Wednesday, March 03, 2010

Some People Just Like a Good Moan

Some people just like a good moan every so often. Take, for example, your intrepid author; when the morning train service faces yet another severe disruption (courtesy of a fire in the London Bridge area), does he resignedly shrug his shoulders and adopt the standard "musn't grumble" attitude of the plucky Brit? No! He instead seizes the opportunity to make "clever" cutting remarks to his friends or, in their absence, random passers-by.

Similarly, when the deputy governor of PBOC says "hey, we're getting worried about inflation" but the Chinese Commerce Minister says "we're gonna stick to our own pace" and "keep the yuan basically stable", does Macro Man stay silent? Of course not! What's the use of hand-crafting a soapbox if you cannot step upon it every so often to point out that the Chinese currency peg is a patent absurdity: in what possible world can it make sense for the world's second largest economy (and owner of the world's largest current account surplus) to mechanistically link its currency value to that of the world's largest economy (and owner of the world's largest current account deficit)?!?!

Still....when it comes to having a good moan, Macro Man must tip his cap to the undoubted creme de la creme, the cadre of European policymaking "elites" who see fit to pronounce upon matters of international finance. Monday's comment from Jean-Claude "Zed" Juncker about the torture implements he keeps in his basement were as remarkable as they were misguided.

While hit-n-run buyers of sovereign CDS protection are pretty clearly suboptimal from both a social and market utility perspective, speculative focus on the sordid fiscal shenanigans of Greece has unearthed a pattern of malfeasance that would make the Gimp blush. For the DOJ to potentially start investigating bearish euro bets is beyond ludicrous.

There weren't any complaints last year, when the euro fell more sharply against the dollar than it has thus far in 2010. (Particularly perceptive readers may also observe that EUR/USD is actually some 10c higher than it was this time last year.)
Moreoever, it was JUST THREE MONTHS AGO that a certain "Z. Juncker, esq." said that "the euro was overvalued and that some adjustment in that area would be desirable." Unless, evidently, that adjustment was based on a fundamental flaw in the single currency project, in which case the perpetrators should be subjected to Zed's dodgy extracurricular fantasies.

M. Juncker, Macro Man salutes you. Your capicity to moan far outstrips his and, he suspects, just about everyone else's. Well, perhaps except for this chap, who's struck upon a cunning plan to fix the stock market!


Anonymous said...

I've come to the conclusion that markets are there to try and keep politicans honest.That is when they f..k up it's the markets that try to clean it up ,or stop it becoming ever more dire.
However ,when this shovels all the doodoo back into the politicians lap then they get busy investigating these market wrongdoers. Simple conflict of interests.

Dimitry said...

Wait a sec...

Was this cunning plan to fix the stock mkt suggested to the SEC by a gentleman by the name of Benjamin Dover? Ben Dover? Doth my eyes deceive me or am I reading too much into it?

Macro Man said...

If the name isn't a giveaway that this is a satire, then surely the actual text of the letter is! Note, however, that it actually does come from the SEC- so it was actually sent.

DT said...

That SEC letter is awesome.

Anonymous said...

Look, everyone knows the SEC is far too busy going after equity day traders posting dodgy stuff on the interweb to bother with the Madoff's and the AIG's of this world

Nemo Incognito said...

I am sincerely hoping the German people say "no mas" sometime soon. This piss-take of trying to help by regulators should be seen for what it is.

In other news, is this all over in Turkey? Was thinking that some of those banks might be worth a punt given that they are seemingly solvent and could do a retail banking Ottoman empire type expansion once NBG finally bites the dust.

Anonymous said...

So who will play Butch and stop Zed? More importantly, if we continue along this line does Voldy incarnate Marcellus?
Love the letter, have seen similar ones.
Glad to hear La Plagne was good, have been skiing there many times in the past and it's ugliness is more than made up for by the "domaine ski-able".
Ta, JL

Anonymous said...

You may laugh about that SEC letter, but isn't this exactly what the Pakistani SE did about a year ago? Worked a treat.

Anonymous said...

According to a web page, Greek, Spanish, Irish etc sovereign DS all retreated lately as their national “intelligence” went in to “investigate”.

Now US congress wants to “investigate” too. Who knows, it may find the US national interest, trade secret or even national security interest in that hole. They ll investigate as long as no turd holder will suddenly decide and default on his turd.

No one wants to “investigate” the “sovereign CDS” itself.

These days, markets equal politics and no part of this equation is “honest”, much less “intelligent”.

It is all just one giant floating doodoo, shuffled constantly by deflating-IQ individuals in between the “=”.

Anonymous said...

ECB wants to cut the rating clowns off from funding access?

That is a start.

Todd Enders said...

I also enjoyed the SEC comment letter. Modest proposal, etc. On China, I think it's normal that different constituencies would hold different sway over a government as sprawling as PRC's.

That said, my team is confident in an appreciation in the Yuan sooner than consensus predicts, and we went long the Yuan in our virtual portfolio in July, as a very stable (currency pegs!) longer-term idea.

Dimitry said...

I agree, MM. That SEC letter itself is priceless (I love the bit where Jimmy Buffett is called the Oracle of Omaha). It's not just the fact that it was written by the infamous Ben Dover III, Esq.

I am astonished that the SEC actually took it seriously and published it alongside other, probably legitimate, commentary. Doesn't reflect well on the level of ability of the SEC staffers, does it? But, then again, that's not exactly an epiphany...

Anonymous said...

Excellent proposal to the SEC by mr. B. Dover. Still, to truly assure that markets will do the proper thing a ban on selling may not ne enough. So let me amend his modest propasal with a modest propasal of my own.

In addition to a ban on selling the SEC should impose a mandate on all investors to buy stock every trading day. A minimum increase of 5% to existing postions a day should suffice.

To make sure that investors can meet this mandate all brokers should be mandated to grant 0% margin debt of up to 1000% of assets.

This will once and for all end the activities of nefarious shortsellers.

Anonymous said...

Its funny how many people will ridicule the incompetence of the SEC one minute...

...and then suggest putting the same group in charge of health care the next.

Macro Man said...

Who has suggested putting the SEC in charge of health care? Talk about your straw man arguments.....

Anonymous said...

MacroMan - you yourself have argued in favor of putting US government bureaucrats in charge of health care

Talk about selective memory from a straw man!

Macro Man said...

Care to provide a quote, wise guy?

Macro Man said...

I would be very curious to hear from the "don't touch my health care at all, bub!" crowd as to what can be done about private sector profiteering in the health care industry. $50 hospital band aids rival 80's era $5000 toilet seats in military procurement for inefficiency and parasitic rent-seeking, and to suggest that the system does need to be reformed - which many appear to be doing- strikes me as patent nonsense.

If Japan-a country with a sordid history of inept, unstable, corrupt government that's the poster child for wasteful spending- can manage to produce a world-class health care system at a half the cost (as a % of GDP) of the US (and with a much older population!), then I have to believe that the US system can be streamlined sufficiently to provide universal care and top notch private practice at a lower cost than is currently the case.

Obamacare might not be that reform, but it is nonsense to discard the notion of all reform because of that.

(As an aside, why is it that the pitchfork-wavers who want to burn bankers don't go after the army of profiteers in the medical/health care/pharma industries? Health care takes up a helluva lot more government dough than bank bailouts on a year in/year out basis.)

Anonymous said...


In sympathy with the apparent disconnect of burn all bankers sentiment and its relative hypocrisy, i think agriculture stands out as a pretty good one... I read somewhere the EU spends about 50 bn euros a year helping its farmers undercut the developing world... Even the Queen is a recipient of EU largesse, as an agricultural landowner in obvious need of fiscal assistance. I imagine the US has a similar sized program.

I mean bankers may be bad, but at least they arent taking money out of the pockets of subsaharan african farmers. Though i dont doubt they'd make an effort if they could

Anonymous said...

MM: Obamacare might not be that reform

That seems rather ambivalent. We are on the brink of having the largest healthcare bill rammed through using underhanded procedural tricks, against the will of the majority of the public.

That's the issue. I think nearly everyone wants to see healthcare reformed, desperately even. But politics is the art of the possible.

With this Congress decent reform is not possible, so people are converging on trying to stop the Rahm-through. Excellent post BTW, hilarious, made my day.

Anonymous said...

Also, it's not "burn the bankers" per se. The target is essentially the coterie of criminalized bankers on Wall St. and in the City who were saved from bankruptcy through the Paulson hostage crisis of 2008.

Anonymous said...

Plenty of people think US health care needs reforming, but it is an absurd leap to go from "the system is broken" to "the ONLY way to fix it is to make it a corrupt government system"

Just because bankrupt Europe did it that way does not mean that solution will work(?) anywhere else.

That corrupt US politicians are trying to force a terrible idea on an unwanting populace that is overwhlemingly opposed to the idea just makes the idea unworkable.

Government health care will not work in the US unless and until AFTER there is a serious change in government culture -- and there is little if any chance of that happening in the near term.

The fact of the matter is: the current US health system is a product of the last time the US government got involved. That is why our system costs 2x any other system on earth.

Macro Man said...

Well, that and the absurd profiteering of the private sector health care providers in the US.

Anonymous said...

At least the health care profiteers didn't threaten to shutdown all the hospitals if we didn't give them $700bn for their friends to pay out in bonuses.

Macro Man said...

No, they just shut out the people who can't afford to pay.

Gary said...

MM -- funny post. Lets all remember the last time the economic central planners decided to restrict short sales on insolvent entities:

The year was 2008, Henry Paulson and Ben Bernanke were alternating between saying "the subprime contagion is well contained" and US money center banks are solvent -- and no one with two brain cells was believing either lie.

In the middle of the summer, US bureaucrats started restricting short sales in 16 "system critical" insolvent banks. The law of unintended (but easily foreseeable) consequences was activated, and quant funds started imploding as historical pair trading relationships went berzerk.

So to fix the mess they made when they tried to fix the mess they made, US bureaucrats enacted further short sale restrictions... Down goes FNMA, FHLMC, Lehman and the little entity hiding Goldman's losses AIG.

So to fix the mess they made when they tried to fix the mess they made when they tried to fix the mess they made -- US regulators enacted even more draconian short sale restrictions in late September / early October. This just told the markets there were even bigger problems still lurking undisclosed.

The S&P was around 1150ish? Oh, and Paulson asked for $700 billion no questions asked to solve the "credit crunch" once and for all.

4-5 months later, the S&P was down 400 points. Hundreds of banks had failed, the FDIC's insurance fund was empty. About the only progress was the "revelation" that Paulson/ Geithner's AIG bailout was anything but kosher.

Congress then bullied FASB to allow banks to legally misstate the value of their assets -- because lying to investors is a sure fire way to restore confidence in the system.

Fast forward to the present: FDIC still bankrupt. Banks still insolvent. Home foreclosures still happening. Economy still a mess.

Throughout all this fiasco, Europeans smugly laughed at the stupid Americans for not regulating their banks and economy -- the EU clearly knew much better how to regulate...

Since then, everything from UBS to RBS has become a ward of the state. Iceland is formally insolvent, while Greece, Portugal, and Italy remain in denial about their insolvency. The UK is next, but not to worry since they will soon bully Argentina out of some oil fields and keep the UK fantasy alive another few years. God save the Queen and all that.

Just like the banking mess, Europe smugly mocks the US health system -- because Europe's system looks much better on paper when the authorities refuse to acknowledge problems. Health care costs in Europe are rising fast, and accounting shenanigans can only hide the problems for just so long.

Without massive "off balance sheet" subsidies, Europe's health systems are having the same problems as the US. Our accounting systems are just recognizing the problem faster

Anonymous said...

MM: "Well, that and the absurd profiteering of the private sector health care providers in the US."

This is great political rhetoric Macro Man, but if you actually believed this lie -- why didn't you buy stock in these profiteers? You would be retired by now.

You haven't put your money where your mouth is because you know your statement is false.

Once you get past the propaganda and lies -- the unfortunate reality is that most US hospitals lose money and rely heavily on charitable donations.

Most US health insurance companies have profit margins that put them square at the average for the S&P.

Check the actual SEC filings of these companies. Check the stock prices.

Stop brainlessly parroting the lying politicians.

Mark Amerman said...

In defense of the U.S. health care system, if
you're going to get sick or get ill, the odds
of your being treated and cured are better in
the U.S. than any other place on earth. This
is true for almost all specific health conditions,
that is if say you're looking at outcomes for
heart attacks, or outcomes for staphococcus
infections, or whatever. This is true despite
the fact that some x percentage of the U.S.
population has no health insurance. Even
including these people the average outcome is
better than all other societies including
nations where everyone has 'free' health care.

Now some will wonder how this can be true given
that there are other nations with longer life
expectancies. The difference is that there
seems to be a significant genetic component to
the risk of various illness. Some ethnic
groups seem to be healthier and longer lived.

At the moment, Norwegians have a longer life
expectancy than Americans, but if we look at
Americans of Norwegian extraction, they are
living at least as long as and probably longer
than the citizens of Norway.

In any case the statement that outcomes are
better in the U.S. has nothing to do with
factoring people into different ethnic groups,
it's a simple straightforward assertion, if
someone has a heart attack, the odds of their
being alive and well x number of years latter
are higher in the U.S. than elsewhere. This
is true for almost everything.

The problem with the U.S. health system isn't
the outcomes, which are significantly better
than a good many countries, but the cost of
this system.

Macro Man said...

And how many bureaucratic staff clock in/clock out, get paid, and do nothing?

How many doctors need financial aid to put their kids through college?

How is it that a simple procedure that costs €50 in Ireland (getting some stitches) costs $400 in the US?

How many layers of people have their hand in the trough at all levels of the US health care provision system?

Too damned many, which a little common sense would tell you if you looked at the numbers and/or experienced health care in other parts of the world.

Anonymous said...

At the end of the day the market rations resources, health care no exception, better than arbitrary and corrupt government officials.

Bigger picture, the poverty in the US is largely a result of the indebtedness, which is a function of having a central bank.

wcw said...

Yikes. What happened to your comments thread, MM?

I watched a European state-run system care for three grandparents. I know not only what they paid, but also roughly what it cost in terms of administration, salary and equipment to do so. I am watching the US system care for my parents as they age. I know not only what they pay, but also roughly what that costs in terms of administration, salary and equipment.

The state-run system does to the US system roughly what the Harlem Globetrotters do to the Washington Generals.

The mental deficiencies of those who bet on the Generals are left as an exercise for the reader.

Macro Man said...

Mark Amerman, how do you distinguish ethnic "health tendencies" from economics? I would wager, for example, that Norwegian-Americans have a higher than median household income, whereas, oh, Sudanese-Americans do not.

I wonder what the relative life expectancy of Cuban-Americans is versus Cubans (the rare poor country with excellent health care), or i8ndeed between black Cubans and "hispanic" Cubans?)

I would, however, agree with your over-arching point- if you can afford it, top-end US health care is superb; whether it's so superb to justify paying 50% - $100% more per capita than other developed nations (and with a lower coverage base)strikes me as a dubious proposition.

Anonymous said...

MM: And how many bureaucratic staff clock in/clock out, get paid, and do nothing?

ANSWER: Almost 100% in the US

MM: How many doctors need financial aid to put their kids through college?

ANSWER: MacroMan has been living abroad for too long and is basing his opinion on hopelessly out of date anecotes. Yesteryear, US doctors earned a good living. Today, many doctors are leaving the profession because they cannot make any profit.

MM: How is it that a simple procedure that costs €50 in Ireland (getting some stitches) costs $400 in the US?

ANSWER: Because the US system charges the full price of the stitches, plus the cost of subsidizing Medicare, plus the cost of subsidizing people who don't pay at all (including tourists)

Ireland's price doesn't include all the external subsidies their system gets from Brussels. The UK's price doesn't include subsidies it gets from the North Sea fields.

And ask the muslims who live in the slums outside Paris how great the French system works for them

Anonymous said...

European health systems are less expensive for exactly the same reason Enron was so profitable: accounting fraud.

If Europe properly accounted for the total cost of their care (including massive subsidies), their health care spending is just as costly as US care... but not as high quality

The poor in the US get much better treatment than muslims in France. In London, the police tend to just shoot visitors from Brazil dead (apparently Brazilians and Pakistanis look the same to British police) -- so no treatment was given. And I am pretty sure you can count the number of foreign immigrants to Dublin on one hand, without running out of fingers. Greece simply doesn't allow foreigners in except as tourists. And Japan doesn't even tolerate couples of mixed race (one Japanese, one "other").

The US allows all comers, unfortunately including terrorists and illegal immigrants -- and we give every single one of them medical care if they need it, insurance or not

Macro Man said...

OK, I think that "contribution" pretty much means that the topic has run out of please, can we move on? How 'bout that euro, eh?

wcw said...

What, you're not limit long AUDUSD?

Anonymous said...

The minister of health of Canada (with its government health system) was recently "caught" for getting surgery in MIAMI, FLORIDA, USA.

When confronted, he said he didn't want to cause political problems for jumping in line for care in Canada -- and he didn't want to wait months for care

Anonymous said...

The most likely scenario for Friday seems to be a nasty number, which leads the people behind the curtain to ignite a stock market rally.

Mark Amerman said...

That's a good question, Macro Man. I was
thinking about that after I posted that
comment above. To give an example, african
americans have higher odds of having a heart
attack in their 50s than european americans.

Now why is that?

Is it because of genetic differences, or
is it because of a lower average income?

We can rule out it being entirely derived
from socioeconomic circumstances because
there's a large enough pool of african-americans
that are financially well enough to compare
their health outcomes to others and still see
a significant difference. Certainly
medical researchers believe there is a
genetic difference, for example at NIH
many health studies are specifically focused
on african-americans, partly because of
politics, also I suppose if one didn't
take this account one could get entirely
misleading results by pretending that
there is no difference.

On the other hand, we can rule not out that
socioeconomic factors are not playing a
role. In fact they likely are.

Given that one has had a heart attack the
chance that an american will recover is
higher than the odds for any other nationality.
What this statement does not take into account
is that the odds of say a norwegian of having
a heart in their 50s is lower than that of
the a american.

It's possible that the higher odds of heart
attack in one's 50s is a reflection of inadequacies
in the american health care system. I don't
think this is true, but it's difficult to entirely
rule out.

You misunderstood my overarching point. I was
not saying that the top-end U.S. health care
is better than anywhere else. I was saying
that 'average' U.S. health care is better than
anywhere else.

In other words if all you know about a person
is that they are american and all you know about
another person is that they are british, the
odds are that the american is getting better

Gary said...

If you can believe this one, Obama has stopped blaming Bush (for the moment anyway) and is now blaming THE WEATHER for job problems.

The boogey man will no doubt be blamed next

Anonymous said...

Gary, that boogie man would be "hedge fund speculators," evidenced by Obama's Justice Department sending letters top hedge funds about opening an investigation into euro shorting.

Hedge funds are the one group which does not have blood on its hands from the recent bailout madness. Of course the leftist dogs are going after the innocent to divert attention from their masters.

Anonymous said...

I am still waiting to hear why MacroMan didn't buy stock in all those "profiteering" medical providers so he could retire early

This being a financial blog, I have the greatest respect for traders who put their money where their mouth is.

Why aren't you retired MacroMan? If you believe your own comments, why didn't you buy into these profiteering companies? Why aren't you living it up on your yacht in Monte Carlo?

Macro Man said...

Gee, I don't know. Why don't you piss off down to Juncker's basement rather than poking a stick at your betters?

leftback said...

The letter to the SEC from Ben Dover comes from a junior trader at Doone & McCafferty Securities. You probably know the partners, Ben and Phil.

Macro Man said...

LB, this health care palaver makes me feel like I am a senior partner at that august firm....

leftback said...

Seriously. All you have to do is mention health care reform and the blog is invaded by Anonymous Proctologists intent on performing unlubricated Colorectal Exams.

I bet Clement Atlee didn't have these problems in 1945, maybe he got Nye Bevan to take the Tories out for a Beveridge.

Anonymous said...

MM: "Why don't you piss off down to Juncker's basement rather than poking a stick at your betters?"

Both MacroMan and Madonna have delusions of being British

Anonymous said...

"The man who is not a socialist at twenty has no heart, but if he is still a socialist at forty he has no head." - Aristide Briand

Macro Man said...

"Opinions are like assholes....everyone has one, and most of them stink." - Harry Callahan

Anon @ 5.55/7.34 being a prime example.

leftback said...


Now, returning to the €, what will the FX market's reaction be when people realize that a non-bailout is likely to create problems for Greek, and by extension, German and US banks. Furthermore, all the Euro shorts appear to have just covered.

William said...

leftback: a non-bailout is likely to create problems for Greek, and by extension, German and US banks.

It ain't over till an Italian bank fails

In the meantime, Geithner will bail out Goldman's losses using AIG. Citibank will record billions in losses; Abu Dhabi will sue Citi for not disclosing the probability of Citi making dumb loans. Deutche Bank will record losses and get a new CEO. RBS will attribute the losses to prior management and demand more bailout money.

By this time, everyone will have forgotten Geithner's Goldman bailout, and Goldman will get on TV and say they avoided losses because they are smarter than everyone else and because they do God's work.

Finally, someone will write a snide comment about deja vu on Macro Man's blog

Macro Man said...

....and then I'll get blamed by some people for being a Communist and by others for being a capitalist leech. Fun for the whole family!

Anonymous said...

You're a good sport MM. It's not personal, just a sensitive time with this reconciliation fiasco and what not. Some less disciplined Anonymous partisans have been feeling a bit hot under the collar, y'know?

dd said...

It's pretty clear no one here has ever been involved with a medical practice. Looking at January billings the gross less "adjustments" (ie variance in Medicare/Medicaid/insurance reimbursements) is 35%. Assuming payments are made as billed, then overhead will chew up 55%.
Applying that to the $400 stitches it will be reimbursed at $140 less overhead is $63 to the provider. (Full disclosure in years past the reimbursements were generally better ie closer to 45-50% gross; but that has changed dramatically).
Surgeons are generally better reimbursed but that has changed as well. For example, reimbursement on many procedures is now at 20%.

FYI: Medicare discourages physicians from cutting rates to self-paying patients below the stated rates and can in its discretion claw back "over-payments" based on reduced charges to self-pay.
At the moment most doctor groups are having heated discussions about going to cash, lowering the rates by 50%, and dismissing the legions of certified medical billers and the legal team necessary for the ever-expanding medicare compliance requirements.

Many doctors have received financial aid for their children but it is generally in the form of subsidized loans. This is not a complaint; physicians make a fine living once the practice is up and running. Please note they do not begin their careers until after 30 and if a surgeon it's closer to 35. Then the start up costs are astronomical and it's another 3 years or indentured servitude to some group before it's a good living.


Gary said...

Thanks for posting DD

This US Federal government Medicare distortion is something Europeans (and Macro Man) simply don't grasp and don't bother to look at

So much of our health care system is an artifact of existing Federal government "fixes" and Medicare related distortions

Doctors have to "overbill" (which is all the Europeans see) to overcome Congressionally mandated medicare nonsense

That in turn makes self payers (aka small businesses and employees) over-pay.

The US Government is the problem with US health care, which is why it cannot be a solution.

Anonymous said...

volcker? what volcker?

(now we ll se The Great Moan)

Anonymous said...

Adviser Frank Congemi is running radio spots this week lambasting government officials and Wall Street firms for the financial crisis, which he calls the “largest economic crime in history.”

Mr. Congemi, an outspoken LPL adviser who manages $100 million in assets, is furious with Wall Street firms and equally furious with the government for bailing them out.

“We need a special prosecutor to investigate certain Wall Street firms for many different reasons and on many different levels,” Mr. Congemi states in one of the ads. “These companies are a cancer on the soul of America and must pay the consequences. How the American people wound up being responsible for the losses of these Wall Street firms who were involved in reckless economic crime is in itself a crime.”

Anonymous said...

That being said, employer sponsored healthcare is madness.

You lose your job, and then you get hit by a bus. Double ouch. Surely some risk-aggregation is useful there?

And what happen if the employer overpromises, a la GM?

Adverse selection, moral hazard, nontransparent pricing (I can have my heart surgery and be on the beach in Thailand for 1/5 the cost?) & information asymmetries/pushers (ok doctor, I'll, I'll scan if you say so), little care for outcomes (except when motivated by a lawsuit), subsidizing pharmaceutical development for the rest of the planet ... surely we can do things better

I'd say the only thing that makes me really angry these days is farm subsidies: we undercut developing world farmers, pay to do so, and with horrendously-sized portions and hunter-gatherer brains, make ourselves fat as a result. Ugly Americans, indeed.

Anonymous said...

employer sponsored health care came about as a way to bypass federal government wage restrictions

Its just another example of the incompetence and corruptness of the US government

But pompous Europeans think they know everything and ask stupid questions like why we don't trust corrupt Congress to manage health care.

Towelie said...

Interesting post DD. A "cash only" practice would be very interesting (for those that could afford it, of course).

I had a knee injury and have been dealing with our health care system for several months now. Do you know the procedure for billing between doctors and insurance companies? Because I do not understand how the billing is done at all. To me, it appears that they spin a big wheel to decide what I initially owe and then adjust it to their liking later.

First I get a "this is not a bill" letter telling me what they think I will owe. Then I get the actual bill. Then I get the "we received your money" letter. Then (this has occured 4/5 times) I get another saying that the insurance company didn't pay what was expected or changed how my visit was classified and I start all over again with another "this is not a bill" letter. Sometimes these billing changes result in me owing less than five dollars. One or two were changes for amounts that were clearly less than the postage on the letter, let alone the time for an employee to process it. So 5-6 letters later, I have payed my bill never really knowing what was charged or how my insurance plan covered it.

It baffles me that the doctor can't look up my insurance plan, look at what procedure is being done and KNOW with 99% certainty what I will be charged.

dd said...

Towlie, you gave me such a laugh. Just let me say that doctors are not insurance agents. In the last go round and now again advised doctors to tell their patients, "I am not an insurance agent. I have no idea what your plan covers."
Large doctor groups have a cadre of employees that negotiate rates, track billings and provide wonderful pie charts. Individual doctors who negotiate rates are toast. There are so many HMOs, PPOs and insurance plans, then Medicare and Medicaid. The payments are generally pegged to Medicare and at best doctors know they will get Medicare rates plus whatever the negotiations yield. But a guy running his own office, only has a vague idea of the revenues and usually has a massive receivable; especially when states stop paying Medicaid.
Doctors are not lawyers and even lawyers can barely negotiate the legalisms of contorted medical insurance. Best bet is talking to the certified medical billers. They know the system, the coding, the deductibles, the co-pays, the discounts and the billings. It is a profession onto itself.

dd said...

Gary, ultimately it's single payer; but the insurance industry can't withstand the revenue drain right now (think AIG a onetime major health insurer). If anything "mandatory" health insurance, like so many initiatives is about shoring up the financial structure first and other issues are secondary.
As for Medicare, the issue was insurance would not cover the elderly and young families couldn't afford their parent's healthcare. Medicare filled the void.
The cash and carry sounds good, but quite frankly it won't work on a large scale. Sure a few practices can free-ride off the base structure for a time; but overall the system crashes. The infrastructure is just too expensive ie what good are cars if there is no government supported street/highway infrastructure?
Just my take after 30+ years dealing with the bs.

Gary said...

DD -- first of all a correction to what you wrote... The "government" does not provide roads or anything else. TAXPAYERS pay for both roads and cars.

Government doesn't pay for anything, it collects money, takes a chunk off the top for red tape / administrative overhead, and then dispenses TAXPAYER money

While the insurance paperwork and conflicting covered/not covered nonsense needs improvement -- based on lots of other government services, I seriously doubt the government is going to have lower overhead than private insurance. And from what you describe, Medicare's coverage/non coverage isn't any more rational-- its just a bigger plan and thus the coverage rules are more widely known.

The bigger problem with Medicare and government paid care is purely a management problem. Congress is simply inept; this has been proven again and again and again. With a monopoly system, there is no choice and no alternative.

While [insert insurance company here] is annoying, bad companies eventually do go out of business. It might take longer than some would like, but it eventually it happens.

By contrast, the criminals in Washington were still collecting a phone tax to cover the Spanish American War 80 years after the war ended.

Washington has a "corporate culture" problem, and that needs to be fixed first -- no one will trust them unless and until after that change happens. And no, I am not holding my breath.

Which is why US government sponsored health care is an ideal only idiots can support.

Walmart invented $10 prescription fills, not Medicare, not Nancy Pelosi, not Obama, not whatever Republican you want to name. I don't like Walmart, but any honest person has to admit Walmart has done more to reduce health care costs than all politicians (both parties) combined... and once Walmart offered $10 prescriptions, all the other major pharmacies followed suit in competition.

Yes, Walmart only offers generic prescriptions. Blame the intellectual property laws and the FDA for the nightmare of brand pharmaceuticals

We have heard years of why the insurance companies, drug companies,etc are evil (and I am not claiming they are innocent)...

We haven't heard much talk about Medicare fraud (which is rampant). We haven't heard about Medicare overhead (which is higher than private companies). We haven't heard much about Congress's annual failure to address intellectual property laws -- they somehow extended the patent on Mickey Mouse for Disney, but no politician has done anything about the time/expense of patenting a new drug.

Instead, the criminals in Washington focus 100% of their time on expanding their own power and reach. That is what Obamacare is about -- its a power grab. Health care is just the marketing gimick they are using this time. ObamaCare is evil -- pure and simple.

US Health care needs to be fixed -- Federal power does not need to be expanded. The two issues are not the same, no matter how many lies come out of the crooks in Washington

Anonymous said...

MM says Cuba is "the rare poor country with excellent health care."

I can tell you, having experienced the two-tier system of foreigners-only pharmacies vs. domestic pharmacies in Cuba, and watched helpless Cubans beg foreigners outside the pharmacies to purchase medicine for them, this is an incorrect analysis.

Macro Man said...

OK, seriously. Health care is now a banned topic, except as it impacts financial market pricing. There is really no point having (or in my case, hosting) a debate in which a significant portion of the participants essentially stick their fingers in their ears, close their eyes, and shout "the government are morons so there's no point even trying to change anything!!!"

They are of course welcome to that opinion, and should they wish to express that view, they should feel free to visit the appropriate venue to vent. But after another day of being told "ooh, you Europeans just don't understand anything" by people whose idea of exotic travel is a visit to Bob's Country Bunker, I've had enough.

Off topic health care posts now incur the risk of deletion.

Anonymous said...

Must say, love how you guys all go/went off every single time health care comes/came up.