Surgery Center of Oklahoma Blog

Howard Brody, medical ethicist, is quoted in our local paper today.  ”If the physician is going to be  a true professional and not a hired gun, that physician is going to have to be independent.  One has to prioritize what is good for the patient above ‘Will I, the doctor, make more money or will the drug company I work for make more money?’”

He is referring to physicians who accept money from drug companies, sometimes for speaking engagements, other times for “research.”  He is, of course, correct.  Physicians that are “hired guns,” as he says are doing the bidding of who hired them, not the bidding of the patient, or what is necessarily in the patient’s best interest.  ”Whose bread I eat, his song I must sing,” or something like that.

Those of you loyal to this blog know exactly where I’m going with this, don’t you?  Let’s take his quote and play a substitution game.

“If the physician is going to be  a true professional and not a hired gun, that physician is going to have to be independent.  One has to prioritize what is good for the patient above ‘Will I, the doctor, make more money or will the_________ I work for make more money?’”  Now let’s put words in the blank that are possibilities.  The original quote was “drug company.”  How about hospital?  What?  You say, “that’s not fair.”  ”The patient’s interest could never be different from the hospital’s interests!”  But what if the hospital makes more money if they insist that their hired physicians substitute cheap drugs for more effective ones? What if the hospital requires their primary care doctors to refer patients to their hired surgeons rather than more competent ones, because they cash in on the surgical fees, as well?  What if the hospital requires their hired guns to perform unnecessary invasive testing on patients to generate revenue needed to pay these physician’s salaries?  I could go on.

How about multispecialty clinic?  Some physicians work for giant clinics (often times with a city’s name attached).  What if the interests of the XYZ clinic that employees a doctor trump that of the patient?  ”Doctor, you must see 49 patients per day and do 13 surgeries a week in order to earn your keep here at this world famous clinic and you must also participate in this drug study that will bring thousands of dollars into our clinic and help pay you.  You must enroll 8 patients/week in this study or face the punitive salary cuts in your contract.”  You get the picture.  You think this doesn’t go on?  Really?

How about “insurance company?”  Do I even need to elaborate?  Remember that HMO’s typically bonus physicians at the end of the year to the extent that they have been successful denying their patients access to specialists and denying care, in general.

“Wait,” you say!  ”Dr. Smith, you are part owner of a surgery center.  You and your partners are biased to do unnecessary surgery to profit yourself!”  I have written about this before, so bear with me.  It is precisely because our facility is physician-owned that unnecessary surgeries for profit are less likely to happen.  Why is that?  Because any idiot that takes this path places all of the partner-owners in harm’s way.  If this were to happen, that partner would be dismissed.  Immediately.  The very existence of our facility depends on the absence of this type of activity.  Not so when physicians are not the owners.  Those facilities are treated like rental cars, not like vehicles you own and care for.  In financial and risk management terms, it matters not to physician “A” if physician “B” operates on patients unnecessarily in a facility that is not physician-owned.

Are physicians who take money from device makers or drug companies compromised?  Of course they are. But the logic of this argument brings us to the heart of the sanctity of the doctor patient relationship and how viciously compromised that relationship becomes when the source of the physician’s revenue is other than the patient himself.

G. Keith Smith, M.D.

Bad news for Canadians turns out to be great news for our facility.  All you need to read in this article is the title but the entire article is a devastating critique of the Canadian health care system.  The answer to the question, “what happens to a national health care system over time that is promoted as ‘free’,” is found in the article.  Could it be that demand dwarfs supply?  Could it be that the government rations care in order to stay solvent?  This rationing ploy amounts to the same thing as a bankrupt company that takes longer and longer to pay its bills, eventually not paying them at all.

Calls to our facility from Canadian patients have picked up recently.  This trend looks likely to continue if the authors of this article are correct.  I like to think of our facility and our transparent and packaged pricing as a surgical lifeboat for people.  There are so many stories now of people who have had life changing surgeries at our facility that they would not have been able to afford, had our facility not been there for them.  This includes Canadians and many uninsured from here in Oklahoma and from many other states.  I also like to think sometimes of the money that we have kept people from spending on health care, Bastiat’s “what is not seen” concept I’ve written about before.  The $10,000 difference between the price for a hernia repair at our facility, and at a local not-for-profit hospital is a significant amount of money by itself, but a gigantic amount when multiplied by the number of patients that have benefited from our pricing.

The lesson of single-payor, universal health care just to the north should have been heeded here, but the power-hungry health care gangsters are determined to implement that failed system here, it seems.  An Associated Press article recently made the case for investing in the Canadian stock market.  I think a better investment might be in the airlines that will carry sick and injured Canadians to Oklahoma City for care for which they will be more and more willing to pay.

G. Keith Smith, M.D.

I wrote early in the life of this blog about the benefits to patients of physician ownership of medical facilities (it was march of 2011 if you want to read it).  Briefly, physician owners are accountable to patients not only for the care they render but for the care the patient receives from the medical personnel working in the facility they own.  The physician owner can’t say, “well…I did my part, but that idiot nurse messed up and that’s not my fault.”  It is his fault if that nurse works for him and for the facility he owns.  Bad employees don’t stick around facilities that are physician-owned because that increases the liability for that doctor.

Bad doctors are typically not kept on the medical staff either.  Some fool surgeon that is unethical or incompetent increases the trouble for everyone that is an owner.  There is no cross-accountability or liability in a facility where there is no physician ownership.

Physician owners can’t very well hide behind an incredibly high bill, either.  They can’t say, “I have nothing to do with that excessive bill, “as they have all of the control in a facility they own.

I could go on.

Try to keep this in mind as you watch the second video from the very talented Dr. Jason Sigmon.  Once again, so many points are made in his video I plan to comment on them in later blogs.  Pay particular attention to the part at the end that shines light on one reason health care is so expensive.  Thanks to Dr. Sigmon for sharing yet another gem.

G. Keith Smith, M.D.

This video, created by one of my partners, the extremely talented and creative surgeon, Dr. Jason Sigmon, makes so many points that I will probably address them one at a time in future blogs. Hopefully you will find more humor in it than tragedy.  It has taken forty years or more to create the situation you see in this video and will not be remedied quickly, I’m afraid.  Enjoy.

G. Keith Smith, M.D.

A friend of mine recently opted out of Medicare.  Let me explain to you what this means in case you don’t know.  He doesn’t refuse Medicare patients, just Medicare.  This was for him, like all other physicians I know, the most liberating act of their medical practice.  He shared this story with me.

One particular Medicare patient my friend the ear, nose and throat surgeon had taken care of was very worried that he would not be able to get in to see his favorite doctor. This patient has a chronic condition that requires periodic nasal procedures done in the office.  He doesn’t have a lot of money and will need ongoing care for the rest of his life.  He made an appointment as usual and at the end of his procedure acknowledged the physician’s decision to opt out and asked him if there was someone else he could see.

My friend looked at him and said, “what do you mean?  Don’t you want to come here and see me?”  The patient told him that he didn’t think he could afford it, paying out of pocket large amounts for his visits and procedures.  ”Bring me a Vente Starbucks Cafe Americano when you come in and we’ll call it even.”

Before the full impact of this story can be appreciated some background information is needed for a proper context.  Think of the Medicare Ponzi scheme as the Titanic.  The now retired senator from Texas, Phil Gramm, used this analogy regularly.  Think of it as the Titanic with a twist, though:  some of you know it is going to hit the iceberg before it does.  Your warnings are met with derision and you are marginalized and labeled a “radical.” Those of you (patients and physicians) who don’t wish to sink in the icy water get in the lifeboats (opt out).  The politicians and mainstream name-callers begin rearranging the deck chairs and claim that Medicare has been reformed (this was Gramm’s famous quote:  ”reforming Medicare is like rearranging the deck chairs on the Titanic”).  The denial and dishonesty on the ship just as in the entitlement program, ultimately result in needless suffering and loss of life.

Note that my surgeon friend and the patient are the only two parties in the coffee- for -nose -surgery exchange.  No third party is present to deny payment “because this procedure is no longer on the approved list,” or something like that.  Medicare isn’t raiding this physician’s office because he coded the claim improperly.  The physician is happy to see this patient and is looking forward to his coffee once he sees this patient on his schedule that day.  The patient doesn’t harbor that entitled attitude that frustrates so many in the medical profession.  He knows that the doctor will be thrilled to see him.  Good coffee has a way of bonding folks, you know.  The taxpayer is happy because no money is expropriated from him or her to pay for this office visit/procedure.   Our children and grandchildren are spared additional debt, as well.

As the bankrupt program nears its end, rationing will be the order of the day.  Procedures and medications will be denied.  This rationing may take the form of payment amounts that are so low to physicians that they no longer perform certain procedures at all, as the payment very likely will be below their cost of delivery.  The Medicare bureaucrats and politicians can say that they are continuing to pay for total hip replacements, for instance, but the greedy doctors simply won’t do them anymore for $100.  This has been the approach by the Medicare bureaucracy for about ten years and I predict will become much more intense soon.  As more and more physicians opt out of the scheme, more and more patients will follow them and do so gladly, as that will be the only way for the elderly to receive care at all.

Medicare will end, one way or the other.  Less people will lose their lives if we proceed in an orderly fashion to the life boats.  Think of the practice of a physician who has opted out as a lifeboat.  The physician who has opted out and has been labeled a “radical” by the mainstream lemmings, may be the only reason you get any medical care in the future.  Time to get on board with these doctors and off of the big boat.

G. Keith Smith, M.D.

Check out this internet radio station.  This liberty loving outfit had an employee that needed surgery.  As they are self insured, they sought out a reasonably priced facility and found us.  Their employee was operated on at our surgery center  and now we are advertising on their radio station, based in Austin, Texas but heard around the world.  This is significant for us because we have never advertised until now.  Any sudden increase in our internet patient volume now will undoubtedly be attributed to our ads on their station.

The market at work.  What a beautiful thing.

G. Keith Smith, M.D.

Grab some popcorn and watch my first movie.

G. Keith Smith, M.D.

Wonder what was buried in the health care bill that no one responsible for it wanted you to see?  Here it is.  This little gem, the medical loss ratio, is intended to make health insurance companies obsolete.  This is the provision that is intended to result in a single payor system.  Here is how it works.  Your insurance company must pay 80% of what it collects from you for medical care.  Sounds like that’s to your advantage, no?  Greedy insurance companies forced to relinquish some of their profits so you can get more health care, right?  Government did this to protect you from your insurance company, right? Wrong.  They did this so that all of the little insurance companies will go out of business right away and eventually all of the private insurance companies will, as well.  The large insurance companies will be left to administer the national health plan in the same way that private insurance companies administer Medicare and Medicaid in a special brand of fascism.

Let’s say you have a high deductible plan.  You have a $5,000 deductible and pay $250/month for premiums.  You basically are paying for all of your health care out of your own pocket.  You have chosen to pay for your care, rather than pay large premiums to an insurance company while maintaining a smaller deductible.  So far so good.  Enter the medical loss ratio.  None of the money that you pay for healthcare  yourself is taken into account for purposes of this calculation.  Your insurance company would need to pay 80% of the $250 you send them every month on care for you in order to be in compliance with this new law.  Guess what your insurance company will do?  They will simply not offer this type of policy any more.  No one will.  Guess what you will have to do?  You will have to buy a much more expensive policy (small deductible and giant premiums) or go uninsured totally.  Initially, this is a pretty good deal for the insurance companies as they get to sell much more expensive policies and collect larger premiums.

The government will punish insurance companies that don’t comply by forcing rebate payments to patients such that these types of policies will no longer be offered and many of these companies will hang it up.  That means there will be less competition in the health insurance marketplace.  Guess what that means for the prices of the policies?  As the prices go up, the demand for a national solution will skyrocket and presto!  About 5 insurance companies (if you can still call them that) will administer “the plan” to the entire country.  The country will be carved up into regions and each “company” will be awarded the spoils, colonies (former states)full of folks for whom it is illegal to not carry their “insurance” product.

Relieved of any competition, these “companies” will collect their premiums with the aid of Uncle Sam’s iron fist and be reluctant to pay for much if any care, as that is how profits are made in the “insurance” world.  Insurance companies are kept in check from becoming too abusive on this account out of fear that the insureds will leave and go to a competitor.  No more!  Rationing will be the order of the day and there will be no where to turn.

Drug shortages will dwarf anything we saw this past year, as the “companies” will set prices below the profit margins to produce many drugs.  Lines will form for basic and life-saving procedures, just as they have in Canada.  People will have to pay completely out of pocket for their care if they want good care in reasonable time.  A facility like ours that has transparent pricing will be life-saving for those looking for help.  I doubt that our current facility will be large enough to accommodate all of the medical refugees.

“Medical loss ratio” will be known soon enough as a measure of mortality statistics in this country.

G. Keith Smith, M.D.

Check this out.  I don’t know if this is true or not.  Let’s hope that it is true.  Now suppose that it is.  There are those of you out there that are thinking, “well…if there’s no money in it for those greedy pharmaceutical companies, this will never make it to the market.  So much for your laissez faire capitalism and its application to medical practice!”  ”This represents a failure of the market and that is why we need government in charge of medicine!”

Sorry.  If you are thinking that way you go to the back of the class.  It is precisely a government institution (the FDA) that will keep this from reaching the market.  It is also the practice of the government funding of medical research that has kept this from coming to light earlier.  You think the FDA isn’t capable of corruption?  Check this out.  That they have been caught in this corruption scandal means that there are probably countless others that have escaped our attention.

Let’s hope this research is in fact true.  You don’t think any money will change hands from the pharmaceutical industry to the FDA to influence whether this gets a fair hearing, do you?    What may seem like market failures are actually government-induced distortions that doom legitimate research and new drug and device introduction to the marketplace.  Right here in Oklahoma City, researchers have disccovered ear drops that can virtually eliminate noise-induced hearing loss if applied within 12 hours of the exposure.  The FDA is requiring that the combination of drops be tested now, even though individually the drops have been proven safe.  The researchers estimate that this will take 4 years.  You don’t think that the FDA would  hold the makers of hearing aids hostage with the possibility of an earlier release of these drops, do you?

 If a government agency exists that can prevent newcomers from entering the marketplace or significantly increase the price of entry, that agency, or the people that run that agency will be” influenced” by those who benefit from barring the newcomer’s grand entrance.  The folks running the agency, will, of course, be acting in our best interest, protecting us from the untested drugs or techniques!

Those of you who think that we need more government in medicine need to give this some thought.

G. Keith Smith, M.D.

When doctors become employees this is what happens.  Doctors on strike.  Their patients dying.  Oh. That’s right.  They aren’t their patients.  That old concept of the doctor patient relationship that everyone in this country takes for granted doesn’t apply to these government-employed doctors.  What can we learn from this?

Economically, the government has set the salaries of these guys below what our  economic friends call the market-clearing price.  The market clearing price is that perfect price where there is neither shortage or surplus.  The buyer and seller of goods and services are both exactly as well off in any transaction as they can be.  Price controls by governments are always wrong.  If the price is set too low, shortages result.  If the price is set too high, surpluses result.  These Indian doctors basically have said,”I’m not working for that wage.  It’s too low.”  Governments (ours included) never seem to learn that there is no possible way that any bureaucrat (no matter how brilliant) can come up with a price that is right.  It will be either too high or too low.  Every time.  This arrogant tendency has been referred to as “The Fatal Conceit,” by Friedrich Hayek.

Doctors would never strike in the old USA, would they?  They already are on strike.  Countless physicians have walked away from patients, the payment for whose care is set below the market clearing price.  Medicare and Medicaid and Tricare are good examples of government health plans that are defined by price controls and prices that are so far below the market clearing price  that most physicians are either not seeing these patients or are severely limiting their exposure to these patients.  Here’s the crazy part:  this is exactly what the government goons want!  This limited access to care is basically rationing care and the physicians play the role of the bad guys, not the politicians or bureaucrats.  A physician who says that Medicare doesn’t pay him enough sounds greedy, no?   What a great way to maintain the solvency of the Medicare Ponzi scheme.

On the doctor patient relationship front we can learn that if the doctor isn’t working for the patient, the doctor is more likely to walk away from them during their care and let them die.  These government doctors in India have no loyalty to these patients.  They couldn’t care less.  Doctors employed by the government, doctors employed by hospitals or corporations…what’s the difference?  One thing these employed doctors have in common:  they aren’t working for you, the patient.  I believe that Osamacare takes us one more gigantic step closer to this situation in India.

G. Keith Smith, M.D.