Private sector or public sector: Which is more efficient?

[KrazyHorse]

Hardly, the American health care "market" has very little competition. And that that does exist is mostly zero-sum.

Ninety-nine percent of metropolitan markets are “highly concentrated” according to federal merger guidelines (up from 94 percent metropolitan markets the year before).
In 54 percent of metropolitan markets, at least one insurer had a market share of 50 percent or greater (up from 40 percent of metropolitan markets the year before).
In 92 percent of the metropolitan markets, at least one insurers had a market share of 30 percent or greater (up from 89 percent of metropolitan markets the year before).
“An absence of competition in health insurance markets is clearly not in the best economic interest of patients,” said Dr. Rohack. “The AMA has urged the Department of Justice (DOJ) and state agencies to more aggressively enforce antitrust laws that prohibit harmful mergers.”

None of the quoted levels of concentration prevent price competition. "Mono" stands for "one", not "some number greater than one".

The AMA, on the other hand, has historically acted as a doctors' trust, and along with state medical and licensing boards is the biggest cause of market distortion in the US.

[KrazyHorse]

And how much will those $200 toward gym memberships save?

Assuming that represents the competitive level of subsidies, absolutely nothing.

Duh.

[Hauldren Collider]

How are state licensing boards causing market distortion?

[Asher]

Ninety-nine percent of metropolitan markets are “highly concentrated” according to federal merger guidelines (up from 94 percent metropolitan markets the year before).
In 54 percent of metropolitan markets, at least one insurer had a market share of 50 percent or greater (up from 40 percent of metropolitan markets the year before).
In 92 percent of the metropolitan markets, at least one insurers had a market share of 30 percent or greater (up from 89 percent of metropolitan markets the year before).
“An absence of competition in health insurance markets is clearly not in the best economic interest of patients,” said Dr. Rohack. “The AMA has urged the Department of Justice (DOJ) and state agencies to more aggressively enforce antitrust laws that prohibit harmful mergers.”

None of the quoted levels of concentration prevent price competition. "Mono" stands for "one", not "some number greater than one".

I'm sure you're familiar with the term oligopoly, and you just did not mention it here because it slipped your mind.

[KrazyHorse]

How are state licensing boards causing market distortion?

[DaShi]

Assuming that represents the competitive level of subsidies, absolutely nothing.

Duh.

Then you've failed to make this argument.

"I think that probably is a better solution than attempting to further nationalize a 2.5 trillion dollar a year industry."

[Asher]

Assuming that represents the competitive level of subsidies, absolutely nothing.

Duh.

It's fairly reasonable to assume it saves more than $200 per year. Unless you think insurance companies are non-profits.

[DaShi]

The AMA, on the other hand, has historically acted as a doctors' trust, and along with state medical and licensing boards is the biggest cause of market distortion in the US.

This I agree with, but doesn't change the argument that there is limited healthy competition in the US health care market.

[KrazyHorse]

I'm sure you're familiar with the term oligopoly, and you just did not mention it here because it slipped your mind.

Do you mind explaining how the health insurance "oligopoly" leads to inefficient practices, because I an think of absolutely no mechanism which would cause this without requiring a conspiracy among all suppliers (and potential suppliers)?

Or does your depth of thought once more terminate with a question of terminology?

By the way, even a monopoly health insurer has no reason not to subsidize regular doctor's visits or gym memberships if it leads to decreased claims...

[KrazyHorse]

Then you've failed to make this argument.

"I think that probably is a better solution than attempting to further nationalize a 2.5 trillion dollar a year industry."

I see you've managed to miss the point entirely.

This is econ 101 level understanding, by the way. The equilibrium subsidy toward lifestyle choice will be set at a level equal to the expected reduction in insurance claims deriving from this subsidy. This is the economically efficient level to set the subsidy at.

[KrazyHorse]

This I agree with, but doesn't change the argument that there is limited healthy competition in the US health care market.

Again:

1) "One insurer has 50% of the market" is not a monopoly
2) Even monopoly insurers will offer the economically efficient subsidy, up to the problem of adverse selection due to gym members preferentially signing up to get the subsidy (this will not be a major issue due to the small scale of the subsidy relative to insurance cost)

[DaShi]

Do you mind explaining how the health insurance "oligopoly" leads to inefficient practices, because I an think of absolutely no mechanism which would cause this without requiring a conspiracy among all suppliers (and potential suppliers)?

Or does your depth of thought once more terminate with a question of terminology?

By the way, even a monopoly health insurer has no reason not to subsidize regular doctor's visits or gym memberships if it leads to decreased claims...

You're pointing it out yourself. It's only about reducing claims, of which there are numerous inefficient ways of doing so that may save the insurance company money, but no one else.

[DaShi]

Again:

1) "One insurer has 50% of the market" is not a monopoly
2) Even monopoly insurers will offer the economically efficient subsidy, up to the problem of adverse selection due to gym members preferentially signing up to get the subsidy (this will not be a major issue due to the small scale of the subsidy relative to insurance cost)

Good, then a single-payer system is a reasonable solution.

[Asher]

Do you mind explaining how the health insurance "oligopoly" leads to inefficient practices, because I an think of absolutely no mechanism which would cause this without requiring a conspiracy among all suppliers (and potential suppliers)?

Or does your depth of thought once more terminate with a question of terminology?

Don't rock the boat. It need not be an active conspiracy.

If you mandate people visit a GP once a year, then you need:
1) More GPs
2) Mechanism to accurately track that
3) Another potential instance of fraud
4) More paperwork on a regular basis from more people

When there's no real competition in the market, why bother? As claims increase, so do rates. There's not a tremendous incentive to offer this savings unless a competitor does it. And they all know that -- so why bother making things more complicated for themselves?

By the way, even a monopoly health insurer has no reason not to subsidize regular doctor's visits or gym memberships if it leads to decreased claims...

No, because increased claims = increased rates. They maintain their profit margins by controlling rates.

[KrazyHorse]

You're pointing it out yourself. It's only about reducing claims, of which there are numerous inefficient ways of doing so that may save the insurance company money, but no one else.

Do you mind reformulating whatever you're attempting to say here into something coherent?

Whether the insurer or the insuree receives the benefit from subsidies is immaterial to the question of whether or not subsidies are offered. When there is perfect competition among insurers, insurees receive 100% of the benefit. When there is no competition, the insurer receives the benefit. In both cases the subsidy is offered at an efficient level.