I read the summary differently. I understood it to be saying that when the military is paying, and therefore there is no malpractice exposure, the costs are much cheaper, but there is little difference in outcome. And therefore all the extra things that private doctors do to avoid liability lawsuits do not significantly improve outcome and only raises costs.
Doctors and Hospitals do many unnecessary things. The question is why?
Option #1. Defensive Medicine.
Option #2. Maximize billing opportunity with add ons and upcharges.
When we go into a store for that cheap item, the store tries to get us to buy the bigger, more costly, higher profit margin. The store tries to get us to buy additional things that we never came in to buy.
The same is true of Doctors and Hospitals. I’ll use myself as an example because I’m forbidden to use others. I went into Emory St Joseph in Atlanta with pneumonia. They held me in the emergency room as long as Medicare would allow, and added on as many exams as Medicare would allow.
Then they moved me to Observation, which is purgatory between ER and inpatient. They again did as many procedures as Medicare would allow. Then I went to inpatient.
The anti-biotic they gave me for minor pneumonia cured me in hours. I did not need to go inpatient.
But they gave me an unnecessary xray that Medicare would pay. xray is useless for pneumonia, but required before they can do a CTscan. So the next step was a CTscan. This was totally unnecessary as it was obvious I had pneumonia.
The CTscan found a millimeter black spot on the lung that did not have pneumonia. I knew exactly what it was. I had many dirty jobs and have dirt in the bottom of my lungs. But the doctors didn’t want to hear my explanation.
They wanted to see if it was cancer. That was defensive medicine? So they gave me an enhanced CTscan. That CTscan can’t tell them anything about cancer. But it is billable to Medicare. And Medicare requires it before they can do surgery.
So the next step was a surgical biopsy. It turned out the little black spot was not cancer.
But the biopsy, the little hole, collapsed my lung. So I was in the hospital a week for a collapsed lung.
My first inpatient day, a string of doctors stuck their head in the doorway and said:
You have shingles
You have difficulty breathing (not until my lung collapsed)
You have this. You have that.
Not a single one came within 5 feet of me. They did not examine me in any sense of the word. I do not know if they looked at my charts where the nursing staff recorded my vitals.
Everything they did was billable to Medicare and Medicare paid.
My conclusion from both my personal experience, and the experience in my work is that both defensive medicine and gullibility of Medicare reinforce each other.
Here in GA some hospitals are failing. Some hospitals and their doctors know how to game the system. Some hospitals, either due to ethics or incompetence, do not maximize their billables.