
Profit affects doctors' treatment decisions - marojejian
http://globaleconomicanalysis.blogspot.com/2013/10/unnecessary-surgeries-you-bet-doctors.html
======
cs702
Many aspects of US society today are organized under the assumption that if
every individual pursues what is in his/her best _financial_ interest, the
"invisible hand of the free market" will produce the best possible outcome for
everyone.

Yet here we have reputable doctors acting in their self interest, and the
result is that they are ordering unnecessary surgeries for financial gain.
Meanwhile, patients are essentially unable to protect themselves against this
travesty.

Maybe in this case the invisible hand cannot be seen because it is not there?

~~~
bhauer
This particular invisible hand has been hamstrung by malignant forces.
Notably, the _payer_ in a typical healthcare transaction is not the same as
the _recipient_ , splitting the typical _buyer_ role into two.

Because health insurance is now commonly provided by employers because of
World War II price controls, and because we have become accustomed to using
health insurance to pay for all matter of health care, including routine
visits, consumers are often ignorant of health care costs.

Customer A: My insurance will pay? Fine, let's do this. Cha-ching, price
rises.

Customer B: My insurance will pay? Fine, let's do this. Cha-ching, price
rises.

Customer C: Oh, insurance won't pay? How much? Whoa! How did the price get so
high?

It's no surprise then that the invisible hand works in a way that appears
flawed when one of its inputs (the buyer's sensitivity to price) is
frustrated.

People of my persuasion often make the case that if automobile insurance
worked the same as health insurance, and we used insurance to pay for oil
changes, the price of oil changes would shoot up wildly. Reason being that you
would no longer care what it costs.

Obviously the seller (the doctor in the case at hand) wants the price to be as
high as possible. The invisible hand can't keep this in check—it cannot
discipline the seller with lost sales—when so many buyers do not act with
actual price sensitivity.

~~~
jellicle
That's a fine bit of conservative nonsense you just regurgitated, coming to
the conclusion that the problem the U.S. is suffering from is "too much health
care", and therefore the solution is to reduce access to healthcare and
insurance. It rests on the assumption that patients get frivolous medical
procedures (open heart surgery for you! and open heart surgery for you! and
open heart surgery for you!) because they may not pay full price for them, a
claim which, like the teapot orbiting the sun directly opposite the Earth, has
never been observed in real life.

In actuality, healthcare is a well known example of a market failure - there
cannot be a normal market in healthcare ever, because definitionally, your
health is worth an infinite amount of money to you (how much would you pay not
to be a slave? how much would you pay not to have your hands and feet chopped
off?).

Further, healthcare prices are unpredictable. How much does a gall bladder
surgery cost? Did I mention that the patient got a flesh-eating bacterial
infection as a result of the surgery? That's true and will always be true even
if prices were posted at the door, which they are not.

The solution - which has been discovered by every advanced nation on Earth
except the U.S. - is having the government strongly involved in paying for
healthcare, insuring across the entire population to even out costs and making
sure that, e.g., medical device manufacturers can't gouge the unknowing
public. Monopsony powers nicely counteract the inherent power imbalance that
healthcare providers normally have over the sick, and everything works just
fine, costing each of those nations less to cover their entire nation than the
U.S. currently spends to cover a small segment of its population.

~~~
bhauer
> _That 's a fine bit of conservative nonsense you just regurgitated_

Conservative, libertarian, I guess they are more or less the same for this
subject. Fine.

> _coming to the conclusion that the problem the U.S. is suffering from is
> "too much health care"_

I suppose you're saying that because higher prices suggest a glut of supply?
Wait, no.

I'm not sure why you say that is the conclusion of my argument. I certainly
never said the US has too much healthcare, nor imply it.

In fact, if anything the US is supply-constrained in healthcare thanks to the
AMA, FDA, etc. There is plenty of demand for healthcare, but the supply is
pretty well controlled through regulation.

I certainly can't start selling healthcare. Even with a lot of studying, I
still couldn't just _sell_ healthcare. Making additional healthcare supply
isn't like making more supply of furniture, food, or even cars (which is
closer on the regulation spectrum to healthcare, meaning it requires a
herculean effort to enter this industry—witness Tesla).

> _therefore the solution is to reduce access to healthcare and insurance_

What?

No, I'd rather make these services _more_ readily available to everyone by
making them available in the same way nearly every other product is available
to anyone. Is the iPad unavailable to me because my employer doesn't provide
tablet insurance? Just sell me healthcare and health insurance on regular
markets, please. Nothing could be _more_ available in my opinion.

As it is, the "availability" of healthcare in my life is extremely narrow
(again thanks to what evolved from 1940s price controls). I have a small set
of options from one vendor selected by my employer. With the ACA, I will now
have that option (maybe, though it's an HSA and I've been told to kiss HSAs
goodbye) and a few other ratified options that have been selected by a central
planning committee.

If I can't afford routine health care on a regular market, I'd rather work
harder to get a better job. In a worst-case scenario, I'll plead with friends
and family or charities. I genuinely would prefer this to the current model.
I'd pick up insurance to handle catastrophic events. I'd donate more to
charity to boot.

> _your health is worth an infinite amount of money to you_

Actually, not really. If I have a quality of life issue and I can improve my
quality of life for $500, I will weigh the pros and cons and probably go for
it. If it costs $500,000, I'll suck it up until someone innovates the cost
down to something I can afford.

Even if I have a catastrophic issue and I have no insurance, and the only
resolution is something that costs $1M, this is something my family (friends,
charities) should decide. Sell/refinance property or pull the plug? Bottom
line, it's a local decision to pull the plug, not something for a central
planning board.

> _Further, healthcare prices are unpredictable_

This is not a counter-argument to using regular price signals. Services that
are unpredictable are usually billed at hourly rates or time and materials
with an estimate. If I have the termite guy out to check my house, he's not
going to be able to give me a quote until he assesses the situation. Even
then, it may be worse than he thought. But he has a price sheet of hours and
services and I can look at that and select a different termite guy if the
price sheet seems out of line. Better yet, other people will have paid termite
guys and give me a basic feel for what a termite guy charges. When he says his
hourly rate is $5,000, I'll know he's a nutcase.

Today, if I heard it cost $5,000/hr for some medical procedure, I wouldn't
even know how to react. Is that a lot? Is it low? I don't even know who I
could ask for a guess.

> _which has been discovered by every advanced nation on Earth except the
> U.S._

I don't enjoy the argument that everyone else does something a given way, so
why don't you get in line already. The way I see it, this country has been
doing healthcare _more similar_ to other countries (no true market, no price
signals) than similar to what I want for decades.

A free market can support a central-planning model inside of itself, but vice-
versa is never possible. This is why those of us who support free markets are
so sensitive to those who would shut them off. Central planners don't have to
_kill_ the free market to do their central planning exercise, but they
_always_ choose to.

We don't ask them to kill central planning so we can have a free market. In
fact, we don't even care how central planners want to arrange their centrally-
planned plan inside the free market, as long as it's voluntary. Have fun!

If I had my way, the ACA would make centrally-planned healthcare an entirely
in or entirely out proposition. Voluntary. Don't want in? Fine, you're on your
own. Entirely.

I'd opt out. And soon enough, I'd find people ready to sell me health care.
Then I'd give more to charity. I'd be so much happier.

~~~
pyoung
One major oversight that you fail to address in you hypothetical free market
scenario is that supply is still constrained. In a truly free market, anyone
can set up shop and try to market and sell their services. If I buy a TV that
craps out in two days, I either get it fixed by warranty or I go online and
write a bad review which hopefully contributes to the demise of the company.
If I get a bad surgery from a poorly trained doctor I die. That is why we have
the FDA etc, and that is why doctors are rigorously vetted and trained through
the med school/residency process, and I think most people would agree that
that is a good thing.

Another issue I have is your mention of 'charity'. Almost anytime this gets
used in a political/economic discussion, it is used to dismiss a whole class
of problems that the author does not want to deal with in their argument. In
this particular case you mention that if you cannot afford a 'free market'
doctor/treatment, then you can turn to charity to provide the funds. Of course
we all know that charity will never come close to providing for the entirety
of society, so you are left with a situation where almost everyone except
those who can afford treatment are forced to go without it. And of course the
typical libertarian response is "tough luck" or "work harder". But here is the
thing, health, similar to environmental issues has strong public effects.
There are a number of diseases and illnesses that, if left untreated in a
large portion of the population, can have devastating impacts on society. A
healthy population is a necessity of a first world economy and relying on
charity to ensure positive, society level outcomes is absurd and ignores
reality.

Look, I lean libertarian on many issues, but there are certain aspects of
society that are just not suited to a free market. I want to be able to go to
a restaurant without being terrified of catching TB from the waiter or getting
salmonella poisoning from the food. I don't want industrial companies
polluting the ocean and rivers that I surf and fish in. The free market can be
very powerful, but it is also fairly dumb, it cannot recognize when it is
doing more collective harm than good. I don't see why so many libertarians
think in terms of all or nothing. Compromise shouldn't be such a dirty word in
today's political discussions, it's a sad state of affairs.

~~~
bhauer
> _That is why we have the FDA etc, and that is why doctors are rigorously
> vetted and trained through the med school /residency process, and I think
> most people would agree that that is a good thing._

With the amount of error we have (see malpractice suits) as it is, I'm not
convinced that what we have right now is actually yielding better overall
results than a free market would with actual price signals.

Reason being that medical care quality is usually not a binary matter—with
outcomes of either total success or total failure. Usually it's a broad
continuum, and yet mediocre doctors are presently extremely difficult to
differentiate from superb doctors because of the lack of price signals.

Malpractice suits would still exist in a free market, of course. And if care
lead to death, there would be lawsuits. But in a majority of cases, bad care
would lead to non-death but non-ideal resolution. That's where price signals
will flourish.

Ironically, I see the current situation as an all-or-nothing where I want more
nuance. We currently treat all doctors as essentially similar because they
have all completed the same rigorous training and certification process, and
we few other measures to use. (Some above-market review systems
notwithstanding.)

Finally, don't be certain that doing away with regulation would lead to
certifications evaporating. It more likely would mean variation in
certification. A less politically-entrenched alternative to the AMA perhaps.
(Of course, I'm also not necessarily bowled over by certification. I put no
stock in computer programming certifications.)

> _And of course the typical libertarian response is "tough luck" or "work
> harder"._

While true, this shouldn't be dismissed cavalierly. We tend to speak without
as much political thought as the right and left—saying apparently heartless
things like "work harder." But what we mean in practice is that there would be
more emphatic pressure on individuals to work to solve their own life
situations first and only in extreme cases leverage safety nets.

We have a situation today where half of the country uses some form of
government assistance. That's not what safety nets should be for. But outside
of "character" or other intangibles, there's no incentive to avoid the safety
nets—in fact there's every incentive to use them, lest you be a sucker. Only
suckers pay for things.

When I had an electric car, I momentarily reeled at the $5,000 federal
government incentive because it goes against my every belief. But, come on.
Who is going to pass on such a sweet kick-back? I took the money. We all do.

Yes, it's _utterly impossible_ for a libertarian paradise to provide a 50%
safety net. But we feel we have such a large safety net because it's a venus
fly trap, not because it is necessary to have a 50% safety net as a first
principle.

Furthermore, many libertarians are amenable to a basic income, and with a
basic income and a free market for health care and health insurance, it's
almost a foregone conclusion that a great deal of competition would angle for
that demand.

> _Compromise shouldn 't be such a dirty word in today's political
> discussions, it's a sad state of affairs_

The trouble with compromise is what I said earlier. We're willing to allow
central planners to build within a free market, to create a voluntary
consortium of participants supporting one another through centrally-planned
distribution of resources. But reverse the tables and we're absolutely never
permitted the same freedom. Central-planning is not voluntary; it a piece of
totalitarianism.

So compromising with central planners means totally conceding. Either they
plan for you or you plan for you. I prefer planning for me, difficulties and
all.

~~~
vasilipupkin
Libretarians tend to conveniently forget that the reason we have FDA, EPA and
all that good stuff is that when it was all pure market, it wasn't working
very well - that's why we set FDA up in the first place. That is not to say
that the current system is perfect.

~~~
steamer25
In spite of the FDA, people are still [potentially] swindled by e.g.,
colloidal silver, ionized air and water, various supplements, energy drinks,
etc. Moreover, it's much harder to tout the benefits of eating e.g., oranges
or kale without funding a zillion dollar study.

I do think various products and services should be reviewed but there are
better ways to do it than with a federal agency. E.g.,
[https://en.wikipedia.org/wiki/Air_ioniser#Consumer_Reports_c...](https://en.wikipedia.org/wiki/Air_ioniser#Consumer_Reports_court_case)

~~~
projct
Much of this is due to the DSHEA[1][2], which really needs to be repealed.

[1]
[http://en.wikipedia.org/wiki/Dietary_Supplement_Health_And_E...](http://en.wikipedia.org/wiki/Dietary_Supplement_Health_And_Education_Act_of_1994)
[2] [http://www.sciencebasedmedicine.org/dshea-a-travesty-of-a-
mo...](http://www.sciencebasedmedicine.org/dshea-a-travesty-of-a-mockery-of-a-
sham/)

------
maratd
Is this really surprising? Who doesn't know this?

My wife was in labor for a bit less than a day. Baby was fine, everything
good, but apparently we were taking too long. Doctor demanded we do a
c-section. When we said we wanted to wait, she walked out, slamming the door.
We got scared, they made 60K for about 20 minutes of work. Guess what the
c-section rate at that hospital is? 50%. Not kidding. I'm in the wrong
business.

[http://www.icanofnj.com/hospitalcsectionrates.htm](http://www.icanofnj.com/hospitalcsectionrates.htm)

~~~
WimLeers
That is very, very scary. I wonder if this problem also exists in other
countries besides the U.S.

AFAIK it's nigh impossible to get away with this in the EU, or at least in
Belgium. Belgium's worried about an increasing C-section rate, but at 20% it's
still far below those in the U.S. it seems (which was ±33% in 2010/2011).

Also: is the cost actually USD $60,000 or is that a typo? That'd be about 10
times the rate in Belgium!

~~~
sarah2079
My insurance was billed $50,000 for my extremely uncomplicated vaginal birth.
They didn't pay that much because of negotiated discounts, but that was the
bill, and is what I would have been charged without insurance. (I live in the
US).

~~~
nsxwolf
If you hadn't had insurance, that's what you would have been charged, but not
what you'd have ended up paying. Their numbers are fake in the first place and
you can usually negotiate things down a lot closer to the (still insane)
insurance price.

Our deductible sucks so we do this all the time. If you have cash in the bank,
ask what they'd be willing to do if you pay 100% today (money now is worth
more than the same amount in the future, and a lot more than money discharged
in bankruptcy).

Challenge every line item. Every $600 bandaid and sleeping pill. It really
helps here if you have evidence of what someone else paid for the same or
similar procedure.

If they won't budge, take a payment plan with the absolute lowest possible
monthly payment you can get them to accept.

~~~
novalis78
You need to seek out medical bill negotiation companies. They can do this for
you, very successfully. Or just write a letter to the governor of your state,
state attorney in cc and demand a "real" bill, not a fraudulent one.

------
Ensorceled
In Ontario doctors were allowed to switch to capitation, where they receive a
lump sum for each patient under their care, rather than billing per service.

My personal physician loves it, he no longer wastes time filing for OHIP
payments and no longer worries that maybe he is only ordering procedures to
make more money rather than for a legitimate purpose.

This is a particular problem when diagnosing problems, is "your gut" or "your
greed" telling you that the patient needs this $1000 test.

~~~
CaveTech
Couldn't it then be argued that the doctor is incentivized to give short
simple treatments so he can work with more patients?

~~~
stonemetal
What would be wrong with that scenario? Shorter, simpler treatments sound like
a win for both patient and doc. They wouldn't necessarily be cheaper than
long, complicated treatments but on the whole they probably would be.

~~~
CaveTech
Because it doesn't imply that the treatment is _successful_. If I have a
condition or disease it could be misdiagnosed as something much simpler and go
unnoticed by me for years. Maybe it's not debilitating but that doesn't mean
it can't be cured or managed better.

When/how do these errors get caught? I'm sure many never are.

~~~
stonemetal
A long, expensive treatment implies success? I would much rather my
misdiagnosis cost 5 dollars than 5000.

------
xanderstrike
The two things I read in this article, minus the loaded language and
assumptions:

1\. "Medical offices which have equipment for certain services provide those
services more often than offices that don't."

They've got the equipment in-house, so of course they're going to use it. The
article doesn't take into account the possibility that patients are choosing
to go to these offices _because_ they have the in-house facilities for the
treatment they want. Going from "doctors who have X machine order X procedure
more often" to "doctors treat patients like an ATM machine" is a huge leap.

2\. "Some surgeons in Florida performed unnecessary surgeries for money."

There are bad apples in every bunch, this is why you get a second opinion
before going under the knife. Yes surgeons get paid per procedure, yes it's a
flawed system, but that doesn't mean they're all wheeling and dealing to get
as many people to submit to surgery as possible.

It's worth noting also that whenever the article says "charged patients" what
they mean is "billed patients' insurance company." Chances are the people who
don't have insurance were the ones smart enough to see another doctor before
paying.

This kind of fearmongering crap undermines confidence in medical professionals
and medical science. The vast majority of medical professionals are extremely
hard working, knowledgeable people who's primary goal is to help everyone that
walks through their door. Without trust from their patients, they can't do
this effectively.

~~~
paschutt
As a medical professional I have witnessed this all first hand, to dismiss
this as fear mongering is not very accurate. My experience was in the
Cardiology field and how they use ultrasound procedures to basically increase
the profitability of their practice. This was done by nearly every Cardiology
practice in my community. When Medicare cut re-reimbursements of
Echocardiograms guess what happened...they all just increased the frequency in
which they ordered them. If you don't think a Electrophysiologist has a
financial incentive to implant pace makers you're greatly mistaken.

------
jdietrich
I once read that traditional Chinese medicine practitioners work on a sort of
subscription basis, where patients only pay when they are _healthy_ , thereby
creating a strong incentive for the doctor to get a sick patient back to
health in a cost-effective manner.

I have no idea as to the veracity of the story or the effectiveness of such a
model (and hold no truck with the pseudoscientific methods used by such
practitioners), but it raises an interesting thought - would healthcare be
more effectively funded through some mechanism other than private insurance or
state funding? Might the debate over healthcare have been narrowed into a
false dichotomy, when there may be a far better option lying unnoticed on the
third hand?

~~~
jrs235
This (where patients only pay when they are healthy) wouldn't work in the U.S.
since a large percentage of people don't care about their health and most
people are NOW oriented.

"Why should I: stop smoking, stop drinking excessively, exercise, or change my
diet? If I get sick (not healthy), I don't have to pay my doctor!"

My question is, why do we keep talking about ACA like it provides care? It
doesn't. It mandates insurance. If you need care, it still costs you more out
of your pocket.

------
thrownaway2424
This is why single-payer is the only way to go. There has to be some panel of
disinterested experts evaluating the cost/benefit of a given treatment for a
given illness, backed up by the buying power of something really huge. Yes,
that's "death panels" to you Tea Party members following along at home.

Of course that wouldn't prevent any doctor and patient from doing whatever
they wanted, at their own expense.

~~~
MrZongle2
_Yes, that 's "death panels" to you Tea Party members following along at
home._

Well, now that you've put it _that_ way, the idea of a government-led panel --
rather than the _family_ \-- deciding that Grandma is too old to bother
treating sounds _so much better_.

~~~
steven777400
Very disingenuous. It's a matter of a government-led panel allocating
government funds. If the family wants to keep treating Grandma indefinitely,
that is absolutely their right ... if they do it on their own dollar.

The "death panel" bit is just the question of how long the government would
have continued to pay benefits.

~~~
nsxwolf
We're not always talking about vegetables on life support here. There's a lot
more to care of the elderly. My 93 year old grandfather recently got a hip
replacement and he's doing great. Would he have received that hip under the
ACA? Recall that a woman asked Obama a similar question and he said maybe she
should just take a pill.

~~~
steven777400
Who paid for that hip? If he did, or you did, or any other private party did;
then it would work exactly the same! The question here (death panels) is only
about what the government would have paid for. Since the government has finite
money, it must decide what it will and will not pay for. There is not enough
money to pay for everything. Decisions must be made.

~~~
nsxwolf
We could have a situation where it's possible that you were paying for a plan
that would pay for your hip, but the government decides to dissolve that plan
and force you to buy a new plan that's not allowed to pay for your hip.

------
nazgulnarsil
I take issue with the "most medical costs are accrued in the last year of
life" point that gets bandied about. We don't know _a priori_ which year is
going to be your last! This makes the point into almost a tautology.

~~~
kingkawn
It would be incredible to do a meta-analysis and see if you could create a
prediction model of mortality based on healthcare spending on individuals. It
could be that as the slope of costs begins to rise you can actually figure out
the mortality based on that alone and not based on disease mechanism.

~~~
eruditely
This is just talk. I doubt it is that easy.

~~~
kingkawn
right, its an idea. an idea that can then be followed up on and proven wrong
or proven right. That is how you discover things. Without talk you've just got
raw accident as the driving force for innovation. It gets some stuff done, but
its not everything.

------
Amadou
This New Yorker article examining major discrepancies in health-care costs
between McAllen Texas (which is the 2nd most expensive health-care market in
the country) and the town up the road was eye opening for me. The summary is
that when doctors invest in medical facilities (like in-practice labs) they
are financially motivated to direct patients to use those facilities.

[http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_...](http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all)

------
angersock
_" According to government estimates, each neurosurgeon at Halifax Health was
generating more than $2 million a year in hospital profits. The hospital
charged fusion patients an average of about $80,000, according to Florida
records on Halifax Health analyzed by The Post, ranking the procedure as one
of the more expensive."_

Wow.

The image of the physician as somebody who is there to help relieve suffering
is cemented as a meme, but the way the system seems to have evolved in the
past few decades is towards help as a secondary duty if any.

Unfortunately, anyone who seems to want to speak out against the system is
immediately rebutted with cries of "Why do you hate doctors?" and "They saved
my babies!".

It is very hard to have an honest discussion and self-introspection in the
current environment, especially with so much money at stake.

~~~
roc
> _" The image of the physician as somebody who is there to help relieve
> suffering is cemented as a meme, but the way the system seems to have
> evolved in the past few decades is towards help as a secondary duty if
> any."_

To be fair, with spinal fusions in particular, when a review panel says
surgery is "not medically necessary" they're recommending daily
pain/numbness/loss of range of motion is better treated with
narcotics/steroids/etc.

So it's hardly as simple as "doctors ignoring pain for profit". It can quite
easily be "insurance company ignoring pain for profit".

You simply can't ignore the role of insurance companies. Their disincentivize
to approve _any_ treatment, necessary or not, to mitigate their own costs is
also a well-studied problem.

~~~
angersock
Quite so.

Reminds me of the song "Stuck in the middle with you":

    
    
      Clowns to the left of me, jokers to the right.

------
001sky
_US Healthcare System Explained in Six Succinct Points

1) A constant battle is underway between insurance companies that do not want
to pay any claims, even legitimate ones, and doctors and hospitals
incentivised to rip off patients, insurers, and taxpayers with unnecessary
surgeries and Medicare fraud.

2) Insurance companies demand massive amounts of paperwork out of rational
fear of fraud and unnecessary treatments. Doctors perform for-profit (as
opposed to for-patient) procedures that guarantee more explanations and more
paperwork.

3) Doctors and hospitals have direct personal contact with patients, but
insurance companies don't. In cases where doctors put patients at huge risk
with needless procedures and surgeries, it's easy for hospitals and doctors to
point their finger at insurance companies. On the other hand, many sincere,
honest doctors have difficulty getting patients the care they should have
because insurers believe they are getting ripped off by unnecessary
procedures, even when they aren't.

4) Doctors make needless tests out of fear of being sued for not doing them.

5) The vast majority of healthcare costs occur in final last year or so of
someone's life. Politicians who want to do something sensible about this issue
get accused of "rationing healthcare".

6) Doctors not only have a financial incentive to prolong life needlessly,
they also worry about not prolonging life out of fear of being sued by family
members unless there is a living will, and perhaps even if there is a living
will._

== Buried a bit, but worth highlighting.

~~~
danvoell
Insurance companies typically pay out 100% of the money that comes in and they
make money on the float. There is always this assumption that they are against
higher prices of healthcare and that they battle the hospitals or the doctors.
They don't, they just raise their premiums to match higher costs. More float
equals more money for the insurance company.

------
tokenadult
I upvoted the article because it raises some important points about how people
respond to incentives in the current health-care financing system in the
United States, with a prediction of expected results under the Affordable Care
Act as the act is implemented. The kind of comments I'd be delighted to hear
from other HN participants is comments about what can be done about this.

On my part, I was just doing some Web searches for patient guides about how to
select treatments and when to get second opinions. Regardless of how health
care is paid for, patients sometimes need guidance about how to choose
physicians, and how to choose treatments. (I know this for sure because my
family lived in Taiwan for almost three years under Taiwan's single-payer
national health insurance system, and we still had to decide which doctor to
visit--we had choice in that matter--and whether or not to follow the doctor's
treatment recommendation, which we sometimes followed and sometimes did not.)
I'll keep looking for a user-friendly guide like that online, and if someone
else commenting here can link to one, I'll be very grateful for that.

------
mikeyouse
Interesting article, but the last premise is fairly disingenuous. He lists 6
reasons why healthcare is expensive, then claims that Obamacare doesn't fix
any of them, but he's entirely wrong on at least 5 of the 6.

1\. Medicare / insurance fraud --- The author obviously hasn't heard of the
Health Care Fraud Prevention and Enforcement Action Team (HEAT). HEAT led to
the record number of fraud charges in 2012. In addition to that, ACA
standardized fraud convictions, so any provider convicted of fraud can no
longer claim any federal money (Previously, a provider convicted of medicare
fraud could still collect payments from medicaid et al).[2] These are only 2
provisions of the roughly 50 that directly address fraud. [2a]

2\. Massive amounts of Paperwork --- This paperwork is moving to EHR / EMR
systems that will file it automatically for the vast majority of patients. ACA
mandates that the systems must use a standard format, so that any system built
can communicate with all federal / private insurance carriers. [2]

3\. Since doctors have direct contact with patients, and insurance companies
don't it's easy for docs to blame insurance companies for unnecessary
procedures --- I'm confused by this point, it seems a bit confused and
contradictory toward his other points.

4\. Doctors perform needless tests for fear of being sued --- The author has
clearly never heard of ACOs. One of their primary goals is to limit the number
of tests and procedures done. Insurance companies and the government will
provide fairly significant bonuses when the cost of provided care comes in
below average. [4a] In addition, the ACA provides research grants to study
best practices and patient outcomes, having published, peer-reviewed research
for common diagnoses will greatly limit the ability to sue for stuff
considered CYA. [4b]

5\. End of life care is insanely expensive --- This would've been addressed in
the ACA, but Sarah Palin, Newt Gingrich and their dimwit followers torpedoed
the 'death panels' to score some cheap political points.

6\. Life is prolonged without living will --- Again, thank Sarah Palin, Newt
Gingrich, and the Fox News brigade for their insane rants against 'death
panels' which would have directly addressed this.

[1] - [http://www.npr.org/2011/12/30/144491419/doj-posts-record-
for...](http://www.npr.org/2011/12/30/144491419/doj-posts-record-for-health-
care-fraud-cases) [2] - [http://www.healthit.gov/policy-researchers-
implementers/stan...](http://www.healthit.gov/policy-researchers-
implementers/standards-certification-rules) [2a] -
[http://www.btlaw.com/files/ALERT%20-%20Healthcare_Health%20C...](http://www.btlaw.com/files/ALERT%20-%20Healthcare_Health%20Care%20Reform%20Fraud%20Abuse.pdf)
[4a] -
[http://www.washingtonpost.com/blogs/wonkblog/wp/2013/08/29/o...](http://www.washingtonpost.com/blogs/wonkblog/wp/2013/08/29/obamacares-
cost-control-programs-may-be-contagious/) [4b] -
[http://www.nlm.nih.gov/hsrinfo/cer.html](http://www.nlm.nih.gov/hsrinfo/cer.html)
[5 & 6] -
[http://en.wikipedia.org/wiki/Death_panel](http://en.wikipedia.org/wiki/Death_panel)

~~~
chamblin
5&6 - it is nonsense to lay the blame for any aspect of the ACA/Obamacare at
the feet of the Republicans (they hated on a lot more than the death panels,
many things that also came to be). The Democrats own every vote in its favor,
and they could have any version of the bill they desired. They are responsible
for any perceived problems with the legislation.

~~~
mikeyouse
That's an interesting view that doesn't really reflect history or political
reality. Do remember that the democrats lost their supermajority in the senate
when Ted Kennedy died.

If democrats could have truly passed any version of the bill they desired, it
would likely be a single-payer system or at bare minimum include the public
option. Why didn't either of those come to be?

Also, when a party is actively lying, and has convinced almost 50% of their
dimwitted backers that a new law is going to actively kill senior citizens,
it's safe to lay some of the blame for the exclusion of that provision at the
feet of that political party.

~~~
nilsbunger
Because they _thought_ they could get a few moderate republican votes until
the very end.

In the end, thought, your parent post is correct. They got 0 republican votes
on it, so they could've made it anything they wanted that they all agreed on
and wouldn't be ruled unconstitutional.

~~~
mikeyouse

        In the end, thought, your parent post is correct.
    

It's still wrong.

The PPACA passed the senate before Ted Kennedy died. When it became clear that
the republicans wouldn't vote for any provision, the democrats had two
options.

1\. Start over with a new, more aggressive bill

2\. Pass the senate bill in the house

Since Scott Brown took away the 60-seat supermajority in the senate, the
republicans could have completely scuttled any bill at all in the senate,
preventing even modest changes to health care.

The D's had no option but to pass the PPACA.

* * * Late Edit since people take exception to my last line above:* * *

The D's technically did have a choice to not pass the PPACA. However, since 0
republicans would vote for any health care reform, their two options were
either pass PPACA in the house, or not pass any health care reform. If they
had neglected to pass any health care bills, all of their political capital
would have been wasted along with several years of debate in congress. It was
clear at the time that the 2010 census would provide numerous gerrymandering
opportunities to the Rs (who had state-level majorities in many states), which
would lead to unavoidable democratic losses in the next election. Add to those
losses the impact of a non-presidential election cycle, and the wasted
political capital and lack of progress on health care reform, and it was clear
that for health care reform to pass in the decade, it would have to be the
PPACA.

~~~
001sky
_The D 's had no option but to pass the PPACA._

Clearly they had every option. Including, doing something different. These are
senators, not 5 year old children.

~~~
commandar
>These are senators, not 5 year old children.

The behavior of Ted Cruz, et al successfully shutting down the government for
a few weeks over something party leadership told them wasn't winnable would
seem to indicate that there's really not that much difference between the two.

Yes, it's worse now, but it was already headed there when the ACA was passed.

~~~
WildUtah
I'm writing just to point out that Ted Cruz had nothing to do with the
government shutdown, except taking unearned credit for it. House Republicans
were the body that planned and forced the shutdown. The Senate passed a clean
CR over minority objections before the shutdown.

I would not deny that the Honorable Junior Senator from Texas does comport
himself like a five year old.

~~~
commandar
You are, of course, correct. While Cruz was essentially the face of the wing
of the party responsible for the shutdown, he didn't have a direct vote
causing it.

The point still stands, however, that the party leadership did _not_ want that
fight and knew that they were unlikely to get any real concessions. Boehner,
for all his flaws, got pushed into it by the even more unreasonable element of
the GOP.

------
riahi
It seems fun to hate on "evil" doctors, but why do we consider doctors as any
different from "personal business consultants" who's business expertise is
health?

I'm curious how you guys think medical professionals should actually be paid /
how can pricing be done "fairly" in a system where there can never be
"information symmetry"?

~~~
PavlovsCat
> _It seems fun to hate on "evil" doctors_

I can only speak for myself; I made very good experiences with doctors
whenever I myself was sick, but I also worked for 11 months on a cancer ward a
while ago, and some of the stuff I saw there was kind of rage inducing. Nearly
all nurses were fine, most doctors were fine, but the ones that weren't,
really really made up for that. I don't think doctors are all evil, nowhere
near, but the reservations and skepticism I do harbour, I don't harbour
because it's "fun" to have them. It's merely a way to cope with real shitty
stuff that does exist.

> _I 'm curious how you guys think medical professionals should actually be
> paid / how can pricing be done "fairly" in a system where there can never be
> "information symmetry"?_

First off, of course there can be "information symmetry". Not between patient
and doctor as much as among medical professionals and health insurance
providers. Medicine isn't Voodoo, things are reasoned about and tested,
usually, and given the right laws and enforcement of them, everything can be
documented and subject to review.

As for how to improve the situation: while I haven't thought in-depth about
this, but how about a flat hourly rate for doctors etc.? That is, not being
paid for the kind of treatment, but rather for being on the job. Of course,
the _hospital_ would need money depending on what kind of treatments they do,
but if there was no (legal) way to pass on that "profit" to the staff itself,
there would be no incentive for malpractice based on greed. As I said, I
haven't thought much about this and maybe I am overlooking other problems this
might cause (like offloading patients that are too expensive and/or too much
work to other specialists, like a hot potato), but I wanted to put this out
there anyway.

------
hkiely
The real way to solve this problem is to get the patients motivated and
involved in their own care and treatment decisions. In a free market, driven
by true choice, patients have the responsibility of learning more
independently about their diagnosis, treatment options, and their physician.
By doing research, a patient may be driven to get a second or third opinion
when faced with a diagnosis like cancer. By utilizing healthcare savings
accounts (HSA) and high deductible low premium insurance plans, patients are
driven to find the best doctor with the lowest prices. This is how the
invisible hand works, choice and competition on each side of the market. The
result- A decrease in price and an increase in quality.

------
mhb
Why is NEJM in this title ( _Profit massively affects doctor surgery choice
(NEJM)_ )?

~~~
rryan
To indicate the original place the study was published?

~~~
mhb
Maybe that shouldn't be in the title here of a blog post that references a
newspaper article that references the NEJM study
([http://www.nejm.org/doi/full/10.1056/NEJMsa1201141](http://www.nejm.org/doi/full/10.1056/NEJMsa1201141)).

Forgive the pedantry. I'm sure the title will be changed soon anyway.

------
vacri
An ex-colleague of mine went into the pharmaceutical industry to work as a
drug rep. They get $X to spend on each doctor they visit as part of their job.
My colleague was quite moral, and she would only use the money for the
_stated_ purposes: improving the doctor's practise. Charts, equipment,
training. Usually it's spent at discretion, and often spent on football
tickets, holidays, etc.

She reported that some doctors already used it for practice-improving stuff.
The middle set of doctors were a bit like "oh well, the gig is up". But the
third set of doctors were _outraged_ that she should tell them how to spend
_their_ money. They saw this drug company money as part of their personal
income.

------
EricDeb
I didn't read the article thoroughly, but one point to think about is patients
may be more likely to visit with a particular doctor if said doctor frequently
performs the surgery they believe will help them.

I am the perfect example of this. I went to a particular doctor with the
expectation that he would eventually perform the surgery I desired. He did
technically evaluate if I was a good candidate, but I got the impression his
patients only visit him if they want the surgery performed. He also does a lot
of these surgeries, making him more experienced and more attractive as a
surgeon. I would imagine this Florida doctor is similar.

------
pbreit
The problems with US healthcare seem fairly well known. But I want to know
what sorts of solutions are promising. I don't think single payer is right for
the US, it's much too anti-American. I also don't think a free-market free-
for-all would work...medicine is way too stacked against the customer.
Obamacare, while seriously flawed, is probably still a step in the right
direction. Would getting employers out of the business help? I keep hearing
about insurance company inability to compete across state lines. What else?

~~~
dllthomas
I think the cap on the MLR is probably the single best thing in Obamacare. It
seems to shift incentives in a meaningful way. This just addresses incentives
for the insurance companies, though, not doctors...

------
jotm
I hate that we're not allowed to self-medicate. I understand the risks, I've
done my research, I know more than my local pharmacist, yet they won't give me
s&&t without a piece of paper signed by someone who supposedly knows better.

I always had a strong suspicion that the doctors prescribe too many
medications (which were also brands more expensive than the generics). Not so
paranoid after all.

------
ffrryuu
Doctors love to give you drugs that the salesman already gave to the doctor,
it's sad. Here have a free sample!

------
nilsbunger
In general most people will operate in their financial self-interest over the
long term.

Taking it back to startup-land, this is why sales team compensation structure
is discussed at such length at the board level. You generally get exactly what
you compensate for, and it's easy to create unintended consequences.

------
yequalsx
I have recently come to the conclusion that ultimately problems like this stem
from high income inequality. Humans have a tendency to compare themselves to
people who are better off than them. Fifty years ago doctors were very well
off in general and were esteemed. But now this is not the case and the desired
prestige can now only be accomplished through financial gain. Back when income
inequality was not so great other motivations came into play besides profit.

There is a perniciousness in American society where too many people have
bought into the "I've got mine, forget you" attitude. Where money is the main
source of prestige of a person. The problem highlighted by the article is a
societal one. Profit is not a great motivator of innovation and ought not be
as high a goal as it currently is in the U.S.

What fascinates me the most is that the segment of society that appears to be
doggedly in favor of a profit first public policy appear to be people who
follow a book that says that love of money is the root of all evil.

------
cobolorum
bhauer: a few flaws in your analysis. Insurance companies do not like prices
being high either. They have to raise premiums and this discourages people
from purchasing insurance. Insurance companies have a vested interest in
making sure that you do not get ill. They have to pay if you get ill. This is
the reason that people who smoke pay higher insurance premiums.

Outside of other comments: of course profit changes doctors' decisions! Why
wouldn't it? The medical industry is a business. It is, however, the most
regulated industry in the USA. Tech is the least regulated. In the tech
industry progress and innovation abounds. It does not in the medical industry.
I see a correlation there.

------
zaidf
Does defensive medicine have no role in doctors opting for aggressive
treatment to the conservative alternative?

------
crazy1van
Of course this is true. How could this be at all surprising?

------
VladRussian2
only in software engineering tools and runtimes are choosen based on what is
best for the project/customer.

------
notdrunkatall
_It would have been nice if Obamacare fixed some of the above problems.
Unfortunately, Obamacare did not fix any of them._

 _Fraud, ridiculous amounts of paperwork, and incentives to do the wrong thing
were everywhere you looked before Obamacare. The same problems exist now._

 _Worse yet, Obamacare added to the mess by over-charging millennials and
their kids, and undercharging smokers and others with unhealthy lifestyles.
Except for those below certain wage thresholds, insurance costs are likely to
increase._

Yep.

~~~
sshThis
Nope. This article's main point indicates that government should further
expand into the healthcare business.

Obamacare sets the vital, initial steps into the industry.

Conservatives love to jump on this line because it bashes Obamacare. IN
REALITY, it means it didn't go far enough.

~~~
erichocean
_Obamacare sets the vital, initial steps into the industry._

False. The US federal government initially entered the private healthcare
market in 1966, with the passage of Medicare. The transformation from private
to public healthcare has been going on for nearly 50 years now.

