> So is Medicare paying more than similar systems in other countries, or less, or about the same?
You can't compare the raw dollar values because the economies aren't the same - $5 in New York doesn't mean the same as $5 in Tulsa, OK or $5 in London. That's why things like PPP comparisons exist (except you can't use a PPP comparison in a specific vertical like this to answer your question, because that is the very question you're asking in the first place; it'd be a tautology).
But there is an easy answer to the question, because Medicare is paying less than what would be necessary to sustain a medical practice, if you assumed that all doctors, nurses, secretaries, and janitors worked for free, and if you assumed that building and office space were free and required zero maintenance. We know that because we know they reimburse less than COGS, which is why we know their rates are nowhere near sustainable by any standards, let alone compared to other countries.
> It's not mere profiteering - it's more like a feedback loop.
Yes, that's exactly what's happening. It's a positive feedback look (in the literal sense; it's not a positive outcome for us).
The positive feedback loop comes from the fact that Medicare has neither a mandate nor an incentive to reimburse rates that are remotely sustainable, so it sets rates that are arbitrarily low. Providers are forced to accept these, and then pass them on to private health insurers. Private health insurers ultimately pass these costs on to patients in the form of higher premiums, but patients have no choice in the matter, because they can't choose providers based on how much the provider will overcharge their health insurer[0]. They can't choose providers based on price at all, because there's no price transparency in the system. And there's no price transparency in the system because that opacity is essentially mandated by law[1], and it's necessary for this system in which Medicare uses private insurers to essentially pad its own budget (by reducing its costs far below what would otherwise be sustainable if they were truly the only payer in the market).
> For-profit medicine works effectively and affordably in at least one other country with a cost of living otherwise on par with ours
Which country are you referring to? Truthfully speaking, every country has a for-profit system in that their healthcare systems are still subject to a profit motive (yes, that includes government-run systems like the IHS and NHS). Most other countries with comparable development levels to the US use privately-run systems anyway, so I'm not sure I understand which one country would be relevant to single out.
[0] Which is a different question from how much they (the patient) will be charged
[1] Not directly, of course, but indirectly - that opacity is the natural outcome of this setup
For the country I'm singling out, it's Japan, because of the massive structural parity between the US and Japanese systems - both using private employer-driven insurance, private providers, and government subsidy for those who can't afford their own insurance. And both are modern first world countries with a first world standard of living and economic complexity.
Here's the thing that gets me... the US is the only first world country with either our costs (most are about half as much per capita) or our massive coverage gap (most provide universal coverage). This suggests to me that it's not so much there's a right way to do it, as there is a wrong way, because a wide variety of other approaches, from mostly-private (Japan) to mostly-socialized (Sweden) are all working just fine. It's only the US that is so broken.
You can't compare the raw dollar values because the economies aren't the same - $5 in New York doesn't mean the same as $5 in Tulsa, OK or $5 in London. That's why things like PPP comparisons exist (except you can't use a PPP comparison in a specific vertical like this to answer your question, because that is the very question you're asking in the first place; it'd be a tautology).
But there is an easy answer to the question, because Medicare is paying less than what would be necessary to sustain a medical practice, if you assumed that all doctors, nurses, secretaries, and janitors worked for free, and if you assumed that building and office space were free and required zero maintenance. We know that because we know they reimburse less than COGS, which is why we know their rates are nowhere near sustainable by any standards, let alone compared to other countries.
> It's not mere profiteering - it's more like a feedback loop.
Yes, that's exactly what's happening. It's a positive feedback look (in the literal sense; it's not a positive outcome for us).
The positive feedback loop comes from the fact that Medicare has neither a mandate nor an incentive to reimburse rates that are remotely sustainable, so it sets rates that are arbitrarily low. Providers are forced to accept these, and then pass them on to private health insurers. Private health insurers ultimately pass these costs on to patients in the form of higher premiums, but patients have no choice in the matter, because they can't choose providers based on how much the provider will overcharge their health insurer[0]. They can't choose providers based on price at all, because there's no price transparency in the system. And there's no price transparency in the system because that opacity is essentially mandated by law[1], and it's necessary for this system in which Medicare uses private insurers to essentially pad its own budget (by reducing its costs far below what would otherwise be sustainable if they were truly the only payer in the market).
> For-profit medicine works effectively and affordably in at least one other country with a cost of living otherwise on par with ours
Which country are you referring to? Truthfully speaking, every country has a for-profit system in that their healthcare systems are still subject to a profit motive (yes, that includes government-run systems like the IHS and NHS). Most other countries with comparable development levels to the US use privately-run systems anyway, so I'm not sure I understand which one country would be relevant to single out.
[0] Which is a different question from how much they (the patient) will be charged
[1] Not directly, of course, but indirectly - that opacity is the natural outcome of this setup