Cleveland Clinic Empathy Video

This is change of pace from the health policy posting.

But I wanted to share this moving short video from the Cleveland Clinic on the hundreds of behind-the-scenes stories every day in the hospital. (I recently saw it a medical conference I attended earlier this month.)

Thank you.

Hsieh Forbes Column: Perverse Incentives and VA Health Scandals

My latest Forbes column is now up: "Perverse Incentives and VA Health Scandals".

I discuss the perverse incentives underlying the numerous VA health scandal. Too many on the political Left (such as New York Times columnist Paul Krugman) are quick to condemn perverse incentives in the private health system, while failing to mention similar (or worse) perverse incentives in government-run health systems.

Incentives matter.

Doc Fix Critiques

Three recent negative critiques of the Medicare "Doc Fix":

"House 'Doc Fix' Bill Makes Things Worse, Medicare Analysis Finds" (Chris Jacobs, Wall Street Journal)

"Medicare Doc Fix Bill Is IPAB-Lite" (David Hogberg, Daily Caller)

"Medicare fix needs fixing" (Theodore Marmor, Philadelphia Inquirer)

In particular, the Hogberg piece notes the perverse incentives that will pressure doctors skimp on care to patients as part of cost containment.  But all three are worth reading.

Perry: Lessons From Cosmetic Surgery Markets

Economist Mark Perry has a written a nice review, "What economic lessons about health care can we learn from the market for cosmetic procedures?"

In general, these services are not covered by insurance but rather paid for by the consumers themselves.  Hence, consumers have a keen interest in finding the best value for their medical dollar.

As a result, prices have essentially stayed stable (or decreased significantly) after adjusting for inflation.  In some case, the prices have gone down in nominal dollars as well!

As Perry notes:

Most importantly, none of the ten cosmetic procedures in the table above have increased in price by anywhere close to the 88.5% increase in medical care services since 1998.  [Emphasis his.]

Perry summarizes:

The competitive market for cosmetic procedures operates differently than the traditional market for health care in important and significant ways. Cosmetic procedures, unlike most medical services, are not usually covered by insurance. Patients paying out-of-pocket for cosmetic procedures are cost-conscious, and have strong incentives to shop around and compare prices at the dozens of competing providers in any large city.

Because of that market competition, the prices of almost all cosmetic procedures have fallen in real terms since 1998, and some non-surgical procedures have even fallen in nominal dollars before adjusting for price changes. In all cases, cosmetic procedures have increased in price by less than the 88.5% increase in the price of medical care services between 1998 and 2014.

In other words, the problem we've seen of skyrocketing prices in the traditional medical market can't be blamed on "fee for service". Rather, the issue is the 3rd-party payor system, a point also made by others such as Dr. Richard Amerling in his recent Wall Street Journal piece.

Proper treatment of a problem requires a proper diagnosis, in public policy as well as in medicine.  Perry's work is an important pointer in the right direction.

More MOC Controversy

Kurt Eichenwald of Newsweek has a new article on the controversy surrounding the American Board of Internal Medicine (ABIM): "A Certified Medical Controversy".

Here's the opening:

My wife is an internist. My brother is a pediatrician at a major academic institution. So was my father. My best friend is a surgeon. I regularly see an internist for my medical care, and I like her very much. I also should mention that this article is an opinion column. 

And it is my opinion that the American Board of Internal Medicine (ABIM) has hidden managerial incompetence for years while its officers showered themselves with cash despite their financial ineptitude and the untold damage they have inflicted on the health care system...

I applaud Eichenwald for asking some hard questions about the ABIM.

See also his earlier related story: "The Ugly Civil War in American Medicine". 

(Via Matthew Bowdish.)