A reader recently send me this graphic on the costs of healthcare, which is interesting in many ways.
Created by: Medical Billing and Coding Certification
Some of this diagram I agree with, and some I do not, or at least what is implied by the information contained therein. Overall, the diagram is correct – American’s can’t afford healthcare. At least not the kind we try to provide. However, I don’t feel that the diagram really addresses why Americans can’t afford healthcare in an accurate way.
Last year I wrote about a few strategies for decreasing costs in the operating room. Since being in fellowship operating many days per week, I’ve come up with a new idea, this time a bit more radical.
In Freakonomics, Leavitt and Dubner posit that in all things, human beings respond to incentives. If you want to understand human behavior, all you have to do is identify the incentives that drive them, be they emotional, financial, or social. In that vein, I wonder what incentives drive us to spend so much money on healthcare, and to waste resources when they need not be wasted.
I found a potential answer in another book, Chris Anderson’s “Free: The Future of a Radical Price” In this work Anderson investigates how an economy is affected when the marginal cost of production of a good approaches zero. Specifically, he investigates the economy surround digital goods, that while costing resources to develop, have a marginal cost of zero to produce and distribute. He proposes that in such a system, it is quite natural that the price of such goods will eventually approach zero, and if it doesn’t, the goods will be routinely stolen rather than paid for.
The corollary to this idea is the concept of optimal use of a resource when its cost is zero. That is, if one gets a real benefit from the use of a resource but it costs nothing whatsoever to use it, what is the right way to use that resource? Anderson suggests that the correct course is to use that resource to its maximal extent, and even to waste it without thinking despite diminishing returns. Read more…
A while back I published a bit about how to get insurance appeals approved. So here’s a specific example. This regards a young woman who delivered her first infant and was having trouble breastfeeding. After discharge, her physician recommended home lactation consultation services, which her insurer denied as not medically necessary. The patient’s policy did cover “skilled” medically necessary home health service , but not “custodial” care, defined as care meant for ongoing maintenance or assistance with daily living.
So here’s an answer to that (nonsense).
For the last 12 months, I have worked for a federally funded hospital. When I came to this hospital, I immediately noticed that the GYN surgical equipment was very outdated, most likely because the primary focus of the hospital until fairly recently had been the care of men. Wanting to bring hospital up to snuff, I requested about $100,000 worth of new equipment, including a hysteroresectoscope, new hysterectomy clamps, uterine ablation equipment, a laparoscopic morcellator, and a modern laparoscopic power source. When I put in the order for these things I was assured that we could get these things in short order, as the hospital had upgrading GYN surgery on its priority list.
As time went on, the equipment never arrived. It was held up in committee. It needed further approval. We needed more competitive bids. After further investigation, it seemed that the hospital just didn’t have enough money to do anything non-critical.