A Tried And True Way To Reduce (Healthcare) Costs: Deregulation

In the 1980’s the transportation and communications industries were deregulated.  The result?  Besides a lot ofmarket disruption in the initial stages, the result was better service and the lower prices we have today.  It seems like a no brainer, but there are certain interests that don’t want you to deregulate health care, and they range from the union you have never heard of to the taboo of self-prescription, and law suits; lots of them.

The Physicians’ Union
My labour Economics professor was a liberal guy, and he was an old fogey who had seen it all and could teach you much.  One of the more insightful things he taught my class was the union that we had never heard of: The FSMB

The FSMB, or Federation of State Medical Boards, according to their website is “a national non-profit organisation representing the 70 medical and osteopathic boards of the United States and its territories. The FSMB leads by promoting excellence in medical practice, licensure, and regulation as the national resource and voice on behalf of state medical and osteopathic boards in their protection of the public.”

That mission statement most likely is accurate, especially if you read what I believe to be a fair assessment of medicine in the 19th century.  But that doesn’t negate the fact that it is a union, and that unions typically lobby for higher wages by limiting the supply of labour.

Currently, there are 159 medical schools in the United States.  These schools (inherently) can train only a fixed number of physicians. 

I would understand why we would need accreditations today if medical quality was poor, but it is not.  In fact, medical quality today is arguably in excess.   The challenge we face is not quality—it is cost.

Further, as written in her book “Every Patient Tells a Story”, Lisa Sanders makes the case that much of diagnosis is the touchy-feely part, the part of interacting with the patient in a social way.  Many of the physicians we train today, I would argue, are not tested in that capacity, let alone are skilled at it or taught to be skilled at it.  To be accepted into one of the accredited institutions, applicants are tested in a scientific, analytical, technical manner.  The physicians we are graduating today are trained to give tests, be socially callous (as a scientist is), and missing the little things that a more social physician would pick up on.

I won’t make the accusation that the FSMB’s express hidden agenda is to garner higher wages for its medically-trained union members, but it is acting like a union and it effectively is doing that.

Lets deregulate medicine because today the challenge isn’t quality—it is cost.  Let’s increase the supply of physicians and bring costs down.  And who knows, if quality becomes an issue for our great grand children, then they can change the legislation back.

No antibiotic for you!
Antibiotics are one of those wonder drugs.  I have seen my cat, limping from pain, make a full recovery after a regiment of antibiotics.  It is for this reason that doctors (and in my cat’s case, vets) don’t want to overprescribe antibiotics—they want to “keep the powder dry”.  However, as a Liberal Libertarian I will tell you that that is a bunch of baloney—humans will cheat the system and get what they want.

I have a few stories, but let’s start with my cat.

That regiment of antibiotics we gave her was the residual of what her “brother” had left over from his surgery.  Point being:  physicians have no way of forcing you to take the full prescription. 

I and many don’t take the full dosage because we tend to be good judges of our bodies—we get that feeling when we know we are going to fully recover.

Not infected but want to get antibiotics?  Lie, or go to the pet store.

If you go to your physician and say that you are headed to a third world country and you would like to bring some antibiotics with you as a precautionary measure, I have read that many physicians will grant your wish, especially if you come off as genuine.

Perhaps you failed at getting antibiotics from your physician.  OK, then go to the pet store and pick up fish antibiotics.  That’s right.  The same antibiotics that are used to cure you are used to cure fish (note:  I am not advising you do this because your infection might be quite different than what that antibiotic is capable of treating, rather I am merely making the scholarly point that access to antibiotics are more available than what one might expect.)

This brings me to my final story, a story where I actually diagnosed myself.  It was also one of the scariest days of my life.

One morning I woke up and the one side of my face was twitching.  Ok, no big deal, muscles across my body have twitched before and they eventually stop.  Sure enough the twitching stopped, but also the muscle control of half my face.  “Holy sh*t, did I just have a stroke?”

My father and I were headed to get something to eat that morning.  I was able to keep my half-working face pretty well hidden up to the point in the parking lot where my dad said, “Zeke, is something wrong.”  “Yeah dad, I woke up this morning and half my face didn’t work.”

My dad is a renaissance man.  I am pretty sure that he could build a space shuttle with a tooth pick and a piece of chewing gum.  Being the worldly man that he is, he said, “That sounds like Bell’s Palsy.  Go online and research it.”

After researching it, I learned that one cause to Bell’s Palsy can be Lyme Disease.  That sounded familiar because I felt like hell about a week ago (oi, the fever, the delusions of thought, I can still remember.)  Being well researched and going to my physician (I love my physician, he is a no BS guy like me) and I said, “I think I have Lyme disease.  Can we test for it?”  He nodded and granted my wish.

A couple of days later the test can back positive—I had Lyme Disease.  I was immediately put on regiment of steroids and the body aches slowly began to go away.

Now, if you had read all of that, the point that I was ultimately trying to make is this:  why did I have to co-pay my physician $20 and waste his time?  We in the age of the internet have access to a plethora of information.  If we are able to self diagnose ourselves and do not require the assistance of a physician, why aren’t we saving costs by doing so?

Lawsuits, lawsuits, lawsuits as far as the eye can see
I am a Liberal Libertarian, so it pains me a bit to side with the Right.  However, there seems to be evidence that shows lawsuits are out of control in the healthcare industry.  But first, how did we get here?

Since roughly the 1970’s, there has been a growing number of medical malpractice lawsuits filed.  What have physicians done in response to this increased litigation environment?  Physicians continue to get ever more insurance (which leads to increase price for their services), moving to more acceptable litigation environments (which limits your access to quality care), and being less out going in their practices (again, less treatment.)  At least that is what they say. 

But it seems reasonable to me, and considering that physicians are a monopoly supplier (the health care industry isn’t very competitive, remember) they are able to pass most of their increased costs onto you.  But that isn’t what bugs me, what bugs me are all the freaking tests and doctors being afraid of their patients.

Any idea why you go for all those tests?  It isn’t to find out what is wrong with you (well, at least that is not the main reason the tests are performed), the real reason you go for all those tests is so that your physician has evidence in the court of law.  That’s right, because in the court of law you don’t have to prove innocence, all you have to prove is not guilty, and a test is a pretty indisputable piece of evidence.  And you thought they were trying to make you better…

I remember when I was with someone close who was receiving medical attention.  Other family members were there inquiring the doctor.  Then I heard one of the most ludicrous things I’ve heard:  “well, what do you think?”  My family didn’t ask the physician that, THE PHYSICIAN ASKED MY FAMILY THAT!

Are you freaking kidding me?!  The expert is asking the persons seeking care what do they think?!  Had I not realised the lunacy of his reply I probably would have flayed him.  But that is what we are seeing across America, physicians who are afraid of their patients.  Afraid to go with their gut and try to treat the person for their malady.  

Should we reform health care lawsuits?  Probably, considering that physician advocacy groups say that 60% of cases are dropped, and 90% of those that go to trial are found not guilty (although it might be because of those tests.)  We would especially like to reform health care lawsuits if we deregulated the industry (quality would inexorably decrease.)  But we don’t live in a perfect world.  So the FMSB will probably just lobby to reform health care lawsuits and not deregulate the industry.  All well, we’re all dead in the long run anyway.

Conclusion
I was reading a Wikipedia page as I tried to conclude here and something caught my eye.

The problem in the healthcare industry is that costs are going up.  If the laws of economics apply here as they seem to have in the transportation and communications industry, then deregulating the healthcare industry should make prices more affordable there.

But we can over deregulate.  Look at the finance industry as an example.  A flat market for a decade, volatility?  The quality there sucks.  Perhaps we should re-regulate it.

The same could be said of our future.  If we over deregulate and our healthcare industry gets as crumby as our finance industry of the past 10 years, then we can simply reregulate it.  Laws can be changed, and changed back.

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