Kyle McNamara

A few weeks ago, I came down with an ear infection.  I visited my doctor, paid for an office visit, and received a prescription.  The treatment didn’t take so I went back a week later, paid for another office visit and prescription, then was referred to a specialist – paying for yet another office visit.  This final treatment worked – but I’d paid for 3 office visits and 2 ineffective treatments to fix a fairly common problem.

In contrast, a few years ago, the gadget panel on the front of my refrigerator started acting up.  I called the repairman, he charged me for the trip and for a replacement part.  That part didn’t take, and over the next several weeks, he came back nearly a dozen times to try different parts – but I only paid for the one trip charge and the part that ultimately worked.

Why is it that my doctor couldn’t warranty her services the way that the repairman did?  This was a common ailment, not a terminal illness, that I hired her to fix.  She may have had no way of knowing whether my body would respond to a particular treatment, but her surprise that the first treatment didn’t work was similar to my repairman’s when the first few parts did not solve the problem I hired him to fix.  It’s no wonder that our healthcare system is so large when consumers have to pay multiple times to fix minor problems, when countless other professionals at least offer some sort of warranty for their work.

A recent issue of Imprimis Magazine alludes that doctors have little choice in how they bill because of how government programs charge – Medicare only allows certain charges, so that’s how the business model was setup in the first place.  Medicare’s restrictions also inhibit technological advances such as electronic medical records and phone/email consultations with your physicians, keeping costs high.  If I’d been able to have a phone consultation with my doctor, I could have at least avoided my second office visit, freeing her to see other patients and keeping money in both my and my insurer’s pockets.  The Economist recently published an article on healthcare, citing evidence that more spending does not reliably lead to better outcomes (which I experienced firsthand).  Without altering the current business model, changing the incentive structure, and encouraging innovation, our healthcare system will continue to be plagued by high costs and lower quality.

The Imprimis article goes on to give examples of innovations in healthcare that have led to freer markets and lower prices over time – the type of behavior you’d expect under a free market system, and a welcome contrast to the current trend of our healthcare system’s costs rising at twice the rate of income.  These innovations include increased use of electronic medical records, telephone consultations with doctors, and published performance metrics – items that do not seem so revolutionary when compared to other industries.  One of the other trends mentioned is the increased use of walk-in clinics such as MinuteClinic that treat common illnesses (such as my ear infection) and offer lower prices by employing nurses instead of physicians   I have been a frequent customer of MinuteClinic because it is often easier to get an appointment and the price is half what my doctor would charge.  And the set of services they provide is a good starting point for identifying common conditions that can be warrantied, reducing costs for consumers and insurers.

As we continue to debate the future of our healthcare system, I hope that the role of innovation and private enterprise are expanded and leveraged to lower systemic costs and the need for additional government regulations such as those that contributed to our current situation.