Mike Shedlock
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Here's an exceptionally well written, on-target email from Claudette, an occupational therapist from Michigan, in response to my post Physical Therapist in NY Chimes in on Health Care Costs.

Claudette wants to "Put the Patient in the Driver's Seat".

Claudette writes ...

Hello Mish

I do not disagree with the PT who wrote to you about consolidation of hospital systems resulting in increases in cost of care, but there are other pertinent problems to consider.

For example, in the current system, the physician and hospital make more money if they perform more services...so there is an incentive to order more tests, do more therapy and generally "do more to make more".

Under the ACA, there should be one bundled payment per diagnosis/incident.

What I suggest is not new, or radical. Medicare instituted DRGs or Diagnosis Related Groups with inpatient day and dollar limits per diagnosis 38 years ago (I was just beginning to work as an OT then).

DRGs drastically cut the cost of inpatient care and spawned the development of new service models including inpatient rehabilitation centers, Homecare and rehab in nursing homes, none of which fell under the constraints of the inpatient DRG.

Was this good? Yes, getting out of the hospital earlier is less expensive and healthier. There is no better place to get really sick than in a hospital.

Healthcare will not be truly competitive or cost effective until the patient is the one in the drivers seat. The patient should be informed, empowered to make care decisions and should pay the bill.

The bill should be discussed and agreed upon before service, whenever possible. Service prices should be posted so that consumers can comparison shop.

Right now patients are the point of service but are not part of the decision process. ACA did not change that and, in my mind, that is its greatest shortcoming.

Claudette
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Mike Shedlock

Mike Shedlock is a registered investment advisor representative for Sitka Pacific Capital Management.