all non-catatrophic care out of the insurance. So people can get insurance that will help them if they get cancer or a heart attack or whatever.
Already had a heart attack? Well that is too bad, the same way it is too bad if you try and get fire insurance after your house has burned down.
But but but you say, what about the 3 year old who develops cancer. Well frankly there are not many of them and that will work better handled as a line item in the federal budget instead of smugglign them in by breaking the whole insurance system but pretending it is still insurance.
Either that or just bare bones single-payer where everyone is force enrolled, which I don't think is too bad, but there would need to be A LOT more rationing than we do in the US currently to keep costs down. And people would hate that.
The system right now is like the worst of both worlds.
First, just as a matter of values I certainly don't want (and voters don't either) as system that lets the 21 year old die bc he let his insurance lapse for a month between college and his job who gets stabbed stopping a robbery and now needs dialysis plus kidney transplant.
Not only do I think the voters don't want that I think ppl would be so scared of that they would never let their insurance lapse. PROBLEM, once you've been diagnosed as being at greater risk how do you switch insurers?
And any insurer who doesn't get a lifetime contract faces adverse selection selection. Ppl learn about their level of health and those who are healthy switch plans to a cheaper one leaving only the sickest. Market solution is to pay for lifetime coverage upfront (eg debt) so literally no one gets to switch insurers and bc of the info asymmetry (as in sale of used car) even if existing insurance is for some reason (doubtful imo) willing to offer you a buyout they'll never offer you the full amount (ppl have private info about their health and healthier ones will preferentially take buyout) so everyone buys insurance once at 18. Bc of bankruptcy floor the market becomes a series of insurers who offer good service for a bit then profit take off their existing clients who can't leave funneling money to shareholders until bankruptcy.
So on your system say a doctor does a genetic test on a 3 year old and discovers they have 50x the usual risk of getting some very expensive disease at 35. How do they buy insurance at 18? Their risk adjusted insurance premiums might well be 50x or more then average.
If you try and have the government cover the difference you recreate the current system. Even if you give ppl a lump sum the government needs to define a standard level of care to infer NPV of the lifetime risk adjustment and then maybe even pass laws to ensure the insurers offer insurance at that rate (the insurers and purchaser have an incentive to uprate the expected cost to fund a more luxurious plan and the only way you avoid forcing those with higher risk into crap coverage is to somehow define minimum coverage and then how do you handle the case where the market seems to rate price higher than gov? There just isn't any workable price discovery here if you commit to not screwing over those with higher risk).
>If you try and have the government cover the difference you recreate the current system.
No you don't recreate the current system because the two systems are not mashed together into some unholy frankenstien whose main purpose is to hide what is going on and obscure all signals about who is paying for what.
You don't have "subsidy for kids who develop cerebral palsy at 6 months" just lumped into everyone's undifferentiated premiums and hidden, but instead as specific line items that are coming directly out of people's taxes and the government coffers. There is more price sensitivity and transparency.
Yes that might mean socety balks and stops covering $200,000/year cystic firbosis treatments that improve someone's quality of life from 62% to 89% instead of the 81% they would get on a much cheaper cours eof treatment, but that would happen outside the insurance system.
As it is now the insurance system is being asked to do about 197 differnet things simultaneously and so it does a ton fo them very poorly.
And sure there is price discovery, it is just the tapayers discovering price for the prexisting condition people isnetad of those individuals.
And yes some people will get screwed, that is life. Two people drive exactly the same, one person gets in an accident and ruins their future happiness, the other lives a carefree life. You aren't going to be able to mash all that out of life even if we doevoted 100% of the eocnomy to just that. We should stop trying to achieve it.
You could also have a separate system where people having kids (or taxpayers generally) simply are required to pay into a "future healthcare for children of X illnesses fund". Then have tehcnical experts decide what level of care the fund can actually afford.
You want to keep as much of the system working with fucnitonal price signals as possible and the current system does a HORRIBLE job of doing that.
My literal optiosn for insurance are something like:
Company A, Product 1: Pay $10k/year in premiums and be at risk for another ~$15k in costs max, at group of providers X
Company A, Product 2: Pay $12k/year in premiums and be at risk for another ~$13k in costs max, at group of providers X +.1(Y)
Company A, Product 3: Pay $15k/year in premiums and be at risk for another ~$10k in costs max, at group of providers X +.1(Z)
Company B, Product 1: Pay $11k/year in premiums and be at risk for another ~$14k in costs max, at group of providers Y
Company B, Product 2: Pay $13k/year in premiums and be at risk for another ~$12k in costs max, at group of providers Y+.1(X)
Company B, Product 3: Pay $14k/year in premiums and be at risk for another ~$11k in costs max, at group of providers Y +.1(Z)
That sounds like an exaggeration, but it is not. I have about 15 different choices and they are all more or less exactly the same product with EXTREMELY MINOR variations. Moreover the fact that I was at low risk of helath costs, have been low risk, never made a insurance claim against and house or car in my life, all things which should be extremely beneficial in terms of my risk profile. All meaningless.
So instead as an adult I have paid in maybe $200k into the medical system in premiums, more? The government has probably chipped in another $100k on my and my family's behalf in one way or another. And used maybe 1/6th of that. Less?
For my and the government's $250k I have gotten a product where half the time I can barely even fucking use when I need it it andrisk goign to jail if I try and not buy it. It is not a good system. Don't hide the cost of being old in premiums for people in their 20s and 30s.
I still don't understand how you allow switching insurers without sinking the system under adverse selection.
If I get a get a DNA test while insured and have way higher risk of some disease how can I ever switch insurers? If I discover I'm at low risk what stops me from switching to a special low risk plan and leaving the first company only with the high priced individuals.
Is it legal for me to start and insurer F who only charges 8k/year and max risk 10k but only for ppl whose genetic risk score is in bottom 40%? If so every customer at other insurers listed takes test and switches if in bottom 40% and stays put if not.
Now those other companies are jn the red bc say A1 still gets same revenue per person but all their customers are now in top 60% of expected healthcare costs.
Either you have to stop ppl from switching or you can only get insured after full dna analysis and if you are in top 10% (healthcare cost weighted to top tail) you are just screwed and need to pay 100k a year for that coverage out of the gate at 18.
To illustrate issue imagine there was a magic device you could use to determine exactly how much your total lifetime health cost would be that you can use secretly at home. Now suppose every year i can choose between your plans. What I do is secretly take the test check of I'll make or lose money on each insurance and only buy it if it's a net positive. Since everyone does this any insurance plan that charges less than the literal maximum medical bill in the country goes under because they pay out more than they get to all their customers. End result is that no one can buy insurance at all.
DNA tests arent perfect but they in combination with other tests are a noisy approximation. As tests get better and better we are able to insure against less and less.
My understanding (based on a moderate amount of research 5-6 years ago) is that the whole pre-existing conditions argument is based on a misunderstanding.
Insurance pre-ACA sure had pre-existing condition exclusions, but they were just a waiting period. If you had a pre-existing condition prior to signing up for an insurance, you would need to wait 3-6 months for that specific coverage. It was always intended to prevent you from calling up an insurer while they were doing open heart surgery on you (absurd mental image intended) and not stop you from ever changing jobs if you had diabetes.
It was also intended so that insurance companies could hand-pick lower cost members, refuse to take people based on their conditions, and charge higher premiums to individuals with pre-existing health conditions. A lot of people in that situation were effectively uninsurable -- they couldn't find an insurance company that would take them.
Hipaa regulates how patient information needs to be secured when stored and transmitted electronically. It doesn’t regulate what medical procedures insurers need to cover or how.
Having spent a lot of time trying to make call centers and other service operations better, I think regulation is a distant root cause here. The more proximate cause is people (sometimes consultants) trying to make their one piece of the operation better, e.g., triaging out live calls to lower cost. In a truly competitive market there's a feedback loop that can correct the excesses, but you need only a small constraint on competition, or a big bureaucracy with lots of inertia, to get the bad result here. I've had the same nightmare experience that Scott describes but with my home internet-TV-phone provider, which theoretically faces some competition. So I think there's overregulation in the mix, but to me it's more Goodhart and principal-agent problems and short-termism.
A competitive market in which those making the decisions pay the costs. That's not true in insurance.
The ultimate problem here seems to be that the insurer wants to discourage the doctor from certain kind of prescription (either bc it costs them money directly or they fear it will expose them to liability if patient is abusing). As long as we have a free market in insurance (and they have potential abuse liability) this is inevitable and arguably socially beneficial to some extent.
The problem is that the insurer isn't allowed to just directly charge the doc in a transparent way that creates optimal incentives. Instead we get a pure social loss in wasted time via a complex highly random system,
I agree with all that, just saying a more parsimonious explanation is "big-company customer service trends toward cheap and bad, absent strong leadership and a brand that depends on good CSAT." There are principal-agent problems in lots of industries, not just in health care. For what it's worth, I've had a few different payors recently and some opportunity to select among them (i.e., it's at least a little competitive), and customer experience is one of my buying factors, but it's a lumpy annual decision so the feedback loop is weak.
Fair. But I've found that in digital age when u have at least weekly aligned incentives u can at least discover the cheap mechanism that makes it easier for everyone. Even most utilities have online payment, outage reports etc...
It's still really bad as u say but this level of bad I only see with misaligned incentives (eg subscription cancellation). I agree but I don't think we are even at the just "tends toward bad and cheap" level here but the "let me make u call between 9-5 London timr the week it's going to renew" level (yes really what a magazine told me)
We might be able to develop a theory of Crap Customer Experience, like a predictive model for where the customer experience will be unbelievably bad, beyond where it would be economically rational to be bad. Feels like some parameters would be
1. Currently overregulated industry with many constraints
2. Vestiges of historical monopoly
3. Many layers between market discipline and decision making (you call this lack of competition, I call it size + principal-agent conflict, same thing)
4. The cancellation experience (dark-pattern save desks and other hurdles)
To play the rolê of stereotypical libertarian, most of this stuff is a result of regulation, not markets operating. Health care's bizarre third party payer model distorts prices and restricts the ability of medical service providers to act outside the narrow confines of what they know is legal and profitable and try new ways of serving customers.
Sounds good, but some of the problem is that the regulation (or more precisely, the misunderstanding of the regulation and fear of lawsuits) is what causes some of these problems.
You'd have to have an invested team of people able to push legislation that doesn't just end up causing more fear and paralysis and the will to follow up when it isn't working out like expected. Based on the history of other medical reform (such as HIPAA) I doubt that is going to happen in this sector.
I've had some insurance companies that were very easy to get ahold of a competent individual who could help you. But honestly when it came time to renew, I regularly opted for the one that was 2,000-4,000 dollars cheaper per year USD. It didn't make sense to pay that amount of money when I had no clue if the cheaper one was worse or better and I only had to call in every 1-3 years.
Agreed. I'd love a world where laws were enforced regularly and fairly, and it was the responsibility of law enforcement to actually do it. I would hope doing so would actually decrease the laws on the books instead of increasing them. In the US there doesn't seem to be much appetite for enforcement. See privacy concerns over speeding cameras, police unions protesting by enforcing all laws to create huge backlogs in the system and generally annoy people, etc.
I wonder how much of the insanity of pharmacies comes from the fact that they are expected to provide second-line service to keep people from being prescribed drugs with harmful interactions and to take them the correct way, instead of just a place to pick up things that the doctor already selected for you and told you how to use.
If everyone had only one doctor, that would work. Unfortunately, many people have more than one doctor; I myself routinely see 6. The pharmacist really is the "last line of defense" to prevent Doctor A from prescribing drug B, which has a lethal interaction with drug C prescribed by Doctor D.
Is it every industry? For instance, how is it in extremely competitive, customer oriented industries like, say, TV sales? Are Best Buy and Panasonic as bad as CVS and Blue Cross?
That depends on your point of view. In small practices, I expect that the physician is absolutely the one that's on the phone. At a moderately sized practice like mine, people like me are hired to perform these duties in tandem with everything else that is required.
A technician like myself has to do the work up, i.e. get the basics of the doctor's bookwork done (thankfully, we do this electronically). That means doing, more or less, anything that doesn't require a doctorate to assess. Which is most parts of the full visit in my field.
Several technicians work for a small number of doctors, so that each 30-60 minute appointment doesn't eat 30-60 minutes of the attending's time. Anything that we do or don't do is ultimately the physician's responsibility, and can be called into question in court. A chart note is a legal record of what happened during the visit, and has to treated as such and amended by strict protocols.
So, yes, the doctor is the one on the phone all day, if in a distributed sense. Any time that I spend sitting on my ass and hoping that either I die or this cockamamie hold music that someone dug out of the dumpsters outside of Hell's orchestra circa 1963 will just please end, whichever comes first, is time not spent tending to someone in the building or answering a question that takes all of 3 minutes to do. That is time that the doctor is losing to what could be charitably described as "smooth jazz as described to an alien that cannot perceive sound".
>A chart note is a legal record of what happened during the visit, and has to treated as such and amended by strict protocols.
Tangentially, this is a big part of why medical transcriptionists are a thing and continue to be a thing even though most doctors know how to type now and text-to-speech software is available for docs who prefer dictating notes. The actual transcribing is only part of what medical transcriptionists do, and the other big parts (cleaning up causal notes into a formal legal document, and recognizing and flagging possible mistakes for the doctor to double-check) remain important.
You can even outsource it, just call InsuriCall on a toll-free number and have your Medical Assessment Number ready and they'll call the insurer and pharmacist for you (for a fee).
Some hospitals have drug reimbursement specialists whose full time job is doing this sort of thing. Some physicians hire medical secretaries, but how good they are and how devoted they are to this aspect of their jobs vary a lot.
Finally, an ACX post to vindicate my absolute seething hatred of deliberately confusing phone trees. Any utilitarian argument for the joys and benefits of widespread automation that does not seem to acknowledge this unparalleled evil earns my immediate suspicion.
I'm not in anything medically related at all, but this is most of my day even so
What field are you in?
Government finance
My apologies.
All it takes is being a human to sympathize-- for example, the pause in the recorded music for advertising to the captive audience thing.
I've dealt with Lab Corp as a impatient, and it's all the same, except for leaving out the number of times it took calling them when they had no record of having talked about the problem before.
I love that you wrote “impatient” instead of “inpatient.” Accidentally or not, it’s sublime
It was intentional. I'm glad you liked it.
But remember, all this is done for your convenience and safety, customer! It's certainly not so we can cut costs by removing real human operators to talk to people!
I wonder if upper management has ever tried calling their own service centre. Probably not, and they have their own direct access.
Or maybe when they call, they're such experts it doesn't seem like a burden. Just speed dial 2, hit 3, #, 2, enter 6969 to bypass the menu, say "speak to human" press # again, press 2. Takes 2 seconds. Why can't users figure that out?
You know, I don't think lack of humans is the problem. There are plenty of humans, they just aren't helpful. I think it's a design issue. It isn't trivially easy to make a great help service.
The companies that succeed in doing so are the ones whose bottom line is harmed by bad customer service. If Rocket Mortgage made it difficult to fill out a mortgage application, they would go out of business tomorrow. Good customer service is probably the most important feature of their business. On the other hand, almost no one selects their insurance carrier based on customer service (indeed, many people don't select their insurance carrier at all). So why on earth would they spend time and effort making their customer service better?
There's probably a startup in here somewhere, gluing together speech-to-text (Openai Whisper), a large language model, and text-to-speech (Amazon Polly or similar).
Google is already piloting various components, with their call screening and automated restaurant reservation systems.
There’s also another startup in here, a health insurance company that actually provides customer support.
I'm (in Germany) privately insured with a health insurance that's basically a non-profit.
I.e. no owners/shareholders who expect profit (they still can have internal incentive structures to encourage good management).
(Disclaimer: private health insurance "cooperatives" like this are not the norm & generally speaking more expensive than the public option. I'm merely describing a different model for health insurance.)
Any money they have above certain reserves at the end of a year, they have to distribute to its customers/members; also, if you don't make any claims for reimbursement of treatments within a given year, you get a non-insignificant part of your premium back.
Iirc, towards the end of the year, if you haven't claimed any reimbursement yet, they sent you a friendly letter
telling you what the amount of premium refund for you would be this year. Then they suggest it could be a good idea to, if you have any medical bills you'd planned to get reimbursed that year, to compare their total amount to the refund, and if it's lower, do nothing and wait for your refund to arrive.
Like, this actually *saves* work.
These non-profit insurance companies aren't without their problems, but at least they don't have an obvious incentive to deny as much coverage as they can get away with without losing their customers or getting branded "impossible to work with" by too many doctors.
The only thing they can do with the money they save denying coverage for patient A's treatment X is paying for patient(s) B's treatment(s) Y, otherwise it gets thrown into the redistribution-bucket at the end of the year.
I guess in some ways, it's more similar to the system most Amish use, these sort of church-organized mutual aid collectives?
Except it's anonymized, and coverage is set out in regular insurance plan contracts.
They do have some disgressionary¹, but my experience (and that of others I know insured there) is that the insurance is, in most cases², quite forthcoming and easygoing in covering bills, both guaranteed and disgressionary.
A lot of other (non-health) insurances seem to work a lot more like in the US, though, trying their best to either deny coverage, or make it out like it's someone else's responsibility².
¹Relevant to this blog's interests: my plan covers a guaranteed amount of psychotherapy, no questions asked - basically half a year of weekly sessions per year - and only if I want/need more than that do I need any kind of prescription/psychotherapist's explanation why it's indicated. And (from what I heard) these are often mostly a formality.
I expect if I would lodge claims for, say, the no-questions-asked-amount plus four sessions, they would just pay, bc it's not worth the work.
Overall, it feels like there are actual human beings working there.
²The only category of cases that easily comes to mind, where my health insurance would try to divert responsibility, is if the medical issue might be due to an accident covered by relevant insurance (as a majority of Germans have - public - accident insurance), as then the responsibility to pay for necessary medical treatment lies with the accident insurance.
But it's very much a "if they won't pay, we will" scenario.
A fair number of insurance companies in the US are non-profits. Including Blue Cross/Blue Shield, which "Blue Helmet" in the OP is riffing on. My own plan--which I get from my job with the federal government--is through Kaiser Permanente which is also a non-profit. At least on the customer side, you still have exactly what you see in the OP.
A non-profit can be just as greedy as any other organization.
It just means the top officials take the money as wages, not stock dividends.
This is one of those "not without problems" issues.
I think the most appropriate English term for what I'm talking about is "mutual insurance" (like what the original guy who took actuarial tables and calculated the projected financial requirements for a life insurance, and instigated the founding of the first
proper, "professional" life insurance), where the whole enterprise is owned by the insurees (that a word?).
I'm pretty sure they have some clauses in their charters or whatever intended to limit how much money executives can extract from the whole thing. And as the insured are legally the boss, if someone is discovered trying to sneakily/creatively extract excess money, there's likely some personell and/or rule changes on the horizon.
Huh. I feel like there must be something I'm missing about the incentive structure operating there?
Or legal constraints?
Or just standard "the larger the organization, the worse they are at things" and/or simplistic middle management-style decisions ignoring many possible/probable 2nd etc order effects?
Eg, someone thought "If we cut cost in the customer service (ie "people calling in with their problems") department, we can lower the insurance premiums, which is good for our customers!"
...only now they or (probably worse) their doctor is spending a lot more time doing this kind of silly BS, and as other doctors don't operate on a "subscription service" like Scott, they can then presumably bill patients/insurances for that work?
At the very least, more BS busywork = less time to actually interact with patients.
But even if customer service was made this way starting with benevolent intent, why would it still so frequently lead to these phone trees from hell?
(Literally - it's easy to imagine some sort of eternal punishment, where you're set some seemingly trivial thing to clear up, and then you're just navigating and endless maze of OP-like BS. Like Sisyphus, just without the open air, mountain views, exercise, and sense of progress at least between the bottom and the rolling-back-down point.)
Point is: I am slightly confused about this, would appreciate explanations by people who know more about the US healthcare thing.
Blue Cross/Blue Shield is an association made up of for-profit insurance companies, the largest of which Anthem/Elevance is publicly traded on the NYSE. Their non-profit status as an association is misleading in terms of understanding the commercial operations of their member insurance companies.
The other large health insurers in the US -- United Healthcare, Aetna, Cigna -- are all publicly-traded for-profit corporations.
All of these companies are optimized to maximize returns to shareholders, not to provide service to patient/members.
Actual non-profits were created in some states under ACA. We have one here in my state. As a provider, I've gotten consistently better service from the non-profit insurance company than any of the private insurance companies. No long wait times on the phone, prompt responses to specific questions via email, very quick escalation to higher ups where things could not be quickly resolved, etc.
Kaiser is a consortium similar to how Blue Cross/Blue Shield is a consortium. Kaiser has a mix of for-profit and not-for-profit entities in its consortium. I haven't looked closely at their corporate structure; it looks like they are criticized for retaining excessively large cash reserves rather than putting them back into the community.
Certainly non-profits can optimize for things other than their actual mission (executive compensation instead of patient care, for instance) and they often do. But it seems at least they may not be optimizing for short-term shareholder value. But I haven't looked to see which parts of Kaiser are actually for-profit.
The healthcare consortia are confusing because the outer shell can be a non-profit while all the businesses operating inside the shell are for-profit. The outer shell I assume is mainly for throwing political weight around.
Non-profit healthcare companies that act as both insurer and provider -- there are huge ones like Kaiser and small state-level ones -- tend to do what's called patient dumping in order to control costs and maximize profits. The profits in this case may return to the providers rather than the patient/members in the form of higher compensation.
I know the one here in our state engages in patient dumping because I have friends and family dumped by them. Patient dumping may mean discouraging people from getting medically necessary treatment, encouraging people to go to the emergency room of the hospital (not part of the non-profit's system) over non-urgent things, or referring on people to other practices when they are perfectly capable of treating them.
The ACA also has rebates if minimum loss ratios are not met.
No that is basically illegal (seriously). The rules are so tight in the US to survive you basically need to stay on these tiny railroad tracks, because the medical system has so few options as regards its policies.
Hmm, well, Anthem makes about $4B a year in profit, so apparently they're surviving ok. Also, One Medical charges a small annual fee and provides better service. So it seems doable to me.
On $150B in revenue. Thats not really nearly as much as it sounds like.
I'm very curious about how Scott's "model company" is gonna work out, that seems meaningfully different?
Although (particularly non-hospital) psychiatry is very cost-bounded compared to general coverage, as it's mostly "just" psychotherapy and prescribing drugs - it's not like some doctor within that model is suddenly gonna be called on to perform brain surgery within that subscription model!
In the US at least, the person having to make these calls is almost never the person who decides what insurance company to contract with, so there's not much way for that to translate into a market advantage.
Yeah, maybe not. It would be interesting to see if it could be turned into a provider network advantage (e.g., include all those doctors who don't take insurance because it's too much of a pain) and/or establish a premium brand that would be meaningful to employees/employers. I've seen companies switch providers because of perceptions of poor service, although I agree it's probably uncommon currently.
I think this just leads to an AI arms-race where 40% of the world's electricity output is dedicated to AIs trying to crack obscure customer service phone trees to get an actual resolution, and 40% of the world's electricity output is dedicated to AIs trying to create increasingly obscure customer service phone trees to avoid having to actually provide the services their company is contracted for.
The one thing cryptocurrency mining was missing - a direct connection to human suffering.
You win the Internet today.
Startup, hell. This is Microsoft Bot Framework with Microsoft Cognitive Services Speech Recognition and Microsoft Cognitive Services Speech Synthesis. Contact your Microsoft Sales Representative for a quote.
There really has to be a way to like a post more than once. This phenomenon is part of the shared human experience c.2022 and it really needs to die in a fire.
This is the funniest-ever ACX post (!).
Hopefully some suitable pharmaceutical use can be found for all of my tears of laughter.
Experiences like this seem so common place, even in other industries, but it's extra tragic to see people suffer when it's medicine. A good friend of mine lost access to his psych meds and we basically had to take turns making sure he was ok for a month due to pharmacy bs. Finally his relative drove him a few hundred miles away to a pharmacy with someone manning the counter whose soul hadn't been double-mortgaged yet and he got the meds needed to function. It could have easily gone the other way with him jumping into traffic or something though during a bad spell. At least we know Hell is real because we're there.
I’ve always had this naive idea that sure they keep the ordinary consumers like me on hold in these terrible systems, but if only I could opt for the “physician” option it would zip me right through to a helpful representative. No way the VIPs have to deal with this.
This was very funny but also extremely depressing. I had a lesser version of this dealing with some medical bills, figuring out that a two of a hospital's different departments billed different claims separately and didn't communicate, that they sent things to the wrong address, etc. HOWEVER: I was pleasantly surprised that there were notes documenting my interactions on the hospital's call-center billing side, which meant that I didn't actually start from scratch every time. Confirming names and keeping a record of calls might not help you, but if the operation is at least somewhat legitimate, it can.
If this is reflective of your style.... again I'm just a rando who encounters this on a consumer side, in privileged circumstances. But perhaps there are ways to phrase your initial requests to get more traction with the representatives? I don't know. Also when you call you should probably have maximum info from the patient available, including any claims information and explanations of benefits. The patient should have access to those, possibly online these days, establishing more of a paper trail than a fax or a phone contact. In fact, it may be that the patient might get better traction if they do the calling? It's a start....
But then who's got time and energy for that, if you're working during their working hours and also need to be on a medication to be functional anyway, which you're not getting?
So it's a catch 22. This is really horrible and I don't expect the bureaucracy to improve anytime soon. So good luck.
It’s sad how realistic it is. I once had to go through 30+ phone calls, over several months, to get a surgery covered that my insurance specifically said ahead of time that they would cover, but which they claimed afterwards that they weren’t covering at all. Ultimately I also had to fill out some special exception form too. It was terrible.
If only you could resolve the problem by getting the patient’s prescription tattooed on your body over and over again for hours until it covers every bit of your skin.
I know this group tends to skew libertarian, but this really *really* seems like something that needs regulation. It's so widespread across every industry, to the point where bad customer service is an accepted standard and everyone is racing to minimize customer service expenses to the collective detriment of the entire society.
This is literally a tragedy of the commons situation that damages labour productivity across multiple sectors.
I think you're right. It feels like this strongly resembles the situation that caused the Paperwork Reduction Act to be passed.
If I thought regulation could fix it I'd be all for that but how exactly do you propose to do that?
Pass a law saying it can't take more than X minutes on average on the phone to resolve an issue - incentive: don't fix simple issues so average stays low.
Pass a law preventing automated phone trees? The insurance companies have same incentives to make it difficult to get them to cover things and to minimize their risk of lawsuit in abuse so now they just pay humans in India to do it. Same effect but more pricey. And some amount of automated phone trees helps everyone.
Pass a law saying that all medications with a valid physician script must be covered?
The nation just demanded (and got) blood from Walmart etc from daring to believe that doctors not pharmacists are best places to decide who needs what meds. First time someone steals a physician pad or someone dies of an OD after their insurance let them fill multiple scripts and the insurance company says their hands are tied it will get repealed.
Also what about the effect of the physicians who just write scripts for crazy expensive brand name drugs and check don't substitute (bc they had a hot pharma rep or bc they once had a patient who responded better and why not bc neither they or the patient pay). Without national coverage the benefits might not be worth increase in price for those buying own insurance.
I agree something should be done but I fear there is a real chance that you try to regulate it and you add an extra layer of fuckery.
But come up with a well designed reg and I'm on board.
Definitely a tricky one to regulate well, but I think a starting point might look something like this:
-you get a live human with a max hold time of x minutes, or a callback within x hours of a request
-hold time limits include time on hold after getting a live human (no taking the call to reset the clock then throwing people in a different queue)
-if the type of call has been correctly pre-sorted by phone tree, some very high percent of calls (90ish) must be concluded by the initial human without transfer (reduce to some.much smaller percent if the call is not pre-sorted)
-information collected over the call must be available to all persons receiving the call, requiring customers to re-enter information is not oermitted
-disconnected calls must be contacted back within x minutes.
Failure in each of these cases should result in a small fine. 100 bucks or so. Customers can flag bad calls at the end of an interaction, or call a seperate number/web form to report an incident.
The key incentives.that companies.have is to make talking to a human hard (humans.cost money) and to waste as.much time as possible in hopes.customers will go away (or at least not pursue higher level support from LVL 2 agents who can actually make decisions ).
Once you force an actual human on the line, you are costing the company money for every minute they don't resolve the problem. Making it expensive (via fines) to transfer calls incentivizes empowering LVL 1 CSRs. I think once you disable the strategy of "don't let customers talk to a human" providing decent service is in their best interest.
I like the no requesting info again thing but . You'd have to make a more complex to handle security concerns rule but that seems good.
Limitations on xfers seem bad as you'll literally never get to the person who really knows you'll just do everything through your first contact who will text the info to higher levels.
On the charge for exceeding weight times I have some objections below. I like the general idea but im not sure how we can get the data to figure out what works and what makes behavior even worse. Maybe something along these lines will work but I don't see how we can figure out what given the difficulty of changing regs especially given lobbying. But if selected right it might help somewhat...but I feel there has to be a more elegant general solution.
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Regarding the limits on hold I don't think you appreciate just how cheap call center workers overseas truly are..I fear the natural result of this is just literally having some guy in India sit on the line with the doctor while he holds saying "sorry I'm waiting to hear back from my manager"...indeed the social awkwardness might be a very effective deterrent to calls itself.
Also, I worry that this ensures that once you pass the threshold they move you to the back of the line and keep you on hold. I'm particularly worried what happens when some national pharmacy fucks up or there is a medication shortage and the system gets overloaded.
Also, does the insurer rack up huge fines when that happens because tons of ppl are calling repeatedly? If the fines are low enough that's not a huge deal then I fear they might be low enough just to eat. After all a bad experience on the phone deters future calls too.
I definitely saw that kind of gamesmanship in the call center I ran the doctor-relations side of. The supervisors/dispatchers on the call-taking end would manually prioritize calls that were under X rings and let others go long and hope for an abandon, since the targets were Y% under X rings and under Z% abandon. Obviously not every call was like this, and not every supervisor, but it happened a lot and the people who did it invariably had better stats even if they had a slightly higher (but still acceptable) abandon rate.
Sigh...yes its hard...i think we need to just let insurers incentivize with limited cash to docs (levelized per specialty/patient demo) in kind of nhs imitation. Sounds bad but no worse than now given time is money and a doc could lose several times duration of visir.
Is this actually a case where moving to tip-based compensation would be an improvement?
Not many people stick around for a post-call survey (or click the links at the bottom of the email saying that it was a good/bad job). Maybe because they assume it doesn't do anything while tipping would. I haven't eaten at restaurants in non-tipping countries / outside of tourist areas where they still expect US tips, is service genuinely better there than here? Taxis were tipped before Uber but the service there was pretty bad...
I tried one year to do a pay-for-performance scheme where we literally paid people a few pennies for every call that met target length (I know, not the same as customer satisfaction, but it was something we could monitor easily) but it never got traction... and honestly it would have been subject to the same gamesmanship (although I had a good strategy in mind to detect it... we had a hard time firing poor performers because hiring was so hard).
I guess my internal economist thinks that the fundamental problem is trying to use temporal investment to allocate limited supply.
My solution sketch would be twofold. First, pass a bill making the feds responsible for abuse monitoring and not the insurance companies. It doesnt make sense to have them do it anyway and let docs override flags online on the fed system.
Second, replace the implicit costs in time with explicit charges in some way with certain caps. I mean it feels wrong but the doctor's time is money and its wasted and now at least the time isnt wasted.
I think we are also looking at two different problems when we compare insurance service to Verizon. In Verizon's case the cost of actually good service is negligable to their bottom line EXCEPT the literal cost of providing good service (wages, giving up the occasional overage charge).
For the insurance companies, if you can get someone to kill themselves while on hold you might be saving a grand of medication.
The mechanic that enables this ehavior in both cases is a lack of accountability: libertarian economist types might describe it as a lack of competition, but only because they tend to think of competition as the only legitimate/functional form of accountability.
An interesting tension: by spending that grand on medication, the insurance company is allowed to make more profits. (Their profits are capped as a percent they spend on claims.)
I'm not sure if they are really trying to prevent the spend by making the call aggravating. But I'd go to trade shows or workshops with people that ran other call centers and... often they just weren't that bright, or maybe they were, but not in the logical sense. And the budgets were often very low (a dollar spent on a claim increases profitability, but one spent on overhead I don't believe does).
How about a simple per minute tax for time spent by customers on the phone without a human on the other end? You could have a threshold so that it would only hit businesses that are reasonably large and make heavy use of phone trees and wait times. Then we wouldn't have to decide what is reasonable and what isn't; we just charge for the use of other people's time.
This is also the technical solution to robocalls. Collect a tax of just a few cents per call or text. It can be applied evenhandedly to everyone and collected through the phone bill, but will only really affect high volume robocallers and scammers.
Require that insurance companies keep tickets for requests so that you don't have to keep starting over.
Forbid interrupting the wait music with anything but a person coming in.
The hard part would be a regulation requiring that, when you get to a person, you get someone with enough sense, knowledge, and authority to solve your problem.
Obligatory XKCD: https://xkcd.com/806/
Requiring conference calls on request would be nice.
"I'm sorry sir, that's a pharmacy issue and you'll have to call the pharmacy."
"Well, let's call the pharmacy together, then."
"They have very long wait times!"
"I hope you weren't doing anything else today, because I sure wasn't."
Once you have three representatives actively sitting on the line, I'm pretty sure they would find a way to solve it besides waiting *another* twenty minutes for a fourth.
Brilliant! It wouldn't solve everything, but it would solve the infuriating "he said, she said" where two parties try to blame each other.
Regulation = even worse fuckery, because at that point there is no way out. No to mention there is no incentive for those designing the system to make it make sense. Obamacare roll out anyone? Do you people actually have to recreate the USSR before you realize bureaucrats don’t fix anything? They just make the fuckery mandatory. How come no one sees that this fuckery comes from an excess of corporate bureaucracy? No one understands that the corporate apparatchiks who design this shite for their corporate overlords will design the same sort of shite for their governmental overlords? Gah, I’m so sick of well meaning people who don’t think things through. Calls for regulation amount to the cry “let’s get someone else to fix this! I know, let’s go to the well of kind selfless people who staff our government bureaucracies to figure it out! Then if it still sucks, we can say oh well, we tried!”
I think it's important to distinguish between knee jerk regulation that sees something bad and tries to ban it (think rent control bc rent is too high) which often makes things worse and piles up red tape and systemic design to align incentives that can actually reduce the amount of red tape by ensuring incentives are aligned.
For instance, I'd count things like FDIC insurance and some mandatory standardization laws in the later category.
The world doesn't magically provide ideal conditions for markets (externalities not internalized, tragedy of commons, natural monopolies) and there is no reason why regulation can't simply better align incentives for action so ppl acting in their own interest result in more societal good.
Unfortunately getting those regs enacted in our system is virtually impossible. The left hates them because it feels too capitalistic and based on selfishness not virtue. The right (well old libertarian right) hates it because it's regulation and they think of it as no different than the patchwork kind. Established biz prefers complex regs to resist competition and it's virtually anathemic to passing via grand political compromise.
I think it may not be an accident that we don't have a simple national health insurance system and that we don't have a parliamentary system.
How about, if a prescription or procedure is denied, there's a government agency that reviews the contract and rules on whether the denial was proper or not, and if it was improper, the company has to cover it plus pay the insured $5,000,000 in damages.
I agree with you that the problem here is that the system incentivizes obfuscation to avoid covering things, and as long as that is true companies will find new ways to obfuscate. But it's not actually hard to remove that incentive. Removing incentives to do bad things are what fines, penalties, and jail time is *for*.
I think that will make things way worse. Ultimately the base rate of errors that insurers can't avoid gets added to our cost. At those figures rather than building a system that has 99.9% accuracy they'll go for 99.9999% accuracy/uptime (a global sys crash could deny millions) and it will look like NASA rockets in terms of cost.
Worse, the strong incentive is for patients and doctors to delibrately script things they think insurance company might deny wrongly in hopes of getting a pay day.
The inevitable uncertainty of subsequent review means insurance companies will have to approve a bunch of stuff that should have a small amount of friction. For instance, a doctor should have to do a bit more work to script an expensive name brand rather than a generic (if u pass the extra cost on to patient insurance isnt working for the small frac who really need the name brand bc of allergy etc) or they'll just script it bc the pharma rep flirts with them (or bc patient asks in hope of a big pay day).
You'd be better just mandating coverage for all meds on some list for any reason.
Ultimately, the problem isnt that there is some cost for doctors making some kinds of scripts. Its that insurers have to run abuse detection, the system is opaque random and that the cost comes in terms of time generating pure social loss.
They don't need 99.9999999% accuracy, they just need a policy of 'approved unless we say otherwise'. Also clearly-written, unambiguous contracts that avoid the possibility for confusion or error.
This is literally what the word 'failsafe' means, design the system so that its failure states are safe. If the penalty for false denials is too high, design the system so the fail state is approval. I doubt it's actually hard to do if the incentives are aligned that way.
>Worse, the strong incentive is for patients and doctors to deliberately script things they think insurance company might deny wrongly in hopes of getting a pay day.
What you're describing here is committing fraud by submitting your fraudulent documents directly to a government agency specialized in evaluating such cases. Doesn't seem smart.
> For instance, a doctor should have to do a bit more work to script an expensive name brand rather than a generic
The proposal isn't that they have to cover every prescription, it's that they have to cover every prescription that their contract says they will cover. As I said, I expect those contracts to become much less ambiguously-worded as a result, and that's a good thing.
>You'd be better just mandating coverage for all meds on some list for any reason.
I mean obviously I just want a nationalized healthcare system like a civilized nation, but I was sticking to the limited scope of the hypothetical.
>Ultimately, the problem is... that insurers have to run abuse detection,
That's *a* problem, but it's not the problem with the current system. The problem with the current system is that insurers directly profit from denying as much coverage as they can get away with, and I'm talking about how to solve *that* problem. Yes, that doesn't sole *every imaginable possible problem relating to the entire process all at once*, but solving the biggest problem *is* a big improvement.
The very fact of having to go through a physician, pharmacist, and health "insurer"* - typically coupled to your employer - to get medication is itself a product of regulation; my prior is that more regulation would make this worse, although path dependence does make it non-trivial to unwind the current state without causing unacceptable collateral damage.
*Insurance is fundamentally a financial product, but so many other things have been shoehorned into it that health insurance isn't.
I don't see how that is a product of regulation. In a perfect free market we'd expect specialization and there is almost no overlap between the skills needed for the three services so it's natural they'd be seperated.
Indeed, vertical integration here would be potentially quite dangerous. You want honest advice from your doctor and if they are part of same corp as insurance company you can't even figure out how to evaluate the quality of your insurance (are they covering the drugs best for you or inducing your doc to favor the drugs they do cover). Similar concerns with stocking and ordering meds at the pharmacy.
In that sense there is a natural antisynergy here so in a ideal market of rational agents we'd expect these to be handled by seperate companies.
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If what you mean is that in a perfect market insurance would primarily be only catastrophic ...maybe but I think for creatures of limited mental capacity and akrasia we are willing to pay more to limit the variability of our health costs and ensure we are never caught short.
None of the three roles are required intermediaries when I go buy a bottle of ibuprofen; regulation puts them in the way for all but a privileged few medications.
I absolutely agree you should be able to show up and just purchase whatever med you want with cash (perhaps for the addictive ones once you've been informed in some way about risks) but I don't think it will stop ppl wanting insurance and once you have insurance they need cost controls so they don't pay out tons of money to cover someone who gets a crazy idea they need to take 60 brand name prozac a day and that brings in this whole problem again.
Unless you plan to let ppl die who don't have the money for meds at the bottom you need a program for the poor. And if those who aren't poor dont buy insurance at all the poverty program effectively insures everyone.
But wouldn't a perfect market result in everyone only buying catastrophic insurance? No, utility isn't linear in money so we rationally want to limit the downside more than improve the upside so it's rational to want to limit your exposure to medication cost by buying insurance even at non-catastrophic levels.
In a perfectly rational world without employer insurance and ACA limits on preexisting conditions everyone would pay a regular fee to option the ability to keep their medical bills relatively small and those insurers would need to both limit costs while meeting people's desired health needs.
We'd still want to consult experts and insurers would still use them to limit costs. Though we might eliminate the abuse holds.
Kaiser Permanente is trying vertical integration. Their HMO lets you see their doctors and use their pharmacies. I know some people that use it and like it (in spite of HMOs getting a really bad name in the '90s). Haven't used it myself (I prefer high-deductible plans and just paying cash for everything, but thankfully I don't have chronic diseases that require medication management, whenever I run the math on other plans than HDHPs are cheaper when costs are small, are cheaper when costs are large, and are usually only a little less expensive when costs are in a narrow range, and seems more complicated, not easier, than just taking the money I would have paid in premiums and putting it in an HSA automatically), but wanted to add the anecdata.
I have mixed feelings. I just moved to an area where vertically integrated HMO is only option (we picked ppo insurance but virtually all docs through IU health). It's great and efficient if you fit into their categories.
Unfortunately, I've been taking buprenorphone for last 20 years (some issues in grad school subsequent to depression and I found trying to go off brought depression back). Everywhere else I've lived either in states or Israel I could eventually just find a private doc to handle it (tho not always on insurance). Here in southern Indiana I've been shunted off to some horrible company that's literally entered multiple pleas to medicaid fraud that treats me like a criminal.
Here in a decent sized uni city in us I literally had a healthcare worker express surprise when I told her everywhere else I'd lived I could just look up a psychiatrist and pay them money to see me.
There ought to be a way to get a permanent prescription for chronic conditions.
They are never going to be ok for that for controlled substances. Too likely ppl who stop needing it build up huge stockpiles and sell them. Even if you agree drugs shouldn't be illegal recreational use probably shouldn't be subsidized by insurance.
Based on anecdata I've heard about Kaiser, it sounds like they're well-optimized for people with what might be terms "Newtonian" health problems: i.e. it's a relatively common problem with clear-cut diagnostic criteria and a pretty good standard protocol for treating/managing it. For example, if you've got high cholesterol or type-II diabetes, they're set up to diagnose it, recommend appropriate lifestyle changes, and keep you supplied with appropriate doses statins or metformin or whatever.
They're also decent at administering PRATFOs (Patient Reassured and Told to [expletive deleted] Off) to patients with minor complaints and no underlying disorder.
Where they're not so good is if you've got legitimate health problems that are rare, tricky to diagnose, or hard to treat. They seem to try really hard to pattern match you to either a common, easily-treatable complaint, or if they can't shoehorn you into one of those, default to PRATFOs.
This failure mode is not unique to Kaiser by any means (particularly since hard-to-diagnose and hard-to-treat complaints are by definition difficult to deal with appropriately), but they seem to fall into it pretty consistently among people whose experiences with Kaiser I've heard about.
Do you know anything about the age profile of doctors at Kaiser. The docs I've seen at these massive integrated facilities (tho I haven't used kaiser) tend to be younger than the one's I've seen in private practice so I wonder how much of that is Kaiser employing docs that are relatively fresh out of residency who then migrate to private practices as they age.
I'm not sure.
I've actually had the opposite experience in terms of younger docs being more interested in playing Dr. House, while older docs tend to be more apt to expect the familiar patterns.
The biggest example in my own experience was several years ago when I went to the ER with what I feared to be a detached retina but instead turned out to be an ocular migraine. After a long wait, the ER nurse tried to diagnose me as a lying non-compliant diabetic until my wife vouched for my non-diabetic status. Then a resident came in, and I gave him a very detailed and precise history of my symptoms. He got very excited, told me it was the best history he'd ever gotten from a patient, did a full neuro workup, started asking questions that seemed intended to explore the possibility of brain cancer or other similarly exotic causes, and then left to talk to his attending.
The ER attending came in a bit later and basically diagnosed me with "probably not going to die or go blind tonight" [he phrased it more diplomatically, but that was the gist] and prescribed a course of "go home and rest, then call your regular eye doctor in the morning and ask for the first available appointment". My eye doctor was the one who diagnosed ocular migraines.
That was exactly my experience with Group Health, a WA-based HMO that Kaiser took over somehow. They were great for all the normal stuff, but once I developed something out of the ordinary, I bounced through years of misdiagnoses and medications that made my condition worse.
I first read that as "ignorance is a financial product". We'll make you an offer you can't understand.
Regulations get Goodharted. That's how this mess came to exist. The fix is to align incentives. This usuallu means less regulation, but it's not the amount of regulation that's essential, but where each party's interests are.
Do you think that the environmental regulations which prevent dumping raw chemical efluent into rivers have been Goodgarted? Goodharts law is typically a problem of operationalizing a problem definition, which isn't always an impossible task.
Regulation: making it very expensive to act against the public interest. As long as you can properly define the prohibited acts, a realignment of interests will follow!
Goodhart's law states that when a measure becomes a target, it ceases to be a good measure. It says nothing about not setting targets if a target is what you want!
It is not less or more regulation. It is the *wrong* regulation.
The US system spends a huge amount of regulatory and bureaucratic window dressing taking what looks like a competitive market of private insurers, and making it in effect a near single payer system where they are all the same, the systme is basically resdistributive (and barely insurance at all really since the risk pooling isn't happening before the risk actualization).
So you cannot get together with a bunch of other healthy people and make a new insurace pool, literally illegal. You cannot cover this sort of thing and not that sort of thing, and so on and so forth.
In exchange for all this bureaucratic madness the legislation mostly insures everyone still gets their full cut. So costs stay high, all the efficiencies are lost, and it is a nightmare.
You need real competition and real market forces for the "private" nature of of our system to do any good, but there is none. When I look for insurance plans I have a choice of maybe 4-6 providers, all overing a few levels of plan which are more or less exactly the same product excpet a few minor details. There is no competition.
So the "insurers" make their giant pile of money, and so does pahrma, and doctors, and hospitals, and people mostly get care, but it is all a nightmarish hellscape becuas eyou are having the costs of both a public system and a private one, but almost none of the benefit sof a private one.
I agree our system is a mess. But I think really giving people what they want in a competitive private system is essentially impossible.
What people want insurance to provide is safety. They want to be sure that if things go bad it won't turn out they fucked up some detail in the plan they choose or forgot to pay the premium for a few months while abroad and now they are fucked.
Without these regs a competitive market forces insurers to deny converge to preexisting conditions. So the only way this market could possibly offer ppl the thing they want is if you contracted very early in life (arguably B4 your parents conceive you) to do something like exchange a percent of your lifetime income for permanent coverage. Any pay by the month/year system just isn't letting ppl insure against the risk they primarily want insured: the possibility they get unlucky and they get diagnosed while uncovered.
But if you have to commit at the start of your life the normal informed consumer choice can't really happen (even your parents would be limited by very imperfect info about the future). Moreover the notion of individual tailoring to preferences doesn't apply since the choices must be made before those exist.
So yah stop pretending it's a free market and just choose a national health insurance scheme (tho maybe more Germany style than UK).
I am not remotely convinced a system with a much freer market of actual insurance where pre-existing conditions are not covered and where the residstributive aspects are just done as straight handouts to the less well off wouldn't be a lot easier.
I would also pull almost all non-catatrophic care out of the insurance. So people can get insurance that will help them if they get cancer or a heart attack or whatever.
Already had a heart attack? Well that is too bad, the same way it is too bad if you try and get fire insurance after your house has burned down.
But but but you say, what about the 3 year old who develops cancer. Well frankly there are not many of them and that will work better handled as a line item in the federal budget instead of smugglign them in by breaking the whole insurance system but pretending it is still insurance.
Either that or just bare bones single-payer where everyone is force enrolled, which I don't think is too bad, but there would need to be A LOT more rationing than we do in the US currently to keep costs down. And people would hate that.
The system right now is like the worst of both worlds.
First, just as a matter of values I certainly don't want (and voters don't either) as system that lets the 21 year old die bc he let his insurance lapse for a month between college and his job who gets stabbed stopping a robbery and now needs dialysis plus kidney transplant.
Not only do I think the voters don't want that I think ppl would be so scared of that they would never let their insurance lapse. PROBLEM, once you've been diagnosed as being at greater risk how do you switch insurers?
And any insurer who doesn't get a lifetime contract faces adverse selection selection. Ppl learn about their level of health and those who are healthy switch plans to a cheaper one leaving only the sickest. Market solution is to pay for lifetime coverage upfront (eg debt) so literally no one gets to switch insurers and bc of the info asymmetry (as in sale of used car) even if existing insurance is for some reason (doubtful imo) willing to offer you a buyout they'll never offer you the full amount (ppl have private info about their health and healthier ones will preferentially take buyout) so everyone buys insurance once at 18. Bc of bankruptcy floor the market becomes a series of insurers who offer good service for a bit then profit take off their existing clients who can't leave funneling money to shareholders until bankruptcy.
So on your system say a doctor does a genetic test on a 3 year old and discovers they have 50x the usual risk of getting some very expensive disease at 35. How do they buy insurance at 18? Their risk adjusted insurance premiums might well be 50x or more then average.
If you try and have the government cover the difference you recreate the current system. Even if you give ppl a lump sum the government needs to define a standard level of care to infer NPV of the lifetime risk adjustment and then maybe even pass laws to ensure the insurers offer insurance at that rate (the insurers and purchaser have an incentive to uprate the expected cost to fund a more luxurious plan and the only way you avoid forcing those with higher risk into crap coverage is to somehow define minimum coverage and then how do you handle the case where the market seems to rate price higher than gov? There just isn't any workable price discovery here if you commit to not screwing over those with higher risk).
>If you try and have the government cover the difference you recreate the current system.
No you don't recreate the current system because the two systems are not mashed together into some unholy frankenstien whose main purpose is to hide what is going on and obscure all signals about who is paying for what.
You don't have "subsidy for kids who develop cerebral palsy at 6 months" just lumped into everyone's undifferentiated premiums and hidden, but instead as specific line items that are coming directly out of people's taxes and the government coffers. There is more price sensitivity and transparency.
Yes that might mean socety balks and stops covering $200,000/year cystic firbosis treatments that improve someone's quality of life from 62% to 89% instead of the 81% they would get on a much cheaper cours eof treatment, but that would happen outside the insurance system.
As it is now the insurance system is being asked to do about 197 differnet things simultaneously and so it does a ton fo them very poorly.
And sure there is price discovery, it is just the tapayers discovering price for the prexisting condition people isnetad of those individuals.
And yes some people will get screwed, that is life. Two people drive exactly the same, one person gets in an accident and ruins their future happiness, the other lives a carefree life. You aren't going to be able to mash all that out of life even if we doevoted 100% of the eocnomy to just that. We should stop trying to achieve it.
You could also have a separate system where people having kids (or taxpayers generally) simply are required to pay into a "future healthcare for children of X illnesses fund". Then have tehcnical experts decide what level of care the fund can actually afford.
You want to keep as much of the system working with fucnitonal price signals as possible and the current system does a HORRIBLE job of doing that.
My literal optiosn for insurance are something like:
Company A, Product 1: Pay $10k/year in premiums and be at risk for another ~$15k in costs max, at group of providers X
Company A, Product 2: Pay $12k/year in premiums and be at risk for another ~$13k in costs max, at group of providers X +.1(Y)
Company A, Product 3: Pay $15k/year in premiums and be at risk for another ~$10k in costs max, at group of providers X +.1(Z)
Company B, Product 1: Pay $11k/year in premiums and be at risk for another ~$14k in costs max, at group of providers Y
Company B, Product 2: Pay $13k/year in premiums and be at risk for another ~$12k in costs max, at group of providers Y+.1(X)
Company B, Product 3: Pay $14k/year in premiums and be at risk for another ~$11k in costs max, at group of providers Y +.1(Z)
That sounds like an exaggeration, but it is not. I have about 15 different choices and they are all more or less exactly the same product with EXTREMELY MINOR variations. Moreover the fact that I was at low risk of helath costs, have been low risk, never made a insurance claim against and house or car in my life, all things which should be extremely beneficial in terms of my risk profile. All meaningless.
So instead as an adult I have paid in maybe $200k into the medical system in premiums, more? The government has probably chipped in another $100k on my and my family's behalf in one way or another. And used maybe 1/6th of that. Less?
For my and the government's $250k I have gotten a product where half the time I can barely even fucking use when I need it it andrisk goign to jail if I try and not buy it. It is not a good system. Don't hide the cost of being old in premiums for people in their 20s and 30s.
I still don't understand how you allow switching insurers without sinking the system under adverse selection.
If I get a get a DNA test while insured and have way higher risk of some disease how can I ever switch insurers? If I discover I'm at low risk what stops me from switching to a special low risk plan and leaving the first company only with the high priced individuals.
Is it legal for me to start and insurer F who only charges 8k/year and max risk 10k but only for ppl whose genetic risk score is in bottom 40%? If so every customer at other insurers listed takes test and switches if in bottom 40% and stays put if not.
Now those other companies are jn the red bc say A1 still gets same revenue per person but all their customers are now in top 60% of expected healthcare costs.
Either you have to stop ppl from switching or you can only get insured after full dna analysis and if you are in top 10% (healthcare cost weighted to top tail) you are just screwed and need to pay 100k a year for that coverage out of the gate at 18.
To illustrate issue imagine there was a magic device you could use to determine exactly how much your total lifetime health cost would be that you can use secretly at home. Now suppose every year i can choose between your plans. What I do is secretly take the test check of I'll make or lose money on each insurance and only buy it if it's a net positive. Since everyone does this any insurance plan that charges less than the literal maximum medical bill in the country goes under because they pay out more than they get to all their customers. End result is that no one can buy insurance at all.
DNA tests arent perfect but they in combination with other tests are a noisy approximation. As tests get better and better we are able to insure against less and less.
My understanding (based on a moderate amount of research 5-6 years ago) is that the whole pre-existing conditions argument is based on a misunderstanding.
Insurance pre-ACA sure had pre-existing condition exclusions, but they were just a waiting period. If you had a pre-existing condition prior to signing up for an insurance, you would need to wait 3-6 months for that specific coverage. It was always intended to prevent you from calling up an insurer while they were doing open heart surgery on you (absurd mental image intended) and not stop you from ever changing jobs if you had diabetes.
It was also intended so that insurance companies could hand-pick lower cost members, refuse to take people based on their conditions, and charge higher premiums to individuals with pre-existing health conditions. A lot of people in that situation were effectively uninsurable -- they couldn't find an insurance company that would take them.
Are you sure that was possible after HIPAA in 1996?
Hipaa regulates how patient information needs to be secured when stored and transmitted electronically. It doesn’t regulate what medical procedures insurers need to cover or how.
Having spent a lot of time trying to make call centers and other service operations better, I think regulation is a distant root cause here. The more proximate cause is people (sometimes consultants) trying to make their one piece of the operation better, e.g., triaging out live calls to lower cost. In a truly competitive market there's a feedback loop that can correct the excesses, but you need only a small constraint on competition, or a big bureaucracy with lots of inertia, to get the bad result here. I've had the same nightmare experience that Scott describes but with my home internet-TV-phone provider, which theoretically faces some competition. So I think there's overregulation in the mix, but to me it's more Goodhart and principal-agent problems and short-termism.
A competitive market in which those making the decisions pay the costs. That's not true in insurance.
The ultimate problem here seems to be that the insurer wants to discourage the doctor from certain kind of prescription (either bc it costs them money directly or they fear it will expose them to liability if patient is abusing). As long as we have a free market in insurance (and they have potential abuse liability) this is inevitable and arguably socially beneficial to some extent.
The problem is that the insurer isn't allowed to just directly charge the doc in a transparent way that creates optimal incentives. Instead we get a pure social loss in wasted time via a complex highly random system,
[oops, I replied to wrong thread at first]
I agree with all that, just saying a more parsimonious explanation is "big-company customer service trends toward cheap and bad, absent strong leadership and a brand that depends on good CSAT." There are principal-agent problems in lots of industries, not just in health care. For what it's worth, I've had a few different payors recently and some opportunity to select among them (i.e., it's at least a little competitive), and customer experience is one of my buying factors, but it's a lumpy annual decision so the feedback loop is weak.
Fair. But I've found that in digital age when u have at least weekly aligned incentives u can at least discover the cheap mechanism that makes it easier for everyone. Even most utilities have online payment, outage reports etc...
It's still really bad as u say but this level of bad I only see with misaligned incentives (eg subscription cancellation). I agree but I don't think we are even at the just "tends toward bad and cheap" level here but the "let me make u call between 9-5 London timr the week it's going to renew" level (yes really what a magazine told me)
We might be able to develop a theory of Crap Customer Experience, like a predictive model for where the customer experience will be unbelievably bad, beyond where it would be economically rational to be bad. Feels like some parameters would be
1. Currently overregulated industry with many constraints
2. Vestiges of historical monopoly
3. Many layers between market discipline and decision making (you call this lack of competition, I call it size + principal-agent conflict, same thing)
4. The cancellation experience (dark-pattern save desks and other hurdles)
What else?
To play the rolê of stereotypical libertarian, most of this stuff is a result of regulation, not markets operating. Health care's bizarre third party payer model distorts prices and restricts the ability of medical service providers to act outside the narrow confines of what they know is legal and profitable and try new ways of serving customers.
Insurance is as regulated an industry as there is on this planet.
Sounds good, but some of the problem is that the regulation (or more precisely, the misunderstanding of the regulation and fear of lawsuits) is what causes some of these problems.
You'd have to have an invested team of people able to push legislation that doesn't just end up causing more fear and paralysis and the will to follow up when it isn't working out like expected. Based on the history of other medical reform (such as HIPAA) I doubt that is going to happen in this sector.
I've had some insurance companies that were very easy to get ahold of a competent individual who could help you. But honestly when it came time to renew, I regularly opted for the one that was 2,000-4,000 dollars cheaper per year USD. It didn't make sense to pay that amount of money when I had no clue if the cheaper one was worse or better and I only had to call in every 1-3 years.
It's insane that insurers are responsible for flagging/stopping abuse. Almost as bad as making Walmart liable for that.
It should be only the doc and the feds doing that. Making insurer or pharmacy responsible is a certain recipe for racial and socioeconomic inequity.
Agreed. I'd love a world where laws were enforced regularly and fairly, and it was the responsibility of law enforcement to actually do it. I would hope doing so would actually decrease the laws on the books instead of increasing them. In the US there doesn't seem to be much appetite for enforcement. See privacy concerns over speeding cameras, police unions protesting by enforcing all laws to create huge backlogs in the system and generally annoy people, etc.
I wonder how much of the insanity of pharmacies comes from the fact that they are expected to provide second-line service to keep people from being prescribed drugs with harmful interactions and to take them the correct way, instead of just a place to pick up things that the doctor already selected for you and told you how to use.
If everyone had only one doctor, that would work. Unfortunately, many people have more than one doctor; I myself routinely see 6. The pharmacist really is the "last line of defense" to prevent Doctor A from prescribing drug B, which has a lethal interaction with drug C prescribed by Doctor D.
Is it every industry? For instance, how is it in extremely competitive, customer oriented industries like, say, TV sales? Are Best Buy and Panasonic as bad as CVS and Blue Cross?
Genuine question; I don’t know the answer.
Funny, but in real life physicians have someone in the office to do all this for them. Right? (Please tell me they don’t do this themselves.)
That depends on your point of view. In small practices, I expect that the physician is absolutely the one that's on the phone. At a moderately sized practice like mine, people like me are hired to perform these duties in tandem with everything else that is required.
A technician like myself has to do the work up, i.e. get the basics of the doctor's bookwork done (thankfully, we do this electronically). That means doing, more or less, anything that doesn't require a doctorate to assess. Which is most parts of the full visit in my field.
Several technicians work for a small number of doctors, so that each 30-60 minute appointment doesn't eat 30-60 minutes of the attending's time. Anything that we do or don't do is ultimately the physician's responsibility, and can be called into question in court. A chart note is a legal record of what happened during the visit, and has to treated as such and amended by strict protocols.
So, yes, the doctor is the one on the phone all day, if in a distributed sense. Any time that I spend sitting on my ass and hoping that either I die or this cockamamie hold music that someone dug out of the dumpsters outside of Hell's orchestra circa 1963 will just please end, whichever comes first, is time not spent tending to someone in the building or answering a question that takes all of 3 minutes to do. That is time that the doctor is losing to what could be charitably described as "smooth jazz as described to an alien that cannot perceive sound".
>A chart note is a legal record of what happened during the visit, and has to treated as such and amended by strict protocols.
Tangentially, this is a big part of why medical transcriptionists are a thing and continue to be a thing even though most doctors know how to type now and text-to-speech software is available for docs who prefer dictating notes. The actual transcribing is only part of what medical transcriptionists do, and the other big parts (cleaning up causal notes into a formal legal document, and recognizing and flagging possible mistakes for the doctor to double-check) remain important.
It's a pretty good job if you can get into it. A former coworker of mine loves it.
You can even outsource it, just call InsuriCall on a toll-free number and have your Medical Assessment Number ready and they'll call the insurer and pharmacist for you (for a fee).
Some hospitals have drug reimbursement specialists whose full time job is doing this sort of thing. Some physicians hire medical secretaries, but how good they are and how devoted they are to this aspect of their jobs vary a lot.
Finally, an ACX post to vindicate my absolute seething hatred of deliberately confusing phone trees. Any utilitarian argument for the joys and benefits of widespread automation that does not seem to acknowledge this unparalleled evil earns my immediate suspicion.