January 24, 2010

Making waiting illegal

waiting on line

By Mark M. Ryan

If the frustrated customers of HMOs in California are fed up with wait times, they should be even more frustrated with a legislative body whose solution is to make wait times illegal. The truth is that wait times are but a symptom of much larger systemic issues in health care delivery.

~ January 24, 2010

www.markmryan.com

The San Francisco Chronicle reports on a new California State Law that aims to legislate away a problem that many clients of HMOs face: excessive wait times.  Anthony Wright, the director of a California consumer advocacy group is quoted as saying, “We are pleased with these first-in-the-nation standards that set standards for when patients should get telephone advice, an urgent-care appointment or a routine appointment from doctors and specialists”.  Mr. Wright goes on to say that he “expects the new law to relieve some emergency room crowding because insured patients often wind up in the ER when they are unable to get an appointment in a timely manner”.  A solution so simple, only politicians could make you believe it would work!

The truth is that wait times are but a symptom of much larger systemic issues in health care delievery.  Let’s take a closer look at what causes wait times, and let’s use the gasoline delivery system as an example. There is a chain of gas stations in the midwest named Swifty. The Swifty filling stations consistently have the lowest price on gasoline, and they pump it for you.  Sounds too good to be true, right?  Well, there is one catch; the lines at Swifty’s service stations are so long that they usually stop traffic for 1/2 mile in either direction of its entrances.  Swifty’s stations normally have only two pumps and one attendant.  Swifty’s customers accept the fact that they will face longer wait times for lower priced gasoline and the convenience of not having to pump it into their cars.  They also know that there is only one type of gasoline at Swifty, 87 octane unleaded, and there are no additional products like coffee, chewing gum, or snacks offered at the service stations.

Across the street from Swifty, the gasoline at BP may be ten or fifteen cents more per gallon, and you have to exit your car to pump it for yourself.  You are able to do this, however, in normally less than three minutes compared to the 20-30 minutes it takes for you gas tank to be filled at Swifty (the irony is not lost on this writer).  With this extra time, many customers of BP enter the service station and use the restroom, eat a sanwich, or buy a freshly brewed cup of coffee – amenities not offered at the Swifty station.

How does this apply to health care and, in particular, California’s HMO clients? HMOs are designed to work like Swifty; provide adequate but limited service at the lowest cost to consumer, provider, and, most importantly, payer.  Long waits are what the consumer sees and experiences, but these waits are the result of the HMO’s cost-cutting strategy of limiting its provider network, limiting it provider reimbursement schedule, and incentivizing its customers and providers to pursue conservative and cost-efficient treatments options.  Consumers enrolled in PPO or EPO plans (the BPs of health insurance) have access to a larger pool of providers, and these providers are very willing to exchange their services for the more lucrative reimbursements offered by PPO or EPO insurance plans.  Physicians are like any other rational human being.  They will migrate toward the incentive of highest reward and lowest cost.  Of the available insurance plans, HMOs offer physicians the worst possible incentives: the lowest rewards and the highest costs.

If the frustrated customers of HMOs in California are fed up with wait times, they should be even more frustrated with a legislative body whose solution is to make wait times illegal.  A more viable solution would be to increase the number of providers to a level that appropriately matches the increased demand for health care.  This could involve increasing the number of medical schools in the state or increasing the size of each matriculating class.  It could also involve the training and utilization of more physician assistants or nurse practitioners in the provision of health care. An even more efficient solution, though less politically feasible, would be to increase the provider reimbursement rates and decrease the costs of practicing medicine in California, e.g., lower state medical license fees, streamline the credentialing process, lower malpractice insurance rates, give tax abatements for new medical practice facilities, and provide a well-trained para-professional health care work force.

Alas, politicians are also rational beings (if only in a peculiarly political sense), and thus, HMO customers are destined to continue suffering long, albeit illegal, wait times.

~ www.markmryan.com                                                                                                                                     January 24, 2010

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