In his recent article “Feed Me, Pharma,” ProPublica’s Charles Ornstein has been calling attention to studies showing that the prescribing decisions of doctors are linked to to the amount of money that drug companies can bestow on them, usually in the form of meals, travel expenses, tuition support to attend courses, and so on.
I find nothing surprising about that, and Ornstein need not be so scrupulous when he clarifies that “the researchers did not determine if there was a cause-and-effect relationship between payments and prescribing.” To deny that perks have a causal effect on physician behavior invites improbable considerations.
In fact, the data suggests that doctors are particularly easy to manipulate. One of the researchers interviewed by Ornstein was “surprised that it took so little of a signal and such a low value meal [to influence doctors]” A Chick-fil-A is all that it takes!
I wish to make one clarification and one prediction regarding employed physicians.
The clarification is this: There is a common misconception that if healthcare operated under free market conditions, it would primarily be a cottage industry of solo practices and of small physician-owned hospitals. Such operations would not develop the capabilities of large healthcare entities that we commonly associate with central planning.
In reality, however, the opposite would be the case.
Transparency—or its absence—continues to fascinate healthcare analysts and healthcare economists. A study just published in the Annals of Internal Medicine addresses the effects of public reporting of hospital mortality rates on outcomes. Its senior author, Dr. Ashish Jha, offered his perspective on the study results and on the topic of transparency in The Health Care Blog.
According to the study investigators, mandatory public reporting of hospital mortality is not improving outcomes. The result of their analysis surprised them because “the notion behind transparency is straightforward” and the “logic [of public reporting] is sound.” The conclusion, therefore, is to persist in the effort, but to do it better with better metrics, better methods, and better data.
In a recent New England of Medicine article titled“Considering the Common Good—The View from Seven Miles Up,” Dr. Martin Shapiro tells a story that serves as a parable for a more general point: Instead of only considering the best interests of individual patients, American physicians should adopt “a more communitarian approach to decision making” and consider “the implications of individual clinical decisions for other patients and society as a whole.”
The parable is as follows: two sick patients are aboard an airplane, each which his own physician. The first one is terminally ill and on his way home; the second one has a grave illness but stands a small chance of surviving. A decision to land midway must be made in flight, and it pits the interests of one against those of the other.
In a recent article entitled “A Hayekian Defense of Evidence-Based Medicine” Andrew Foy makes a thoughtful attempt to rebut my article on “The Devolution of Evidence-Based Medicine.” I am grateful for his interest in my work and for the the kind compliment that he extended in his article. Having also become familiar with his fine writing, I return it with all sincerity. I am also grateful to the THCB staff for allowing me to respond to Andrew’s article.
Andrew views EBM as a positive development away from the era of anecdotal, and often misleading medical practices: “Arguing for a return to small data and physician judgment based on personal experience is, in my opinion, the worst thing we could be promoting.” Andrew’s main concern is that my views may amount to “throwing the baby with the bath water.”
A couple of weeks ago, I presented a paper about health and medical care at the 2016 Austrian Economics Research Conference, which was held at the Mises Institute. I will be sharing the content of the talk in the next few posts, but given that I use some terms and concepts borrowed from that school of thought (e.g., “praxeology”), I thought that I would first take the opportunity to give a brief introduction to Austrian economics for those unfamiliar with it.
Austrian school economics refers to a school of economic thought whose adherents generally share similar views on methodology. The originators of that school were mid-to-late nineteenth century Austrian scholars whose economic ideas were in opposition to the ones dominant in Germany at that time. The term “Austrian school,” given in disparagement by members of the German Historical School, stuck. The German school has disappeared, but the Austrian school remains vibrant today.
This week’s post is by Dr. Marc Fouradoulas who is a board-certified internist with a subspecialty in psychosomatic medicine. Marc’s ten years of clinical experience include psychiatry and primary care, and he currently works at the University Clinic in Bern, Switzerland. For the past 3 years, Marc has been studying towards a Master’s degree of advanced studies in managed healthcare and health economics at the Winterthur Institute of Health Economics, School of Management and Law, in Zurich, Switzerland. You can send him email.
An alternative take on the Swiss health care system
In a recent New England Journal of Medicineeditorial, Nikola Biller-Adorno, a German ethicist now based in Switzerland, and Thomas Zeltner, a physician and former Secretary Director of the Swiss National Health Authority, painted a rosy picture of the Swiss health care system, which they qualified as a potential role model for the US.
Given the author’s backgrounds and positions, their viewpoint may not be the most objective. Here, I wish to give readers a more realistic glimpse into this highly complex system from the perspective of a practicing physician.
In this article, I wish to introduce the reader to the theory of entrepreneurship advanced by Frank Knight (1885-1972), and show that the common, everyday work of the physician could be considered a form of entrepreneurial activity in the Knightian sense.
Knight was an influential American economist. He is best known for his book Risk, Uncertainty, and Profit in which he proposed to distinguish risk and uncertainty as follows:
A couple of weeks ago I was interviewed by Kevin Price on his radio show “The Price of Business” which runs on Houston’s 1110 AM KTEK radio station. Also present was Dr. Geetinder Goyal. We talked healthcare economics, free markets, and direct patient care. I hope you enjoy it.