Explaining soaring health care costs in easy to understand language

Hospitalist Bob Wachter comes up with a nice analogy explaining why health spending is soaring.

Apologies for the block quote, but this should be read in its entirety:

You’ve just moved to a new town and stroll into a restaurant on the main drag for lunch. None of the large tables are empty, so you sit down at a table nearly filled with other customers. The menu is nice and varied. The waiter approaches you and asks for your order. You’re not that hungry, so you ask for a Caesar salad. You catch the waiter looking at you sideways, but you don’t think too much of it. He moves on to take the order of the person sitting to your right.

“And what can I get for you today, sir?”

“Oh, the lobster sounds great. I’ll have that.”

You’re taken aback, since the restaurant doesn’t seem very fancy, and your tablemate is dressed rather shabbily. The waiter proceeds to the next customer.

“And you, ma’am?”

“The lobster sounds good,” she says. “And I’ll take a small filet mignon on the side.”

Now you’re completely befuddled. You tap your neighbor on the shoulder and ask him what’s going on.

“Oh, I guess nobody told you,” he whispers. “This is a lunch club. We add up the bill at the end of the meal, and divide it by the number of people at the table. That’s how your portion is determined.”

You frantically call back the waiter and change your order to the lobster.

And indeed, as Dr. Wachter continues, there will be more restaurants specializing in lobster if more of these lunch clubs distribute costs the same way.

That’s how the financial incentives drive our health system, in a nutshell. But the bottom line is that doctors, by themselves, aren’t solely to blame. It’s important to remember that, as Dr. Wachter puts it, “it’s everyone.”

Or, as I’ve previously written, “singling out physicians would be like wholly blaming the players for a proverbial game’s flawed rules. More important than focusing on the players, we need to change the rules.”

Related posts:

1. Cutting health care costs
2. Soaring Medicaid costs
3. Successful health reform requires changing physician incentives, my take in The New York Times
4. How is health care like the Bowl Championship Series?
5. Cutting health care costs means reducing utilization
6. Controlling health care costs will require patient sacrifice, that how that will affect the status quo
7. AMA: Curbing the rise in health care costs is key to health-system reform

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Tagged as: health reform