Katie Couric expounds on unnecessary MRIs and CT Scans

Thursday, September 24, 2009

Katie Couric expounds on unnecessary MRIs and CT Scans

The CBS Evening News tonight had a piece on how many high tech diagnostic procedures are performed in the US annually (~$100B) and how, about a third of them were completely unnecessary. The one good point in the segment was that some physicians are lazily relying on these technological short cuts, rather than practicing good diagnostic medicine. The latter of which, of course, takes longer and provides less income. And the CBS News piece did state that patients were clamoring for these high tech solutions and it was hard for doctors to resist their patients' requests.

But the segment totally ignored the main reason for the increase in CAT Scans and MRIs: malpractice suits. If a patients comes in and complains of persistent headaches, unfortunately, these days the first thing that the physician thinks of is, "If I don't order every test under the sun and it it turns out that the patient has a brain tumor, the patient and/or the patient's family will sue the pants off me." In states like NY, which are saturated to the gills with trial lawyers (including its completely incompetent, lawyer-laden Legislature), there are presently no liability limits for pain and suffering . But that's old news and the Obama "plan" that's on the table, will do nothing about reducing medical malpractice costs. The US Senate "plan" does however, begin ratcheting down the number high tech diagnostic procedures that patients can have, unless they want to pay the costs for "unnecessary" MRIs and CAT Scans out of pocket. The next time a patient twists his or her knee when skiing and they can't have an MRI, they will know what it feels like to live under the Canadian health care system.

But there was a certain degree of irony, because of the commercials that followed the segment. They were all for pharmaceuticals. But then, the CBS Evening News mostly has commercials for non-generic prescription drugs. Why these drug companies spend billions of dollars on these commercials is beyond me, since most health insurance plans require physicians to prescribe generic equivalents. Further, these pharmaceutical TV commercial campaigns add substantially to US health care costs. But we all know that US health care is a growth industry. It shouldn't be, but it is.

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Health care should't be a growth Industry

As an obstetrician-gynecologist practicing in Upstate New York, I’d like to suggest an alternate path for reforming health care in this country. As a hands-on clinician, I practice in Troy along with five other OB-GYNs, two nurse-midwives and a nurse practitioner. We care for a wide range of patients, from those on Medicaid or less, to the elderly served by Medicare, to state employees, who are blessed with outstanding private health insurance. We have delivered thousands of babies at our local hospitals and have tried our best to stay ahead of the ever-increasing patient load, demanding new technologies, declining reimbursements and the ever-lurking trial lawyers.

The main concern in reform issues has been to contain costs while providing better health care for all Americans. The major argument regarding reform is whether some modest variant of the present health insurance system should be instituted or whether a single-payer system should be imposed by the federal government. In May of this year, Senator Charles Schumer, offered a “middle ground.”

Schumer has laid down some good ground rules, saying that any public plan should be voluntary, fairly funded and self-sustaining, as well as administered by separate managers and regulators, but the debate about alternatives has become protracted.

One day, when sitting with my checkbook and looking at my ever-increasing electric utility bill, I got an idea. It wasn’t a grand, elaborate idea, but rather a simple one: Years ago the power industry in the U.S. was heavily regulated. Those days are gone, of course, swept away in a fury of deregulation. But back then, a state like New York was divided into geographic regions and each electric utility had a regional monopoly, such as Niagara-Mohawk upstate, Consolidated Edison in the New York City and LILCO on Long Island.

These companies couldn’t just raise electric rates on a whim. They spent years, justifying to regulators even a modest increase in the rates that they could charge to the consumer. Every aspect of their business model was thoroughly inspected and restricted. They couldn’t build too many power plants or invest in risky or unrelated capital projects. As a result electric rates remained stable for years. In addition, everyone who invested in the stock market always kept some low risk, utility stocks in their portfolio, to cushion the blow when there was a recession. But the utility company CEOs complained loudly to the politicians. In a matter of years, that stable system, designed for the public benefit and run by private entrepreneurs, was dismantled.

Now what does this have to do with health care? It has lot to do with it. The debate over health care reform has degenerated into sloganeering and as Schumer suggested, someone has to propose a middle ground. Lest we continue to only hear that a single payer system is “irresponsible, heavy-handed socialism” and the present system is “rampant, self-serving capitalism.”

I have another proposal.

Under my proposal, private health insurance companies would bid to the federal government on obtaining a regional monopoly for a specific geographic area. Within that area, there would be no other purveyors of health insurance; no Medicare, no Medicaid and no other private insurers. For those patients who are employed, the employer would pay the geographic insurer. For those patients without employment, the federal government would reimburse the insurance company on a capitation basis at the private employee rate. In exchange for their geographic monopoly, the government would heavily regulate health insurers’ profits and limit the annual increase in profit to either some small percentage or the rate of inflation, whichever was greater. It would be up to each “monopolist” to set insurance costs and provider reimbursement rates within its geographic region, within some guidelines established by the federal government.

In addition, these private insurers would pay no federal, state or local income tax. The private insurance company would also bear the burden of paying out any malpractice claims, as both legal liability and malpractice insurance would be eliminated for individual physicians, hospitals and other health care providers. The federal government would monitor various health care metrics within each geographic region, to assure some measure of consistency in the quality of care throughout the country. If no private insurance company wished to bid on a particularly "risky" geographic area, the federal government could step in with a subsidized public insurance entity.

The health care sector is referred to as “a growth industry.” Investment advisers and economists proudly point to its continued vigor during our present recession. The problem is that it shouldn’t be a growth industry. It should be a stable system, designed for the public benefit and run by private entrepreneurs.

Naomi's Idea - Health Care Reform

Thursday, September 24, 2009