Health Care

Mariner has been pondering the health care issue. As someone once said, it is complex. It is complex because there are many facets to health care. For example, today health is managed as a marketplace rather than a healing place; a patient is a source of profit; medical practitioners no longer run hospitals, business specialists do. It has taken seventy-five years for this to happen. Mariner went back to the 1930’s and 40’s to track health care evolution.
In 1944, when the mariner went to the hospital with his ailing mother for a checkup, the hospital was not a fancy place. It looked more like an old high school with yellowed ceramic tile. The hall was the waiting room and patients sat along the walls on church pews. At night, the lighting was the same as in public schools, a depressing light not quite bright enough and intensifying the same worn, yellow shade.
When a patient was treated for a specific condition, the bill was one simple page. For example, going to the maternity ward to give birth to a child created a single line item: Maternity Care – $150.
Doctors were challenged to have the highest cure rate among patients. Further, doctors seemed to move about more slowly and seemed not jammed with appointments. It was all about the patients, not administrative efficiency.
Today in 2017, hospitals look fancier than many hotels. There are many more private and semiprivate rooms for patients; waiting rooms are expansive and off the halls. Billing for hospital services has become a hodge podge of line items worse than the various schedules of an income tax form. Doctors are encouraged to maximize income to the hospital. For example, tests are scheduled whether they are needed or not.
What happened?
In the mid 1900’s, health insurance was almost invisible. Most folks were covered by insurance paid for by their employers. The cost of services was related to real function and overhead – billed amounts had a close relationship to actual cost; in many ways, payment for services catered to the financial status of the patient. Eventually the mariner’s mother died after spending a year in the hospital. No one mentioned billing until after her death and payments were negotiated. Today, a patient risks being rejected at the door if a credit card can’t be presented.
The public experience was akin to free health: insurance coverage was virtually invisible to individuals. Further, health care was not a profit based market. It was all about patients and curability.
In the 1980’s and 90’s, business types discovered the lack of efficiency in health services. Further, all these MBAs saw a huge profit if health services were managed by what the market would bear rather than actual cost. As a consequence, maternity care today is $2,000 to $5,000 at a minimum.
Further, the one line item on the bill, called bundled billing, was replaced by unbundled billing: an aspirin, billed at $2 has its own line item. Further, a health service like maternity care is billed as a fixed set of services – whether they are used or not.
Health services also have different ways of taking profit from the system. Consider pharmacy markets, equipment markets, rehabilitation markets, specialist markets, insurance markets and many more. Each has their own profit earning model uncoordinated with other providers.
If a doctor thinks he has discovered an absolute cure for cancer, he will not be underwritten by any of the providers because, in effect, the cure will drive them out of business. This has led to a preference for continual care rather than cure.
Mariner could go on but the reader has the idea: health care, not a for-profit market, is treated as if it were. Naturally, over time lobbyists have tailored Federal and State legislation to protect this irrational alliance. Did you know hospital services, clinics and providers do not have to provide their cost for a given procedure or product? For the same procedures, one hospital may charge $1000 while another may charge $400 but you will not be able to acquire this information. It is almost as hard to acquire information about success rates. In general, this block also applies to the various providers; for example, one needs a go-between like a pharmacy to find out price differences in drug and insurance coverage for the same drug.
In government, there are no rational plans for correcting the US health delivery system. Conservatives want to cut cost by (a) cutting coverage and (b) issuing finite amounts of funding to States (block grants) requiring States to cover inevitable shortfalls in health coverage. States will have the authority to cut coverage to save cost, e.g., pre-existing conditions. Insurance companies will participate by requiring huge deductibles.
What goes unmentioned is the power of the State Health Commissioner and/or State Insurance Commissioner. These positions oversee health and insurance regulations, practices and rates. Theoretically, the Commissioner could, for a given state, slowly correct the delivery of health services by setting price limits for services that in turn would push profit market practices out of health delivery. The fatal flaw at this time is that the Commissioner is appointed making it a politically bound position – to say nothing of massive lobbyist interference.
Nevertheless, the best approach is to reduce the cost of health care without reducing health coverage. It is a mistake to assume today’s prices will always be the case making them too expensive to cover for a nation that has debt problems. Restructuring the health market, one-sixth of the nation’s economy, is a tall task. Tying adjustment to a big tax cut for oligarchs does not help.
Ancient Mariner


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