More on this book
Community
Kindle Notes & Highlights
by
Marty Makary
Read between
February 19 - March 21, 2021
But tragically, that heritage of public trust is threatened today by a business model of price gouging and inappropriate care.
For centuries, medicine was based on an intimate relationship between doctors and patients. But behind the scenes, a gigantic industry emerged: buying, selling, and trading our medical services. Health care industry stakeholders are playing a game, marking up the price of medical care, then secretly discounting it, depending on who’s paying.
This story reminded me that we don’t have malicious leaders in health care; we have good people working in a fragmented system. The operations I do today use the same equipment, anesthetics, sutures, and paid staff that I used ten years ago. So how is it that health insurance costs have been skyrocketing? It’s explained by the money games of medicine, loaded with middlemen, kickbacks, and hidden costs.
About one in five Americans currently has medical debt in collections and half of patients with certain medical conditions, such as women with stage 4 breast cancer, now report being harassed by a collection agency for their medical bills.4
A woman in California helped me appreciate the burden that our rising health care costs place on small businesses. To start her dry cleaning business, Jennifer had to pay $100,000 a year to get health insurance for herself and three employees.5 Right off the bat, her small business was six figures in the hole. How many more garments does she now need to clean in order to be profitable? Jennifer’s story illustrates one of the greatest risks to our economy: health care costs are increasingly suffocating business in America.6
The 2007 banking crisis resulted from complexity that kept onlookers confused. When people questioned banks being overleveraged and selling mortgages to people who couldn’t afford them, financial experts responded by saying, “It’s extremely complicated. Leave it to us.” But the problem was simple: Banks were spending money on toxic assets with money they didn’t have. Bad mortgages were bundled and sold on the market for more than they were worth. Credit ratings agencies, supposedly independent, received payments to prop up this house of cards. The result was a huge economic disaster.
It’s been going on for decades, but primarily in heart vessels. Such procedures can be lifesaving for someone experiencing a heart attack, but for most other patients, studies show stents provide no survival benefit. Because of that, heart stenting is in decline, replaced by better medications.
One thing puzzled me, though. It’s not as if patients just book appointments to have cardiologists check out their leg circulation. “Where are they finding all these patients?” I asked Chatrathi. “In churches,” he replied.
Chatrathi explained that churches hold community health fairs at which doctors show up and perform predatory screenings.
The young woman administering the screening may have been unaware of national guidelines about this type of testing and, with good intentions, convinced herself that plaques are evil. And the woman being tested probably thought testing was good for her health. She would be responsible for a small portion of the cost, but all of us would pay for the rest of her bill through the Medicare program.
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.
The doctors replied that, on average, they believe 21% of everything done in medicine is unnecessary.4 Breaking it down further, the doctors in that survey estimated that 22% of prescription medications, 25% of medical tests, and 11% of procedures are unnecessary. Literally billions of dollars are spent on care we don’t need.
It’s common for older patients to have some narrowing of leg arteries. The femoral leg artery is long, and some narrowing is normal. It’s called peripheral artery disease. But the body usually adapts. If surgeons operated on every artery narrowing, we’d be operating multiple times on nearly everyone over 70 years old.
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.
And if a cardiologist tells a patient he has a “widowmaker” in his heart—an actual medical term used to describe a partially blocked artery—the patient does whatever it takes to address it. No one wants their spouse to become a widow.
More than 300,000 appendectomies are done in the United States each year, each with a hefty price tag. Most of these patients can be treated with antibiotics alone.11
Nudges from doctors can be as powerful as IV sedation. Sometimes we steer patients toward what’s best for them. Sometimes we steer patients toward what’s best for us.
“Come back in a few months for a follow-up to take another look.” By the time they’re done ringing the cash register, Medicare has spent approximately $10,000 per person, a cost that’s passed along to every other American. Private insurance will pay up to triple that amount for the same procedure. It may be a scam, but it’s perfectly legal. The doctor carefully documents that the patient has a diagnosis of “claudication” to ensure that everything will be covered by insurance.
composure, but I could tell she was seething.
Our team eventually identified about 1,100 U.S. churches, synagogues, and mosques that served as vascular screening centers13—despite a scientific consensus that people should not be screened this way for this disease.
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. What we personally observed was consistent with what Caitlin’s maps had indicated.
Improving Wisely,
The idea of the medical industry intruding on Sunday worship brought to mind the biblical account of Jesus throwing the merchants out of the temple.
The politicians debated how to fund health care, but what we really need to talk about is how to fix health care.
Before Adam got discharged, a hospital representative came to his bedside to talk finances. He explained that the operation would cost $150,000.
as it would be in the United States. The family timidly asked how much the operation would cost in France. “About 15,000 U.S. dollars,” said the French surgeon.
“Quite honestly, we are thinking of having the surgery in France for $15,000,” Adam said. Without hesitation, the hospital representative dropped the price to $50,000.
Henri’s family was disturbed by the ethics of a hospital that would try to charge $150,000 for something they would do for $25,000. They didn’t expect a hospital to operate like a used car lot.
Adam had the surgery in France for $15,000 with a good outcome. “We loved our American doctors,” Henri told me over a drink. “It was the business of medicine that turned us off.”
At auto dealerships in the United States, you read the price on the windshield of a gleaming car and the salesperson says “I can talk to my manager about that.” Then he or she drops the price and says “We’re losing money on this sale to you.” It’s the same old dog and pony show. Increasingly, we see the same markup and discount game in medicine. Hospital charges are notoriously inflated—
Each insurance company negotiates a different discount, which varies depending on who has the leverage. The result is that insured patients don’t pay full price, unless their insurance carrier doesn’t have a contract. Then they’re “out-of-network” and face whatever the hospital decides to charge. The only difference between the game in car sales and health care is the size of the margin. For the car dealer, getting people to pay sticker price can mean making 15% more off the sale. But for a hospital, gouging the sick and injured can mean making 1,000% more.
Heart surgery outcomes are publicly available. The research showed no correlation between surgery price and quality.1
Instead, we created a website called SolveTheCrisis.org, where the day after the expert panel concluded we posted our opioid prescribing guidelines.
During and after our work to create procedure-specific guidelines, I watched the government and some insurance companies continue to issue draconian policies that limited opioid prescriptions to a 4-, 10- or 30-day supply. How could anyone dictate hard-and-fast limits when the amount of pain resulting from every procedure was different? Drilling bone to do a hip replacement is far more of a shock to the system than a lymph node biopsy.
Most doctors worldwide reserve opioids for the classic indications—like terminal cancer, burns, and major surgery. I felt a bit ashamed, but it was true. The opioid crisis was unique to American medicine.
There are concrete things we can do to address this crisis. We can start by changing perverse financial incentives. It is difficult to find doctors interested in carefully managing a patient’s pain medications because doing so pays so little.
We also need insurance companies to change. Ironically, acetaminophen and NSAIDs (nonsteroidal anti-inflammatory drugs) are over-the-counter medicines and thus rarely covered by insurance. But the insurers do cover narcotic painkillers. As I’ve talked to my patients, I’ve come to believe that one simple solution is that all non-opioid pain meds should be fully covered after surgery with no copay or deductible. Those who think that the $10 to $20 price for a bottle of NSAIDs is a not a barrier to patients buying them should meet some of my poor patients from inner-city Baltimore. I have had
...more
Treatment for opioid addiction is essential, but we should remember that preventing addiction is even better. To address the opioid crisis, we need to take away the matches, not just put out the fires.
The hospital charges don’t have to be reality-based. The amounts they accept from insurance companies don’t have to be disclosed. The price the patient will pay is not shared before treatment takes place. This isn’t like other consumer transactions in which people pay for services.
What they didn’t realize is that I had been able to find out how much the hospital would have taken from an insurance company for the same procedure. I used a website called HealthcareBluebook.com, which shows the typical rates hospitals get paid for various common operations. The site showed me that the fair price, the one the hospital actually takes from in-network patients, is about $12,000.
“Would your hospital be willing to accept $12,000 for the same service for an insured patient who is in-network?” I asked the representative on the phone. The woman got upset. “We can charge someone out-of-network as much as we want,” she told me. “The law says we can.”
I told him that Dina didn’t have a contractual obligation to pay, which she didn’t, because she had struck out the clause saying she’d pay whatever they charged. I added that the law prohibited collections agencies from hurting her credit if they did not have a contract for services. The hospital director then made a big show of offering Dina financial aid. But mind you, this wasn’t an act of generosity. The Affordable Care Act requires hospitals to have financial assistance policies, and sets parameters for what a hospital can do. The rules say hospitals are not allowed to discourage patients
...more
I asked the director what an in-network insurance company would have paid for Dina’s bill. As I expected, he said he wasn’t allowed to disclose his discounted rate with any insurance company. “Look, if Dina can pay $30,000, I’ll write off the difference,” he said, trying to close the deal. “She can do $12,000,” I replied. “How about $25,000?” Surround him with camels and pyramids and he’d be right at home in the bazaar. “She can do $12,000.” “How about $20,000?” “She can do $12,000” “How about $19,000?” I said no, thank you, and have a nice day.
And, frankly, it is embarrassing. Health care doesn’t have to be so different from any other business in America. Imagine you see an orange in the supermarket with no price on it. You take it to the register to get a price check. “How much for the orange?” “You have to buy it to find out,” the cashier says. You’re hungry, so you buy the orange. But you recoil when you see the cashier has charged your credit card $500. And there are no returns. If that happened at the grocery store, you would be outraged. But that’s how our current health care system operates. You can’t see the price until
...more
When you buy a car, you can check the Kelley Blue Book to see the fair price. But nothing like that existed in health care.
Employers that partner with Healthcare Bluebook are able to flag the price gougers in the market to their employees and point them to a fair-priced provider.
Getting patients to shop wisely is a milestone in health care. A large study by the group RAND found that when patients who are not paying for their medical care can choose between lower-cost and higher-cost care, they choose the more expensive care. They assume the more expensive, the better, a correlation that may work in other industries. But that’s not the case for many types of treatment in American health care. Employers love Healthcare Bluebook and pay for the service because they may be saving the difference between $37,000 and $1,500, just as Jeffrey did when he shopped for a hospital
...more
We spend enough money on health care in the United States that we should be able to cover every citizen. “It’s the waste that strains the system,” Sprowls added. Price transparency alone will not solve all the problems of predatory screening and unnecessary medical care. But it could save the health care system hundreds of billions of dollars currently being wasted on the game. In the words of senator and physician Tom Coburn, getting price transparency right is the first step in fixing health care because it ushers in quality transparency. We need to see prices, so patients and health plans
...more
The new ACA health care law had inserted in it the “Safeway Amendment,” which allowed employers to use up to 30% of the cost of an employee’s health coverage as a “reward” to induce the employee to take part in the program. If you don’t participate, you pay a lot more for your health insurance. That’s how wellness programs proliferated in America.
