Free Market Face Palm

Face Palm

This has been in my stack for near 2.5 months now.  The good Dr. Greens writes:

Wow.  Really, really good Washington Post story about how there’s a $50 treatment for a serious eye disease that affects the elderly, but doctors regularly choose the $2000 treatment, bill Medicare, and we all pay.  Ugh.

The story goes something like this:

Two equal treatments, one sells for $50 and the other for $2,000.  Docs prescribe the more expensive one because they make more money.

The complaint?

And another great example of why health care is so much more expensive in the US than the rest of the world.  Other countries simply don’t get lobbied into wasting money on Lucentis when Avastin will do the trick nor are their doctors financially rewarded for doing so.

Right – greed.

Wanna know how to fix it?

Expose the patient to the cost of the treatment.

4 responses to “Free Market Face Palm

  1. Doctors make extra money by pushing expensive drugs that medicare has to pay for, therefore the solution is make patients pay for it?

    To a degree, I’m with you. Medicare ought to set some kind of limits on treatments that doctors can only exceed when it’s medically necessary/reasonable/whatever, and if the patient chooses a more expensive but unapproved drug they have to pay the difference.

    The problem with that solution is that the government is now approving whether or not you get the fancy drug or the basic drug, and suddenly Michelle Bachmann starts yelling about death panels. Nonetheless, this has been the private insurance solution for years; they set a U&C level for procedures and you are on the hook if the doctor charges more.

    So, exposing the patient to the treatment cost is one part of a good solution, but that only works if (1) the doctor provides an unbiased opinion about the benefits of the treatments and (2) the patient understands the costs upfront. The former is impossible as long as they’re getting kickbacks, so we need to eliminate that. The latter is impossible because hospitals and physicians simply refuse to be transparent about costs, and they consider insurance coverage to be the patient’s problem to figure out. So, the answer will end up having to be some more regulation after all.

    • The former is impossible as long as they’re getting kickbacks, so we need to eliminate that.

      I mostly agree – though it presupposes an awfully negative view of doctors.

      The latter is impossible because hospitals and physicians simply refuse to be transparent about costs, and they consider insurance coverage to be the patient’s problem to figure out.

      I admit that our two largest medical expenses, the birth of our two kids, came and went without me going into the line item detail of the expense.

      However, if I was presented with the decision, complete with the burden of the cost of each medication listed above, I’d make a much better informed choice the allowing the doctor.

      And I know that we can’t just pass the cost on, but even if we added a 10% co-pay….

      • I absolutely believe that the majority of doctors have direct ties to pharma companies.

        However, if I was presented with the decision, complete with the burden of the cost of each medication listed above, I’d make a much better informed choice the allowing the doctor.

        There are really three things patients need to know: how much it will cost them, how well it will fix their condition, and what else may happen if they take the drug. Doctors and hospitals purposefully make the first item hard to figure out in advance (and no one is going to call ahead for price checks before running to the hospital), and the donations to doctors make the second and third tainted at best. If we made patients pay some small percentage now, we’d see the same profits on the doctor’s side and the drug company’s side and the cost would just be shifted from insurance to patient, and no one would stop following their doctor’s advice. So, until we can make sure the advice is sound, we can’t trust the patient to accurately adjust behaviors.

        • There are really three things patients need to know: how much it will cost them, how well it will fix their condition, and what else may happen if they take the drug.

          Yup.

          Doctors and hospitals purposefully make the first item hard to figure out in advance (and no one is going to call ahead for price checks before running to the hospital)

          I’m thinking you have left the example above -which is cool, blog comments tend to move around- but the medication we’re talking about is one for a condition that is “applied” several times. The reason I mention this is because it’s not a “emergent” condition but one that is planned and controlled.

          Someone could very easily conduct research on this.

          But I do get your point as it pertains to those procedures/medications where such investigation is not possible.

          If we made patients pay some small percentage now, we’d see the same profits on the doctor’s side

          In this case, consider a co-pay of 10%:

          $200.00 vs. $5.00.

          A very powerful market lever indeed. Even 5% would have a powerful impact.

          we can’t trust the patient to accurately adjust behaviors.

          Such views of doctors and patients — Is there so little hope for humanity 😉

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