Beware the Medical Industrial Complex

Back from vacation.

There have been a number of articles recently about the inadequacy of the U.S. health care establishment. All agree that whatever it is that we have (I hesitate to call it a system) doesn’t work. An article by Paul Krugman and Robin Wells, “The Health Care Crisis and What to Do With it” elicited a particularly insightful response. Written by Arnold Relman, a former editor of the New England Journal of Medicine, the letter notes why the task is so difficult.

“The “monetarization” of health care (a term used by the late Eli Ginzberg) changed it from a largely not-for-profit, community-oriented social system into an industry, and this has affected the behavior of all providers—hospitals, doctors, and others.

Investor-owned businesses constantly seek to expand their revenues. Yes, expensive new technology and new procedures, more specialists, and an aging population are all part of the problem. But much of the impetus to expand the use of health resources surely comes from the fact that there is a lot of money to be made and the expectations of investors and physicians are high.

Krugman and Wells are right that we will have to reform the delivery system as well as the insurance system and that powerful vested economic interests will have to be confronted. They should understand, however, that private insurance companies and the pharmaceutical industry are not the only vested interests who will resist. All those investors who have an equity interest in a vast variety of for-profit health care businesses and all those medical specialists whose high income depends on the fee-for-service reimbursement of expensive technology and complex procedures will also have to become convinced that change is necessary before we can make it to the promised land.”

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