I wasn’t going to blog on this article. It’s about the “secretive panel that helps set Medicare’s fees has stoked a debate over whether doctors have too much control over the flow of taxpayer dollars.” The reason for my unaccustomed reticence: I know nothing about setting medical fees. Are the doctors on the panel setting the fees correctly?
But, as I read the piece with rapt attention, I realized that, though I can’t offer perceptive comments of medical billing, I had to make sure I point it out for Inkwell readers. The article shows what happens when people get in a room and set prices. This is the opposite of letting the market work. I don’t know how the market could work when prices for a giant government program are the issue. All I know is that this is a look at what happens when prices are decided by experts:
A Wall Street Journal analysis of Medicare and RUC data suggests that services were paid too generously in some cases because the fees were based on out-of-date assumptions about how the work is done. The analysis found more than 550 doctor services that, despite being mostly performed outpatient or in doctors’ offices in 2008, still automatically include significant payments for hospital visits after the day of the procedure, which would typically be part of an inpatient stay.
For instance, one operation to treat male urinary incontinence wraps in payment for 118 minutes of hospital visit time after the day of surgery, though 2008 Medicare data show it is done around 80% of the time outpatient or in a doctor’s office. Stephanie Stinchcomb, manager of reimbursement for the American Urological Association, says the surgery used to be largely inpatient; its payment was last updated based on a RUC evaluation in 2003. It’s not clear if a new analysis will find doctors should now be paid less for it, she says.
As I said, I have no prescription. But I do know this, if the administration’s health care system stands, all our medical decisions will be made by secretive panels in rooms. These decisions will be based on abstractions and they will affect our lives. They will be as unrealistic as those of the fee-setting panel. They will control more than fees. Have a nice day.