We can’t really be sure when the state of being called health and the care we sometimes need to sustain health became one entity, or more precisely when it became a heavily regulated industry; one in which the consumer has been largely cut out of the loop. For certain, it has been an insidious transition. To construct the timeline would make your eyes glaze over and you would start to drool like the school kid in Ferris Bueller’s Day Off !
Suffice it say, that somewhere after 1965 (hint), an economic sector was born which continues to consistently outpace the rest of the economy, and even continues to grow during recessions. (And no, this observation is not all due to the relatively in-elastic demand for healthcare, as much of the consumption is discretionary for elective issues).
While essentially functioning with characteristics of monopolies, giant public & private bureaucracies have emerged that hide behind a mantle of “health” in order to ensure their own existence by controlling our choices and gating our access.
A Wrong Turn Onto a Dangerous Detour
Why didn’t we see this coming? Regrettably, while most of the medical profession was asleep at the wheel (or too busy with just the right amount of complacency thrown in) and refused to heed our elder colleague’s warnings, a giant industry has evolved that does not operate in the best interest of our health or our care.
Too many of us in the medical professions drank the Healthcare industry Kool-Aid flavored with such additives as “cost control”, “access”, “choice”, “quality”, and the ever popular “strength of network”. This was a recipe designed to hide the bitter taste and mask the misery that has followed.
There’s no conspiracy here, folks. It wasn’t an evil plot. It was just a business opportunity teed up high & easy for them in a highly regulated system with Medicare leading the way. It was simply the path of least resistance for the insurers at the time. But since then, a lot of mischief and inefficiency has occurred in the name of ‘healthcare delivery”. And that’s an understatement if there ever was one!
Insurance companies per se, are not the problem; they made a rational business decision in light of the circumstances. They were steadily paying out more and more because reasonable and customary fees continued to rise (duh! It was someone else’s money, right?), so they took control of the financial reins, not unjustifiably so.
The big players in today’s health “insurance market” are mostly publicly traded companies and a corporation’s fiduciary responsibility is to their investors and management’s mandate is to maximize shareholder value, period! This is how corporations are supposed to function.
Nonetheless, this is all making healthcare much more expensive than it needs to be. The problem is, they have just become part of the scenery and so much a part of our national experience that we are numb to inflationary effect caused this third-party dominated systems. And the health plan industry would like to keep it that way.
We must understand clearly that the Health Insurance Networks of today don’t exist for our benefit or to make it easier for us to obtain care from the best doctors or utilize the best technology. They exist to give the Payer (the network essentially) control over their costs, and therefore profits, not out of a concern for your choices. This consistent use of insurance for nearly every encounter with a doctor has resulted in a very expensive, inefficient way to pay for medical care.
The Detour Takes Its Toll
An Insurance Network’s marketing campaigns may tout choice and the stellar qualifications of their select network of doctors and hospitals, but what they are really giving you is what they have been able to include in their grab-bag of pre-loaded offerings. What about the doctor that got away? Are they under-qualified or didn’t meet the payer’s rigid standards? No, probably not. Most were just lucky enough to be in a position to say “NO” to poor reimbursement schedules, burdensome regulations, penalties, intrusive audits, and the other myriad of red tape and nonsense that accompanies many provider contracts.
What if your insurance company has nine out of ten orthopedic surgeons on their panel and surgeon number 10, the one you need, isn’t in network? “So sorry, please make another selection from our consolation prize bag.” Instead, shouldn’t we be making personal, independent, informed decisions about where we spend our health & care dollars based largely on advice from professionals that we chose and trust; instead of picking from the “provider” list and hope we get lucky!
The Consequences of Driving While Asleep
The prognosis is not good as it stands now: It has become increasingly difficult to vote with our dollars when it comes to medical care expenses because someone else is paying the lion’s share of the tab on our behalf and keeping a hefty percentage of our premium dollars as profit. And, they are doing it with our pre-paid dollars (which benefits your employer thanks to the tax laws) via complex contractual arrangements with those providing the medical care; contracts that patients have no say in.
The game is rigged because the market forces that give consumers choice and foster healthy competition, shape quality, improve access and promote cost transparency, are largely absent in the Healthcare industry today. Why? Because the Price-Demand curve is no longer operational in the healthcare market; it’s all negotiated for us and the financial cream is skimmed off the top by Wall Street and Washington D.C in the form of political contributions from indebted beneficiaries of policy.
Our leverage as consumers has been bought out at a very high price, on multiple levels. Individuals have given up their right of choice by giving up control of the purse strings to third-party payers, in turn for “coverage” against artificially high prices on one end of the spectrum and for routine services comparable to the cost of two gallons of quality paint on the other end. What a deal, huh?
So, when DID Health-Care become one word? I’m not sure, but the why is much easier to ascertain. Our health and the care we sometimes need to sustain it has become Healthcare because we (as patients) have become largely recipients of care, instead of recipients that are also direct consumers (read the essay by Arnold King “health insulation vs. insurance”). Because of this disconnect, we have lost our leverage in the marketplace. This same disconnect is also the main driver of runaway costs and the super inflation we have witnessed in health insurance costs over the past 40 years.
Physicians’ participation in provider networks has unwittingly locked, loaded and launched the upward spiraling cost curve of medical care. This critical misstep has made care less personal and made it way more complex than it needs to be for patients and doctors. The result is the behemoth that accounts for one-sixth of our economy, called HEALTHCARE!
This failed experiment in central planning, it’s origins to circa 1965, has incrementally replaced real patient choice with restrictive networks and subjugated physicians to working under the constraints of third-party contracts rather than working independently for their patients! And, to add injury to insult, physicians are continually looking over their shoulder in fear of audits/penalties/sanctions and even federal charges for unintentional violations of Medicare!
How to Correct Course
Step one: All subsequent reforms hinge on this. Physicians should be wholly independent and leave the insurance contract between the subscriber and the insurance company, including Medicare & Medicaid. This non-participation is the only market force strong enough to effect real change, bend the cost curve down, prevent a budget crisis (again) and allow other market alternatives to emerge to indemnify at high end risk, while keeping prices lower and stable for the low to moderate cost items.
The irony is, the thing they say we can’t live without is the very thing that’s driving costs upward at such as staggering rate. This bizarre health cost inflation spiral that we’ve allowed to dominate for the past four decades is causing an unnecessary crisis that is being politicized and manipulated to the disservice of those purported to be the beneficiaries. What is it? Pre-paid, employer-sponsored network health plans, masquerading as insurance. AKA, the automatic profit machine for the third-party payment industry!
Let’s bend that cost curve back down to sanity and take back control for the sake of our patients and our profession: Just say no to networks! We can work it out with the patient directly, while providing better care at lower costs.