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Why Pay Physicians Anything At All For Providing Healthcare?
Townhall.com ^ | March 18, 2013 | Hal Scherz

Posted on 03/18/2013 8:35:03 AM PDT by Kaslin

Last week, the National Commission on Physician Payment Reform released its recommendations, calling for the elimination of fee-for-service healthcare within the next 5 years. This organization, funded by the Robert Wood Johnson Foundation, is populated by physicians from academia, the insurance industry and from the public policy world. Having former GOP Senate Majority leader and cardiac surgeon Bill Frist serving as honorary chairman gives the imprimatur of bipartisanship and legitimacy. However, Dr. Frist, a former academic himself, has long favored a government supervised healthcare system, and is therefore less than objective in this regard.

The Commission was formed to assess by what means and how much doctors should be paid. Their position is that payments to physicians are one of the key drivers of escalating healthcare expenditures. They want to pay for the sustainable growth rate (SGR or "doc fix") by cutting physician payments for services, just as they aspire to hasten the implementation of the Affordable Care Act by fast tracking new and unproven concepts such as accountable care organizations (ACOs), patient-centered medical homes and value-based purchasing.

Sadly, the objectivity of this group has been clouded by its ideology and perhaps itsself-interests. Although physician payment is one of the components of healthcare costs, it is hardly the major driver. According to a 2012 study from Jackson Healthcare, compensation to physicians was 8.6% of healthcare costs, or $216 Billion annually- amongst the lowest of the major Western nations. Germany spends 15% of their healthcare costs on physician compensation, Australia 11.6% and France spends 11%.

Placing blame for runaway healthcare costs solely on physicians is simply an attempt to divert attention from the real perpetrators. In his recent Time magazine feature story, Steven Brill painstakingly outlined how hospitals throughout the country are generating obscene charges and profits. Over 30% of healthcare spending is generated by hospitals, a large share of which goes to managers and executives; many taking home seven figure salaries. Ignoring this, the Patient Payment Reform Commission wants to give the hospital administrators, through the new ACO model, even more control by directing payments to them, effectively making them the gatekeepers of reimbursements. The false narrative that has been created for public consumption is that in doing so, savings are created by consolidating and delivering care more efficiently and effectively. So far this is simply false.

Two of the major drivers of out of control healthcare spending are medical liability and the 3rd party payment system.

Medical liability costs, both the money spent to defend claims and the awards, is greater in the United States than in all of the Western democracies combined. The largest contributor to these costs comes from extra tests ordered by physicians, to protect themselves from frivolous lawsuits-defensive medicine. A Harvard study in 2008 calculated these costs to be about 2.4% of healthcare spending or $65 billion annually. The 2011 newsletter of the American Health Insurance Plans (AHIP) reported that these costs were actually somewhere between $650-850B annually.

The 3rd party payment system is perhaps the most potent driver of runaway healthcare spending. Without any restraint on spending, largely because individuals are disconnected from the costs of their healthcare, patients routinely expect tests and procedures that may be unnecessary simply because someone else is paying the bill. Doctors have little incentive to dissuade this behavior since the cost is also opaque to them and the threat of malpractice always lingers in the background.

Physician compensation is not the reason that healthcare costs are out of control. Annual healthcare spending is estimated to be $2.7 Trillion. There are many parties uninvolved in direct patient care, who have devised ingenious ways to get a share of this limited pot of money. If one considers that the basic relationship in medical care is between one doctor and one patient, and that the physician is responsible for referrals, tests, hospitalization and x-rays, it becomes clear how others could profit by controlling physician behavior and reimbursement. When doctors have less discretion over their decisions, entities that have had a hand in imposing these controls stand to profit, and they currently are. As a result of current regulation and payment policies preventing physicians from competing against hospitals, doctors are often forced to direct patients to these institutions, where costs are often as much as 10X higher for the same services that could have been offered in a physician owned center.

It is easy to be swayed by "experts" who find it quite convenient to make scapegoats of doctors and their compensation; attempting to convince the public that fee-for-service is the problem while using worn out clichés such as "doctors are being paid for sickness instead of wellness". Physician compensation plays a minor role as a driver of escalating healthcare costs. Anyone who suggests otherwise is protecting their own interests and deflecting scrutiny away from the real culprits- the hospitals, the insurance companies, the federal government, and the trial bar.


TOPICS: Culture/Society; Editorial; Government
KEYWORDS: economynews; governmentspending; obamacare; physicians
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To: KrisKrinkle

So I answered your questions honestly. I have a few for you. This will help me understand whether we’re splitting hairs or are on the same page. Do individuals possess a right to health care? How about a right to education? Do individuals possess a right to food and water?


41 posted on 03/18/2013 1:16:03 PM PDT by andyk (I have sworn...eternal hostility against every form of tyranny over the mind of man.)
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To: Kaslin
Part of it yes, but an entire paycheck?

I do get what you're saying. But, I've seen nothing intrinsic to the arguments validating the income tax that imply there is some built-in limit to what can be taken. Any limits are those imposed by voting alone.

It's either constitutional, or it's not. It's not just constitutional up to X percentage.

It probably sounds like splitting hairs, but I think we need to understand the power we have handed over to our fedguv.
42 posted on 03/18/2013 3:45:09 PM PDT by andyk (I have sworn...eternal hostility against every form of tyranny over the mind of man.)
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To: Kaslin
The 3rd party payment system is perhaps the most potent driver of runaway healthcare spending.

Many leftists accept, in the abstract, the notion that scarce resources should be allocated to those who need them the most. What they (and all too many Republicans) fail to grasp is that not only does a person's willingness to pay for something correlate very strongly with need, but it is far less corruptible than other metrics. Those who outbid everyone else for scarce resources get the resources, but have to pay for them. Those who don't bid high enough to get the resources are compensated by not having to pay for them, and will consequently have more money with which they can bid on other things.

Allocating things based upon willingness to pay thus gives people a major incentive to minimize their need for scarce resource. Conversely, many other allocation methods reward those who try to maximize their real or apparent needs. Policies which reward need will beget more need, to the point that demands become insatiable. Only if policies reward those who minimize need, can needs possibly be met.

43 posted on 03/18/2013 4:15:14 PM PDT by supercat (Renounce Covetousness.)
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To: JohnBrowdie
This is basically what the old Soviet Union did. And it worked great. By the time the Evil Empire fell, the life expectancy was about 59.
44 posted on 03/18/2013 8:46:01 PM PDT by hinckley buzzard
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To: Kaslin

either pay your way in life or lie down and die!!!

No one owes anyone anything!


45 posted on 03/18/2013 8:49:48 PM PDT by dalereed
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To: Kaslin
Interesting, with so many professional vocations being threatened with cutbacks and diminished salaries, one specific profession manages to thrive no matter what happens to the rest of the economy.


46 posted on 03/18/2013 9:06:11 PM PDT by Bratch
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To: Holly_P

Hey Holly, some people think you make too much money!


47 posted on 03/18/2013 9:06:15 PM PDT by Graybeard58 (_.. ._. .. _. _._ __ ___ ._. . ___ ..._ ._ ._.. _ .. _. .)
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To: andyk
Let’s see, where to begin…

In case it wasn’t obvious to you, we’re talking about intrinsic, natural rights.

You didn’t limit your statements to “intrinsic, natural rights” in either Post 9 or Post 20, so I had no reason or obligation to limit my response to that. That you find it necessary to make the distinction of “intrinsic, natural” rights indicates that there are other kinds of rights. Note that Webster’s 1828 Dictionary states: “Rights are natural, civil, political, religious, personal, and public.” I would say legal rights and contract rights are included.

And you did write “There’s not enough discussion of what rights really are…”. I don’t see how we can discuss that without discussing the various kinds of rights.

You have a “right” to someones services because they agreed to it! That is a simple concept.

Putting quotes around the word “right” as you did implies it’s not really a right, but it may well be a right. It’s not an intrinsic or a natural right, but it may be some other kind of right.

You do not have a right to their services because you claim a right to health care.

You might have some type of right, if your claim is a just claim.

It negates no statement I’ve made.

I’ll stand by my previous statement in regard to your previous statement.

By the way, does a newborn baby have any sort of right to care (provision of sustenance, health care, etc.) from the parents, or can the parents claim the newborn has no right of any kind to anything from them?

And now, to your Post 41, after a bit.

48 posted on 03/18/2013 9:20:56 PM PDT by KrisKrinkle (Blessed be those who know the depth and breadth of their ignorance. Cursed be those who don't.)
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To: andyk
Do individuals possess a right to health care?

Individuals do not possess a natural right to health care, except maybe in so far as they can provide it themselves. Except maybe a newborn child. A newborn child may have a natural right to health care from its parents. Or maybe not. Maybe the parents can just let the newborn die because it has no right to healthcare from them.

Given that there are rights other than natural rights, individuals may have some kind of right to health care other than a natural right. Arguably if an individual pays for health care in advance, the individual has a right to that health care. Arguably an individual in the US Military has a right to the health care services the military provides its members as part of the deal.

How about a right to education?

I suppose individuals have a natural right to education they can provide themselves as long as such provision doesn’t abrogate another’s rights. Again, given that there are rights other than natural rights, individuals may have some kind of right to education other than a natural right.

Do individuals possess a right to food and water?

John Locke wrote: “The earth, and all that is therein, is given to men for the support and comfort of their being. And tho' all the fruits it naturally produces, and beasts it feeds, belong to mankind in common, as they are produced by the spontaneous hand of nature; and no body has originally a private dominion, exclusive of the rest of mankind, in any of them, as they are thus in their natural state: yet being given for the use of men, there must of necessity be a means to appropriate them some way or other, before they can be of any use, or at all beneficial to any particular man.” (Emphasis added.) He goes on to describe how a man may make such things his own property.

Locke further writes: “It will perhaps be objected to this, that if gathering the acorns, or other fruits of the earth, &c. makes a right to them, then any one may ingross as much as he will. To which I answer, Not so. The same law of nature, that does by this means give us property, does also bound that property too. God has given us all things richly, 1 Tim. vi. 12. is the voice of reason confirmed by inspiration. But how far has he given it us? To enjoy. As much as any one can make use of to any advantage of life before it spoils, so much he may by his Labour fix a property in: whatever is beyond this, is more than his share, and belongs to others.” (Emphasis added.)

Considering the above, I would have to say that an individual does possess a right to food and water in so far as he can make them his own and that another individual does not necessarily possess a right to amass all the available food and water to the detriment of the first individual, at least absent an organized society. A question would be: Does an individual in an organized society lose this right and if so at what point?

Other questions might be:

Does a prisoner have a right to food and water or may he be justly starved to death?

Does a newborn have a right to food and water or may it be allowed to die without?

Given several property owners along a stream of water, can someone upstream rightfully divert the stream for his own purposes or do those downstream have a right to the water?

Discussion of "what rights really are" is not as simple as it might seem.

49 posted on 03/19/2013 11:48:31 AM PDT by KrisKrinkle (Blessed be those who know the depth and breadth of their ignorance. Cursed be those who don't.)
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To: KrisKrinkle

I appreciate the time you took to respond.

What you’ve done is show that discussion of rights really is as simple as I claim.

I see your answers to my three questions were “no”, even though I can tell you did not want to admit that. One of the first things I said was that one can do what one pleases as long as it doesn’t infringe upon the rights of others. That is not the same thing as you have the “right to pursue education”. It means no one has the right to stop you from doing so.

Why did I assume this was a discussion of natural rights? This thread was dedicated to health care. Absent man-made agreements, natural rights are the only one at play when it comes to healthcare. Otherwise, it’s between you and the mutually consenting party. Every edge case you presume to use is based on a mutual agreement between two consenting parties.

The rights you seem to be fond of are all man-made, and can be revoked by man.


50 posted on 03/19/2013 3:08:48 PM PDT by andyk (I have sworn...eternal hostility against every form of tyranny over the mind of man.)
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To: andyk
I appreciate the time you took to respond.

And I appreciate your acknowledgement of that.

What you’ve done is show that discussion of rights really is as simple as I claim.

We disagree on that.

Absent man-made agreements, natural rights are the only one at play when it comes to healthcare.

And we have rights, though not natural rights, as a result of those agreements.

The rights you seem to be fond of are all man-made, and can be revoked by man.

I'm fond of the right to liberty and the right to the pursuit of happiness (to include the pursuit of education) and I am most particularly fond of the right to life, and those are not man-made. I'm also fond of several rights that are not natural rights, such as the right to due process, the right to a trial by jury and the right to vote. What about the right to keep and bear arms? Is that a natural right?

Again, we disagree that discussion of rights is simple. But then, we haven't defined what we're discussing so: What's your definition of a right? Did you come to it yourself or do you have a source for it?

51 posted on 03/19/2013 7:15:09 PM PDT by KrisKrinkle (Blessed be those who know the depth and breadth of their ignorance. Cursed be those who don't.)
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