Sunday, December 06, 2009

What is Cost Containment?

What, precisely, is meant by “cost containment” when legislators are discussing “health care reform” legislation? It might not be and probably isn’t what you might think it would be, namely reducing the amount you pay when you go to the hospital or doctor.

Ron Beasley at Newshoggers had what he called a “health adventure” and shows us a bill for $606 submitted by a doctor as a result of that adventure.

Today I received the above bill from the emergency room physician who spent about five minutes with me. I will add another 10 minutes for looking at the X-rays and the EKG but that still comes to over $2,400 an hour. I will call them on Monday and agree to pay 50% ( still outrageous) - about what Medicare or an insurance company would pay.

Which means a) that the doctor is billing cash customers twice what is billed to contract customers and b) that the doctor is charging Ron $606 for something that costs less than $200 to produce.

But, and this is a really big "but," the insurance companies are the problem, the sole cause of high health care costs, and the source of all things evil. We don't need to change anything about the way this doctor is charging patients because passing legislation with a "public option" will solve all of the problems of cost and will result in health care instantly becoming almost free.

I may have indulged in a little bit of sarcasm there.

Ron’s post includes a clip of a panel discussion on the Rachel Maddow Show, on “health care reform” legislation or, actually, the politics thereof. One of the panelists is Anthony Weiner, a New York Congressman, who talks at length about the importance of “cost containment.” The transcript is not yet available, so I may not have his words exactly right, but he says, among other things,

If we don’t contain costs this will be considered a failure. … The cost containment part is the important thing and that’s where the public option has emerged as an important (unintelligible due to crosstalk).

What does the “public option” have to do with prices charged by doctors and hospitals? Well, nothing, which is why “cost containment” doesn’t mean what one might think that it does. Weiner seems to think it means reducing the price of health insurance, but his platitudes on the "public option" have not sold me that we can do that really effectively without reducing what health insurance companies pay out for health care services.

So when your representative claims that the legislation he/she is voting for contains health care “cost containment” measures, ask them what “cost containment” means.

And make them actually answer the question.

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