The incentive to maximize profits (i.e. minimize costs and maximize number of customers) is the benefit of a privatized market. The profit-minimizing mechanism is supposed to be competition, because then people switch away from plans that have a poor balance between price and rejecting claims. But because most plans are tied to employers, that part doesn't work.

If you had a non-profit with no competition it would be little different than the government, i.e. susceptible to regulatory capture and with poor incentives to constrain bureaucratic inefficiency.

Non-profits in a competitive market would be better, but so would for-profit insurers in a competitive market. The problem isn't that somebody is making money -- a service is being provided and somebody is getting paid one way or another -- the problem is it's too hard to switch so bad providers proliferate.

I understand what you’re saying but I don't think it’s so simple when you involve human lives. When you have shareholders and a board demanding profits, fucked up things happen like you don’t get the new MRI machine because it’s bad for the bottom line. Or you pass on the state of the art surgical robot because it won’t pay for itself quick enough. Both examples would increase outcomes for patients but don't happen because the board chooses profits. I am from a family of primarily doctors for multiple generations so I have 2nd hand experience with this crap.

I think as a society it would be totally reasonable for us to say “we don't want profiteering in healthcare”. If you set out to take care of people then your business may only cover costs, which includes reinvesting into the business and your employees. You can never be in a situation where you’re weighing profits against patient care because the conflict of interests is considered unacceptable. I would love to see more people advocate for that stance.

If you have multiple non-profits competing with each other for price-sensitive insurance customers, they have the same incentives. The new MRI machine will require them to raise premiums which will lose them customers, so the providers with the most customers will be the ones that cut costs. Unless customers can measure and prioritize service quality over price, but if that was possible it would also be possible with for-profit insurers.

If you have no competition, the problem shifts the other way. The MRI machine is ten years old, so buy a new one even if it still works, because there is no competition so nothing stops them from raising premiums to pay for it. Then the MRI manufacturer declares that they're only supported for five years and by the way the price has gone up, because they know the non-profit isn't price-sensitive and the patients have no other choice. (Unless you put government pressure on them to keep costs down, and then you're back to cost cutting.)

The underlying problem is that you need an objective way to measure whether some cost is worth incurring. The best metric we have for that is whether the patient is willing to pay that amount of money for it, having been informed of the consequences by their doctor. Sometimes the answer is no -- it really might not be worth spending a million dollars to extend the life of a 78-year-old by six months.

But it probably is worth spending $100,000 to extend the life of an 8-year-old by 70 years, even if the 8-year-old doesn't have $100,000. Which is where you want some kind of insurance.

Where we screwed up is in making "insurance" cover minor procedures that really ought to only cost tens to hundreds of dollars out of pocket, because then the insurance causes those costs to balloon up to thousands by providing a deep pocket that can fund excessive bureaucratic inefficiency. (It also doesn't help that the AMA engineered a doctor shortage so now doctors are overworked, patients are less informed and prices are higher because of supply and demand.)

I guess I'm okay with costs increasing if it means the quality of care is increasing and it's going to care providers not to shareholders. That's the implication of a non-for-profit, that all costs go back into employee salaries or equipment overhead. I'm okay with a good medical team making bank or with pricier but stellar facilities justified by results. I'm sure no system is perfect, but if we'll get the same results removing the profit motive, why not eliminate that potential conflict?

> Where we screwed up is in making "insurance" cover minor procedures that really ought to only cost tens to hundreds of dollars out of pocket, because then the insurance causes those costs to balloon up to thousands by providing a deep pocket that can fund excessive bureaucratic inefficiency. (It also doesn't help that the AMA engineered a doctor shortage so now doctors are overworked, patients are less informed and prices are higher because of supply and demand.)

This is 100% true and concurs with complaints I've heard from doctors (both bits, the broken model and artificial doctor shortage). Insurance isn't the right model for baseline healthcare. People should be willing to pay for routine care like they pay for anything else (food, TV, movies, games, etc.). It should cost $30 to get a physical because it takes a doctor 15 minutes, not $300. Insurance should kick in for absurdly expensive "disaster scenario" procedures that nobody can be expected to afford.

> I guess I'm okay with costs increasing if it means the quality of care is increasing and it's going to care providers not to shareholders.

Shareholders aren't some distinct group. One of the big "providers" of MRI machines is General Electric. Are the shareholders of that conglomerate more honorable than the shareholders of some insurance conglomerate?

Somebody is the beneficiary of any given inefficiency and they're the bad guys regardless of what kind of labels you put on things.

> I'm okay with a good medical team making bank or with pricier but stellar facilities justified by results.

The "justified by results" thing is the whole problem. What do you want to do when the system is pricey but the results are still mediocre?

> I'm sure no system is perfect, but if we'll get the same results removing the profit motive, why not eliminate that potential conflict?

If you set up the incentives in the same way (e.g. by making non-profits compete for customers) then you'll get similar results, but the existing system is bad. The problem with that is we need something better, not something the same.

And it's not impossible to end up with something worse, e.g. a non-profit with no competition that allowed healthcare costs to go up when we need them to go down because people can't afford the cost as it is.

> People should be willing to pay for routine care like they pay for anything else (food, TV, movies, games, etc.). It should cost $30 to get a physical because it takes a doctor 15 minutes, not $300. Insurance should kick in for absurdly expensive "disaster scenario" procedures that nobody can be expected to afford.

There is a case to be made that it should cover an annual physical and routine diagnostics, because early diagnosis lowers costs and you don't want people to skip their checkup to save $30 and then need a $500,000 heart transplant that could've been prevented with a $5 bottle of pills.

What it shouldn't cover is e.g. most prescription medications, because then the $5 bottle of pills goes up to $500 when the insurance is covering it, or patients request $5000 patented drugs that aren't materially better than $5 unpatented ones but the patented ones have better marketing and they stop caring about the cost when the insurance is paying.

That was how we got the "people can't afford insulin" problem IIRC. Insulin isn't patented but there was a patented form of it that was somewhat more convenient, which everybody with insurance gets. There weren't enough people without insurance to justify anyone making the generic stuff anymore, so the super expensive patented stuff was the only thing available, which the minority of people without insurance can't afford.

> Shareholders aren't some distinct group. One of the big "providers" of MRI machines is General Electric. Are the shareholders of that conglomerate more honorable than the shareholders of some insurance conglomerate?

I wonder what it would look like to mandate that suppliers must also be non-for-profit. Companies would all have to spin up non-for-profit divisions (if they don't already have one) and sell to hospitals through them. I imagine it would be massively disruptive in the short term.

Anyway I agree that healthcare should be competitive regardless of whether it's for profit or not.

My wife and I just looked into genetic testing for our child-to-be and Natera bills insurance multiple thousands but only charges people $250 or so if you pay out of pocket. The hilarious part is they bill insurance so much that it would have cost us more to have them bill insurance ($650 would have been our cut of the like 3-6k bill) than if we had done it out of pocket. Ultimately we didn't do it at all because the whole thing seemed sleazy. It's just so fucked up.

Sounds great, but to make it happen on a legal level, the public would have to mobilize enough money to out lobby the vast interests already enjoying complete regulatory capture. Also every advertisement block would have a 2 minute propaganda segment showing a grandmother suffering due to 'sclerotic non-profit ineptitude' that is inevitable when the god given American profit motive is stripped away.