Book Club Summary: The Price We Pay
Within Abett, our team participates in a book club to help keep us abreast of developments in the industry, and to generate ideas for product features that can create value for our customers. We publish summaries of our discussions from books we've enjoyed.
Marty Makary's latest book, The Price We Pay, is filled with great information and stories regarding hospitals, patients, and the importance of ethical billing practices. The Price We Pay was voted "Business Book of the Year" by the Association of Business Journalists and gives an inside view to what is really going on in the health care industry. While it's a book we hope everyone reads, we've pulled some key statistics and takeaways for those who want a snapshot of some of the toxic undercurrents in the healthcare industry.
1 in 5 Americans have medical debt in collections
Half of women with stage 4 breast cancer now report being harassed by collection agencies
On average, doctors believe that 21% of everything done in medicine is unnecessary
Leg artery procedures (completely unnecessary) can generate $100K in one day when a doctor owns the facility
It is thought that in 2018, 60% of Americans received a surprise medical bill
One study found that for every 10 doctors, the average US hospital has seven (7) nonclinical FTE staff members working on billing and insurance function.
Real price transparency in LASIK, cosmetic surgery, and in-vitro fertilization has resulted in a global reduction in prices over time and has appropriately rewarded high-quality physicians.
One Boston-based self-insured business paid for diapers and wipes for a year if employees used specific healthcare providers because the cost of routine child birth in the area varied between $8K and $40K
Health care centers that initiated full price transparency saw a 50% increase in patient volume, a 30% increase in revenue, and an increase in patient satisfaction
A Kaiser Family Foundation study found that 70% of Americans are cutting back on food, clothing, and other basic needs to pay medical bills
Non-profit hospitals are more likely to sue patients than for-profit hospitals
A University of Arizona study of 5200 trauma patients concluded that nearly 1/3 of patients transferred by helicopter were minimally injured and did not need air transport
In 2018, physicians prescribed 4.5 billion medications, double the number a decade ago
The average person on Medicare is on 12 medications
A report by the Washington Health Alliance found that 45% of WA state health care services were unnecessary, costing an estimated $282 million in one year
Eighty percent of Americans get their medications through a pharmacy benefit manager (PBM) and the top three PBMs control 85% of the market (Cigna owns Express Scripts, CVS owned by Aetna, Optum owned by United)
The pricing "spread" between what the PBM charges the employer and what the PBM pays the pharmacy is in many cases outrageous: in one example the patient's copay for Lipitor covered the entire cost of the drug, but the employer still paid over $170 for the prescription
A recent analysis suggests that reducing generic reimbursements by $1 per person would lower health spending by $5.6 billion annually
If these statistics have piqued your interest in the Price We Pay, please pick up a copy and do a deeper dive. We promise you won't regret it.