Let's start with where the U.S. ranks in life expectancy among developed nations - #45 - according to a report by The Commonwealth Fund, a healthcare research group.
If you live in Miami, Medicare will spend $8414/person/year versus $3341/person/year in Minneapolis. Why? A large supply of doctors in Miami means more per capita utilization of services and testing, hospitalizations, and intensive care stays.
Doctors in this country are reimbursed for whatever they bill. They're paid separately by insurers for patient visits. As long as their patients are in the hospital, doctors can bill and be paid for each visit. In our healthcare system, "if you have a slew of physicians and a willing patient, almost any sort of terrible excess can occur."
(SaturdayEveningPost.com, Jan.-Feb., '15, p. 36).
Volume counts. Fear of lawsuits creates volume in terms of services (some unnecessary) and referrals. Better-informed patients might be the most potent restraint for over-utilization.
Here's the other side of the coin. According to Dr. Jauhar, he was under pressure
at Long Island Jewish Medical Center to reduce the length of stay of patients
hospitalized with heart failure. The shorter the patient's stay, the more the hospital's costs were reduced (associated with less use of hospital resources during a shorter stay).
It's a physician's squeeze.
The result?
Doctors are trying to sell their practices; uncompensated care is growing; admissions and elective procedures (money makers) are declining; and hospitals are cutting costs, staff, and services.
Dr. Jauhar suggests several options:
- Hire doctors as employees and put them on salary, removing incentives to
overtest
- Use bundled payments for packages (an entire hospitalization, for example),
rather than discrete services
- Move to an "accountable care organization" in which teams of doctors would
be responsible (and paid) for patients' clinical outcomes. Most doctors have
performed poorly in such situations. (pg. 38)
A recent Time magazine article by Steven Brill (Jan. 19, 2015) suggests another option:
- The University of Pittsburgh Medical Center's model (Brill also cites the
Cleveland Clinic's model, a 75-facility enterprise)
in which hospitals, doctors, clinics, AND INSURANCE COMPANY would be
under one roof. Tight regulations for these conglomerates, mostly through
use of
federal anti-trust laws and state regulatory authority, would ensure their
accountability. The in-house insurance company
would have the incentive to control the doctors' and hospitals' costs
AS WELL AS the means to do so. There would be less incentive to
inflate costs or overtreat, because the in-house "boss" would get the bill
through the insurance company.
