The Price We Pay: What Broke American Health Care--and How to Fix It

by Marty Makary

Attending the church outreach event that day offered me a fresh reminder that health screening can be a double-edged sword. It can be a powerful tool to detect disease and prevent tragedy. But it can also be a business model to recruit patients for treatments they don’t need. In an instant, overscreening converts a community of average residents into a pool of patients. It’s just one costly example of the medicalization of ordinary life.

Leg artery procedures can generate $100,000 in one day when a doctor owns the facility. By comparison, I earn about $2,000 per day doing cancer surgery. Doing a procedure pays well, but taking time to explain the importance of exercise, which increases leg circulation, pays poorly.

Patients make decisions based on how we present options to them. We just give them a nudge.

The research team produced figures, tables, and maps that described the predatory nature of the procedures. With every new piece of data, we got a clearer vision of the big picture—and it was distressing. With every trip to a church health fair, we were saddened to see happy, grateful people, mostly African Americans, being fleeced by white physicians and their staff.

The politicians debated how to fund health care, but what we really need to talk about is how to fix health care.

Hospital officials confessed that they inflate bills more and more each year to generate more revenue since their insurance companies pay only part of the sticker prices. Insurers confessed they demand bigger and bigger discounts in their contracts with hospitals in order to keep up. Both acknowledged that they pass on higher hospital bills to the public in the form of higher insurance premiums.

“Insurers fight for a bigger discount every time they renew a contract with a hospital. Then hospitals go around and inflate their prices. It’s a game.”

Hospitals use software called the “chargemaster” that automatically inflates prices to achieve a desired margin.

One study found that for every ten doctors, the average U.S. hospital has seven nonclinical full-time-equivalent (FTE) staff working on billing and insurance functions.

There are two Americas—the one I live in and the one I was now observing. Research shows that six out of every ten Americans have less than $1,000 in savings3 and about half of them have no savings.

The good news was the majority of hospitals didn’t sue any patients in 2017, a finding that restored our faith in the leaders of American hospitals. However, the 37% of hospitals that did sue filed over 20,000 lawsuits against patients that one year alone.

Surprisingly, nonprofit hospitals were more likely to sue patients than Virginia’s few for-profit hospitals.2 My team and I also gathered more information on the patients being sued. People in rural areas were just as vulnerable as those in urban and suburban parts of the state. Our study showed where the patients who had their wages garnished were employed. At the top of the list was Walmart, with about 450 employees from Virginia who had their wages garnished in 2017.

I argued that half of U.S. women with stage 4 breast cancer are now being harassed by medical debt collectors. Secretary Azar called it a disgrace and instructed his staff to work hard on a bipartisan solution that would provide relief for Americans gouged by overpriced and surprise bills.

As I traveled across America for this book, what I saw was not a Republican/Democrat divide or a conservative/liberal divide. Instead, I felt a widespread sentiment among low and middle-income workers that the system was stacked against them, controlled by the powerful elite who make the rules.

Some respondents saw hope in President Trump’s anti-establishment style, which helped me better understand how he swept elections.

We looked at one of the judgments against a husband and wife whose debt ballooned because of interest and court fees. It went from $783 for the principal, plus $291 for interest and $176 for court fees up to a total of $1,252. And the judgment drew interest at 9%. The interest and court fees amounted to 60% of the principal. That sounds less like a hospital that’s there to serve and more like a payday lender that’s trying to hound a patient in debt.

I was starting to feel like a cop who had seen so much crime he lost his faith in the system. But I knew the truth. Most U.S. hospitals care for patients without suing them and garnishing their wages. What’s more, some hospitals forgive patients who can’t pay without making them feel like fugitives.

They flew him on a 1978 Lear 7 jet and charged $630,000. “The plane itself only sells for $350,000!”

Eighty percent of the more than half a million air ambulance flights a year (1,300 per day) in the United States are not emergencies but are much more like routine transfers. In other words, most of the time, these helicopters are taking stabilized patients from one facility to another—just as I took nursing home patients to the hospital as a teenage ambulance driver. “Many of those trips could be done at a much lower cost with a ground ambulance,” said Frazier.

As you would expect, Sentinel is hitting a nerve by cutting into the industry’s profits. That’s why one of the industry giants is suing Sentinel, on the grounds of defamation for calling out their unfair prices. Visser has spent hundreds of thousands of dollars fighting this lawsuit. And the lawsuit has been revealing. In one deposition statement, the CEO of the air ambulance company argued that whatever amount they charge, the bill should be paid in full, even if it is $1 million.

My friend Jill risked her life to avoid the money games of a ground ambulance. She had watched her brother go through a nightmare fight with their local ambulance company after he received a surprise $8,000 bill for a short lift to the hospital.

Instead of the ambulances I remember clustered around the emergency room drop-off area, now there was a gathering of Uber and Lyft cars dropping people off.

I noticed that one of the requirements was that any proposed new measure be supported with multiple published articles proving that the measure was evidence-based. That’s a nice idea, but a narrow way to look at quality improvement.

We used the wisdom of busy practicing doctors to create a specialty-specific way to measure quality.

I explained to them that these pattern measures were very telling and that using them had broad implications for cutting waste in Medicare.

Unfortunately, some physicians believe that a lack of a randomized controlled trial means there’s no evidence. That sloppy and dangerous thinking gets worse when the medical community conflates “no evidence” with “not true.”

The liberal use of “no evidence to support” has conditioned us to distrust anything not supported by trial. I’ve taught my students and residents to do better, replacing the sloppy phrase “There is no evidence” with either “It is unknown because it has not been adequately studied” or “It has been studied adequately and has not been shown to be effective.” The concept behind Improving Wisely is to apply the wisdom of expert doctors to identify practice patterns that appear inappropriate. When I show the practice pattern data to doctors and they see outliers, they say “I get it.” No trial necessary.

The concept behind Improving Wisely is to apply the wisdom of expert doctors to identify practice patterns that appear inappropriate. When I show the practice pattern data to doctors and they see outliers, they say “I get it.” No trial necessary.

For most of my surgical career, I gave out opioids like candy. I was unaware that about 1 in 16 patients become chronic users, according to the recent research by doctors at the University of Michigan. My colleagues and I didn’t realize we were fueling a national crisis. But today opioids are the leading cause of death in America of people under 50 years of age.

Consider this simple fact: Last year, physicians prescribed a record 4.5 billion medications.2 That’s about double the number we prescribed just a decade ago. Did the incidence of disease double in the last ten years? Of course not. Most of the doubling represents pills that could be avoided with lifestyle changes or more judicious prescribing.

“I can tell you, if you’re listening out there, stay away from back surgery,” Kerr said. “I can say that from the bottom of my heart. Rehab, rehab, rehab. Don’t let anyone get in there.”

I’m convinced we are living in an age of rampant loneliness. It’s reached endemic levels. I see more patients coming to appointments alone than I ever have in my career. When I ask who will be with them during surgery, or whom I should call afterward to confirm they are okay, they often answer “No one.” I see it in the gym, too. Back in college, we would all socialize and talk between lifting weights. Now everyone wears earphones and walks around like a zombie. Loneliness is a leading public health problem.

In most cases, bypassing traditional health insurance and self-funding is the best value for employers. It saves so much it’s like giving every employee an instant pay raise. But employers often don’t make the changes, he said.

Congress should repeal the 1987 safe harbor law that exempts GPOs and PBMs from antikickback laws. This reform will end opaque drivers of price distortion.

The problem is not GPOs. The problem is that GPOs are dominated by insider payments and kickbacks, the cost of which gets passed on to ordinary Americans.

As a gastrointestinal surgeon and advocate for healthful foods, I’m well aware how this low-fat teaching is based on the medical establishment’s embarrassing, outdated theory that saturated fat causes heart disease. A landmark 2016 article in the Journal of the American Medical Association found that the true science was actually being suppressed by the food industry.

It was driven by an unscientific agenda advanced by the American Heart Association and the food industry, which sponsored the misleading food pyramid. These establishment forces spent decades promoting addictive, high-carbohydrate processed foods because the low-fat foods they endorsed require more carbohydrates to retain flavor. That 40-year trend perfectly parallels our obesity epidemic.

But beware of tests that go fishing for diseases. At times in my medical training, I’d hear a doctor justify ordering a broad set of tests with the remark that one time, one of the tests revealed a rare medical condition. The real question is: Are these conditions treatable? Because if not, it can create tremendous angst.

The study came out just as the Affordable Care Act was being crafted, and the article quickly became a highly cited source as the legislation was being debated. As it turns out, the study’s coauthor was a political adviser to those drafting the ACA.

As soon as the Harvard researchers published their 3.27-fold return on investment, it got cited as “published science.” I call it the pseudoscience bandwagon effect. The same journals that advanced the low-fat diet and told us opioids were safe had now, in the case of the Health Affairs piece, increased health care costs by publishing a misleading ROI statistic.

I’ve traveled to hundreds of U.S. hospitals and met with countless doctors. I’m always amazed by the maverick phenomenon, even within small groups of physicians. Let’s say there’s a group of three physicians. Often, one will criticize the others for not practicing up-to-date medicine; another will feel that she deserves to take fewer calls; and the third finds a creative way to hoard the good cases.

About 10% of what I learned has since been disproved and 80% is as irrelevant to how I practice medicine as the use of Botox on a furry dog. That leaves approximately 10% of what I learned in med school that’s relevant to my job.

However, things haven’t changed much on campuses because medical education is controlled by an establishment guard of accrediting boards and institutionalists. Medical education needs lipo. Instead of teaching every medical student how to refract people’s eyes to fit them for eyeglasses, how about teaching teamwork and communication skills? I learned the Krebs cycle, but not how to communicate effectively with nurses.

Klasko based his new curriculum in part on a $1.5 million grant he received to study what makes doctors different from everybody else. He learned that the way we select and educate physicians is akin to joining a cult. He identified four fundamental traits that get ingrained early: a competitive bias, an autonomy bias, a hierarchy bias, and a noncreativity bias. He learned that the profession attracts highly creative team players but that we ingrain in them the qualities of focus, discipline, and rigidity.