Back then it was UPMC and Highmark playing out their decades old battle. Sadly - not much has changed - nor is it likely too - except that it's becoming even more prevalent.
Sadder still is how much of the patient view is lost in these battles for revenue. Public rates are too low - so the commercial side has to carry *everyone* to profitability - and who funds that? Employer Sponsored Insurance - which covers about 160M Americans - and commercial rates are just INSANE. The average cost of ESI coverage for a Family of 4 (PPO coverage) is over $30,000 - per year. That's average.
We keep saying all this is unsustainable - but that's a lie too because nothing will change unless/until we end ESI (and cap commercial rates). We could do that. We should do that - but the change has less to do with healthcare and more to do with tax reform and *that's* not likely anytime soon.
Thanks so much for the kind comment! I just read through your article - really fascinating stuff about the Highmark and UPMC history!
ESI is the original sin of US healthcare, but it will be firmly embedded into the infrastructure until we come along with a better system. I don't see a path to government-universal system yet, but who knows? With the right cultural change, anything is possible.
I was there when all this happened. UPMC leveled the playing field for all payors to enter the market to compete with Highmark. I was with Cigna at that time. Agree with everything you have said. The systems don’t like to be capped. Here are some of my thoughts which I think will align with yours.
Good agreement - but directionally I try to be more focused on universal coverage as a primary objective. It's the best delivery mechanism for monopsony (one-buyer) pricing - and that's how to reign in uncapped pricing. We do this with utilities all the time - so it's not new/novel - it's just that the regulatory capture in healthcare goes back decades and is deeply entrenched.
You might like the book - and this one piece on UHC ;-)
Thank you, I will definitely read it. I was just thinking about what healthcare could learn from utilities industry a few days ago and started jotting down my thoughts. Appreciate the share, I’ll take a look.
... it's an analogy that works pretty well. My surgery could easily be 2.5X or 3X the cost of my neighbors simply because we're in different coverage tiers - but my kWh rate is identical.
We do regulate payers (to some extent), but specialists, hospitals, Rx and Med Dvcs are entirely unregulated/uncapped.
Great coverage - which I also stabbed at back in 2012 for Forbes:
https://www.forbes.com/sites/danmunro/2012/03/30/when-healthcare-titans-compete-patients-lose/
Back then it was UPMC and Highmark playing out their decades old battle. Sadly - not much has changed - nor is it likely too - except that it's becoming even more prevalent.
Sadder still is how much of the patient view is lost in these battles for revenue. Public rates are too low - so the commercial side has to carry *everyone* to profitability - and who funds that? Employer Sponsored Insurance - which covers about 160M Americans - and commercial rates are just INSANE. The average cost of ESI coverage for a Family of 4 (PPO coverage) is over $30,000 - per year. That's average.
We keep saying all this is unsustainable - but that's a lie too because nothing will change unless/until we end ESI (and cap commercial rates). We could do that. We should do that - but the change has less to do with healthcare and more to do with tax reform and *that's* not likely anytime soon.
http://hc4.us/esi20
Thanks so much for the kind comment! I just read through your article - really fascinating stuff about the Highmark and UPMC history!
ESI is the original sin of US healthcare, but it will be firmly embedded into the infrastructure until we come along with a better system. I don't see a path to government-universal system yet, but who knows? With the right cultural change, anything is possible.
Andrew, I don’t think government universal system will work in the US. We need a hybrid approach. Let me know what you think of my thesis here - short read. https://www.linkedin.com/posts/activity-7418035376398766081-AHbO?utm_source=share&utm_medium=member_ios&rcm=ACoAAAEhtUgBt9wZNFxqiLYQB3q-i-3cMkQW3fI
I was there when all this happened. UPMC leveled the playing field for all payors to enter the market to compete with Highmark. I was with Cigna at that time. Agree with everything you have said. The systems don’t like to be capped. Here are some of my thoughts which I think will align with yours.
https://www.linkedin.com/posts/activity-7418035376398766081-AHbO?utm_source=share&utm_medium=member_ios&rcm=ACoAAAEhtUgBt9wZNFxqiLYQB3q-i-3cMkQW3fI
Good agreement - but directionally I try to be more focused on universal coverage as a primary objective. It's the best delivery mechanism for monopsony (one-buyer) pricing - and that's how to reign in uncapped pricing. We do this with utilities all the time - so it's not new/novel - it's just that the regulatory capture in healthcare goes back decades and is deeply entrenched.
You might like the book - and this one piece on UHC ;-)
http://hc4.us/oneprice
Thank you, I will definitely read it. I was just thinking about what healthcare could learn from utilities industry a few days ago and started jotting down my thoughts. Appreciate the share, I’ll take a look.
... it's an analogy that works pretty well. My surgery could easily be 2.5X or 3X the cost of my neighbors simply because we're in different coverage tiers - but my kWh rate is identical.
We do regulate payers (to some extent), but specialists, hospitals, Rx and Med Dvcs are entirely unregulated/uncapped.
Well done as always. Have you found the Healthcare uncovered substack /crew yet?
Thanks for supporting as always! I found the Substack, but wasn't aware of the crew!