The NY Times has
been running a series of articles on the cost of health care, which presumably
have engendered anger and frustration in many, if not most, readers. I
discussed one of them, “The
$2.7 Trillion medical bill”, on Jul 28, 2013 (The
high cost of US health care: it's not the colonoscopies, it's the profit).
It used colonoscopies as an example of why we have such high health-care costs.
A more recent piece on the cost of delivering a baby, Paying Till It Hurts: American Way of
Birth, Costliest in the World (July 1, 2013) documents the cost of that procedure. Many letters followed, most
irate and some discussing the conundrums; for example, our expectation of every
birth and baby being perfect, backed up by the threat of lawsuits, requires the
presence – and frequently deployment – of enormously high-tech resources for
every normal delivery.
One particularly
articulate and irate response came in an Op-Ed by H. Gilbert Welch, a professor
of medicine at the Dartmouth Institute for Health Policy and Clinical Practice,
“Diagnosis: Insufficient Outrage”, published July 4, 2013. Welch states
that he is “…not talking about a
violation of federal or state statutes, like Medicare or Medicaid fraud, although
crime in that sense definitely exists. I’m talking instead about the violation
of an ethical standard, of the very “calling” of medicine.” He goes on to
carefully describe both the incredible increase in prices for medical care and
the excess use of the procedures that cost the most. He adds that the prices
are only partially felt by the end-user (people) because Medicare, Medicaid and
commercial insurers pay far lower amounts than the posted prices, but that the
portion paid by people is going up, and of course the uninsured are charged
full price. He notes that “They are
largely young and employed (albeit poorly) and have little education,” although
in fact many are older, and unemployed (remember Medicaid insures only poor
people, but far from all poor
people).
His description
of the huge prices ($108 for a $5 tube of ointment, etc.) has become familiar,
and is reminiscent of the $100 hammers bought by the Defense Department several
decades ago. Less familiar, but at least as scary, is the increase he describes
in charges that come solely from the purchase of physician practices by
hospitals, which allows them to charge the higher fees that Medicare allows hospitals,
called facility fees. In one place where this was done, the amount paid by Medicare for an
electrocardiogram went up from $200 to $471, and for a colonoscopy from $2000
to $8000, in one year for the same procedure in the same location.
Welch says that “The word ‘crime’ is awfully strong. Many
prefer to call all this a problem of perverse incentives: good people, working
in a bad system,” but it is pretty clear that he has not convinced himself,
not to mention me. And yet, I know the pressures that physicians and hospitals
are under to make more money. After all, hospitals are run by businessmen, and
buying up all those physician practices and having to pay the doctors does not
come cheap, especially when insurers, particularly Medicare, are focusing on
saving money by reducing their reimbursements.
It is a fascinating, if not encouraging, situation, where I can read all
these exposes of medical excesses and then go back to work and hear from our
own hospital leaders what strategies that they are going to need to employ to
continue to make money in a challenging and competitive environment.
Welch says that “Medical care is intended to help people, not
enrich providers.” I agree, and maybe you do too, but there is an enormous
industry built around medical care and lots of providers (doctors and hospitals
and owners of various for-profit facilities, not to mention the pharmaceutical
and device industries, and insurance companies) who are indeed getting very
rich. And many of them are running very scared that their riches will decrease.
If we want a medical care system that is indeed intended to help people rather
than enrich providers, there needs to be a major change in the way that it is
paid for. We need to devise a system that encourages the provision of
high-quality, appropriate care to everyone who needs it. And does not provide
unnecessary or potentially harmful care to anyone. And is not so complicated
that it encourages work-arounds to cherry-pick profitable patients or do more
profitable procedures.
For starters, we need to have one payer, a single
payer for everyone so no people are “more desirable” or “less
desirable” based upon their insurance coverage (or lack thereof). That system
needs to have a component (not the RUC, see Changes
in the RUC: None.. How come we let a bunch of self-interested doctors decide
what they get paid?, July 21,
2013) that evaluates what a reasonable cost is for that care, including a
reasonable profit margin for the provider. It needs to have a component that
evaluates new technologies to assess whether they offer benefit over existing
diagnostic and treatment modalities, and to whom, and to not encourage
over-proliferation of expensive technologies (such as the proton-beam
accelerators Welch describes) because “if we don’t have one, they’ll go to the other
guys”. Incredibly expensive technologies, such as proton-beam accelerators,
should be purchased by the single payer system, regionally administered, and
available to everyone.
The profit-making
competitive marketplace works for many goods and services. It has no place in our health care.
1 comment:
Thank you for the article, very informative.
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