How ‘No Coverage’ Means More Care

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Writes G. Keith Smith, MD:

My mother called me this morning to tell me that a 76-year old friend of hers had gone to her doctor to get a B12 shot.  She was told her insurance (Medicare) didn’t cover that any more. Her friend was incensed and left without getting the shot.

What are the lessons here? First, my mother’s friend doesn’t understand what incredibly great news this is. She will understand soon enough that the only care available to her might be only those things that Medicare doesn’t cover. Care subject to price controls will be…ok..if you said “scarce” you get a gold star. Care outside of the “system” will be controlled somewhat by market forces, with prices free to adjust and send appropriate scarcity signals to producers who then rationally respond. If my mother’s friend really needs her B12 (as opposed to those patients that obtain this injection simply because it is free or priced below its value) it will be available.

But here’s the rub. She will have to pay for her B12. All of it. So many people are conditioned to follow the “orders” of the third parties, including government payers.

“The pharmacist will only fill 30 days at a time of my medicine because that’s all Medicare will pay for.” I don’t know how many times I have heard that.

“How much would it be for you to pay for a 6-month supply out of your pocket,” I ask?

“Didn’t think about asking.”

Did my mother’s friend have difficulty thinking outside of her usual box or did she not really need the injection? I don’t know. Maybe a little of both.

What has happened to the price of Lasik surgery and plastic surgery over the years? What has happened to the quality? Poor results in this field are simply not tolerated. Too high a price? That surgeon’s waiting room is empty. Why would anyone think that the rest of health care is any different? Indeed, what is it about the medical economics of Lasik surgery and plastic surgery that results in reasonable pricing and great results? Could it be the absence of the distorting influence of third parties? Could it be the market at work? What do you think will happen to the price and availability of B12 shots once “insurance” is no longer part of the picture? What will happen to the demand of the unnecessary B12 shots? What will happen to the incidence of B12 shots reported given that were never given but billed for?

How long will it take for patients to learn to pay for their hernia repair out of their pocket rather than wait years in a line like the Canadians have been trained to do? Will people in the U.S. be intolerant of this treatment?  We’ll see.

I always learn something when I talk to my mom.

(Thanks to Floy Lilley)

9:10 am on August 8, 2012
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