Saturday, July 18, 2009

Capitation in Massachusetts?

Megan McArdle at the Atlantic looks at the unforeseen consequences of "universal health care' in the state of Massachusetts. Believe it or not, expanding the public net of coverage has the effect of driving up health care costs. Imagine that. Coupled with the fact that there aren't nearly enough primary care doctors to provide care for the massive influx of new patients, a financial and public-relations disaster is brewing in the old Commonwealth.

So now a commission appointed by the governor is exploring the political feasibility of capitation as a solution. Capitation means that an arbitrary cap is placed on the amount of health care one can receive over the course of a year. Once you hit your limit, you're out of luck. It's an awful proposal, of course, representing the worst of human commodification and rationing.

I find it interesting that when we discuss the issue of cost in the health care debate, everything always boils down to the potential abuses of a fee-for-service system where proceduralists are incentivized to do more, inject more, excise more, radiate more. It is the greedy doctor's fault. And the solution is simply to cap the amount that can be spent on individual patients. Certainly you're going to deleteriously effect a proceduralists income by capitating, but you're also potentially compromising individual patients. What about the diabetic fifty year old who suffers from incapacitating biliary colic, needs her gallbladder removed, but has already exceeded her spending limit just from her expensive medications and other health care needs? Who's going to electively do her lap chole for free, with all the inherent risks?

Peter Orszag et al (along with articles on McAllen, Texas practices) have successfully demonized physicians as the source of the cost problem. But if something is expensive, why in health care do we attribute that cost simply to the utilizers (doctors/patients)? What about the producers who stand to gain the most profit from the current system? Where is the outrage against Big Pharma and the medical equipment industry (Stryker, Medtronic etc)? Why are caps set on the amount of (cheaper) prescription drugs that can be imported from foreign countries? Where is the populist rage about $3,500 MRI's? Could it be that political clout carries the day in contemporary American politics? That it's easier to go after the fractured, disunited physician lobby?


Unknown said...

Well said, until producer fees are controlled, the situation will only get worse. Somebody needs to step up against the major source of rising costs (I am looking at you Obama).

Andrew_M_Garland said...

You are overlooking a political subtlety.

The politicians want to pay the primary care physician say $1000/year per patient to keep everyone healthy. The plan does not limit treatment to $1000/patient, it only sets the payment. The PCP is expected to do what is needed, including hiring tests and specialists to properly care for the patient.

The PCP will be told to keep most patients healthy and use the excess money from the well patients to care for the very sick patients.

The politicians are currently blaming doctors for being greedy. They will also blame doctors for being stingy.

Would you like to be paid more? Form a lobbying organization and argue your case before the legislature, while they are going broke. All the rationing and blame will be put on you, the uncaring doctor.

Anonymous said...

I've looked into it and decided that the people who are most demonized are malpractice lawyers.

Doctors order lots of tests to make lots of money and then blame it on the lawyers. Even in States where it is difficult to sue.

That New Yorker fellow had an interesting line when he said that the most expensive piece of medical equipment is the doctors pen.

CaliforniaNeurosurgeon said...

Anonymous, you are exactly wrong, and have obviously never dealt with those bottomfeeding slime who call themselves malpractice attorneys.

Doctors rarely if ever make a penny from ordering tests.

Of course, the trial lawyers have the Democrats in their pockets, and the President is a lawyer.

Buckeye Surgeon, you are exactly right. Psychologically, "medical bills" are conflated with "doctor bills," and as the patient (and Congress) see the doctor, not Medtronic, in the office, we get the blame. And I say this as someone working for a well known managed care system, on a salary, in a state with a cap on malpractice awards.