Insurance

HEALTH REFORM: Obamacare won’t fix broken health system

Dr. Matt McCord

JUNE 18, 2013 – very week we read another article on the fuzzy math and ridiculous mark-up for our routine health care. Do your own research; see Elizabeth Rosenthal’s article in a recent Sunday New York Times, “the $2.7 Trillion Medical Bill” or Steven Brill’s lengthy tome in Time, “Bitter Pill.”

We spend, and will continue to spend, more on health care than any other nation in the world and yet we are 38th in health care rankings, according to the World Health Organization. America has the most efficient markets in virtually every other sector except health care. Unfortunately, we are just beginning to see that our landmark health reform law, Obamacare, is no improvement and it will give us less for more.

America has had a broken model for our health care for nearly two generations (50 years). What is broken is our dependence on third-party middlemen (government, insurers) when we need health care. Even though 70 percent of our health care is elective, non-emergency and provided outside of a hospital, we allow middlemen to control all transactions.

These middlemen obscure all real pricing and insulate us from normal market dynamics and price competition. This prevents the development of a virtuous cycle between consumers (us patients) and providers (doctors, clinics, hospitals). Thus, instead of win-win health care where individuals are paying attention to costs and are motivated to stay healthy by saving money, we have lose-win-lose health care where everyone loses but the middlemen — have you ever noticed that there is always a crane in a hospital parking lot? Our poor collective health may be just one indicator of how decoupling the patient from their health care is a failed strategy.

America needs to move from an “open bar” model, where everything is covered and no one is paying attention to costs, to a “cash bar” consumer-driven health care model. Patients would pay attention to costs, have leverage for access to care, which will be important moving forward, and get incentives for healthy behaviors.Providers would be more focused on the patient and be motivated problem solvers for the patient — providing higher quality and more convenient care. This model for health care is more holistic and ethical too; by engaging and incentivizing the recipients of care, it recognizes the interdependence of all stakeholders while giving patients and their families the ultimate choice of how their health care is managed.

Dr. Matt McCord is an anesthesiologist in Ann Arbor. He is one of the founding members of the Michigan Alliance for Sustainable Healthcare (MASH).

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