Oh OK. This is where the $20K to have a baby came from; from a Canadian, of course.
To start with, it doesn't cost $20K for an uncomplicated labor and delivery in the US. It's going to be more in he range of $4.5K to $10K, despite a Canadian's assertion of what "Superstore" the comedy says (really? That the source of this "understanding"?).
What the person having the baby actually pays would range from $0 to $3,500, depending on their insurance plan. Insurance would cover the balance. That's just a fact that is easily verified. I happen to know for sure what it costs, but you can simply Google it and get some more or less accurate figures. For example;
https://smartasset.com/financial-advisor/cost-of-having-a-baby
But hey, if you don't want insurance and you don't want to pay anything, you can have some midwife work for barter - maybe a basket of eggs from your chicken coup - and have the baby on your living room sofa. If that's how much you care about yourself, your baby or your loved one, go for it. OTOH, if you really care and you want all of the best in case something goes wrong, you pay for insurance that pays the hospital room with all of the machines and staff and the doctors that have the latest greatest tech and training to handle any emergency. Or if you can't pay for regular employer group insurance, you seek an ACA plan or apply for Medicaid. This is not rocket science.
Now, is it seriously being proposed that in Canada doctors and nurses receive $0 salary? Hospitals just magically appear full of equipment and cost $0? Facilities just maintain themselves via little elves the appear in the middle of the night to do the work with magic pixie dust?
Come on man. Of course the cost in Canada isn't $0. People paid for your brother in-law's care through taxes. The entire Canadian medical system is maintained through taxes - except all the people that bought private insurance (rhetorical question - why would they do that?!!!?).
In the US, some of the system is paid for by taxes and a lot is paid by private citizens and corporations. Instead of paying for it through taxes they pay for it through insurance companies and sometimes directly to the care providers.
It doesn't matter what system you're working in, private or socialized, a lot of relatively healthy people are paying in money they won't personally see a return on to care for a few very sick people. It's called a "risk pool". At least in private systems, you can pick and choose which mix of level of benefits you want at what price. In socialized, you have no choice. It's one size fits all.
Now, you might ask why the middle man of insurance would be desired in the US. Don't they make a profit? Wouldn't removing that profit be a savings to "the people"?
The short answer is "no" - but, since no one on this site, given the lack of knowledge and some of the anarchist/socialist leanings, is going to believe that or take it on faith because I said so, allow me to explain.
Before we address the cost impact of profit, let's look at overhead. Both the government and insurance companies have overhead. Some say the government does it cheaper. That is a fallacy. The often quoted Medicare overhead statistic is misleading. It is calculated on the the wrong variables. They use overhead divided by cost of services provided to arrive at a % overhead (aka admin cost) that is lower than private insurance. The problem is that that Medicare members cost 4 times what under 65 costs. So that calculation dilutes the % admin cost by a factor of four. The correct calculation is admin cost per member. On that appropriate metric, Medicare is no cheaper than private insurance and, in some instances, more expensive than private insurance. In fact, the federal govt (CMS) worked with private insurance to create Medicare Advantage plans. This is Medicare that is sold and managed by private insurance - about 35% (and growing) of Medicare is Medicare Advantage plans. The govt did that because they recognized they could not manage as well as private insurance (look it up if you don't believe me). Also, many CMS administration costs are hidden in other budgets. Those costs are not in the erroneous, albeit often cited, metric I mentioned.
Profits - insurance makes profits on volume. So low margins/high volume. If you removed profits, you would need a sharp pencil to find the savings in premiums - also, much private insurance is through not-for-profit companies, like some Blue Cross/Blue shield plans. Their premiums are no more affordable than the big for profits' offerings. But that's not all. The for profits are able to make profits because they compete in the market and people buy a well managed company's products on price and quality. Competition keeps price low as possible. Insurance must implement cost savings measures and the cost savings outweighs the profits. So save $10 and keep $1 as profit. The other $9 gets passed on to the consumer (you).
How do they save money? Regional based carefully tailored contracting with care providers. Fraud detection programs (there are $billions in fraud every year perpetrated by care providers). Dropping of contracts with providers that deliver poor care. Utilization management (e.g. pre-auth checks won't authorize medically unnecessary procedures, drugs and technologies), care management programs that ensure that the chronically ill are maintaining treatment and not decompensating (e.g. one on one calls to members/patients and connecting with care providers to alert them to gaps in medically approved protocols - all through data analytics). Also, performance based contracting with care providers. There's much more. That's just a few examples to illustrate. Again. Medicare/CMS/Federal govt found it could not do these things well.
No one ever talks about any of this. They just want to gripe about their low grade poor reality non-correlations.
