8 reasons why healthcare costs are rising

In early June, 2010, MedPage Today posted a survey question asking readers to identify the primary driver of rising healthcare costs.

More than 1,200 readers responded by answering: 24%, Increased insurance premiums; 22%, New technology; 22%, Malpractice costs; 12%, Drug costs; 3% Increased physician payment; Other — 16%.

I voted “Other.” This survey, like most, misses the main point. It is the decisions of patients and physicians that are the principal drivers of healthcare costs. This survey did not provide that answer to choose. Finger-pointing elsewhere by the responsible individual is typical.

These are the main drivers of healthcare costs:

1. Patients with insurance who consider medical care a “freebie” with no cost consequences.

2. Physicians who neither practice evidence-based medicine nor include costs in their decisions.

3. The absence of realistic cost transparency.

4. Decisions driven by the pervasive mystique of “defensive medicine,” which now dictates hugely expensive (and lucrative) “defensive practice standards.”

5. Hospitals that want to fill beds, especially ICU beds, and aggressively market the newest and most expensive technology, beautifully performing tests, and treatments that patients often do not need.

6. Insurance companies that primarily care about making money for their owners and senior executives.

7. Drug companies that successfully push use of their most expensive drugs.

8. The extraordinary success of “American Marketing” as a dominant cultural behavior.

Those eight powerful factors are the primary drivers and, unchecked, they will bankrupt our beloved America.