Right Conclusion, Wrong Prescription

Austin Frakt has a post on doctor self-referrals (docs refer more when they have a financial interest in the referral). It elicited this comment, which I am reposting because it so admirably cuts to the chase on what is important here:

Iprice and competitionf physicians were forced to publish all-inclusive pricing for their services, it wouldn’t matter that they recommend their own facilities and expensive equipment, since competition would force physicians to moderate any excesses. [Emphasis mine]

The fact that every service, facility, drug and piece of equipment comes unbundled, with all the pricing quite hidden, is what conspires to cheat the patient and consumer. I just got pricing from an ophthalmologist in Austin for cataract surgery. His office didn’t know how much the facility charges, anesthesiologist charges, or drug charges would be, but gave me numbers to call. I called the numbers, but the anesthesiologist needed the CPT code for the procedure and the procedure’s duration, requiring me to go back to the ophthalmologist. The total cost for one eye came to $4400.

I called and e-mailed for prices in Thailand, Costa Rica, Prague, Monterrey, Nuevo Laredo and Rio de Janeiro. Not only did they quote me all-inclusive prices — in some cases including lodging–but the total in Monterrey was $1400 (18000 pesos) per eye, excluding travel and lodging, and basically the same (2000 to 3000 reals) in Rio de Janeiro, where I have a home I visit every year anyway. The other foreign places were even cheaper.

Do you see the problem with the policy suggestion in sentence one? No one is forcing providers in other countries to publish all inclusive pricing. U.S. providers offer unbundled services because that is the way they maximize against third-party payment formulas. The foreign providers cited are all competing for patients spending their own money. No force is needed when patients control the dollars.

Comments (22)

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  1. Perry says:

    Please also note that doctors employed by hospitals are encouraged (strong-armed sometimes) into referring to the hospital services which may not be cheaper or more effecient.
    Hospital employed physicians are going to be more the norm as re-imbursement goes down and costs of mandates such as EMR, etc go up.

  2. Adam says:

    Yet isn’t it easier (instead of disentangling ourselves from the 3rd part system) to mandate inclusive pricing? Seems like a faster fix with no immediate negatives.

    • Billy says:

      Except the loss of freedom.

      • Adam says:

        We’re only free to do the right thing.

        • Billy says:

          Then that’s not freedom.

          • Adam says:

            Welcome to the dilemma Thomas Aquinas had.

            • Brendan says:

              That’s no dilemma. The right thing is not enslaving others by stealing their hard earned money, which represents part of the limited time on earth. That is the definition of slavery. I very much doubt Thomas Aquinas would agree with you, since he valued human life greatly, as well as family. By forcing people to work, they take time from their families, and they reduce the number of children they think they can afford.

              Perhaps its time for you to return to whatever twisted logic classes you barely graduated from and get some remedial education.

  3. Billy says:

    “anesthesiologist charges”

    These are the worst crooks of the bunch.

  4. Tom G. says:

    “Costa Rica”

    You might have let this one slip by you John. Costa Rica has a universal healthcare system. Are you advocating for that now?

  5. Wiliam says:

    “The foreign providers cited are all competing for patients spending their own money.”


    • Kilian says:

      Yeah, all those places have some form of universal healthcare if I remember correctly.

      • Greg Scandlen says:

        They may have government-owned clinics and hospitals, but that hardly makes a “universal system.” These facilities are usually aimed at the poor and everyone else gets services from private providers. You don’t really think the upper class in Mexico is going to stand in line at a public clinic, do you?

  6. Stewart T. says:

    Or we could just have the government pay for it and be done with it.

    • Billy says:

      If you want to sign up for high taxes and substandard care, then be my guest.

      • Stewart T. says:

        I’d happily do it if I knew it meant my neighbor had the same access to care that I do.

        • hoads says:

          Au contraire, your neighbor may have the same access to healthcare as you but what good is that if both of you must wait an inordinate amount of time to receive substandard healthcare. Access to care does not equal care.

  7. Milton Recht says:


    Doctor can provide her/his prices but publishing a set price which includes agreed to prices of other doctors needs an anti-trust lawyer to comment on whether it is legal in the US or price fixing.