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Doctors shouldn’t have to go in the hole

Submitted by on Monday, 1 December 2008 No Comment

Yet another health-care situation where there’s plenty of blame to go around, but blame doesn’t matter as much as getting the situation fixed:

About 10 percent of U.S. doctors are thinking about no longer vaccinating privately insured children because they’re losing money doing it, according to The Associated Press.

According to a new study by University of Michigan researchers paid for through the Centers for Disease Control, the price-per-dose of one brand of hepatitis B vaccine ranged from $4.26 to $13.06 at different medical practices. Reimbursements of the measles, mumps and rubella vaccine ranged from $16.77 to $59.02.

The study was startling information for some doctors, co-author Dr. Gary Freed said. Many contracts prevent doctors from talking about spending and reimbursement for vaccinations, he told AP.

Regardless of what you think about vaccinations, this is wrong. If childhood immunization prices can be set by secret negotiation, what else in our health-care system is settled by cold, market-level negotiations?

The negotiations are on two levels: The price doctors pay manufacturers and the amount insurance companies reimburse physicians.

I grasp the “market forces” at play.

On the manufacturer-to-doctor loop, it’s simple economies of scale. Think “bulk discount” to drill it down to consumer terms. Big medical practices buy more vaccine and get better prices from drug companies.

On the insurance company-to-doctor loop, it appears to be nothing short of racketeering. Companies decide what they’re going to pay physicians, who are simply stuck with it, but all the while the insurers pass premium increases along to consumers under the guise of “paying more to physicians.

Seem underhanded and sneaky bordering on fictitious? A number of courts have believed, going as far as to order major companies to settle such claims with physicians. And Wellpoint CEO Angela Braly in May cited the company’s ability to “lean hard” on doctors to get them to accept lower reimbursement rates.

How you view the rightness of this depends on how you answer the question posed during the town hall presidential debate this fall: Do you believe health care should be treated as a commodity?

There’s good news for doctors in the latest study, Freed said. They can join purchasing cooperatives to get better group rates or negotiate prompt-pay and volume discounts.

I suppose health “consumers” could try the same thing, except insurance companies that provide the better group rates create a different set of problems. And good luck negotiating with them at all.

Copyright 2008 Debra Legg. All rights reserved.

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