HOUSE_OVERSIGHT_020989.jpg
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Presentation slides / report (kpcb "usa inc.")
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2.61 MB
Summary
Two slides from a KPCB (Kleiner Perkins) presentation titled 'USA Inc. | What Might a Turnaround Expert Consider?' (pages 295-296). The document analyzes US healthcare economics using 2008 data, arguing that government and employer funding separates consumers from true costs, leading to higher consumption, and that providers are incentivized to drive revenue through volume. The document bears a 'HOUSE_OVERSIGHT_020989' Bates stamp, indicating it was part of a document production to the House Oversight Committee.
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Locations (1)
| Location | Context |
|---|---|
Key Quotes (4)
"Employer and Government Funding System Separates Consumers from True Costs of Healthcare"Source
HOUSE_OVERSIGHT_020989.jpg
Quote #1
"When one doesn’t pay directly and gets an expensive good / service for free (or well below cost), one tends to consume more – it’s basic supply and demand economics."Source
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Quote #2
"Healthcare Providers Are Rewarded for Driving Revenue"Source
HOUSE_OVERSIGHT_020989.jpg
Quote #3
"Reimbursement for providers is generally volume-based (e.g., more procedures generate more revenue for care providers)"Source
HOUSE_OVERSIGHT_020989.jpg
Quote #4
Full Extracted Text
Complete text extracted from the document (2,406 characters)
Restructure Medicare & Medicaid: Economic Factors –
Employer and Government Funding System Separates Consumers from
True Costs of Healthcare
Employer and Government Funding System Separates Consumers from
True Costs of Healthcare
• When one doesn’t pay directly and gets an expensive good / service for
free (or well below cost), one tends to consume more – it’s basic supply
and demand economics.
free (or well below cost), one tends to consume more – it’s basic supply
and demand economics.
• Count up the subsidies:
- Medicaid: 47 million (24MM children / 12MM low-income adults / 7MM
disabled / 4MM elderly) Americans (15% of population) each received $6,872
in taxpayer funds, on average, for healthcare in 2008 through Medicaid. That
$6,872 equals ~19% of annual per-capita income for Americans.
- Medicaid: 47 million (24MM children / 12MM low-income adults / 7MM
disabled / 4MM elderly) Americans (15% of population) each received $6,872
in taxpayer funds, on average, for healthcare in 2008 through Medicaid. That
$6,872 equals ~19% of annual per-capita income for Americans.
- Medicare: 45 million elderly Americans (15% of population) averaged $7,991
per person for healthcare in 2008 ($4,875 for hospital care; $3,116 for medical
insurance and prescription drugs). That equals ~23% of annual per capita
income.
per person for healthcare in 2008 ($4,875 for hospital care; $3,116 for medical
insurance and prescription drugs). That equals ~23% of annual per capita
income.
- Private Market: 157mm Americans with private health coverage (subsidized
by employers) in 2008 paid just 16% of the total premium cost themselves for
single coverage and 27% for family coverage. In effect, that represented tax-
free “earnings” of $3,951 for singles or $9,256 for families (not including the
tax savings on their personal premium contributions).
by employers) in 2008 paid just 16% of the total premium cost themselves for
single coverage and 27% for family coverage. In effect, that represented tax-
free “earnings” of $3,951 for singles or $9,256 for families (not including the
tax savings on their personal premium contributions).
KP
CB www.kpcb.com
Source: Department of Health & Human Services, Centers for Medicare & Medicaid Services.
USA Inc. | What Might a Turnaround Expert Consider? 295
CB www.kpcb.com
Source: Department of Health & Human Services, Centers for Medicare & Medicaid Services.
USA Inc. | What Might a Turnaround Expert Consider? 295
Restructure Medicare & Medicaid: Economic Factors—
Healthcare Providers Are Rewarded for Driving Revenue
Healthcare Providers Are Rewarded for Driving Revenue
• While striving to provide the best care possible, healthcare
providers tend to have financial / legal / societal incentives to
provide more care, all else equal.
providers tend to have financial / legal / societal incentives to
provide more care, all else equal.
• Reimbursement for providers is generally volume-based (e.g., more
procedures generate more revenue for care providers), though there
are efforts to increasingly focus on quality.
procedures generate more revenue for care providers), though there
are efforts to increasingly focus on quality.
• Unlike car buyers, for example, who often disregard a dealer’s
maxed-out model and choose only the features that are important to
them and what they can afford, healthcare buyers tend to buy all the
“features” as: 1) buyers (patients in this case) are typically not
medical experts, so they defer to doctors / care providers for
decisions; and 2) buyers only bear a small portion of the costs as
someone else (employer or government) is paying for the features.
maxed-out model and choose only the features that are important to
them and what they can afford, healthcare buyers tend to buy all the
“features” as: 1) buyers (patients in this case) are typically not
medical experts, so they defer to doctors / care providers for
decisions; and 2) buyers only bear a small portion of the costs as
someone else (employer or government) is paying for the features.
KP
CB www.kpcb.com
USA Inc. | What Might a Turnaround Expert Consider? 296
CB www.kpcb.com
USA Inc. | What Might a Turnaround Expert Consider? 296
HOUSE_OVERSIGHT_020989
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