The bizarre calculus of emergency room charges

[jk]

Re: The bizarre calculus of emergency room charges

I think there is reason behind all this madness. It comes down to a matter of social control; that is, people in the U.S. are made more dependent on their employers and more insecure in their lives than people in other industrialized countries by the absence of single payer/socialized medicine. While insurance costs add to the costs of production for U.S. manufacturers, the overall higher level of social insecurity in the U.S. tends to keep wages and thus costs down. Companies such as GM, which one would expect would benefit directly from socialized medicine as a means of controlling costs, still have opposed it. For an interesting discussion of the issue, see John Spritzler, "Market-Driven Health Care And Social Control"

employer-paid health insurance is a remnant of wwi wage controls. with a labor shortage and unable to raise salaries, companies started offering health insurance as a way to recruit and hold onto employees. there was no nefarious scheme for social control involved. the system has evolved as systems do.

re telemedicine: there are already u.s. licensed radiologists in india reading xray images sent over the internet. it's especially valuable as a way to arbitrage time zones, not just fees.

also re telemedicine: i can easily see a role for specialist consultations, which are usually by appointment. this might save a rural resident a trip to the city. otoh, it might make consultations easier so that more are done and short-term costs actually rise. otoh [the 3rd hand if i'm counting properly], if the consultations are productive there might be longer term savings.

[mesyn191]

Re: The bizarre calculus of emergency room charges

i suspect this has more to do with nutrition, obesity, and so on than to medical care.

FWIW supposedly obesity in the US accounts for costs 10-20% of health care costs depending on whose study you look at. Most of them seem to suggest that this is easily dealt with by focusing on preventative medicine (ie. get them exercising some how) though.

i think the only hope for seriously reforming the medical system will come from a kapoom that forces a radical rethink of all spending.

If the Credit Bubble popping is anything to go by even this may not be enough to result in positive change. Many of the people running the show in the insurance and health care industry seem to be just as corrupt as those i-bankers IMO and just as well connected.

[leegs]

Re: The bizarre calculus of emergency room charges

Upon reading about the reasonably-priced clinics in immigrant areas, my first reaction is 'why'? Given that the current system seems to be so lucrative, why do some doctors operate these clinics, apparently more-or-less outside of the insurance system? Is it out of a sense of service and fairness, i.e. are these just good people? Or is it the case that at the level of medicine being practiced (i.e. apparently not neurosurgery) there is so much friction in the insurance system, and so much money going into the pockets of the insurance companies, that a doctor can make a good living charging much lower fees and not dealing with the friction and the skimming of profit?

Similarly reading LD's thoughts on possible future development of tele-mediated medicine, the reaction is to wonder why this would happen? What would be the motivation on the part of the existing health care 'system' to make any changes in this direction? The current one seems to be working out pretty well.

[lakedaemonian]

Re: The bizarre calculus of emergency room charges

Telemedicine in the teleoperative sense has a large number of both structural and societal/economic limitations:

1) Unless there are large percentages of doctors sitting around with nothing to do, it is quite unclear how the ability to project skills across the Internet is going to help with supply. Far more likely is that you'll see "doctor franchises" like you see with famous chefs.

I definitely see the doctor franchises......both in the celebrity chef model particularly for elective surgery....and the possibility of generic medical franchises for the efficient, economy of scale back office functionality and consistent image/experience for basic medical and preventative care.....as well as the possibility of non-emergency room after hours minor emergencies. For the high end of care for those that can afford it from the affluent on up there seems to be a trend towards concierage subscription care....pay a large annual subscription fee and your personal doctor is available 24/7 to your family and a select few others. Beneath that...I see McDoctors 'Do you want a Cholesterol test and some Statins with that?"

2) The existing provider networks already limit medical practice both for public safety and for job security - how would teleoperated medicine fit in with that? Just imagine how the AMA would react to foreign doctors practicing in the US via the internet

I believe we are already seeing a taste of that now with radiology as mentioned by another forum member. But agree that regulatory wise and "guild/monopoly protection wise" it could be a very steep and high climb in the special interest fighting arena.

3) Cost of equipment. A full teleoperative setup is likely 7 or 8 digits in cost, plus significant maintenance. A hospital's operating expenses aren't just the capital depreciation of its MRIs and what not, but also the ongoing building, supply, sanitation, disposal, and so forth.

Rather than thinking high to ultra high end....I'm thinking in terms of basic general practice...instead of paramedic emergency...think physician assistant/nurse practitioner primary care. Far more preventative than invasive....21st century local family doctor that makes housecall or neighbourhood calls......but with the inclusion of high end telecommmunication for specialist support as well as inflation by reduced quality in person but supported at length by higher quality.

4) The actual doctor's fees in many operations seems to be insignificant; I know my own $35K operation - the one doing the operating got paid $1200. So how does teleoperative medicine help then?

While I've seen some interesting experiments with a high end tractor trailer kitted out for specialist surgery here in NZ with specialist surgeon in Queensland, OZ supported in person by general surgeon and surgical nurse in NZ...I'm not sure the numbers add up(yet or ever) behind the cool technology of high end remote medicine.

I do think teleoperative medicine may have some benefits for rural areas where population density is too low to support a full medical infrastructure, but I equally doubt that is the market being targeted.

And that's where my thus far very limited experience and current course comes in.......remote medicine....focused on sustaining life over a longer period than typically required of paramedical personnel and expanding into basic primary care where none currently exists....expeditionary medicine to sustain life far longer than a paramedic in a 1st world environment and basic primary care/sick call, but with higher level care supported/approved through PMD/Medical Control.

As for teledirection - I don't see this working at all.

Just consider the ramifications of malpractice insurance in the context of a non-certified practitioner working under the direction of a certified practitioner. If something goes wrong, who gets sued and for what? Does this mean the certified practitioner must now also insure the non-certified practitioner for malpractice? How do non-certified practitioners perform the subconscious exercise of skill sets which they don't have - i.e. noticing things wrong besides what the patient says?

In my experience and learning we have been taught we operate completely under the umbrella of the PMD(Physician Medical Director) or Medical Control.

The environment we are expected to operate in is both remote and typically quite austere with some identical and some different regulatory and legal requirements and consequences.

But 1st world PMD/Medical Control environments already exist and have existed for a few decades in the form of Physician Assistant/Nurse Practitioner roles working under the auspices and umbrella(at times remotely) from their controlling Physicians.....so what I'm suggesting is simply an extension of what ALREADY EXISTS in the 1st world.

What about things like prescriptions? Do non-certified practitioners get to dispense prescriptions? How do you control the non-certifieds from writing prescriptions not dictated by the certified?

Control measures such as scopes of practice and regulatory/legal frameworks allow the use of some pharmaceutical in the sustainment of life by non physicians...these differ from place to place....what I know is what I can do in my scope of practice independently on operations in a remote setting is far different than if I'm visiting the US with an ambo 5 minutes away and a hospital 15 minutes away.

But it's probably best if we stick to the 1st world big volume stuff.

Jay could be a useful asset here in expanding far beyond my limited experience and understanding.

As someone who has been involved with packet type communications for 25 years, the idea of practicing medicine in the face of 'internet lag', DDoS, trojans, viruses, OS incompatibilities, Internet browser updates or lack thereof, HTML protocol updates and lack thereof, and so forth is quite unappealing.

While I think you make some good points and bring forward serious/legitimate concerns.....I think the expansion of the relationship that already exists between physician assistants/nurse practitioners under PMD/Medical Control of a Physician is likely when you combine the dramatic improvements in telecommunications/sensing technology, the falling cost of telecom/computing power, the perpetual ratcheting up of healthcare costs, and the common examples of cost being controlled thru reduced(or masked) quality/quantity in a high inflation environment.

If we see a bar of chocolate maintain price, but shrink the quantity/quality of the content(and multiply that example in cars, clothes, etc.).....isn't it reasonable to believe the same could/would happen with healthcare where price inflation is quite high?

I would be keen to hear our resident resident Jay chuck his valuable 0.02c in here, I would defer to him.

My very limited experience in the field has me intrigued about the many possibilities both good and bad in merging technology/telecommunications with health care.

What I see is a new or significantly expanded class of mid level healthcare workers focused on primary/preventative care still working under the auspices of Physician PMD/Medical Control....leveraging technology/telecom to try to achieve more with less.

Legal/Regulatory/Guild/Monopoly frameworks would need to be changed(if they can be changed).

We've seen it "work" before.....a good example would be down here in NZ....midwives(mid level healthcare workers) have literally dominated the "birthing of babies" with OB/GYNs retaining specialist support in emergencies and C Sections in recent decades.....shifting towards higher level IVF treatment/fertility care for those remaining in the field......at lower cost to government(insurers)

In the UK, they are now trialing/implementing mid-level healthcare workers focused on proactive in home preventative care/support......it's been described as analogous to fire stations proactively engaging in the communities they support to fire-safe homes....resulting in far fewer fires being put out by preventing them from happening in the first place.

Just my 0.02c

[Andreuccio]

Re: The bizarre calculus of emergency room charges

Upon reading about the reasonably-priced clinics in immigrant areas, my first reaction is 'why'? Given that the current system seems to be so lucrative, why do some doctors operate these clinics, apparently more-or-less outside of the insurance system? Is it out of a sense of service and fairness, i.e. are these just good people? Or is it the case that at the level of medicine being practiced (i.e. apparently not neurosurgery) there is so much friction in the insurance system, and so much money going into the pockets of the insurance companies, that a doctor can make a good living charging much lower fees and not dealing with the friction and the skimming of profit?

The ones I know, I can say without hesitation, are good people. But a little math shows that they can also do reasonably well.

I did a quick Google search, and a Family Practice doc or an internist might make about $150,000 per year, which works out to about $75 an hour. If in the clinic they can see an average of 4 patients an hour, (which seems like a conservative estimate), at $40 per that's $160. With a nurse at about $30 and a receptionist at about $15, they still clear $35/hour above the $75 average. If the clinic is open 12 hours/day, that leaves $420 per day, or about $12,600 per month, to cover rent, which I can't imagine would be very high in these areas, other expenses, and profit for the clinic owner, who might also be the doctor.

That's all with only one doctor on, and not including extras. For example, an antibiotic shot will cost you $100 at the clinic I go to. There's got to be a pretty high mark-up on that. We usually just get the prescription for the slower acting, but cheaper, pills, (which I get for the copay through my insurance at the pharmacy next door). Also, they do refer out for tests, which I assume they get some referral fee for, and have some tests on-site. We almost always have them done through the HMO, but the couple we've done through them have been quite reasonable: maybe a hundred or two for an ultrasound. Even at the reduced rate, that's still an additional source of revenue.


As you say, not neurosurgery, but works out great for us for mundane things, like ear infections, stomach aches, coughs, etc. When it is something serious, they're good enough to know it and tell us to get to the ER quick.

One other thought: there's not much difference in my mind between these clinics and the urgent care facility we sometimes go to through the HMO. The copay is only $10 at the urgent care, but we like these doctors so much I often don't mind dropping the extra $30. Since I only pay the copay, I don't know what the bill would be in the urgent care without insurance, but it's got to be a lot less than an ER visit.

[lakedaemonian]

Re: The bizarre calculus of emergency room charges

The ones I know, I can say without hesitation, are good people. But a little math shows that they can also do reasonably well.

I did a quick Google search, and a Family Practice doc or an internist might make about $150,000 per year, which works out to about $75 an hour. If in the clinic they can see an average of 4 patients an hour, (which seems like a conservative estimate), at $40 per that's $160. With a nurse at about $30 and a receptionist at about $15, they still clear $35/hour above the $75 average. If the clinic is open 12 hours/day, that leaves $420 per day, or about $12,600 per month, to cover rent, which I can't imagine would be very high in these areas, other expenses, and profit for the clinic owner, who might also be the doctor.

That's all with only one doctor on, and not including extras. For example, an antibiotic shot will cost you $100 at the clinic I go to. There's got to be a pretty high mark-up on that. We usually just get the prescription for the slower acting, but cheaper, pills, (which I get for the copay through my insurance at the pharmacy next door). Also, they do refer out for tests, which I assume they get some referral fee for, and have some tests on-site. We almost always have them done through the HMO, but the couple we've done through them have been quite reasonable: maybe a hundred or two for an ultrasound. Even at the reduced rate, that's still an additional source of revenue.


As you say, not neurosurgery, but works out great for us for mundane things, like ear infections, stomach aches, coughs, etc. When it is something serious, they're good enough to know it and tell us to get to the ER quick.

One other thought: there's not much difference in my mind between these clinics and the urgent care facility we sometimes go to through the HMO. The copay is only $10 at the urgent care, but we like these doctors so much I often don't mind dropping the extra $30. Since I only pay the copay, I don't know what the bill would be in the urgent care without insurance, but it's got to be a lot less than an ER visit.

Just for clarity's sake......by "urgent care facility" do you mean HMOs provide options between general practice and proper emergency room care?

If it's like the 24 hour surgeries we have down here(filling the gap between GPs and ERs, ESPECIALLY outside of normal 9-5 practice hours) then that makes perfect sense.....we were stunned that option didn't exist for my oldest when they visited the US, and that was in a fairly dense part of the US between major cities.

I envisage much the same but pull the physician back a step as centrally telecom hubbed maestro.....conducting a small number of physician assistants/nurse practitioners as the physician's force multipliers.

Down here in NZ we use a joint practice of 9 doctors and 6 nurses.

Doctors visits are $47NZ for adults, kids are free until they turn 7....then it's $10-15NZ a visit until they turn 18....and you get as much time as you need with the physician IF needed...otherwise, it's pretty quick....the office work tempo seems quite high and things do feel a bit rushed at times, but everyone we know is incredibly loyal to this practice.

Our prescription costs are incredibly low by comparison it seems.

I take anywhere from 12-15 prescription meds with me when traveling in the developing world as emergency backup in my med kit...the total cost is under $60.

Filling meds in the US for that money wouldn't even cover my emergency Cipro let alone the rest.

It will be interesting to see if NZ and/or other countries will fall victim to pharmacy cost inflation/subsidy failure along the lines of what has happened in Greece down the road.

[Andreuccio]

Re: The bizarre calculus of emergency room charges

Just for clarity's sake......by "urgent care facility" do you mean HMOs provide options between general practice and proper emergency room care?

Yes.

During regular hours you're required to go to your primary care physician (GP), unless it's a clear-cut bona fide emergency. If it's after hours or you can't get an appointment for something urgent, you can either go to the ER or the urgent care.

The ER has everything and docs on call in all specialties: it would be the place to go if you thought you were having a stroke or had just cut your finger off with a miter saw.

The urgent care will have one or two GP's working with a triage nurse and a couple of back office nurses, plus a receptionist. Perhaps access to onsite x-ray and other limited testing. I think calling it a "surgery" would be stretching it, as they're probably only equipped to do very minor surgery. It's where you would go for the more mundane stuff, or if you weren't sure and wanted to get a cheaper, faster opinion before heading to the ER. The urgent care will often refer you to the ER if they can't handle the issue.

In my experience, many urgent care facilities have limited hours, perhaps closing at 9 or 10 pm, and will be open weekends, also closing at 9 or 10. I'm not sure if that's typical or not. The HMO I've been with the last few years has a 24 hour urgent care.

On my insurance policy, copay for urgent care is $10, same as for primary care physician, copay for ER is $50. They want you to head for urgent care first.

[lakedaemonian]

Re: The bizarre calculus of emergency room charges

Yes.

During regular hours you're required to go to your primary care physician (GP), unless it's a clear-cut bona fide emergency. If it's after hours or you can't get an appointment for something urgent, you can either go to the ER or the urgent care.

The ER has everything and docs on call in all specialties: it would be the place to go if you thought you were having a stroke or had just cut your finger off with a miter saw.

The urgent care will have one or two GP's working with a triage nurse and a couple of back office nurses, plus a receptionist. Perhaps access to onsite x-ray and other limited testing. I think calling it a "surgery" would be stretching it, as they're probably only equipped to do very minor surgery. It's where you would go for the more mundane stuff, or if you weren't sure and wanted to get a cheaper, faster opinion before heading to the ER. The urgent care will often refer you to the ER if they can't handle the issue.

In my experience, many urgent care facilities have limited hours, perhaps closing at 9 or 10 pm, and will be open weekends, also closing at 9 or 10. I'm not sure if that's typical or not. The HMO I've been with the last few years has a 24 hour urgent care.

On my insurance policy, copay for urgent care is $10, same as for primary care physician, copay for ER is $50. They want you to head for urgent care first.

Yeah....sounds near identical to our 24 hour surgeries.......I think the term surgery here is an old school legacy term describing a doctor's office that goes beyond a regular doctor's office, but still runs short of a proper modern ER.

Minor surgery beyond life sustaining/stabilizing care(typically pushed STRAIGHT to ER) or sutures would also be referred to the ER here....so they both sound quite similar.....except the one we use being open 24/7/365 supporting a city of approximately 400k with a couple of public/private hospitals with ERs.

I believe we pay $40 for 24 hour surgery visit...regardless of child/adult.....ER visits are "free".

Great "in between" and after hours GP/light emergency care without wasting far more expensive ER resources.

Cheers for that!

[flintlock]

Re: The bizarre calculus of emergency room charges

Perhaps one big difference between US costs and the rest of the world is related to the legal aspects. And I don't mean just the cost of paying lost lawsuits, or defending against them, but rather the indirect cost of AVOIDING lawsuits. How many expensive steps do medical staff take just to avoid anything that might possibly get them sued? Regardless of how remote the chance? I notice these every time I go in. To use the car analogy, its like replacing an engine every time a customer takes a test drive, just to avoid being sued for selling a "used" car. Medical staff are forced to go to some extreme lengths some times just to play CYA. This aspect of our legal system exponentially adds cost to everything we do. It spirals out of control at some point.

But no doubt, cronyism is alive and well in the medical business. Americans have become very good and carving out huge fortunes by killing competition and using the iron fist of government to protect their little fiefdoms. Medicine is no exception. People used to have integrity and didn't dare play games with the truth like they do today. There was some degree of self-regulation. But when some people realized no one was watching the hen house, then combined that with their lack of ethics, it became a bloodbath.

The current system is completely unsustainable, but I don't claim to know what the solution is. All I know is something is clearly broken and if not fixed we will likely end up with a system where almost no one except the wealthy receive decent medical care. A good start would be to require up front pricing and perhaps the same pricing for all. Let market forces work their magic on costs. As it is now, it is virtually impossible for competition to have any impact, seeing how you rarely know what any procedure will truly cost in advance.

I think some of the current run up in costs has to do with providers attitude of "making it while they still can". Doctors seem more eager than they used to. Can't blame them really, when you see the cost of their education combined with the possibility that some bureaucrat may be deciding how much they are allowed to make in the future. Another reason to fix education in the country. Another part of our economy where costs are out of control.

For example. I merely mentioned the prospect of having a sleep study to my doctor. The next day my phone is ringing and its the hospital wanting to know if I can come in the next day and have the study! How much I ask? They can't tell me that, nor do they offer to call me back and let me know. So apparently they want a blank check on that. What other business could get away with that? Could you see people going in to buy a car and being told, " You'll get the bill in a few weeks and just pay that". The hospital continued to call back every now and then wanting to schedule me. I finally did go in for a study a year later. Negative for sleep problems. I saw then why they were so aggressive. The place was almost empty. About 20 rooms and only two patients that night! And I still have no idea how much the study cost!

I suspect my doctor's clinic is getting some kick back from the hospital to refer patients to the sleep clinic because usually they can't be bothered to so much as send me a copy of my tests. Is that the way it works? Do physicians have that kind of relationship with hospitals and other facilities? I know they have a chummy relationship with pharma.

[jk]

Re: The bizarre calculus of emergency room charges

kickbacks for referrals in medicine- for labs, studies, hospitalizations, etc- are illegal. unlike lawyers splitting fees when they refer to another lawyer, doctors cannot.

i have a low tech practice but the cost of staff for billing etc, phones, rents, insurance, means that my overhead is a little over 45%. most doctors' overheads are higher than than.

[Shakespear]

Re: The bizarre calculus of emergency room charges

This relates to the profession mentioned in the comment by flintlock, the law firms. This examples of an exclusive group in London shows that they are milking some "Big Cow" in the world.

http://en.wikipedia.org/wiki/Magic_Circle_%28law%29

The "Magic Circle" is an informal term used to collectively describe what are generally regarded to be the five leading UK-headquartered law firms,^[1][2][3] and the four or five leading London-based commercial barristers' chambers.

The Wiki entry describing this group shows impressive figures ($) for their counterparts in the US. Some countries do not make that much.

[LazyBoy]

Re: The bizarre calculus of emergency room charges

I had brain surgery in Victoria, British Columbia, Canada. The cost to me: not one-cent. Under socialized medicine, the government pays for everything, and you get the best surgery, the best equipment, the best medicines, and best doctors in the world.

I'd love to hear from others in counties with socialized medicine. In the US, I've heard stories about Brits waiting years for non-urgent surgeries. Is this just propaganda?

LB

[Andreuccio]

Re: The bizarre calculus of emergency room charges

225778[/URL]]kickbacks for referrals in medicine- for labs, studies, hospitalizations, etc- are illegal.

I was listening to something on NPR a few days ago that dealt with the pay structure for MDs. I remember the (woman) doctor saying one reason so many tests were ordered is that doctors' pay increased as they ordered more tests. I have no idea what the mechanism was or any other details.

Any chance you know what I'm talking about and could elaborate?

[jk]

Re: The bizarre calculus of emergency room charges

I was listening to something on NPR a few days ago that dealt with the pay structure for MDs. I remember the (woman) doctor saying one reason so many tests were ordered is that doctors' pay increased as they ordered more tests. I have no idea what the mechanism was or any other details.

Any chance you know what I'm talking about and could elaborate?

if they're tests that can be done in the doctor's office, s/he can bill for them. if the doctor is a radiologist, then obviously s/he gets to bill for the radiologic studies, and perhaps s/he owns the facility and gets to bill that way, too. if the doc is a gastroenterologist, then s/he bills for the colonoscopy, endoscopy, etc.

all the immediate factors militate towards ordering more tests: cya, patient reassurance, financial self-interest. the only factors which militate against this are systemic and of low salience unless some structure has been put in place to enforce stricter standards.

[ER59]

Re: The bizarre calculus of emergency room charges

More U.S. employers tie health insurance to medical tests
http://www.usatoday.com/money/indust...ves/53932628/1