No insurance company pays a internal med doctor $200 for a visit. Maybe $50, maybe $75. I seriously doubt $200. If you are paying cash, you could see the doctor for probably $50, $75-$100 for a physical (in Midwest). One of the main sources of increased physician prices is their need to hire more staff to get money from managed care companies (read Medicare/Medicaid). Thus, the concierge doctors can run an office with 2 staff members and provide above average care. Little billing, little overhead. Plus, if you are paying only $250/mo. in premiums for your catastrophic insurance (total guess) vs. $1000/mo for full coverage, it doesn't take long to pay for some tests or prescriptions or doctor's visits. Plus it lowers utilization of healthcare (as it is real, not free money) and the lower the demand, the lower the price. Also, the patient will find which MRI center does an MRI for $800 and skip the one that charges $2000 (though the insurance company will pay for either without blinking). I could go on, but most people's eyes have glazed over by now.
You are right, that no insurance pays $200 for a doctor visit, but I guarantee my doctor charges the insurance company that and has accepted a lower payment schedule in return.
And, yes, you would think that market forces would be a wonderful driver to reduce costs. But, unfortunately, as of today, we have a multitude of government funded sources of medical insurance: Medicaid/Medicare, etc.
If we truly want it to be free market and see costs decrease, you would have to remove those programs that lead to increased pricing. And you can’t require that everyone have coverage. Otherwise, it is not a free market and prices will be driven up.
“Plus, if you are paying only $250/mo. in premiums for your catastrophic insurance (total guess) vs. $1000/mo for full coverage,...”
In Maryland, my group policy with HSAs for a family with a $2,400 per year deductible, and significant co-pays until the out-of-pocket maximum of about $7,000 is reached, costs about $850 or so per month.
“Full coverage,” that is, no four-figure deductible, modest co-pays, and a low out-of-pocket maximum runs about $1,600 per month.
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