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Sheriff Cad

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I am in healthcare and can tell you that this would collapse the entire system and lead to a recession.

Hospital consolidation and the move away from small business/private practice is a large problem. Hospital and Insurance lobby wrote PPACA, and I’m sure they’ll have their hands all over any new rework. The system isn’t really fixable IMO because if you look at 75% of congressional districts in the country chances are the local hospital is the #1 or #2 employer.
Why do you think it would collapse the whole system?

Medicare pays about 82% of the actual cost of healthcare, right? My proposal puts the price cap at 115% of medicare.

Why would the system collapse if the price is capped right around the actual cost of care?
 

INTHEMIDSTOFLIONS

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My parents let me be “sexual harassment panda” for Halloween in like 2001. I was a very young kid in elementary or middle school. My mom made me a panda costume and I had a little pamphlet and everything.

they also let me go as Tim meadows “the ladies man” one year in full black face, a wig, and a sock stuffed in my underwear. This was maybe 1998 or 1999 and I was in elementary school.
 
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Kithani

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Why do you think it would collapse the whole system?

Medicare pays about 82% of the actual cost of healthcare, right? My proposal puts the price cap at 115% of medicare.

Why would the system collapse if the price is capped right around the actual cost of care?
Using your own chatGPT

Current private healthcare reimburses about

More specifically:


  • Inpatient hospital services: ~ 189% of Medicare rates. KFF
  • Outpatient hospital services: ~ 264% of Medicare rates. KFF
  • Physician services: ~ 143% of Medicare rates.
You think you can just cut all of that out tomorrow and the system would chug along? You think a private practice or hospital really has that much profit margin built in?

Bottom line estimates:


  • Hospitals: ~ 3–6% operating margin is common in many cases, though there are big outliers.
  • Private physician practices: ~15–30% net margin is a reasonable rule of thumb, depending on specialty and efficiency.
 
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Sheriff Cad

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You think you can just cut all of that out tomorrow and the system would chug along? You think a private practice or hospital really has that much profit margin built in?
Yea, maybe. I don't think it has that much profit built in, but I do think it has a lot of bloat and unnecessary administrators/hoops to jump through that could all be eliminated.

Fixing the prices in that way would eliminate the entire industry around chargemaster prices, billing disputes, bill adjustments. The price would be the price. How many insurance people, doctors office people, and hospital people currently work in billing and playing the billing game? They could all be gone. All of them. Thats just one aspect.
 
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Kithani

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Yea, maybe. I don't think it has that much profit built in, but I do think it has a lot of bloat and unnecessary administrators/hoops to jump through that could all be eliminated.

Fixing the prices in that way would eliminate the entire industry around chargemaster prices, billing disputes, bill adjustments. The price would be the price. How many insurance people, doctors office people, and hospital people currently work in billing and playing the billing game? They could all be gone. All of them. Thats just one aspect.
Most of those games are… invented by Medicare, lol
 

Daidraco

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Using your own chatGPT

Current private healthcare reimburses about

More specifically:


  • Inpatient hospital services: ~ 189% of Medicare rates. KFF
  • Outpatient hospital services: ~ 264% of Medicare rates. KFF
  • Physician services: ~ 143% of Medicare rates.
You think you can just cut all of that out tomorrow and the system would chug along? You think a private practice or hospital really has that much profit margin built in?

Bottom line estimates:


  • Hospitals: ~ 3–6% operating margin is common in many cases, though there are big outliers.
  • Private physician practices: ~15–30% net margin is a reasonable rule of thumb, depending on specialty and efficiency.
Im under the impression, and you can correct me if Im wrong - sure. But isnt the medical sector just a big fucking circle jerk of reach arounds that allow insurance companies to siphon off as much money as they can? To be specific, insurance companies charge the customer for their coverage. Customer comes into Hospital. Hospital has to have its own insurance to cover malpractice etc. Hospital charges customer 400% markup on shit that should cost pennies on the dollar etc. etc.

So wouldnt cutting it off at the legs basically cripple the system like you said - but given time, it would self correct itself? I mean its like the EBT bullshit we just went through. Cutting it off completely had a marginal price decrease effect on food prices for a short lived moment.
 
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Kithani

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Im under the impression, and you can correct me if Im wrong - sure. But isnt the medical sector just a big fucking circle jerk of reach arounds that allow insurance companies to siphon off as much money as they can? To be specific, insurance companies charge the customer for their coverage. Customer comes into Hospital. Hospital has to have its own insurance to cover malpractice etc. Hospital charges customer 400% markup on shit that should cost pennies on the dollar etc. etc.
Even with that 400% markup, hospital makes about 3-6% profit margin… because if their only payer is Medicaid or Medicare then they would go under.
 

Sheriff Cad

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Even with that 400% markup, hospital makes about 3-6% profit margin… because if their only payer is Medicaid or Medicare then they would go under.
Democrats were about 2 votes in the Senate away from passing medicare for all in 2009, would that have crashed the whole system?

That would have made all payments medicare pricing, right?
 

Kithani

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I have no love for hospitals or their legion of sleezeball, useless administrators btw, would love to see them all out of a job and grifting elsewhere. I just don’t see putting every hospital in the US in the red literally overnight as a reasonable solution to healthcare, sorry.
 

Kithani

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Democrats were about 2 votes in the Senate away from passing medicare for all in 2009, would that have crashed the whole system?

That would have made all payments medicare pricing, right?
What would have probably happened is that Medicare would now be reimbursing more than it does today and overall spending about the same IMO
 

Gravel

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Using your own chatGPT

Current private healthcare reimburses about

More specifically:


  • Inpatient hospital services: ~ 189% of Medicare rates. KFF
  • Outpatient hospital services: ~ 264% of Medicare rates. KFF
  • Physician services: ~ 143% of Medicare rates.
You think you can just cut all of that out tomorrow and the system would chug along? You think a private practice or hospital really has that much profit margin built in?

Bottom line estimates:


  • Hospitals: ~ 3–6% operating margin is common in many cases, though there are big outliers.
  • Private physician practices: ~15–30% net margin is a reasonable rule of thumb, depending on specialty and efficiency.
I'm not sure I buy these numbers, otherwise the current model of massive hospitals buying up the regionals and building massive upscale compounds wouldn't exist.
 
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Khane

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Why do you think it would collapse the whole system?

Medicare pays about 82% of the actual cost of healthcare, right? My proposal puts the price cap at 115% of medicare.

Why would the system collapse if the price is capped right around the actual cost of care?

It wouldn't collapse the whole system. He's bought into the hospital administrator snake oil.

I know a lot of you are around middle age like me but when I was young, my parents didn't have to always go in to see a PCP, they could actually call and a secretary would answer and then go ask the doctor and at least half of the time the doc would say "nah don't worry about that go down to see the pharmacist I'll call in this script".

Now? "Oh well its against all these made up rules and regulations I'm bullshitting you about because the administrators of my group are forcing me to act like a charlatan. You say you have some minor acid reflux? Gotta make an appointment! Can't give you advice over the phone. Never mind all those teledoc services that aren't part of your network anyway so you're not gonna do that even though you could! Go fuck yourself"
 
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Sheriff Cad

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Administrative costs are a huge waste of our money. And whats more, it wasn't always like this.

Administrative costs, which include administrators and billing departments, typically account for 15% to 30% of U.S. hospital budgets, depending on the study and definition used. More recent analyses put this closer to 20-25% for hospitals specifically, with a 2021 McKinsey estimate pegging hospital administrative costs at $250 billion nationally, or about 21% of total hospital spending at the time. Billing and insurance-related activities (a key subset of administration) alone represent around 8.5% of hospital spending. Some reports cite even higher figures, with administrative costs exceeding 40% of total hospital expenses when broadly defined to include regulatory compliance, collections, appeals, and non-salary overhead like vendor fees for quality reporting. These costs have risen steadily, outpacing inflation and contributing to overall expense growth.

In contrast, spending on direct health care providers (e.g., physicians, nurses, and technicians) is primarily captured in labor costs, which make up 45-56% of total hospital budgets based on 2023-2025 data.

Wasn't always like this:

Pre-1965 (e.g., 1960): Administrative costs were minimal, estimated at 3-5% of total healthcare spending overall (and similarly low for hospitals, around 5% or less of expenses). Hospitals operated with simple billing (mostly fee-for-service cash or basic insurance), limited regulation, and small admin staffs—often just a few clerks per facility. Labor data proxies confirm low overhead: Administrative/clerical roles comprised under 15% of hospital workers.
 
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Kirun

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What Cad Cad is describing about admin costs is actually a massive problem nation-wide, not just in healthcare.

You can start with David Graeber’s 2018 study on "bullshit jobs." Admin jobs in the US have grown over 140% since 1980. His survey work estimated that 30-40% of workers believed their job contributed nothing of real value. Not "I dislike my job," but "my job would not matter if it disappeared." That number has popped up again in research out of the UK, the Netherlands, and the U.S., with some analyses suggesting that in certain industries, over half of administrative roles could vanish with no effect on output.

Universities are the clearest canary: administrative staff have ballooned at up to 6x the rate of enrollment growth, sucking up billions while adding almost nothing to educational quality. Corporate HR, compliance, and "operations strategy" teams are following the same curve. Every new policy requires an analyst. Every analyst requires a supervisor. Every supervisor justifies a coordinator. It's organizational mitosis. Cells dividing because that's what cells do, not because the organism needs it.

The McKinsey Global Institute estimated that roughly one-third of tasks performed in the modern office environment are "non-value-adding." Not low-value, non-value. Pure overhead. Just pseudo-work invented to keep middle-class employment afloat in an economy that offshored nearly all of its physical production.

A large swathe of jobs now are just white-collar sandbags. A giant work program dressed up in ergonomic chairs and corporate jargon. And this is where "AI" comes in. Which actually would be a solution to a lot of the things Cad is bemoaning. But rather than having it help offset healthcare costs like it will and should, these vampires are just going to add it to their bottom lines instead.
 
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Kithani

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What Cad Cad is describing about admin costs is actually a massive problem nation-wide, not just in healthcare.

You can start with David Graeber’s 2018 study on "bullshit jobs." Admin jobs in the US have grown over 140% since 1980.
140% haha, those are rookie numbers.jpeg

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