[Ip-health] US - Auction 2012: Bought Health Care

Riaz K Tayob riaz.tayob at gmail.com
Wed Feb 1 13:01:32 PST 2012




Snip:

This prioritizing of money over health outcomes shows up in the 
political influence the American Medical Association uses to stifle 
competition.  Shikha Dalmia, a senior policy analyst for the nonprofit 
think tank Reason Foundation, described in Forbes how the AMA used its 
political influence to insist that only doctors could deliver babies, 
even though midwives have performed this service for years.  "In 1995 
thirty-six states restricted or outright banned midwifery, even though 
studies have found that it delivers equally safe care at far lower 
prices than standard hospital births."

Then there's the prescription drug problem, where pharmaceutical 
companies leverage their political influence to protect and expand drug 
monopolies.  In one case, a company called KV Pharmaceuticals got the 
FDA to give it an exclusive franchise over a hormonal agent used for 
years by obstetricians.  The price jumped from $300 a treatment to 
$25,000.  Pharmaceutical companies advertise to convince you that you 
are sick, and spend $61,000 per doctor on promotional costs to get 
doctors to prescribe you their drugs.



Dylan Ratigan
Host, MSNBC's 'The Dylan Ratigan Show'; Author, 'Greedy Bastards'; 
Founder, Get Money Out Foundation
*Auction 2012: Bought Health Care*
Posted: 02/ 1/2012 2:01 pm

Auction 2012 is a week long series in partnership with The Huffington 
Post and United Republic.

The point of seeing a doctor -- or being one -- should be to improve 
health.  After all, besides your mother or spouse, who do you count on 
to care about your well-being more than your doctor does?  That is 
literally his or her job.  But what I've found, and I've written about 
in my new book Greedy Bastards, is that the same incentives distorting 
banking, energy, education, and government are distorting our very bodies.

The American health care system has incentives so out of alignment for 
everyone involved that it's a Greedy Bastard paradise.  For American 
health care providers, the goal isn't to get you healthy, but to get you 
paying.  And similar to banking where the costs of a low interest loan 
might be a hidden balloon payment, the costs of our health care system 
are hidden from the end consumer.

One basic problem with the system is how doctors are paid, the fee for 
service model.  In fee for service models, doctors are paid based on the 
treatments they deliver rather than the health outcomes they generate.  
So for instance, if you need an expensive surgery, your doctor gets paid 
to operate.  If you don't need surgery, your doctor doesn't get paid.  
This creates an obvious incentive to recommend surgery, even when you 
don't need it.  And it also discourages looking at the evidence of what 
works and what doesn't, because expensive but ineffective procedures 
create more profit for the doctors and hospitals that host and perform them.

This prioritizing of money over health outcomes shows up in the 
political influence the American Medical Association uses to stifle 
competition.  Shikha Dalmia, a senior policy analyst for the nonprofit 
think tank Reason Foundation, described in Forbes how the AMA used its 
political influence to insist that only doctors could deliver babies, 
even though midwives have performed this service for years.  "In 1995 
thirty-six states restricted or outright banned midwifery, even though 
studies have found that it delivers equally safe care at far lower 
prices than standard hospital births."

Then there's the prescription drug problem, where pharmaceutical 
companies leverage their political influence to protect and expand drug 
monopolies.  In one case, a company called KV Pharmaceuticals got the 
FDA to give it an exclusive franchise over a hormonal agent used for 
years by obstetricians.  The price jumped from $300 a treatment to 
$25,000.  Pharmaceutical companies advertise to convince you that you 
are sick, and spend $61,000 per doctor on promotional costs to get 
doctors to prescribe you their drugs.

This wouldn't be affordable for most of us if we had to pay the sticker 
price.  But we don't, because most of us are covered by increasingly 
expensive third party health insurance (through our employers, which is 
yet another problem).  This insurance is protected by a law granting 
health insurance companies the right to monopolize state coverage, a 
monopoly retained by the enormous sums spent by the health insurance 
industry in Washington ($263 million from 2009-2010 alone).

None of this improves health outcomes, or is necessary for good health.  
Sometimes it is counterproductive, because it discourages collaboration 
and the adoption of best practices.  In my book, I spent time learning 
about the Mayo Clinic, where doctors are paid on a flat salary, and 
where they operate in teams.  This promotes the sharing of information, 
and leads to far better health outcomes.  I also spoke with Jeff 
Brenner, a specialist in Camden, New Jersey, one of the poorest areas in 
the country.  He assembled a team to specifically target the most 
expensive cases, and using this technique of hotspotting, was able to 
save millions of dollars.  For instance, he found out that one diabetic 
was continually relapsing because he wasn't wearing his glasses when he 
injected himself with insulin, and so was taking the wrong dose.  This 
alone saved thousands of dollars in hospital bills, but in our 
fragmented health system, it wouldn't be anyone's job to tell you that 
you aren't taking your medicine correctly.  In fact, the hospital would 
make money on every return visit.

As with banking, energy, and education, we have the skills and tools we 
need to improve outcomes and cut costs.  We know how to stop Greedy 
Bastards from ruining the system and bankrupting us.  They are after all 
operating according to certain incentives, and those incentives are 
malleable.

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http://www.huffingtonpost.com/dylan-ratigan/auction-2012-bought-healt_b_1247465.html




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