The history of a rumor

LITTLE ROCK — That was a revealing news story by Charlie Frago in Friday’s paper about Medicaid’s new way to handle medical costs in Arkansas. What it reveals is pretty much what you’d expect as our government assumes more and more of the role once played by our family doctor.

When that happens, the first result is confusion. As illustrated by the rumor passed on by John Selig, who heads the state’s Department of Human Services, and amplified via NPR, that reliable source of unreliable news. Mr. Selig told its Diane Rehm how well Medicaid’s new cost-containment program was working in Arkansas. According to him, one doctor told by DHS that he was charging Medicaid too much looked over his billings and traced his “unacceptable” costs to a hospital. The story had a happy ending, according to John Selig:

“. . . we dug further and found out that the hospital he was using was keeping patients—the mothers—on average an extra half-day or day longer than other hospitals, and that was causing his cost to go up. And he said, well, I can talk to the hospital about that, and he did do that. And they said, well, we do that because we can get paid for it.”

Actually, that wasn’t what was happening. Not at all. The obstetrician, who delivers babies at both Baptist and St. Vincent medical centers in Little Rock, found that the hospitals weren’t keeping patients longer than DHS liked in order to boost their revenue. As the doctor explained: “Neither hospital has ever come to me and said, ‘Can you let someone stay longer because it’ll help our bottom line?’ In fact, there’s a bed shortage. Nursing coordinators are always asking me if I have someone ready to go home because they need the bed.”

It’s not the hospitals but the new mothers who are delaying their departure from the maternity wing. “New mothers often want to stay a little longer,” the doctor explained. “They’re getting used to breast-feeding. It’s overwhelming.” Anybody who’s a new mother, or has ever been around one, will know what the doc means. But now he’s being pressed to send his patients home earlier than they might like.

That’s how the most intimate decisions in our lives may be shifted from physicians and their patients to bureaucrats when government plays doctor to cut health-care costs. Though it has yet to be established that all these cost-containment measures will actually contain costs. For human ingenuity is such that, where there’s a will, there’s a way around even the most restrictive regulations. Ask anybody who’s ever been in the Army. It may all depend on who you know, and how resourceful you are at finding your way through or just around the maze that is The System. In this case, Medicaid.

Nor is it just Medicaid and Medicare that are feeling this kind of pressure. Private insurers, too, are adopting the same kind of cost-containment measures that John Selig described so inaccurately to a nationwide audience. Later, he would acknowledge that his story was based more on hearsay than facts, that he didn’t even know the name of the hospital in the story he was telling. But his anecdotal account did lend an air of credibility to Medicaid’s claims for its new approach to policing physicians. Till the facts caught up with him.

Mr. Selig’s story also offers a revealing glimpse into the Brave New World that awaits American doctors—and their accounts, formerly known as patients. That bit of gossip he shared over the national airwaves offers a foretaste of what is in store for American medicine as the health-care system is “reformed.”

One result of all these reforms, at least for those trying to escape the bureaucratic clutches of The System, will be the kind of two-tier medical system the British already have, in which those who pay private doctors for their care can avoid the embrace of the National Health Scheme, as it used to be called before its name was euphemized.

Much the same phenomenon occurred in the old Soviet Union, where paying for private care was technically a criminal offense, but could be done under the table. And it was, like so much else in a command-control economy that does anything but command and control. Human beings can be quite resourceful when it comes to (a) getting around rules and regulations, and (b) getting better health care.

IN THE END, medical care is a commodity, no matter how often it is called a right, and the laws of supply and demand still apply. When good care is scarce, the demand for it will increase, and a government seeking to control its price will soon enough have to resort to rationing the commodity. It’s already started to happen. (“Sorry, ma’am, but we want you out of this hospital bed by 3 p.m. today.”) That kind of thing will doubtless occur more frequently as government regulations continue to expand. The emphasis of all these changes in health care seems to be on how to pay for it—on efficiency and savings, not on improving health care itself.

Instead of beginning at the supply end of the equation—by producing more and better qualified medical professionals—we’ve started by expanding and subsidizing demand. Which is a sure recipe for poorer quality and inflated cost. As the example of almost every country that has socialized medicine will demonstrate.

This story in Friday’s paper was about just one Medicaid program in one state. Wait till ObamaCare envelopes American medicine in a fog of still-to-be-determined rules, regulations, and electronic forms. Even now you can see an Orwellian future on the cloudy horizon in which doctors never actually see a patient but spend their working day before an inanimate computer, checking spreadsheets and evaluating reports from their team of assistants—five, ten, a dozen?—and sending back instructions, comments, ad libs, and all the medical directions that can fit into a tweet.

As for whether these cost-cutting measures will actually cut costs, that promise may prove as illusory as the elaborate story John Selig was telling over NPR. One of the more beguiling myths of humanity is that actions need have no consequences, that benefits can be obtained at no cost. So this state’s Medicaid program can add hundreds of thousands of new patients to its rolls and no one will have to pay for it. Even as we wind up paying for it through higher taxes, longer waits, and worse medical care in general.

All those patients waiting in emergency rooms may still wait there even if the hospital gets to bill Medicaid for them. Which may be great for the hospital’s bottom line, but have little effect on the quality of health care itself except to reduce it further. For the object of all such reforms seems to be to cut the time physicians, nurses and hospitals actually spend caring for patients.

The moral of this story: There is no free lunch. Any more than there is free medical care. Somebody will wind up paying for it. Either in higher taxes and premiums or in poorer care. Probably both.