Thursday, May 22, 2008

The Cause of Spiraling Health Care Costs

A colleague of mine received my email with the “Open Letter” and my comment that I think that the third party payer system is the true root problem of the spiraling cost of health care.

He answered:

“I feel that not only is it the greed of third party payers stifling
our health care choices, the health paradigm itself is failing. The
paradigm allows for patients to abuse their bodies and then hope for a
pill/surgery/procedure to get them up and running again. This taxes
the system and rewards those who can care less about their health. It
does nothing to empower people to live healthier lives.

I completely believe in a system that allows for healthier people to
pay fewer premiums. Less utilization = lower premiums. Stop eating
your cheeseburgers and diet cokes and maybe you'll save $$, let alone
live extra years.

When a patient of mine was allowed to degrade under physical therapy
for 8 straight years under Medicare, and then regain neurological function
under my care in 2.5 months, we have a problem. Not only that,
Medicare then wants to cut him off.

Bullshit, bullshit, bullshit. How about rewarding excellence in
care and in patient behavior? Doesn't happen”

My answer:

The third party payer system does not equal “greed of the third party payers”, not at all, not at all. The third parties will always behave the same way, coming up with anything to save money. It does not matter if the third party payer is a for profit company or a government institution. The behavior will be exactly the same. roof: I have seen all the exact same shenanigans that HMOs do to us here in the US exercised by the government run "sickness fund" in Germany. No difference at all, none, zero. I cannot stress that enough.

The problem is that the people involved in making the decisions to spend the money, parties one and two have no interest whatsoever in saving money. Patients want the best, most expensive, most modern, coolest treatment of the planet and yesterday and will all the creature comforts please. Physicians want to be nice to the patients and want to earn money. The more physicians do, the more they earn....
The problem is that we are "shopping with someone else's credit card" and therefore ready to waste.

As you correctly point out, people do not care about prevention - hey, why should they, if something happens, "it's all covered" anyway, so why worry. Unless it starts to become costly to neglect your body and your health, people will not go for prevention. Anybody who says otherwise is a dreamer and lives in idealistic lalaland....

That is where the solution is:
People have to pay for their health care. Period. Problem solved. There was a large study done by the Ayn Rand foundation in the 70's: one group with an insurance that covers everything- with 5% out of pocket and one group with 50-50% out of pocket and one group where the insurance covers only 5%, and 95% are out of pocket.
What happened: the care for the 95% out of pocket was the least expensive - but they reduced health care consumption indifferently, they reduced consumption of truly needed as well as superfluous tests and treatments.

Every socialist will cry out when hearing this reasoning: "see, people are going to get breast cancer, they are going to neglect their health to save a few dollars, this is immoral, blablabla. Cry, cry...insert tear jerker anecdote here....

My reasoning: at some point in life people have to learn what is important and what is not. You might as well start now, and the earlier the better. In time, people will realize what they really need and what they don't need. Today are not the seventies and with the Internet providing information, it is easy to tell the difference between necessary and superfluous tests.

And: only when a patient asks the physician: "What is the most cost effective way of dealing with this?" and then insist on the right solution, only then will the "unstoppable increase" in health care costs abate...
Your Obgynthoughts

1 comment:

Kalpesh Vaghasiya said...

100% agree with you. Everybody wants coolest, most expensive therapy in the world and shopping with thinking that I am not paying it by myself - it's someone else's credit card. Change out of pocket to 30% and people will think 10 times before wasting money.