U.S. Markets closed

Two Experts Debunk Four Big Health Care Fallacies

Yuval Rosenberg

In a The New York Times op-ed, Ezekiel Emanuel, a health policy expert and a former adviser in the Obama administration, and Victor Fuchs, a Stanford health economist, look to clarify what they call “four fundamental health care fallacies”:

1. Employers pay for workers’ health insurance. “Since 1999, health insurance premiums have increased 147 percent and employer profits have increased 148 percent,” they write. “But in that time, average wages have hardly moved, increasing just 7 percent. Clearly workers’ wages, not corporate profits, have been paying for higher health insurance premiums.”

2. Medicare for All is unaffordable. “True, Medicare for All would increase federal health care spending. But that is not the same as increasing total health care spending, which was over $3.5 trillion last year,” Emanuel and Fuchs say. “We have our doubts about Medicare for All. But unaffordability is not a reason to oppose it. … When you hear a health care price tag in the trillions, know that the existing system has already brought us there.”

3. Insurance company profits drive health care costs. “The fact is, we could eliminate those profits and it would hardly matter to the cost of health care. You would not notice it in your premiums. … True, $22.1 billion is a lot of money — but it is 0.6 percent of health spending. And last year alone health care costs increased over $130 billion — six times insurance company profits. Health care spending would not be significantly cheaper if all insurance companies’ profits were zero.”

4. Price transparency can bring down health care costs. “Over 80 percent of the cost of medical care is paid by private and public insurance. Patients have little incentive to seek out the cheapest provider. When pricing websites exist, few patients use them. … Furthermore, price considerations are useful for choosing only about 40 percent of procedures — routine services like colonoscopies, M.R.I. scans and laboratory tests. Most of the expensive services — think heart catheterizations, cancer chemotherapy and organ transplants — are not the kind of thing you decide based on price.”

Read the full piece at The New York Times.

Like what you're reading? Sign up for our free newsletter.