Want doctors to innovate? Free them!

Peter Orszag, formerly the Director of the White Office of Management and Budget, appears to have found a new career as a pundit for the NYT. The fact that he's chosen to admonish doctors in a recent sermon at least means that the new preacher and his chosen pulpit are well-matched. The contempt for the medical profession shown by Mr. Orszag -- and his boss -- during health care reform is readily apparent, as he begins his editorial by stating that

[d]octors, like most people, don't love to work weekends, and they probably don't enjoy being evaluated against their peers. But their industry can no longer afford to protect them from the inevitable. Imagine a drugstore open only five days a week, or a television network that didn't measure its ratings. Improving the quality of health care and reducing its cost will require that doctors make many changes - but working weekends and consenting to quality management are two clear ones.

This may seem like a simple matter while flying at 30,000 feet and focused on line items in a massive budget, but the reality in the trenches is somewhat different. If Mr. Orszag really wants to help doctors make the health care system more valuable and not just less costly, he needs to learn more about what doctors actually do and give some real consideration to the extremely adverse economic and regulatory conditions under which they labor -- conditions now worse than ever thanks to Mr. Orszag and the 159 new federal bureaucracies he helped create.

In common with most social commentators who have little or no direct experience providing patient care, Mr. Orszag tends to take a broad but superficial view of the two most fashionable but complex aspects of health care delivery: quality and cost. Mr. Orszag is wrong to believe that the quality of medical care will be improved by forcing doctors to submit to "quality management," terminology borrowed from industry and embodying a process poorly suited to medicine. Doctors have been practicing continuous quality improvement since science was incorporated into medical practice in the 19th century. Lifelong learning, the continuous adaptation of practice to incorporate advances in medical science, and the detailed evaluation of untoward events were the standard practices of physicians long before they were discovered by industry and government. All medicine is evidence-based medicine; there just isn't evidence enough to provide all the answers, so experience and judgment are still critical to good outcomes. Current attempts by the federal government and others to measure medical quality by forcing doctors to submit to quality management by reporting on a long list of easily measured but often meaningless quality measures will not improve care. Mr. Orszag cites an example of this when he describes how a simple measure of quality led to the earlier discharge of patients from a hospital. However this may improve convenience, these simple measures can in no way assess the quality of anything but the simplest aspects of care provided by an individual doctor to an individual patient. Real quality assurance is still a task for experts. Reporting an airline's on-time arrival record is not the same job as figuring out why a plane crashed.

Mr. Orszag also makes the common mistake, seen especially in the media, of confounding the roles of doctors and hospitals. Doctors are not hospitals, and a hospital does not offer medical care. Doctors offer medical care, hospitals provide infrastructure and supporting services, and together they provide an environment in which patients can receive the care they need. A hospital cannot open a blocked coronary artery to avert a heart attack; only a doctor can do that. A doctor does not have the capital or expertise to build, staff, and run a heart catheterization lab; only a hospital can do that. The two elements go hand in glove, but the economic circumstances and work environment of the doctor and the hospital are different -- something that can't be ignored if the institution of a seven-day work week is desired to improve quality and convenience.

Mr. Orszag is undoubtedly an expert in Medicare finance, so he knows that physicians have been subject to federal price controls since 1992 and that practice costs for doctors since that time have gone up 54.8% while Medicare payments have increased only 11%. From basic economics he must also know that when the provider of a service is unable to recoup the cost of that service, the availability and quality of the service inevitably decline, and innovation ceases. Yet during health care reform, his plans for budget-neutral health care reform were based on cutting doctors' fees a further 25%. He must therefore believe that this huge additional cut in take-home income could be inflicted on physicians with no change in their behavior, that they would act as though they were in a free market and change their practices in response to public demand. This demonstrates not only deficiencies in his grasp of economics, but also a failure to understand human psychology. Instead of scolding doctors, Mr. Orszag should work to lift price controls, free doctors from stifling federal regulation, and let the free market once again provide incentives for them to innovate. If people are willing to pay doctors to provide elective services on Saturdays, doctors will provide those services. This is the American way, and it works -- something our federal government, and perhaps also Mr. Orszag, has forgotten.

Hospitals are a different story, but if Mr. Orszag wants elective surgery on Saturday, he'll have to pay for that, too. Besides not getting cost-of-living increases, few doctors get paid vacation, paid sick leave, overtime, night differentials, payment for being on call, time and half on weekends, or double time on holidays -- but hospital employees do. And in case Mr. Orszag has forgotten, hospitals are also price-controlled, and their employees are their major expense. Weekend work is going to cost more. Is Mr. Orszag willing to support increased payments?

We have a problem with our health care system because the federal government has made promises of unlimited subsidized health care to the nation's seniors and others. In doing so, it has incurred future financial obligations so great that they now threaten the very viability of the country. In its desperation to save money, Washington has hammered the medical profession into submission, forcing it into Max Weber's "iron cage of bureaucratization," and taken away the right of doctors to charge freely for their services. Such treatment, morally inconsistent with the founding principles of this country, has all but destroyed the medical profession as a profession. If Mr. Orszag wants more from the nation's physicians, more of the same mistreatment is not the answer. For Mr. Orszag to lecture doctors, some of whom have been working on weekends for longer than he's been alive, isn't temerity; its just impudence. No doubt they can hardly wait for Mr. Orszag's next installment, when he teaches them "that experimentation is the mother of improvement." Who would have guessed it?
Peter Orszag, formerly the Director of the White Office of Management and Budget, appears to have found a new career as a pundit for the NYT. The fact that he's chosen to admonish doctors in a recent sermon at least means that the new preacher and his chosen pulpit are well-matched. The contempt for the medical profession shown by Mr. Orszag -- and his boss -- during health care reform is readily apparent, as he begins his editorial by stating that

[d]octors, like most people, don't love to work weekends, and they probably don't enjoy being evaluated against their peers. But their industry can no longer afford to protect them from the inevitable. Imagine a drugstore open only five days a week, or a television network that didn't measure its ratings. Improving the quality of health care and reducing its cost will require that doctors make many changes - but working weekends and consenting to quality management are two clear ones.

This may seem like a simple matter while flying at 30,000 feet and focused on line items in a massive budget, but the reality in the trenches is somewhat different. If Mr. Orszag really wants to help doctors make the health care system more valuable and not just less costly, he needs to learn more about what doctors actually do and give some real consideration to the extremely adverse economic and regulatory conditions under which they labor -- conditions now worse than ever thanks to Mr. Orszag and the 159 new federal bureaucracies he helped create.

In common with most social commentators who have little or no direct experience providing patient care, Mr. Orszag tends to take a broad but superficial view of the two most fashionable but complex aspects of health care delivery: quality and cost. Mr. Orszag is wrong to believe that the quality of medical care will be improved by forcing doctors to submit to "quality management," terminology borrowed from industry and embodying a process poorly suited to medicine. Doctors have been practicing continuous quality improvement since science was incorporated into medical practice in the 19th century. Lifelong learning, the continuous adaptation of practice to incorporate advances in medical science, and the detailed evaluation of untoward events were the standard practices of physicians long before they were discovered by industry and government. All medicine is evidence-based medicine; there just isn't evidence enough to provide all the answers, so experience and judgment are still critical to good outcomes. Current attempts by the federal government and others to measure medical quality by forcing doctors to submit to quality management by reporting on a long list of easily measured but often meaningless quality measures will not improve care. Mr. Orszag cites an example of this when he describes how a simple measure of quality led to the earlier discharge of patients from a hospital. However this may improve convenience, these simple measures can in no way assess the quality of anything but the simplest aspects of care provided by an individual doctor to an individual patient. Real quality assurance is still a task for experts. Reporting an airline's on-time arrival record is not the same job as figuring out why a plane crashed.

Mr. Orszag also makes the common mistake, seen especially in the media, of confounding the roles of doctors and hospitals. Doctors are not hospitals, and a hospital does not offer medical care. Doctors offer medical care, hospitals provide infrastructure and supporting services, and together they provide an environment in which patients can receive the care they need. A hospital cannot open a blocked coronary artery to avert a heart attack; only a doctor can do that. A doctor does not have the capital or expertise to build, staff, and run a heart catheterization lab; only a hospital can do that. The two elements go hand in glove, but the economic circumstances and work environment of the doctor and the hospital are different -- something that can't be ignored if the institution of a seven-day work week is desired to improve quality and convenience.

Mr. Orszag is undoubtedly an expert in Medicare finance, so he knows that physicians have been subject to federal price controls since 1992 and that practice costs for doctors since that time have gone up 54.8% while Medicare payments have increased only 11%. From basic economics he must also know that when the provider of a service is unable to recoup the cost of that service, the availability and quality of the service inevitably decline, and innovation ceases. Yet during health care reform, his plans for budget-neutral health care reform were based on cutting doctors' fees a further 25%. He must therefore believe that this huge additional cut in take-home income could be inflicted on physicians with no change in their behavior, that they would act as though they were in a free market and change their practices in response to public demand. This demonstrates not only deficiencies in his grasp of economics, but also a failure to understand human psychology. Instead of scolding doctors, Mr. Orszag should work to lift price controls, free doctors from stifling federal regulation, and let the free market once again provide incentives for them to innovate. If people are willing to pay doctors to provide elective services on Saturdays, doctors will provide those services. This is the American way, and it works -- something our federal government, and perhaps also Mr. Orszag, has forgotten.

Hospitals are a different story, but if Mr. Orszag wants elective surgery on Saturday, he'll have to pay for that, too. Besides not getting cost-of-living increases, few doctors get paid vacation, paid sick leave, overtime, night differentials, payment for being on call, time and half on weekends, or double time on holidays -- but hospital employees do. And in case Mr. Orszag has forgotten, hospitals are also price-controlled, and their employees are their major expense. Weekend work is going to cost more. Is Mr. Orszag willing to support increased payments?

We have a problem with our health care system because the federal government has made promises of unlimited subsidized health care to the nation's seniors and others. In doing so, it has incurred future financial obligations so great that they now threaten the very viability of the country. In its desperation to save money, Washington has hammered the medical profession into submission, forcing it into Max Weber's "iron cage of bureaucratization," and taken away the right of doctors to charge freely for their services. Such treatment, morally inconsistent with the founding principles of this country, has all but destroyed the medical profession as a profession. If Mr. Orszag wants more from the nation's physicians, more of the same mistreatment is not the answer. For Mr. Orszag to lecture doctors, some of whom have been working on weekends for longer than he's been alive, isn't temerity; its just impudence. No doubt they can hardly wait for Mr. Orszag's next installment, when he teaches them "that experimentation is the mother of improvement." Who would have guessed it?

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