Yes. I don't know if that's the primary factor that gives them their market power; it might be even simpler than that. But yes, they absolutely do.
Unless you're Kaiser, in which case you're the insurer and most of the providers, which is the whole idea behind Kaiser. But every other insurer --- and overwhelmingly, Americans aren't on Kaiser --- is beholden to providers. And of course, Kaiser competes with providers for service providers and vendors.
Then why isn’t everyone on Kaiser? Because they’re stupid?
Providers is also kind of vague. You show up at a hospital, does the nurse practitioner who does your intake set the price of your ER service? Who specifically sets the prices?
I acknowledge there are issues on the provider side, but it is disingenuous to say that providers set the prices alone. Payers introduce a ton of inefficiencies in billing and also remove money from the system, which negatively impacts care. They implicitly affect care patterns and pricing through denials.
HMOs, for all their problems, have many advantages as well, such as the aligned incentives you allude to.
tptacek|1 year ago
Unless you're Kaiser, in which case you're the insurer and most of the providers, which is the whole idea behind Kaiser. But every other insurer --- and overwhelmingly, Americans aren't on Kaiser --- is beholden to providers. And of course, Kaiser competes with providers for service providers and vendors.
doctorpangloss|1 year ago
Providers is also kind of vague. You show up at a hospital, does the nurse practitioner who does your intake set the price of your ER service? Who specifically sets the prices?
pilotneko|1 year ago
HMOs, for all their problems, have many advantages as well, such as the aligned incentives you allude to.