Thursday, April 13, 2006

Show Me the Money

I’ve been thinking a lot about the difficulties with the costs of healthcare today, the growing number of uninsured, and how downright impotent us doctors feel to effect change with the system. I guess our impotence is derived in part from the lofty expectation of the Hippocratic Oath. We are patient’s advocate after all, with little real understanding of the political and business jet streams above our heads that move policy across the landscape of the healthcare arena. Unfortunately, these business and political interests are often contrary to our patients’ best interests. How do we influence these jet streams for our patient’s benefit?

I feel a major problem in our misunderstanding of controlling costs of healthcare lies in a superficially simple (but realistically exceedingly complex) observation – people don’t have to pay for the services rendered when they get sick – insurance does. In ways, this encourages people not to ignore their health care if they become ill since the monetary disincentive does not exist. Doctors don’t have to worry about the cost of procedures or tests for their patients. They order tons of blood tests, EKG’s, x-rays, fancy scans, and the like because the patient needn’t worry about the bill. No test is too frivolous or too repetitive. Computers make daily (or even hourly) laboratory blood test ordering easy. But are such daily tests necessary? Liability concerns help counter the guilt regarding the expense. Protect theyself, o’ physician, lest ye be sued! (And believe me, this is no small issue.)

But what if costs were disclosed? What if costs were available online or during the ordering process on the Electronic Medical Record for physicians to make judgments about how many tests they REALLY need? Might it affect care negatively? I doubt it. Would it change outcomes? Probably not. Reduce cost? Absolutely. Is it difficult to implement? No.

And taking that concept one further, what if the patient could see the costs of expensive technologies? What if the costs of implantable defibrillators were available online? (For instance, it’s easier to find what a defibrillator weighs, than what it costs…. I checked Google, the big three ICD manufacturers websites [Guidant, Medtronic, St. Jude] and could find none.) Stents? Would patients always want the “expensive version” of technology or would they settle for a lesser model if it saved them or the system a few bucks? I don’t know. But to shield the ultimate consumers (the patient and their doctors) from these costs is counter-productive and serves to permit price increases to occur without public awareness and limits free-market competition. Transparency in healthcare costs is just as important as transparency on corporate financial statements. Maybe more. And this won’t just help the doctors and patients.

More and more doctors help hospital administrators bid on bulk purchases of expensive technologies. You see, these administrators really don’t know what’s “in” and “cutting edge” in a particular field, but they know to ask an experienced doctor for guidance (after all the doctors have to agree to use the purchased technology). Wouldn’t it be nice for the hospitals to know the retail price for equipment across provider lines and thereby make more informed decisions in concert with these physicians?

Anyone who has read The Tipping Point by Malcolm Gladwell knows that big epidemic changes can occur through the action of small, summative, incremental actions. Price transparency might be one of these actions. I say, show me the money.

--Wes

4 comments:

Anonymous said...

Patients should also be aware of what physicians collect, as opposed to what they charge. A vast difference, based on insurance company presets, and the main reason doctors see more and more patients in less and less time. This inevitably leads to poor care, and related to your example, more unnecessary tests due to the lack of a good history/physical. The docs count on the tests doing the work they personally do not have time for.

The Medical Blog Network said...

We have been beating the drum of healthcare transparency over at TMBN ever since getting started. Without openness about availability, relevance, quality, and pricing there can be no meaningful reform.

Check out my recent commentary on Health IT World: Consumers at the Gates: Resistance Is Futile

... and an older blog post outlining the vision: Open Medicine vs. Single-Payor Healthcare

DrWes said...

Thanks for the tip, Medical Blog Network!

And anonymous - you're right on. People should know the difference between charges (which can exceed Medicare reimbursement rates by a factor of two to six!)

The Medical Blog Network said...

Dr.Wes, I would encourage you to register on our site. We are working on new services to help promote transparency and increase trust in patient-physician relationships.