End-of-life counseling. Death panels. Pulling the plug on Gramma. Putting her on the ice. Some of this is amusing. Some good theater. Some over the top.
But there is a serious issue here that everyone is overlooking. The only reason we are even discussing whether Medicare should pay doctors for end-of-life counseling is because of the totally dysfunctional way doctors are paid in the first place.
Imagine a discussion with a lawyer. The conversation might begin with life insurance move to annuity contracts ease over into living wills jump to the problem of your worthless heirs segue into legal issues surrounding cremation and perhaps end with you questioning whether you can require your surviving spouse to keep the urn with your ashes on the mantel over the fireplace next to your photograph.
You would expect to pay your lawyer for the time you spent in consultation. Right? But what if lawyers were paid the way doctors are paid?
Knockin on Heavens Door
If Medicare were paying lawyers there would be a long list of approved consultation services and next to each service there would be an approved fee. There would be one fee say for advice on insurance contracts another for annuities and yet another for living wills. But if a service were not on the list at all (say advice on worthless heirs or urns on mantel shelves) the lawyer would get nothing whatsoever for those parts of the conversation.
If you think that sounds wacky it gets even worse. But lets turn to doctors for a moment. Medicare has about 7500 tasks it will pay doctors to perform and it has an approved fee for each task. As everyone knows by now end-of-life counseling is not among them. But thats not surprising. There are all kinds of useful doctor services that arent on Medicares list. For example:
•For all practical purposes Medicare doesnt pay for telephone consultations.
•For all practical purposes it doesnt pay for e-mail.
•It wont pay your doctor to advise you on how to shop for drugs; where to find the best prices and how to economize by quantity-buying and pill-splitting for example.
•It doesnt pay for your doctors assistance in getting a low price for a CT scan or for negotiating on your behalf for specialist services.
•It wont pay your doctor to teach you how to use the Internet to get free advice buy supplies or compare notes with other patients.
•It wont pay a doctor to teach a diabetic how to monitor his own glucose level and in other ways manage his own diabetes.
•Ditto for asthma.
•Ditto for heart disease.
•Ditto for all chronic illnesses even though thats where most of the money goes and even though studies show that well-trained patients can manage much of their own care with lower costs and higher quality outcomes.
In addition seniors have special needs that fall through the gaps in Medicares payment structure. Many older patients for example have five or six medical problems rather than just one. Yet for the most part Medicare regards doctors as cost center silos and doesnt pay anyone to coordinate care between the silos. In addition many older patients are taking as many as a dozen different medicines or more. Yet Medicare wont pay a doctor to reconcile the pills determining how they interact and which ones should or shouldnt be taken in combination.
So whats the solution? Its not to start adding more things to the list of approved tasks. That list will never be complete; and even if it were the approved fees would always be wrong.
To appreciate the problem lets return to lawyering. Suppose you are accused of a crime and you pay your defense attorney by task. To make up some numbers lets say the fee for jury selection is $20 per hour and the fee for preparation and delivery of a final summation speech at the trials end is $500 an hour. What would happen?
Your lawyers final speech to the jury would be eloquent persuasive compelling and masterfully delivered. It would be so impactful that it might get you off scot-free if only it were delivered to the right set of jurors. But of course it isnt because you skimped on paying for that set of services. Thats why you dont want to pay your lawyer by task. You should pay in a way that encourages him to devote his last hour to that aspect of your case that promises the highest return. The same principle applies in medicine.
In my review of Clay Christensens book The Innovators Prescription I reported his observation that doctors should probably be paid in different ways depending on the service. For some services payment by the hour (like lawyers) makes sense. For others a flat fee for a bundle of services seems better.
It goes without saying that the market will sort these things out much better than a political bureaucracy.
End-of-life counseling. Death panels. Pulling the plug on Gramma. Putting her on the ice. Some of this is amusing. Some good theater. Some over the top.
But there is a serious issue here that everyone is overlooking. The only reason we are even discussing whether Medicare should pay doctors for end-of-life counseling is because of the totally dysfunctional way doctors are paid in the first place.
Imagine a discussion with a lawyer. The conversation might begin with life insurance move to annuity contracts ease over into living wills jump to the problem of your worthless heirs segue into legal issues surrounding cremation and perhaps end with you questioning whether you can require your surviving spouse to keep the urn with your ashes on the mantel over the fireplace next to your photograph.
You would expect to pay your lawyer for the time you spent in consultation. Right? But what if lawyers were paid the way doctors are paid?
Knockin on Heavens Door
If Medicare were paying lawyers there would be a long list of approved consultation services and next to each service there would be an approved fee. There would be one fee say for advice on insurance contracts another for annuities and yet another for living wills. But if a service were not on the list at all (say advice on worthless heirs or urns on mantel shelves) the lawyer would get nothing whatsoever for those parts of the conversation.
If you think that sounds wacky it gets even worse. But lets turn to doctors for a moment. Medicare has about 7500 tasks it will pay doctors to perform and it has an approved fee for each task. As everyone knows by now end-of-life counseling is not among them. But thats not surprising. There are all kinds of useful doctor services that arent on Medicares list. For example:
•For all practical purposes Medicare doesnt pay for telephone consultations.
•For all practical purposes it doesnt pay for e-mail.
•It wont pay your doctor to advise you on how to shop for drugs; where to find the best prices and how to economize by quantity-buying and pill-splitting for example.
•It doesnt pay for your doctors assistance in getting a low price for a CT scan or for negotiating on your behalf for specialist services.
•It wont pay your doctor to teach you how to use the Internet to get free advice buy supplies or compare notes with other patients.
•It wont pay a doctor to teach a diabetic how to monitor his own glucose level and in other ways manage his own diabetes.
•Ditto for asthma.
•Ditto for heart disease.
•Ditto for all chronic illnesses even though thats where most of the money goes and even though studies show that well-trained patients can manage much of their own care with lower costs and higher quality outcomes.
In addition seniors have special needs that fall through the gaps in Medicares payment structure. Many older patients for example have five or six medical problems rather than just one. Yet for the most part Medicare regards doctors as cost center silos and doesnt pay anyone to coordinate care between the silos. In addition many older patients are taking as many as a dozen different medicines or more. Yet Medicare wont pay a doctor to reconcile the pills determining how they interact and which ones should or shouldnt be taken in combination.
So whats the solution? Its not to start adding more things to the list of approved tasks. That list will never be complete; and even if it were the approved fees would always be wrong.
To appreciate the problem lets return to lawyering. Suppose you are accused of a crime and you pay your defense attorney by task. To make up some numbers lets say the fee for jury selection is $20 per hour and the fee for preparation and delivery of a final summation speech at the trials end is $500 an hour. What would happen?
Your lawyers final speech to the jury would be eloquent persuasive compelling and masterfully delivered. It would be so impactful that it might get you off scot-free if only it were delivered to the right set of jurors. But of course it isnt because you skimped on paying for that set of services. Thats why you dont want to pay your lawyer by task. You should pay in a way that encourages him to devote his last hour to that aspect of your case that promises the highest return. The same principle applies in medicine.
In my review of Clay Christensens book The Innovators Prescription I reported his observation that doctors should probably be paid in different ways depending on the service. For some services payment by the hour (like lawyers) makes sense. For others a flat fee for a bundle of services seems better.
It goes without saying that the market will sort these things out much better than a political bureaucracy.
