Price Competition Comes to Hospitals!
by Scott MacStravic
I found your comment implying that even at a cost 1/3 of the going rate there might not be a switch in referrals if the patient’s physician was an owner in a competing physician owned hospital very telling. The undermining of the physician’s fiduciary duty to the patient in such situations is obvious, yet in policy and regulatory arenas there continues to be a reluctance to accept it and act upon it.
A CABG is certainly no commodity, certainly if I’m the one having it. I’m going to base my decision on more than cost. Prior outcomes, service, personality of the providers, convenience and cost will all enter into the equation, as they should. I am capable of assessing many of these factors myself and making a rational choice based on my life priorities. But several of the most important factors in the decision will require the assistance of my physician to guide my selection, acting as my trustee.
For most patients the proposed price reduction will have little, if any, affect on what they pay. The savings will accrue to the insurance company. Especially if there are exclusive contracts with the insurers, the patient’s choice may be limited. With such a large difference in price, the pressures exerted by the insurer to obtain care at the cheapest location regardless of quality or service could be significant.
I am fearful that in the situation you have described that the decision could be unduly influenced by either my insurer’s interest in saving money, or my physician’s interest in personal gain through ownership in a competing hospital, thereby trumping my interest in obtaining the care that is best for me.
Insurer’s are already unduly influenced by their interest in saving money. That is precisely why they enter into exclusive contracting agreements. Typically, the smaller, investor owned hospitals are not given the opportunity to show their value to the insurer - that remains the sole domain of large, for profit and not-for-profit entities. The executives of the large facilities are threatened by the value brought to patient care by the physician / investor owned hospital. Why? IMHO, the primary obstacle to true patient-based care has been a culture within hospital executive management based on creating an adversarial relationship with user physicians. Within this framework physicians are merely a “neccessary evil” that must be dealt with, disregarding the reality that hospital management IS NOT the interface between the public (patient) and the care giver (physician, nurse, etc). Many of the most dedicated and productive physicians, nurses, and other essential allied health personnel have found that they are empowered to truly care for their patients - and their co-workers in the smaller investor-owned hospitals. When you are making your decision, talk with health care providers that have been employed in both settings and inquire as to where they would like to have themselves or their families cared for. thank you
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