The Leading Business Education Network for Doctors, Financial Advisors and Health Industry Consultants

In My Opinion … Hospital Charges Not 4 Me

Dr. David Edward Marcinko; MBA

[Editor-in-Chief]

On February 09, 2010, journalist Maggie Mahar posted an excellent op-ed piece on The Health Care Blog. In fact; I am now compelled to address one aspect of it. The essay was titled: “Massachusetts’ Problem and Maryland’s Solution”.

Assuredly, I’ve no beef with Maggie, her economic machinations or reporting. In fact, I am a fan and encourage all ME-P readers and subscribers to “read it and reap.’

Link: http://www.thehealthcareblog.com/the_health_care_blog/2010/02/massachusetts-problem-and-marylands-solution-we-dont-have-to-wait-for-washington-part-2.html#comments

Maggie Speaks

In her essay, Maggie says the following to which I agree. It is well known to me as a Balti-moron. For, I lived in the bowels of inner-city Baltimore when this legislation went down, back-in-the-day:

“While health care reformers argue about what it would take to “break the curve” of health care inflation, the state of Maryland has done it, at least when it comes to hospital spending. In 1977, Maryland decided that, rather than leaving prices to the vagaries of a marketplace where insurers and hospitals negotiate behind closed doors, it would delegate the task of setting reimbursement rates for acute-care hospitals to an independent agency, the Maryland Health Services Cost Review Commission. When setting rates, the Commission takes into account differences in labor markets and how much a hospital pays in wages; the amount of charity care the hospital does; and whether it treats a large number of severely ill patients.

For example, the Commission sets the price of an overnight stay at St. Joseph Medical Center in suburban Towson at $984, while letting Johns Hopkins, in Baltimore Maryland, charges $1,555. For a basic chest X-ray, St. Joseph’s asks $81 and Hopkins’ is allowed to charge $155. The differences reflect Hopkins’s higher costs as a teaching hospital and the fact that it cares for generally sicker patients.”  

Of Invoices, Charges and Cost Shifting – Oh My!

I do have a beef with the above charges, which are not necessarily costs, which are not necessarily what is ultimately paid by a third-party insurer, or patient. This cost shifting is not unique to JHU, of course, but mention of the “Johns” just caught my eye as I admit that I’ve been away from my hometown of Baltimore, Maryland for 35 years.

Oh my; don’t get me wrong. I loved the place and played stick-ball in JHU’s parking lot on Broadway in Upper Fells Point when I was a kid. I was seen in the ER, at a young age, for a forehead laceration. I even met two of the greatest physicians in the world there.

J. Alex Haller Jr. MD – the world famous Children’s-Surgeon-in-Charge of Johns Hopkins Hospital, and pectus excavatum surgical pioneer, from 1964 until 1997.  As well as pediatric heart surgeon Helen Brooke Taussig MD (1898 – 1986), developer of a famous operation to alleviate “blue baby” syndrome, and who first warned the public on the dangers of thalidomide.

Link: https://healthcarefinancials.wordpress.com/2009/09/01/off-road-touring-with-dr-marcinko-part-vii/

However, as a health insurance agent and advocate of HD-HCPs for more than a decade, who has direct economic “skin-in-the-insurance game”, I would rather go to suburban St. Joe’s medical center for non-traumatic, non-emergent care – if I had my druthers. The neighborhood is safer and the quality can’t be much different. After all, a basic chest x-ray … is a basic chest x-ray, and an uncomplicated overnight stay … is an overnight stay etc, ceteris paribus.

RememberParetto’s 80/20 economic principle of the “vital few and trivial many”? Most of us [trivial many] will not need JHU care [vital few]. And, that’s a good thing! 

The fact that JHU is a teaching hospital that generally cares for sicker patients has tremendous societal implications with positive “trickle-down” innovative benefits for the masses. But, not for me as one doctor-purchaser of healthcare services who knows better. I refuse to pay freight charges for the “full JHU monty”.

I just can’t afford it under my definition of medical / business school derived quality health care.

The correct diagnosis, necessary care and proper treatment with f/u and ancillaries; at the most convenient venue; by the appropriate level medical provider; in an appropriate time-frame, and at the right price.

Assessment

JHU is an outstanding healthcare entity in Baltimore, but perhaps even more so for the poor and/or rich; not us “tweeners”.

For the middle class, it is expensive care whose reputation for quality may actually be declining.

In fact, some JHU employee’s still living “back in the hood” tell me that it is “getting larger, but not better.” 

Link: https://healthcarefinancials.wordpress.com/2010/01/10/a-story-all-doctors-and-patients-should-re-read/

Quality guru, Bob Wachter MD, where are you?

http://community.the-hospitalist.org/blogs/wachters_world/about.aspx

PS: I am a former CPHQ myself [Certified Physician in Healthcare Quality].

Conclusion

Your thoughts and comments on this ME-P are appreciated. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, subscribe to the ME-P. It is fast, free and secure.

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

• DICTIONARIES: http://www.springerpub.com/Search/marcinko
• PHYSICIANS: www.MedicalBusinessAdvisors.com
• PRACTICES: www.BusinessofMedicalPractice.com
• HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
• CLINICS: http://www.crcpress.com/product/isbn/9781439879900
• ADVISORS: www.CertifiedMedicalPlanner.org
• BLOG: www.MedicalExecutivePost.com
• FINANCE:Financial Planning for Physicians and Advisors
• INSURANCE:Risk Management and Insurance Strategies for Physicians and Advisors

Filed under: Health Economics, Health Insurance, Op-Editorials, Quality Initiatives | Tagged: david marcinko, Edward Miller MD, hospital cost shifting, Johns Hopkins University, Maggie Mahar, Maryland Health Services Cost Review Commission, medical care quality, Robert Wachter, The Health Care Blog, www.thehealthcareblog.com | 6 Comments »