Most nurses probably don't know enough about the economics of health care and health care policymaking in this country. The idea that the provision of health care occurs within a complex political and economic system barely comes up in nursing schools-even though health care costs make up roughly one-sixth of the U.S. economy, and the public-private system under which health care is financed and provided drives many policy decisions. Consider the following: consolidations of hospital systems and insurance companies have created monopolies in which prices keep rising, regardless of actual costs. Drug companies can legally thwart competition from generic drug manufacturers to keep prices high. Many nurses (and physicians) report feeling alienated from their labors because of the financial constraints they must work within. This prompts a pressing query: has big business broken the American health care system?
A complicated system is often likened to an onion: you peel back the layers to reach its core, learning more as you go. But American health care is like an onion without a firm core-instead there's a secret trapdoor that drops you into a fog of acronyms, billing codes, and dollar signs, a miasma that breaks all known rules about how economies should work. Elisabeth Rosenthal, a trained physician and an experienced journalist, reveals the nature of that fog in her new book, An American Sickness: How Healthcare Became Big Business and How You Can Take It Back (Penguin Press, 2017). Nurses who care for patients from a sense of mission will feel the gut-punch of the first sentences: "In the past quarter century, the American medical system has stopped focusing on health or even science. Instead it attends more or less single-mindedly to its own profits." An American Sickness indicts all the usual parties known to engage in such profiteering: insurance companies, hospitals, physicians, drug companies, even home care companies. These entities collude to maximize their earnings, as Rosenthal's discussion of hemophilia treatment shows.
Hemophilia, a hereditary bleeding disorder that results from lack of clotting factor VIII, afflicts a tiny percentage of the population, which suggests that companies wouldn't be much interested in its treatment. Yet one marketing consultant whom Rosenthal interviewed called hemophilia a "high value disease state," meaning that these patients constitute a niche market ripe for collusive profiteering. Rosenthal describes what happened in the 1990s, when it became possible to artificially synthesize factor VIII: pharmaceutical and home care companies conspired to make factor VIII more expensive, although artificial synthesis should have greatly lowered its cost. Moreover, whereas patients had taken the drug only as emergent treatment during bleeding episodes, they were now offered triweekly doses as a preventive measure. Home care agencies changed their practices; instead of charging patients or insurers for drug delivery and infusion services, they allied themselves with drug manufacturers "and got paid by the drugmaker per unit of factor VIII delivered into patients' veins."
The book is filled with similar stories. Rosenthal's overall point is that the practices of the health care market violate basic laws of economics, as her list of 10 "Economic Rules of the Dysfunctional Medical Market" shows. These rules include "More treatment is always better. Default to the most expensive option" (rule 1) and "Prices will rise to whatever the market will bear" (rule 10).
Some people argue that our health care system isn't even a real system, just an awkward agglomeration of government-run programs, for-profit businesses, and brick-and-mortar health care facilities. These private and public entities often have competing goals. Entities like public hospitals eschew profits, while private insurers embrace profit making as an end. Rosenthal aptly demonstrates how our health care system has shifted its focus from service to business-and since health care is a service, being overtaken by business values warps vital aspects of how the system functions.
Every other developed country uses some degree of government oversight to keep health care affordable and available to all citizens, and spends far less annually per patient on health care than America does, with better overall outcomes. Rosenthal's book shows how our health care system's skewed economics causes it to fail patients and providers alike, and in the closing section, offers suggestions for action.