On Topic: The high cost of health

New book takes dim view of health care industry

In “An American Sickness: How Health Care Became Big Business and How You Can Take It Back” — the highly readable book of the moment, judging from the premium reviews and podcasts, by Elisabeth Rosenthal, a former ER physician and New York Times reporter and now the Kaiser Health News editor-in-chief — the author divides her mammoth topic into various “ages.”

In doing so, she looks at, among other enormous subjects, insurance, hospitals, physicians, pharmaceuticals, research and — today’s main-event debate subject among the informed and those who are less so — the Patient Protection and Affordable Care Act.

And throughout, she leaves little doubt that she perceives just about everyone involved in practically any sphere of the American health care systems to be, well, not quite altruistic. Financial gain rules.

After all, in the book’s introduction, Rosenthal lists her 10 Economic Rules of the Dysfunctional Medical Market.

Among them:

l “A lifetime of treatment is preferable to a cure.”

l “There is no free choice. Patients are stuck. And they’re stuck buying American.”

l “The prices will rise to whatever the market will bear.”

But when it comes to the ACA, one might ask, weren’t safeguards put in place to protect patients, providers and the industry alike?

Ah, replies Rosenthal quoting a former state deputy insurance commissioner, “In health care, entrepreneurship outsmarts regulation every time.”


As one among many examples, Rosenthal cites Steve Carlson, an insulin user whose medicine became increasingly expensive under Medicare Part D.

At first, she writes, Part D worked as it was supposed to: If a patient’s deductible and co-pay exceeded a certain amount within a year, that patient entered the “doughnut hole” — that’s when the consumer would have to begin paying 100 percent of the costs. The idea being she or he would become a smarter buyer and think twice about buying especially costly drugs that might not really be needed.

Once the patient spent her way across the hole and was back chewing into the other side of the doughnut, Medicare took over and would pay 95 percent.

But in the real world, Rosenthal says, “once all seniors were guaranteed drug coverage and were paying only a co-payment, drug companies raised prices — a lot. Insurers then responded by charging higher-percent co-payments to discourage use.”

Here’s that assumption again: The idea of the doughnut hole was that when patients had to pay for a chunk of their prescriptions, they’d buy less-expensive drugs. But Rosenthal contends that “a $3,000 co-pay for a minor surgery when you’re already paying $1,000 a month in premiums is not having a little skin in the game” — the phrase often used by insurance companies and lawmakers. “It’s more like having a kidney.”

She also notes a 2015 study by Vox Media researchers that determined when patients were switched to higher-deductible plans — again, to strongly encourage them to spend less on their health care — “they mostly just avoided any interactions with medicine at all.”

To add another nail to her argument, the author quotes a Jan. 14, 2014, article in “Physician’s Weekly” that advises its readers, when “seizing the opportunities provided by the ACA” — as the story is titled — health care “providers should leave no money on the table.”

Well-intentioned notions in the ACA that survived the legislative birthing process back in 2010, Rosenthal says, have been “diluted and perverted” after they got out in the real world.

The health care profession today, in her view, is not one Mother Teresa would approve.



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Michael Chevy Castranova is business editor of The Gazette; (319) 398-5873;

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