Comments on: Saving Money by Buillding Fee Transparency in Healthcare

By: concordjoe

concordjoe — Mon, 02 Feb 2009 19:28:17 +0000

this is a GREAT idea. i used to run a small business and I always thought there was a lot of fat in that broker fee but i was too shy to ask. I oringally came to this site for the pennies but I have read every posting and they are mostly great ideas

By: thistimeisthetime

thistimeisthetime — Thu, 29 Jan 2009 20:14:15 +0000

they aren’t going to have any choice as I read this. The proposed law is only about disclosure. no one is regulating anything. sounds like it will be up to the buyers to negotiate

By: Beenaroundforalongtime

Beenaroundforalongtime — Thu, 29 Jan 2009 14:44:39 +0000

In my dealings with the broker field i found one charging a % of claims as the commission, so where is that logic about controlling costs. these guys love the system and will not want a change to their income levels. there is other low hanging fruit like this throughout healthcare but so many people have gitten rich on these senarios it is unlikely that such changes will reach the federal level, remember all healthcare is regional.

By: harvardguywithtoomuchtime

harvardguywithtoomuchtime — Thu, 29 Jan 2009 01:43:40 +0000

i hate to agree with an MIT guy, but I am all for transparency in pricing too. One of the requirements for efficient markets is perfect information and in this case there is none. I would bet on a 50%+ decline in broker fees in the scenario describes, where pricing is made explicit. healthcare is a commodity. brokers are a commodity.

By: MITguywithtoomuchtime

MITguywithtoomuchtime — Mon, 26 Jan 2009 19:31:35 +0000

So as I read your postings and comments, I find several economics themes which are not expressed like an economist would express them but are principles of economics nonetheless:

–more transparency, like this one or the real estate brokers

–stop hidden subsidies like the gasoline or the right to die

–get rid of artificial secondary markets like in the scalping or the income tax refund anticipation loans by making the primary market more efficient

–get incentives aligned like in both postings about gasoline or real estate brokers or measuring innovation or the philanthropy

–create options, like the pennies or the real estate brokerage

Some of these things don’t fit in any category, like the gift card or the immigrants.

what are you going to do with this stuff? No one can find it on the web, you know. I found it through a friend who lives in Concord and hates pennies.

By: alewis

alewis — Mon, 26 Jan 2009 19:20:48 +0000

I think Art is onto something here. When prices are “shrouded” (bundled into other prices) they are almost always higher than when they are explicitly charged. I would suggest:

(1) The health plans should be required to bill the broker fee separately from the adminsitrative services fee or premium

(2) The broker should be required to charge the buyer directly.

Both cases shine a bright light on the broker fees, will cause them to melt away, saving employers substantial sums without reducing coverage or benefits for employees.

Further, with federally qualified health plans (those authorized to insure federal employees), unbundling can be accomplished through federal regulation rather than Act of Congress.

Therefore, we are One Signature Away from lowered healthcare expenditures.

By the way, I am a broker myself. My fee for putting a disease management program in place is far lower in percentage terms than what other brokers charge, and yet you don’t see me eating squirrel under a bridge.