HEADLINES

Thursday, December 30, 2010

How Government Regulations Push Up Cost of Medicine and Limit Patient Choice

from - Big Government


How Government Regulations Push Up Cost of Medicine and Limit Patient Choice: "

It’s no secret that health care is an industry beset by huge problems. The problem doesn’t as much stem from “evil insurance companies” as it does from a system created by federal and state governments to make a system as economically inefficient as possible.



For instance, most people do not pick their own insurance companies. Their employer does. The customer then isn’t the consumer, it is the business that contracts them to provide insurance for their employees. Patients don’t pay the doctors, the insurance companies do. In fact, the medical industry collects maybe 30% of the bills that aren’t sent to an insurance company. So their customer isn’t the patient, it’s the insurance company (or the government in the case of Medicare/Medicaid).


What you have is a system that puts all the control in people who aren’t the primary two parties in a health care relationship: the doctor and the patient. Is it any wonder why the system sucks? We’ve taken everything we know about economics and done the opposite.


However, for their part the doctors and the insurance companies have more access to legislators (due to campaign contributions and lobbyists) than patients do. The result is a regulatory system that is skewed away from patients, affordability and choice.


Illinois provides a great example of this.



Currently there is a debate on legalizing specially trained nurses to give birth outside of a hospital setting. This legislation is SB3712.


Currently, the interpretation of the Department of Professional Regulation is that attending a birth is “practicing medicine” and must be supervised by a doctor. Illinois is a judicial hell-hole, so liability insurance for doctors is already at least four-times what it is in neighboring states so you won’t find a doctor willing to attend a home-birth (unless you have a crap-ton of money).


So you have doctors (and more accurately) their liability insurance companies who are setting the terms of birth for women who might want to have birth at home. Many people might find the concept of a home-birth not for them. That’s fine. It isn’t for everyone. It certainly isn’t for high-risk pregnancies but many pregnancies aren’t high risk.


However, let’s examine the costs. A homebirth costs around $2,000. A hospital birth with no interventions costs about $25,000. In fact, if you go into labor quickly and can’t get to the hospital in time and have birth at home or in route to the hospital, the hospital charges still run about $20,000 for doing little more than cutting the cord.


27 states currently license homebirth midwives. Illinois isn’t one of them. Many women are pushing to make that licensing legal in Illinois so they can have birth on their terms. There is one obstacle, the Illinois State Medical Society.


They give lots of cash to legislators, so they have access. They say things like “it’s too dangerous” and legislators bow to their wishes. In reality, it’s about income protection. Low-risk, low-maintenance mothers are an “income stream” because they can be charged the full price for giving birth in a hospital where the staff basically sits around and does little.


But shouldn’t medicine be about “informed consent” where the patient decided their standard of care and not some lawyer or bean-counter they never interact with? Not to the Illinois State Medical Society. They also think that doctors who sexually abuse their patients shouldn’t immediately be suspended from medicine. Go figure.


This is somewhat a personal issue for me. My wife has had 2 of our three children at home and the other attempt we transferred into the hospital due to complications. My wife asked me if I was ok with her giving birth at home. My only condition was that I didn’t have to be the one to catch the baby.


Each time, the midwife was professional, well-trained and gave my wife the standard of care she wanted.


However, in Illinois, the ISMS wants to impose their standards on my wife without so much of a discussion. And that standard is written by lawyers who, understandably, are concerned about Illinois’ hellacious tort system.


Regulations should not be designed to limit choice. They should be limited to only what is needed to protect consumers and prevent abuse. In Illinois in the coming weeks, we’ll see if politicians side with women or side with industry lobbyists who simply want to buttress their cashflow.


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