A Knee Replacement that Costs $5,300 in Oklahoma Costs $223,000 in California

[Justin Bilyj]

Survey finds discrepancy in hospital charges - Las Vegas MyNews3 - KSNV

"The data doesn't show that there's any quality care as the prices go up," notes Robert Zirkelbach of America's Health Insurance Plans.

Zirkelbach represents insurance companies.

Like Medicare, insurers are able to negotiate lower fees...To a degree.

"So much of the public policy debate is focused solely on health insurance premiums and has largely ignored the prices that are being charged for services that drive those premium increases," Zirkelbach points out.

Now the debate shifts to what hospitals are charging, and why.

 

[GreenSky]

Which is one big reason that buying insurance across state lines won't hold down costs.

I live in CA but let's assume I can buy insurance at a much lower cost in OK. When I have my knee replacement, the OK insurance carrier is on the hook for much more than had I done it in OK.

The potential risk is much more here in the land of milk and welfare than in OK.

Rick

 

[taterpeeler]

I agree with rick... 100% state line crossing is a bogus farce

 

[leevena]

Which is one big reason that buying insurance across state lines won't hold down costs.

I live in CA but let's assume I can buy insurance at a much lower cost in OK. When I have my knee replacement, the OK insurance carrier is on the hook for much more than had I done it in OK.

The potential risk is much more here in the land of milk and welfare than in OK.

Rick

I don't know if I agree with your statement. If a carrier did write business acrsos state lines, they would need to price it for the expected costs in that area. For example, assuming the same plan of benefits, a covered person in OK would pay $1 and the covered person in CA would pay $3. This is done all the time with national plans.

Am I missing something here?

 

[GreenSky]

I don't know if I agree with your statement. If a carrier did write business acrsos state lines, they would need to price it for the expected costs in that area. For example, assuming the same plan of benefits, a covered person in OK would pay $1 and the covered person in CA would pay $3. This is done all the time with national plans.

Am I missing something here?

Yes, you're missing the "it will lower the cost of health insurance." So if I can buy insurance from an OK at CA prices, how is that helpful?

Rick

 

[Norwayguy]

Yes, you're missing the "it will lower the cost of health insurance." So if I can buy insurance from an OK at CA prices, how is that helpful?

Rick

Maybe your complaint is not with the carriers it is with the doctors and hospitals billing such outragious charges. But then again if the free market allows it, it is still preferable to hospitals and doctors being government employees.

 

[leevena]

Yes, you're missing the "it will lower the cost of health insurance." So if I can buy insurance from an OK at CA prices, how is that helpful?

Rick

Sorry, but I do not agree with your statement "so if I can buy insurance from an OK at CA prices, how is that helpful" because it is not part of the argument.

The issue of lower costs because of writing across state lines was never framed within the context of selling OK rates in CA. The issue of a lower cost had to do with the regulations in other states. The fear was that a carrier in a less regulated/low cost state would come into a highly regulated/higher cost state and offer a more competitive plan/cost. So if an OK carrier had a 10% pricing advantage (due to less mandated benefits and regulations) and they were able to sell that plan design in CA, it would be harmful to the CA based carriers that had to include.

 

[somarco]

Group plans on employers that have employees in multiple locations factor in the cost of care across several zip codes and network penetration.

Individual plans written in OK assume most care will be delivered in OK. If everyone that bought an individual plan in OK went to OK for care the carrier would lose money.

 

[leevena]

Group plans on employers that have employees in multiple locations factor in the cost of care across several zip codes and network penetration.

Individual plans written in OK assume most care will be delivered in OK. If everyone that bought an individual plan in OK went to OK for care the carrier would lose money.

Hi Bob.

Your statement is correct, but if carriers were allow to be written across state lines the issue would be mute. The carrier in OK would have a OK product, priced for the zip/geo that the OK resident purchased the product. If that OK company were able to sell in CA, it would then use the same core plan (less the cost of mandates and regulations) to sell in that zip/geo in CA. Those contracts would assume a much higher consumption of CA services and be priced accordingly.

 

[somarco]

And therein lies the problem.

The cost of filing a new product in a state is cost prohibitive. Carriers file individual plans on the expectation of X number of contracts written. Just filing revisions is several hundred thousand dollars and months to years before approval.

GA approved buying across state lines about 2 years ago. To date not a single carrier has applied to sell their product here.