Can you find "American Sickness" in the laboratory?

Posted by Sten Westgard, MS

I just finished reading "An American Sickness" by Dr. Elisabeth Rosenthal. While I have been accustomed to reading about the problems of US healthcare in books, this particular volume was particularly shocking. Dr. Rosenthal didn't pull any punches - it made me believe that there are no easy answers to the problem of US healthcare, and that there are no hard answers either. There are only painful, seismic, near-impossible answers to the US healthcare system.  And given the current weak tea of both the Affordable Health Care Act ("Obamacare") or the American Health Care Act ("Trumpcare") do not show any political courage required to tackle the root causes of our problems.

Dr. Rosenthal starts her book with a set of "economic [mis-]rules of the dysfunctional medical market"

1. More treatment is always better. Default to the most expensive option.
2. A lifetime of treatment is preferable to a cure.
3. Amenities and marketing matter more than good care.
4. As technologies age, prices can rise rather than fall.
5. There is no free choice. Patients are stuck. And they're stuck buying American.
6. More competitors vying for business doesn't mean better prices; it can drive prices up, not down.
7. Economies of scale don't translate to lower prices. With their market power, big providers can simply demand more.
8. There is no such thing as a fixed price for a procedure or test. And the uninsured pay the highest prices of all.
9. There are no standards for billing. There's money to be made in billing for anything and everything.
10. Prices will rise to whatever the market will bear.

Dr. Rosenthal convincingly demonstrates that all of these rules are true for American healthcare. As I read this list, I wondered, "How many of these rules are true for laboratory medicine"? Certainly, for some rules, laboratory medicine is no better off than other areas of healthcare. But there are notable differences: the price increases rampant in other medical fields have not been so terrible in laboratory medicine. Laboratory medicine is one of the few areas where prices have been managed and costs haven't increased as fast. (There are those in the laboratory who feel we have been short-changed, who feel continually targeted for cuts while other fields and departments see unchecked spending).

I'm curious to know what others think: Are all ten mis-rules applicable to laboratory medicine? Or just one or two?

Here are a few choice quotes about what Dr. Rosenthal says about pathologists:

"Pathologists tend to be quiet, antisocial types and have never been very good at forming alliances or lobbying." p. 65

"Making Money with Bad Medicine: Test First, Examine Later" p.152

"[A CHEM-7] is a single test performed simultaneously on one red-topped tube. When I most recently checked in my area, the commercial labs were charging $17.25 to $22.69 for an electrolyte panel. But on hospital chargemasters the same single is now often billed as seven separate tests - about $50 to $70 apiece, for a total of $350 to $490."