We need health cost containment before fixing the payment method
By Jack Lohman
Let’s take a
time out.
As the nation
struggles with how to pay for health care costs that are spiraling
upward at an annual rate of 17%, five times the rate of inflation,
we are virtually ignoring the reasons behind the escalating costs in
the first place. We are engrossed in payment methods rather than
cost containment, all while the industry seeks innovative ways of
taking home a bigger piece of the national pie.
Some see the
“free-market” as our savior when, in fact, the slow conversion to a
free market system that began a decade ago is the reason we are in
trouble today. And it will get worse.
Years ago it
was considered fraudulent for hospitals to hire their own
physicians, for physicians to own an interest in a hospital to which
they referred patients, and for physicians to refer patients to an
outside laboratory in which they had a financial interest. We also
had a certificate of need program that prohibited hospitals from
leap-frogging the hospital down the street, thus churning expensive
high-tech imaging systems.
Thanks to $100
million in annual campaign contributions from the health care
industry to politicians, all of these cost-containment rules that
protected the system from excesses have been eliminated, and the
ensuing free-for-all began. It thrives today, but this maneuvering
also promises to backfire and become the undoing of a once-proud
medical profession.
The only
competition that resulted is between hospitals and clinics as
physicians move expensive and profitable testing into their clinics.
Hospitals that once used time-shared mobile MRI services -- and then
bought their own in-house system because volumes justified it -- are
now finding their local clinics adding the mobile MRI service and
leaving hospitals without patient volumes to pay for their system. In the
meantime patient testing is increasing in the clinic because of the
added profit incentives.
Is anybody
watching the growth of these cash cows? Or are we totally blinded by
the conflicts of interest that a free-market system demands?
Don’t get me
wrong. Physicians should be paid extremely well, but not on the
basis of how many tests they order or surgeries they perform.
Doctors should have the freedom to refer their patients to any
hospital or independent lab for expensive tests, as long as they or
their clinic do not have a financial interest in the service.
Hospitals should be prohibited from employing their own physicians,
and physicians should be prohibited from referring patients to a
hospital in which they have a financial interest. What’s not to
understand about these no-brainers?
There is one axiom that has held for centuries: “He who has the
gold, rules.” Currently that gold is held by the business leaders
who provide employee health care and who are losing sales to
products that are made in countries that have universal health care
systems. Their competitors do not have to add health costs to their
product price, thus some American companies are moving jobs offshore
while others are preparing to take over the health care system.
Physicians should look at how the dominoes will eventually fall. The
current system is unsustainable and will eventually be taken over by
the MBAs and CEOs and shareholders. If left alone the current system
will transition to corporately-controlled HMOs, and independent
physicians will be a thing of the past.
We
have two sustainable options: A Medicare-for-all system, but better
than Canada’s, or a socialized system, like that in Britain and our
own VA and armed services systems. The latter uses salaried
physicians while the former still leaves room for fraud and overuse.
In the end, health care can
be either a social service or a market commodity, but not both.
But
make no mistake about it. Regardless of the system we choose, the
public will bear the final costs. The important question is: How
long will it take us to correctly fix it? We can fiddle with costly
workarounds and ultimately settle on one of the above. Or we can fix
it without delay and move on to other national policies that are
critical to our nation.
-- Lohman is a retired business owner from Colgate and founder of
http://www.ThrowTheRascalsOut.org. He can be reached at
jelohman@gmail.com.
Source:
http://www.wisopinion.com/index.iml?mdl=article.mdl&article=5463
Massachusetts -- A healthy direction -
By
John McDonough | October 14, 2006 -
IT HAS BEEN six months since Governor Mitt Romney signed health
reform into law, and Massachusetts is engaged in an
unprecedented experiment to expand affordable health insurance
coverage. Thousands have realized new benefits, much progress
has been made, and difficult issues remain unresolved. It's a
work in progress and residents should take pride in
accomplishments to date. See complete article
HERE.
Healthcare
Economist on P4P (Pay-for-Performance):
TheHealthCareBlog.com, an excellent
resource and discussion Blog, discusses an
article from the Healthcare Economist
about why P4P isn’t enough and
implicitly why we need budget and supply
constraints to get health care costs under
control. (Hint, it isn’t always possible to
tell when the curve is flat or heading
downhill).
Good Links:
http://healthcare-economist.com/2006/10/12/p4p/
and
Pay for Performance -
does it work?
Comments:
In my mind the most valuable addition to
health care would be that of a national
patient database operated by Medicare or the
VA (or Halliburton, if you are of that
persuasion) and would include all of the
nation's patients. Of course a patient opt
out is necessary, and heavy security with a
triple password would be needed.
The process
would start with the patient sitting in
front of a computer and answering a lengthy
questionnaire that the physician could use
for assessment. Given all of the patient's
answers and physician remarks the system
would then provide a list of theoretical
solutions from the medical books plus
a list of treatments used by physicians
across the country (physician and patient
names excluded). If your physician's ideas
are out of the norm, s/he might reassess
them. If s/he decides to move forward anyway
it becomes a matter of record and is passed
to the next physician thousands of miles
away. If the drugs that are being prescribed
have nasty side effects or will react with
current medications, a flag would be raised.
Deaths due to medical errors would be
drastically reduced, and all medical data
would be available in emergencies.
Your
physician may be perfect and never need
guidance, but others are not and especially
new physicians are not. This would serve as
an excellent tool to minimize practice
variations and to train new physicians.
As for the
Pay-for-Performance system above, I'd like
to see physician referral patterns as a
consideration. Being able to decide between
two physicians, one never referred to and
the other always referred to, would be
helpful. But the downside is that new
physicians are at a distinct disadvantage
and that type of system can turn into a
popularity contest and mutual
back-scratching tool.
I also worry
that physicians and hospitals will avoid
difficult patients so as to not negatively
affect their stats.
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