Trimming the Fat in Health Care

August 22, 2011

Unless you’ve been living under a rock, you might’ve heard about a need for cost-cutting in health care. Our esteemed politicians tell us that all options are on the table, and that they’re looking for ideas. Just on the off-chance that they actually mean it, here are my favorite three.

Unless you’ve been living under a rock, you might’ve heard about a need for cost-cutting in health care. Our esteemed politicians tell us that all options are on the table, and that they’re looking for ideas. Just on the off-chance that they actually mean it, here are my favorite three:

Tort reform. Figure there are about 30,000 practicing radiologists in the country (there were in 2009). According to the AMA, a little over a decade ago the average malpractice-insurance premium per radiologist was almost $20,000. Let’s be optimistic and say that the cost has not increased (I can tell you it has in my neck of the woods). That’s $600 million in health care dollars each year not funding patient care. That figure only represents radiology. It doesn’t include multimillion jackpot-justice awards (much of which goes to lawyers taking cases on contingency), costly defensive medicine, time wasted in defending against frivolous cases…you get the idea.

There’s been no shortage of ideas in this venue - caps on awards, a “loser pays” mechanism, specialized health courts, etc. Some folks (lawyers, for instance) claim that tort reform won’t help. I have yet to hear them explain where those billions of malpractice-premium dollars would otherwise go.

Also, how is it that healthcare reimbursements keep on going down, yet malpractice awards are unchecked? If we must abide by CPT, DRGs, and whatever other alphabet soup tells us what we’re allowed to collect for our services, shouldn’t lawsuits over them be similarly controlled?

Cut the middlemen. There are ever-increasing legions of workers in the health care system who produce no actual health care. I’m sure that many of them serve useful functions and add to overall quality and efficiency, but let’s be honest - an awful lot of them just bog things down, preventing care from occurring or at least slowing it down a great deal. Agencies overseeing the system often overlap with one another, creating redundancies at best and, all too often, conflicting edicts.

As a result of their efforts, hospitals and physicians’ offices employ additional personnel to have a prayer of navigating the byzantine system without getting fined, forget being properly reimbursed for services rendered. Think about it: Ten years ago, how many practices did you know that needed a full-time coder? How about all the clipboard-carriers and meeting-attenders who haven’t done anything clinical in years, if ever?

Maybe the next few rounds of cuts should be focused on reducing the bureaucracy that, to my knowledge, has yet to be shown as cost-effective. Every human cog in the machine draws a salary and benefits. Each of those agencies has a healthy operating budget. I wonder when they last faced a 20 percent cut? The irony of cutting them would be that more work would likely get done as a result.

Allow balance-billing. Let government and the insurance companies hack away at reimbursements to their hearts’ content; if they say they can only pay $1.29 for a whole-body CT with and without contrast, so be it. But then let every radiology office and hospital have the option of billing patients to cover the shortfall. This would reintroduce a bit of the free market to healthcare; if I’m more efficient than the guy across the street and can advertise that I provide a service without billing a penny while he charges $50 per case, I bet I’ll attract more business.

It also could reward quality of care: If you were choosing between two physicians, and one cost a little more but he had 15 years more experience and was extensively published in his area of expertise, might you consider him worth the extra cash? To be fair, all prices would need to be clearly posted so patients could be informed customers, and true emergencies (as opposed to patients using ERs for their primary care) would have to be excluded; a trauma-victim is in no position to “shop around” for a better deal in another hospital.

Then again, maybe I’m taking this a little too seriously. Perhaps we in health care shouldn’t care so much about a few billion dollars when our nation’s leaders have just demonstrated that they can’t be bothered to take on the trillion-dollar issues.