Healthcare costs cannot be controlled by only banning fee for service

by James Baker, MD

Once the recession is over (maybe that should be “if the recession is ever over”), it’ll be time to do something about the deficit.

The way to do that is to get healthcare costs under control.

But I don’t see how containing fee-for-service medical practice does the trick because, outside of family practice, I cannot see how to get away from fee-for-service, for the most part.

I think there are three drivers of escalating healthcare costs: 1) end-of-life care; 2) defensive medicine; and, 3) our patients are not our customers.

Here’s how to address each, in turn:

End-of-life. We don’t need “death panels,” but we do need social consensus about how to manage end-of-life medicine.  It cant be left to doctors, as their job is to preserve life.  It cant be left to families, as the price in guilt of making such decisions is far more expensive than the price of hopeless medical care.  So, as a society, we have to give permission to both docs and families to spend less at end-of-life.

Defensive medicine. Lots of tests get ordered simply because there is nothing more painful to a doc than the theater of a malpractice suit.  So there has to be some sort of no-fault process that keeps docs off that stage instead of spending money on marginally-necessary MRI’s and the like.

Patients as customers. The best way to drive down medical costs is to use high-deductible insurance policies tied to HSA’s.  Fund the HSA’s for the poor, the disabled and the elderly.  In that way, the patient (not the insurance company) becomes the doctor’s customer again.  That is, decision-making about what to pay for moves out of the insurance company suites back into the patient consultation room.

And the research is clear that, when given back this choice, every patient — including those with mental illness — can make decisions that are clinically effective and cost less money.

James Baker is a child and adolescent psychiatrist with Metrocare Services who blogs at Mental Notes.

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