The further you get from the actual “doctoring,” the less many American healthcare systems do for your well-being. “That’s why so many people love their doctors but hate the healthcare system, the author notes.
When I first began thinking about what Postindustrial America needs to know about healthcare, my first thought was: “Everything.”
The sheer opaqueness of one of the nation’s largest economic forces (representing $4.5 Trillion dollars, or 17.3% of total GDP, or nearly 1 in every 5 dollars spent in the US) leaves just about everyone – even industry employees – largely uninformed, under-informed or misinformed.
It's a daunting task to try to whittle away at the complete mess of it all and choose a place to start. The writer in me wants to make an analogy to Alexander the Great and the Gordian Knot, but that type of grandiose posturing is precisely what’s wrong with the industry, in part, to begin with.
So, I’ve decided to start with the fundamental misconception that the healthcare system is built with patients in mind.
How do we untangle that untruth from reality? Let’s start by addressing another related misconception right away:
In the healthcare industry, only the doctors take the Hippocratic Oath – and in the US as of 2019, in research published by Amol Gupta in the Journal of Hospital Administration, only 5% of hospital CEOs are physicians.
Or, in other words, in a system built for the health of people, the people in charge are not held to that fundamental standard.
That’s why so many people love their doctors but hate the healthcare system. Once you move past the physician, everyone else in the system has moved further and further away from what should be the primary motivation – good, healthy results.
Now, this isn’t to say that every one that isn’t a doctor in a hospital or doctor’s office isn’t hoping to help people. What I am saying is that every step removed from the actual role of “doctor” you are shifting the measure of success further away from “a healthy human” to “a healthy bottom line.”
This isn’t too much of a problem in small, local offices like your primary care physician or family doctor. However, if your doctor or their office is part of a large health system, then every new layer that is added must be bringing in money.
And as an aside, in the hospital world, being a non-profit means absolutely nothing. Just ask the New York health system that just bought into the film production business.
So, what does all of this mean?
Well, it means misalignment in what should be the primary goal of healthcare which results in high costs and poor outcomes.
How do we know this? Because there was a law that went into effect in 2021 that made it mandatory for hospitals to publish their prices for procedures.
And, because Medicare already has pre-set market-appropriate prices it pays for procedures, we can compare how much a hospital is charging the public (non-Medicare/Medicaid patients) compared to the Medicare/Medicaid prices.
In addition, we are able to see how much a hospital is making compared to what it needs to operate. These can be paired with quality ratings from a variety of sources to understand where we are paying a lot and getting very little in return.
All of this is public and can be viewed by anyone for no cost through a brilliantly created tool called the Sage Transparency Tool.
As an example, let’s take a look at West Virginia.
Out of 23 hospitals in West Virginia, 17 were high-cost low-quality, with 6 of those charging more than 300% of Medicare prices to private insurance.
That means if you go to one of those hospitals and a procedure costs a Medicare patient $100, you – with insurance through your job – will pay $300 for the same procedure. If you’re in one of those 17 hospitals, then the quality of the work will also be not very good. Eight of those hospitals are also operating at more than double their break-even costs, meaning there is ample opportunity to control costs on the commercial side.
Let me be clear: West Virginia is nowhere near the worst in the country, but overall, Postindustrial States are not doing very well at controlling hospital prices.
I know right now you’re thinking, “That’s great and all, but what am I supposed to do with this?”
Well, to start, you actually CAN negotiate prices – if you’re the type of person who has the gumption to do that.
If you’re in a plan provided by your job, then take a look at the prices, and if they look crazy high, let your HR person know. Employers can do a lot if they put their energy in the right place. If you have health care from your employer, then they are paying those high prices too – whether through poor outcomes and lost productivity or directly if they are self-insured.
If you have Medicare or Medicaid, congratulations – Uncle Sam already has the best possible deal for you. Use the transparency tool to find where you’ll get the best care for those healthcare dollars.
Really, though, the most important takeaway from this is that our healthcare system is broken and misaligned. You need to understand that it is at a fundamental level and that we have to try and do something to get the measures of success to match what really matters in healthcare – your health.
