Tuesday, July 30, 2013

The Demise of Hospital Charity 

Among the many unremarked implications of Obamacare is its contribution to the demise of the hospital as a charitable institution. 

The modern hospital in its original form was created to provide care for people who were economically unable to be sick decently at home.  In northern climes, there was nothing humane about being ill in December in a third floor unheated walkup when everyone else in the family had to go to work.  Hospitals were developed as a remedy for that.  They were also a way to get the bothersome mentally ill off the streets. 

As the years went by, hospitals began to provide treatment as well as care and so people of means had to use them too.  They occupied private rooms (charity cases were cared for in open wards) and were expected to pay for the services they received.  Then insurance came along, creating a category of paying patients in between those occupying private rooms and those housed in wards.  They were admitted to semi-private (two bed) rooms, for which the charges were lower. 

As both the nature and the economics of what they did changed, so did the charitable orientation of hospitals.  From an initial dependence on donations, they became increasingly dependent on revenues from paying patients.   Charity patients, once the purpose for which the hospital existed, came to be seen as a burden.  In the large cities, publicly supported hospitals were built to provide care to the poor. 

With the exception of Catholic institutions, hospitals gradually lost their sense of obligation to serve the poor – to the extent that most states now have laws that prohibit them from denying care because of inability to pay. 

Obamacare promises to move that trend some distance towards its final conclusion.  By requiring everyone to have insurance, it will greatly reduce the number of non-paying patients.  Legal proscription against denying care to those who remain will no doubt continue, but for most hospitals providing services to the indigent will become a minor burden and any remnant of their identity as charitable institutions will pretty much disappear.

Sunday, July 28, 2013

A Note for Advocates of Single Payer

When thinking about government programs, it is always wise to remember that government is controlled by politicians and therefore can be counted on to respond to political considerations.

I was reminded of that by a July 21 Op-Ed piece in The Boston Globe reciting the recent experience of columnist Robert Kuttner.  It seems that Kuttner’s 99 year old mother suffered a bad fall.  She was taken to the Mass General where she stayed for four days.  Upon her discharge, Kuttner was surprised to find that his mother’s stay had been classified as “for observation.”  This meant that the services she received were paid for as an outpatient service under Medicare Part B in which the patient’s co-pay is much larger than it would have been had she been classified as a regular inpatient, payable under Medicare Part A. 

According to Kuttner, this stratagem has been devised by Medicare as a cost reduction measure which results in paying the hospital less and requiring the patient to pay more.

None of this should come as a surprise.  Whatever political benefit attaches to new programs is at its peak at the time of enactment.  Thereafter, from a political point of view, it becomes a drain on resources that could otherwise be used to generate political benefit by financing other new programs.  That helps to explain why the financing of public programs tends to diminish over time.

Single payer advocates take note.

Tuesday, July 23, 2013

The Transition from Individuals to Institutions

A recent experience served as an example of the trend in health care of relying on institutions rather than individuals.

Wife Marilyn has for some time known that she had a cataract that would eventually require repair.  Recently, she decided that the time had come.  She called for an appointment with her Ophthalmologist, only to learn that he had suffered a major stroke and died.

An appointment was then made with another Ophthalmologist in that same group.  She saw him once in clinic and yesterday underwent cataract surgery at his hands.

While sitting in the waiting room during the procedure, it occurred to me that the only thing we knew about the surgeon performing surgery on my wife’s eye was that he was a member of a large, well known and well regarded group of ophthalmologists.   I couldn’t even remember his name.  Without thinking about it, we had placed our full confidence in the organization; i.e., the group, trusting that whoever it allowed to do surgery was competent.

I suspect that some version of the same was true of the other dozen or so people in the waiting room.

The surgery was successful.

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