HANOVER, N.H. — RECENT revelations should lead those of us involved in America's health care system to ask a hard question about our business: At what point does it become a crime?
I'm not talking about a violation of federal or state statutes, like Medicare or Medicaid fraud, although crime in that sense definitely exists. I'm talking instead about the violation of an ethical standard, of the very "calling" of medicine.
Medical care is intended to help people, not enrich providers. But the way prices are rising, it's beginning to look less like help than like highway robbery. And the providers — hospitals, doctors, universities, pharmaceutical companies and device manufactures — are the ones benefiting.
A number of publications — including this one — have recently published big reports on the exorbitant cost of American health care. In March, Time magazine ran a cover story exposing outrageous hospital prices, from $108 for a tube of bacitracin — the ointment my mother put on the scrapes I got as a kid and that costs $5 at CVS — to $21,000 for a three-hour emergency room evaluation for chest pain caused by indigestion.
Of course, Medicare will have none of this — it sets its own prices. And private insurers negotiate discounts. So no one is actually charged these amounts.
Check that. The uninsured are. They are largely young and employed (albeit poorly) and have little education. So the biggest medical bills go to those least able to pay.
At what point does it become a crime?
Consider another recent shift in health care: hospitals have been aggressively buying up physician practices. This could be desirable, a way to get doctors to use the same medical record so that your primary care practitioner knows what your cardiologist did.
But that may not be the primary motivation for these consolidations. For years Medicare has paid hospitals more than independent physician practices for outpatient care, even when they are providing the same things. The extra payment is called the facility fee, and is meant to compensate hospitals for their public service — taking on the sickest patients and providing the most complex care.
But now hospitals are buying up independent practices, moving nothing, yet calling them part of the hospital, and receiving the higher rate.
In North Carolina, Duke's health system has been aggressively buying up local cardiology practices, thereby increasing the number of echocardiograms performed "in the hospital" by 68 percent in one year, and bumping the Medicare payment from $200 to $471, according to The Charlotte Observer and The News & Observer, in Raleigh.
It's happening in my hometown hospital, Boulder Community Hospital, where my late mother was a trustee. The Denver Post reported in May on a patient whose cardiac stress test cost around $2,000 one year, and around $8,000 the next, after his doctor's practice was bought by the hospital.
Same office, same machine, same doctor, but it cost four times more. Mom would want to know: what happened to the word "community" next to the word "hospital"?
The problem is not just prices, but also volumes: how much we do to patients, and how often. Look at colonoscopies. There are good reasons to believe that they can reduce the number of deaths from colon cancer. Expert panels recommend that most people need a colonoscopy only once every 10 years. But a study published in 2011 in The Archives of Internal Medicine found that 46 percent of Medicare beneficiaries with a normal colonoscopy nevertheless had a repeat exam in fewer than seven years. For some gastroenterologists, it seems, the primary finding from your colonoscopy is that you need another one.
Cardiology has a similar problem. Each year millions of Medicare beneficiaries undergo an echocardiogram. Half of them have the test repeated within three years. It sure looks as if some cardiologists are doing the test annually.
Finally we've learned the value of new capacity: if you build it, they will come. Two proton beam facilities were recently approved for Washington. One is already being built in Baltimore, only 40 miles away. There may be some role for proton beam radiation in children who have brain and spinal tumors, but there are only about 140 such children a year in Washington and Baltimore. Three facilities have the capacity to serve well over 10 times that. It's hard to imagine that some of the roughly 8,000 men in the area destined to develop prostate cancer next year won't receive proton beam therapy, despite the fact that there's no good evidence that it's any better than standard radiation for their condition.
But it is certainly more expensive: profits at one of the facilities are expected to reach almost $16 million a year by 2019.
The word "crime" is awfully strong. Many prefer to call all this a problem of perverse incentives: good people, working in a bad system.
We could make the system better. We could ensure that everyone has access to the same set of prices, like the Medicare fee schedule. We could end the "fee for service" positive feedback loop — in which doctors and hospitals earn more for every procedure they do, which leads to overtreating patients — and instead have a flat fee. But the incentives will never be perfect. Ultimately, society needs individuals to be guided by ethical standards. And in medical care, those standards are getting pretty darn low.
Too many of us have passively accepted the situation as being beyond our control. Medical care in America could use a dose of moral outrage. It would be best for all if it was self-administered.
H. Gilbert Welch, a professor of medicine at the Dartmouth Institute for Health Policy and Clinical Practice, is an author of "Overdiagnosed: Making People Sick in the Pursuit of Health."
This article has been revised to reflect the following correction:
Correction: July 5, 2013
An earlier version of this article incorrectly attributed a 2011 study on colonoscopies. It was published in The Archives of Internal Medicine (now JAMA Internal Medicine), not The Journal of the American Medical Association.
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