Sunday, October 2, 2005

Medical Consumers Aren’t Even In the Loop

A nice note from friends in California, with news that Ed had a stress-test evaluation that led his doctor to arrange an angiogram.  He’s fine and the tests showed nothing abnormal, so everyone’s relieved.  There were no symptoms of chest-pain or shortness of breath, but you can never be too careful.  A one-day outpatient procedure that Ed walked in for and walked away from.  No big deal.


Until the bill arrived.


Sit down, catch your breath, unless you’re part of the health-care stream and then maybe you’ll just smile knowingly.  $19,000.00.  You read that right, nineteen thousand dollars. For an eight-hour procedure, six hours of which was merely lying still in a recovery room. No anaesthetic, no invasive procedure, unless you call inserting a catheter into a vein invasive.  They squirt some dye into your bloodstream and then take X-rays.  Good old Ed, bless his heart, didn’t even miss dinner at home and playing with the dog.


AngiographyEd was covered by his insurance, thank god.  But at least 45 million Americans aren’t and probably another twenty or thirty million have policies that don’t include such nifty little procedures.  The part I find interesting about this is Ed and his wife weren’t even consulted about the cost-side of the equation.  Thus, they have become an unwitting part of a profit-center, entirely cut out of a loop that circumscribes doctors, hospitals, insurance companies and finally, your and my federal government.


Does that seem strange to you?. 


So, I looked into this angiography equipment on the Web.  You can find anything there. I found a State Agency Report about Hinsdale Hospital in Illinois requesting funding for just such a machine.  Actually, their request is for more than just the machine.  They're applying for $2,265,730.00, which includes such agreeable extras as $15,000 in preplanning costs (that must be for thinking about getting a machine).  Then there’s thirty grand for an architect to design the $300,300 allocated for space to put the thing, space for patients to recover and maybe space for a dartboard and coffee machine.  There must be something like that, ‘cause there’s $33,430 for contingencies and a ten grand cushion for other costs.  Oops, the other costs turn out to be asbestos mitigation.


That leaves $1,877,000 for the actual goods, the stuff of which Medicare and Medicaid invoices are made.  The whirring and gurgling part with the flashing lights. 


Hinsdale Hospital is replacing their old equipment, which they state to be thirteen years old.  So, using that as a guide, amortizing the new gizmo over time comes to a depreciation factor of $144,384 each and every year.  Add to that Hinsdale’s projected operating costs; $968,454 in Radiology department salaries, $169,213 benefits, $396,175 supplies and the total annual operating cost comes to . . . a lot . . . just about $1,680,000.


It takes exactly eighty-eight Eds to hit the break-even.


Now I would like to think that this little profit-center could be kept busy an average of twice a day, five days a week.  That doesn’t seem unreasonable, as most of the patient elapsed time is lying still for six hours and that can happen in the hallway, if necessary. So, assuming that, we have a 500 procedure opportunity every year, if I got my arithmetic reasonably straight and shut down for two weeks vacation. 


Hey, pardner, that’s 412 pure profit whirrs and gurgles every year.  At nineteen grand a pop, it comes to a nifty $7,828,000 to stick under the mattress each January 1st.  I could run a shop like that myself in a rented storefront downtown and take on the local hospitals as ‘outpatients.’ Do a little web site, canvass the local doctors, spread a little green.


Hire a receptionist named Angie.  Call it Angie’s Angiograms.  I like it.
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There are lots more Things That Make Me Nuts, all of them on my personal web site.