Arnold Kling  

Health Care and the Consumer

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The Baltimore Sun reports


National Imaging Associates estimated several years ago that as many as 30 percent of imaging studies were not needed or not the correct test, although NIA believes the number may have declined as insurers have tightened the approval process.

Several hypotheses are offered as to why too many tests, or the wrong tests, could be ordered: physician worry about malpractice suits; patient demand for the latest, best exam; doctors who aren't up to date on the rapidly-developing technology, and doctors who profit from tests because they own imaging equipment.


Of course, "patient demand" is in the context of being insulated from the cost. One wonders what might happen to "patient demand" if more patients were paying out of pocket.

Meanwhile, Regina Herzlinger, known for advocating consumer-driven health care, has a new book. The publicity page says,


Herzlinger describes in precise detail how her innovative program will provide.

* Smaller, disease-focused medical facilities that provide complete care [for] patients
* A national system of medical records that provides privacy with confidential access by approved practitioners
* Mandatory performance evaluations of all hospitals and all other medical organizations
* Mandatory health insurance with subsidies for those who cannot afford it


These proposals sound more government-driven than consumer-driven. I understand the problem, because if someone asks you for policy solutions, you tend to think in terms of government actions. My own book is rather light on policy prescriptions, for that reason.

Basically, our health care system has evolved in a direction that makes it very hostile to individual consumers. Without an insurance card, you are likely to be denied service or charged double what others pay. Buying insurance on your own takes you into a poorly-functioning market, with few suppliers, who generally charge considerably more than they would for the same insurance offered through an employer. Adding injury to injury, for any given premium your after-tax cost of health insurance is higher as an individual than as a covered employee.

It is hard to make consumer-driven health care sound appealing, given the way that the deck is stacked against consumer-driven health care today. Of course, if the majority of consumers were in consumer-driven mode, the market would serve them better. But getting from here to there is not easy to describe.

Thanks to Michael Cannon to pointers to both items above.

On a more optimistic note, concerning new low-cost retail health clinics, Grace Marie-Turner writes


A Harris Interactive poll conducted in March for The Wall Street Journal said that 22% of those visiting the clinics were uninsured. Wal-Mart says that half of its clinic visitors are uninsured.

Retail clinics are particularly attractive to 4.5 million people with Health Savings Accounts who have health insurance with higher deductibles and want an affordable option for some of their routine care.

And the clinics are working to solve another problem that is vexing Washington -- creation of electronic medical records. Most retail clinics create computerized patient records, with the goal of making the records accessible throughout the chain.


Comments and Sharing





COMMENTS (3 to date)
Bruce G Charlton writes:

Waivers?

I wonder if it would be possible for providers to offer cheaper health care if consumers signed some kind of waiver which said that they would not sue, or in some way shifted the onus of proof for malpractice?

shecky writes:
Basically, our health care system has evolved in a direction that makes it very hostile to individual consumers. Without an insurance card, you are likely to be denied service or charged double what others pay.

Where does this come from? My doc offers very affordable (and negotiable) rates for uninsured cash pay patients. Apparently, dealing with insurance companies demands several full time staff dedicated to the task, and charges to insurance companies are significantly inflated due to the tendency for the companies to pay only a portion.

John writes:

You are right, what was I thinking.

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