The Cost of Colonoscopy: A New Payment Model

July 8, 2013
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There is a steady push to change the way that physicians are paid.  No compensation model is ideal.  The fee-for-service (FFS) model has become Public Enemy #1 as it is felt to be responsible for overtreatment generating excessive costs and utilization.

There is a steady push to change the way that physicians are paid.  No compensation model is ideal.  The fee-for-service (FFS) model has become Public Enemy #1 as it is felt to be responsible for overtreatment generating excessive costs and utilization.  Salaried physicians may be freed from the FFS conflict of interest, but it has other drawbacks including a diminished incentive to provide exemplary service to patients and to referring physicians.  Since physicians did not initiate compensation and health care reform decades ago when we should have, we are now being squeezed hard by external forces that will overcorrect on the system’s deficiencies.  It’s always better to fix your own house.  There should be a lesson here for other professions who are in need of some reform and repair.  Teachers, in my view, were dragged into the education reform arena, and will suffer because of it.  Attorneys have been smug and cavalier about the legal profession’s obscene excesses and I believe that they will rue their inaction.

What do patients think about how their doctors should be paid?
 
I’ve done over 20,000 colonoscopies.  As I have written in this blog, I’m not even sure how much I charge for the procedure.  It’s not simply because I have little interest in the business of medicine.  It’s also because colonoscopies are like air travel.  No two passengers pay the same price.
 
 
 
Which system would you favor for pricing a colonoscopy?
 
(1)    Flat fee for the procedure for every insurance carrier.
(2)    Hourly rate.  If a colonoscopy is tough and takes twice as long, the physician should get double the dough.
(3)    Graduated rate depending upon experience.  Should a 20 year gastro veteran be paid the same as a green newbie?
(4)    Airline model.   We now know that various airline seats have been designated as premium seats because they afford an extra centimeter of leg room or the oxygen mask actually works.  Similarly, certain colonoscopy time slots could be subject to a surcharge, such as the first appointment of the day when the physician is energized and not yet running behind.  The 5 pm slot, in contrast, would be discounted as the physician is fatigued and is trying to make a 6 pm dinner reservation. 
(5)    Name your own price model as is done with air travel, car rentals and hotel rooms.  Patients offer an on-line price in advance and the GI practice decides to accept this or wait for a higher bidder.  This adds a fun element to the colonoscopy adventure.
(6)    Patients decide after the procedure to pay the doctor what they feel the training, knowledge, experience and judgment are worth.  Some patients, I fear, may valuate the colonoscopy only by the 10 minutes duration.   This is not quite fair.  Once in Cape Cod, I saw a beautiful sand sculpture of a mermaid.  I asked the artist how long it took him to create the art.  His response was ’30 years and 7 hours’.  Get the point?
(7)    Barter system as functioned well historically.  One colonoscopy = 6 Box seats at sporting event = set of luggage = last year’s iPhone model = 1 hour plumbing service = 5 car gas fillups
(8)    No charge at all.  You can’t put a price on your health, and we shouldn’t try. 
 
While I’ve never regarded myself as business savvy, perhaps I’m on to something here.   What do readers think?  Is it time to take off the rubber gloves and wear suits and ties or should I keep my day job?