Could Both Liberals and Conservatives be Wrong on How to Fix Health Care?

Liberals say congress needs to force prescription drug prices to be cut and limit the profits of medical insurance companies. Then, they say, there would be plenty left to pay for the uninsured. Conservatives believe to fix the United States medical insurance problem people need to start paying for more of their medical costs. But could the problem lie in the way doctors are compensated? According to a New York Times article, doctors in the United States earn two to three times as much as they do in other industrialized countries. Surveys by medical-practice management groups show that American doctors make an average of $200,000 to $300,000 a year. Primary care doctors and pediatricians make less, between $125,000 and $200,000, but in specialties like radiology, physicians can take home $400,000 or more. In Europe, however, doctors made $60,000 to $120,000 in 2002, according to a survey sponsored by the British government in 2004. Compare that to prescription drugs cost. On average they cost 30 percent to 50 percent more in the United States than in Europe. The difference in doctor’s salaries is much larger. Liberals avoid pointing out this fact speaking about the advantages of a European-style health care system. American’s accept the fact that medical doctors earn a good salary. Congress has repeatedly blocked Medicare’s efforts to reduce the amount it pays for each procedure doctors perform, even though Medicare payments to doctors are soaring and the cuts are legally required to keep the program’s budget balanced. Another problem in the health care system is the way medical doctors are paid. Medical doctors are paid for every test and procedure they perform, rather than a flat salary. Because of this system, medical physicians have a financial incentive to perform procedures that drive up overall medical care spending. Doctors do not make much for routine examinations and cognitive services. This is causing many medical students to choose to become specialists because primary care doctors and pediatricians rarely perform complex procedures. Almost all expenditures pass through the pen of a doctor. So a physician may decide to perform a test that costs $5,000 so they can make $1000 for themselves even though a cheaper test would work just as good. This is an inefficient way to pay medical doctors and the problems spill over into Medicare. In Medicare there is not a lot of utilization review or prior authorization. Medicare doesn’t like to second-guess medical doctors. As a result, doctors have steadily increased the number of procedures they perform on Medicare beneficiaries. This drives up health care costs and doesn’t improve the patients’ health. The health-care system is set up to pay for services that are rendered when patients are only interested in health.