Why we pay $1000 for a $20 medical test


#1

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#2

Before reading the article, I thought that perhaps the labs were limiting individual testing options, and renaming a panel of tests as something like "gynecological screen" enforcing multiple testing at once. I was surprised to find that the physicians were actually checking off all of the tests themselves.


#3

Speak for yourself. I went in to my doctor to get a pap smear and they wouldn't do one at any price!


#4

What do you mean? Oh never mind, I'm guessing it has to do with gender.


#5

Why is it that, in the computer field improving technology leads to lower prices, while it's the opposite in the medical field?


#6

I think it was sexual discrimination. :trollface:


#7

Because nobody ever got sued for ordering too many tests, and the insurance companies pay up for the same reason. Do you want to be the cost-cutter on the day a patient dies?


#8

This is really just a microcosm of the American health care system. Americans pay more for everything, (usually not 50 times more, but six or seven is typical).

The explanation is simple: Insurance companies, doctors, labs, drug companies and everyone else wants to make money. Higher cost = more money. There is simply no one in the system who is motivated by patient health.


#9

The impression I got was that it was a combination of both -- software that makes it too easy for doctors to just check off EVERYTHING and some places where labs are marketing pap+ tests that include more than most people actually need.


#10

I don't think that's an entirely fair assessment. It's a fair assessment of the system, but not of individuals. Plenty of doctors are motivated by patient health, for instance.


#11

I'm just going to post this on most stories today. It's scarily appropriate to too many things.


#12

The medical system is certainly more screwed up; but, at a population level, it isn't entirely clear that improving technology has led to lower spending. Sure, if you were a nerd kid in the 80s, you can now get substantially more than what you paid $5k(in 1985 dollars) for for $50 in the palm of your hand; but most people simply didn't own some $5k 8086 monster. They just didn't have a computer. They do now. Probably one that lives in their pocket, costs a couple hundred, and has a monster data plan attached, quite possibly one or more others that live at home, and are connected to the internet, probably another at work, where an entire department has spawned and metastasized to take care of them all...

For pretty much any measure of power, IT spending has gotten more efficient (more power, more RAM, more storage, for your money, more flops/watt, more cores per rack, etc, etc.) but consumption has gone up considerably as well. The nerds still have thousands of dollars worth of gear(though it's a hell of a lot nicer); but now almost everybody else has not that much less.

What I don't know is if we were to, say, provide 1985-level medical care to a population, what would that cost and how would mortality differ?


#13

The funny thing is...that pap smears from 1985 are the same as 2013, essentially. I'd also add that some blood pressure medications are as effective, if not more effective, than more modern day, very expensive, sometimes with more side effects, still under patent, drug options. Progress does not always equal better, although marketing might direct you to believe that.


#14

I think it is then incumbent upon the physician to have the patient sign an informed consent regarding tests. This way the patient can make an informed decision on whether it is worth spending the extra money and the physician is protected by the patient understanding risk of limiting tests. But then that would take more time during an office visit, so I can't see it happening realistically. Perhaps someone other than the physician could be given this responsibility.


#15

The problem is that few patients understand the concept of what things cost- the prices are all over the map, there is no transparency to costs vs pricing, and there is no communication of efficacy or cost/benefit ratios. Few patients could really understand this information in the first place (lots of studies on this subject). The system fails the "free market" test on nearly every front. That aside, I believe a few things would improve the situation (and probably destroy a large portion of the current, broken system in the process:

  1. Transparent pricing. People need to know, up front, what things will cost them.

  2. People need to know if the costs are competitive. This can be done with pricing indexes, both on a regional/national scale, and on an international scale. The pap smears in this article still cost $10-$40 outside of the US borders. Same efficacy. Same outcomes.

  3. Standards of care need to cease to be governed by sales teams at pharma and test labs. They need to be governed by ongoing efficacy and outcome studies. The studies will not only save or improve lives, they will cost a lot less than the savings realized by their results. When the "cost to treat" (the additional amount that needs to be invested before a single positive outcome is realized) exceeds alternative approaches for generating positive outcomes, the choices for standards of care will become obvious and informed.

This last suggestion has the potential to put a large portion of the ineffective health care sector out of work. It is unfortunate, but it is these kinds of changes that allow an economy to be more productive.


#16

Well, I certainly did casually imply that doctors don't care about their patients, and that's not fair to actual people who are doctors. I shouldn't say there is no one who is motivated by patient health, I should say there is no force in the system for patient heath. There are lots of individuals who are doing their best to help the patients they actually see.


#17

You are a good person.


#18

Transparent pricing. People need to know, up front, what things will cost them.

This. So called "capitalism" is based upon perfect knowledge. Current US capitalism is all about Stiglitz' information asymmetry. Entire industries exist exploiting the information gap between parties. Medicine is particularly bad at this, as when you go into a place they aren't set up for you to even possibly shop around to compare. By the time you even think about questioning, you've been whisked away to a room and possibly taken off your clothes.

What other industry basically gives you prices weeks, if not months AFTER you get the service? I'd love to see a Michael Moore-esque movie where someone walks into a hospital for various procedures and asks for a cost breakdown before they are even admitted. I'm curious as to if it's even possible.


#19

Cost plus.

Doctors make more money the more tests they order/perform, or drugs they prescribe, and make more money if they overcharge.

Patients have been taught that they aren't getting a good service if they don't get a test and some pills out of a trip to the doctors, and the insurers pass all the costs along plus their margin.

Everyone wins, except all of us.

I like an awful lot about living in the US, it's certainly a happier place than the UK is recently, but the 'healthcare' scares the crap out of me. I can't believe this is the system people really want.


#20

Except not all of us want it this way. A large portion of us would be happy if the system were freed-up, including pricing and availability separate from your job and your state.

Instead the powers in charge just decided to double-down on the stupid. They eliminated no waste, fraud or malpractice reform, did nothing to increase the supply of doctors and crammed it into a law packed with special interests and vagaries.