I blog about free markets in medical care and transparent pricing.


My New Video Blogs

I have been encouraged by my friends at Visual Image, the consultant helping me with social media, to create video blogs, all of which, completed as of today, are linked to in this blog.  I plan to embed all future video blogs into this written blog for the benefit of those of you who subscribe to this blog with RSS alerts.  The response to the vlogs produced so far has encouraged me to continue with this, as the following of the vlogs in a very short time has surpassed the following of my written blog!  I plan to continue to write, however, as I am convinced that writing, more than anything, has helped me to speak and communicate more clearly and accurately.  Thank you one and all for your support.

G. Keith Smith, M.D.

For more information about free market healthcare, visit:



Video 1

Video 2

Video 3

Video 4

Video 5

Video 6

Video 7

Video 8

Video 9

My interview on Varney and Co. last week

Here is a link to my interview on Fox’s Varney and Co., last week.  Initially skeptical, Mr. Varney came around towards the end of the interview.  If the email response I received from patients looking for an affordable surgical experience is any indication, this particular television show has a huge audience.  Hope you enjoy.

G. Keith Smith, M.D.

My interview on CNBC

Here is a link to my interview on CNBC last week for those of you interested.  When asked many years ago, what he would do if pronounced king for a day, Ludwig von Mises responded, “abdicate.”  I had this in mind when asked at the end of the interview what I would do if I were pronounced the CEO of “Obamacare.”  I am pretty sure, based on their reaction, they didn’t anticipate my response.  Hope you enjoy.

G. Keith Smith, M.D.

For more information about free market health care visit:



The Criminal Regime’s Double Standard

One of the most compelling and well-written books I have read in a long time is Thomas DiLorenzo’s “Organized Crime: The Unvarnished Truth about Government.”  In almost every chapter he drives home the very simple point that we would never tolerate behavior from an individual that is every day and commonplace for governments all over the world and all through time.  In short, governments routinely engage in activities that would be considered criminal for you and me.  

I thought about this conundrum recently while reading about a medical data breach at a large hospital system, the work of Chinese hackers if you believe the media.  In spite of having taken all precautions, embracing all safeguards, their system was compromised using a malware software.  The hospital system had even purchased insurance to protect them from such an incident, a policy that served to make the victimized patients “whole,” or as best as possible.  Their efforts to prevent such a cyber attack and their efforts to insure that anyone victimized by such an attack are laudable.  But nothing will protect them from Uncle Sam’s HIPPA knives, congressional hearings and fines likely on the way.

Here is the order of events, then:

The federal government requires the purchase of electronic medical records systems or slashes Medicare reimbursements for those who don’t comply.

Once digitized and no longer secure, the patient medical records, if vandalized, represent an almost limitless liability to the physician or hospital in whose possession the records rest when compromised.

All the while, the federal government requires that digitized patient data be transmitted to them (meaningful use) without the patient’s consent in order to better order our lives and for our own good.  

The most prominent item in Ron Paul’s office was a sign that said, “Don’t steal.  The government hates competition!”  I think the same can be said about HIPPA, a law which basically grants the government a monopoly on violating the medical privacy of individuals.

I find it impossible to believe that the “state” cares about our medical privacy when no group of Chinese hackers can begin to more effectively mine our personal information than the government health care hackers (never mind the NSA!).  The hypocrisy of those who enforce and benefit from HIPPA should be clear to all, by now.  You say, “Wait a minute!  No one working for the government is going to use my medical information in a way that would harm me!”  Can you honestly say that with a straight face?  That the privacy violations of this gang of eavesdroppers are sanctioned by the “state” is particularly concerning as the primary beneficiary of this information is…..the “state.”

Lew Rockwell once said that there is only one way to know for sure that something about our government is true and that is when the government issues its official denial.  That HIPPA exists to protect our medical privacy is yet another of the “state’s” many lies so many have chosen to believe.  

G. Keith Smith, M.D.

For more information about free market health care visit:



Hit ‘em harder, Dan!

Daniel Goldberg and his Free Market Health Group are part of the emerging and growing cast that is introducing physicians to the idea that embracing the discipline of the free market, rather than rejecting or resisting this force, can actually be good for the physician’s practice.  Mr. Goldberg recently contributed an article to the periodical “Orthopreneur” which you can read here.  I informed him on a Facebook post that I was going to take friendly issue with part of his article, as I believe he has understated the very point he was making, the result being a far too kind characterization of our friends in the insurance world.

Towards the end of his article he writes:

With self-funding, the employer “rents a network” from a larger carrier like Cigna or Blue Cross. This rental simply means that the employer will pay the same cost for procedures as guaranteed under Cigna’s network. However, instead of the insurer paying the claim, the employer pays the claim and acts similar to an insurer. Also, unlike most plan arrangements, the employer is not precluded from contracting with providers outside of the network for lower rates.

The italics are mine and are the heart of my issue with this paragraph.  You see, here in Oklahoma, self-funded employers are securing pricing that is far better than the pricing “negotiated” for them by their “network.”  The savings that Advantage Health Plan (part of the Kempton Group) has realized, for instance, is almost 8 million dollars in just over 2 years and is calculated as savings compared to what would have been paid at “network” rates.  Same goes for Oklahoma County, $570,000 saved in 5 months!  Compared to historical network payments for the same procedures.

While the big carriers who often are administrators of self-funded plans claim to have their client’s interests at heart, they shun from their network the highest quality and lowest priced players in the market, my facility being a classic example.  Part of the reason for this is the massive revenue generated by selling their “discounts” or repricing of claims, the carriers claiming as their own, a percentage of the “savings” they have generated for their clients. With this arrangement the last thing the carriers want is to seek out reasonably priced care, particularly from a transparently priced facility, as the absence of any claims adjudication eliminates their repricing opportunity and revenue.

Employer groups are directly contracting with facilities like mine, shoving their PPO or network aside and realizing huge savings as a result.  Mr. Goldberg and I are in agreement.  I just think it bears pointing out that his point is even stronger than he has made it out to be.  Employer groups are not just looking for cash based physician practices and facilities.  They are willing to give their carrier the boot to reach those bold enough to make this change in their medical practice.

G. Keith Smith, M.D.

For more information about free market health care visit:




Poisonous Restaurants and the VA Hospitals

Imagine for a moment that you own and operate a restaurant knowing that if you provide spoiled food and rotten service, you will subsequently make more money.  You openly employ strong-arm and intimidation tactics to keep any conscientious employees from revealing what is really going on in the kitchen.  Sound like a restaurant people would want to frequent?

This is the VA hospital system.  High mortality rates, patient neglect, extreme waiting lines, intimidation of wannabe whistleblowers, you have it all.  And a 17 billion dollar bonus from Washington for providing this fine service.  One of the three senators to vote against rewarding this incompetence and malevolence was Oklahoma’s own Dr. Tom Coburn, soon retiring to his plough.  

Awarding more loot to the VA after the revelation of the most recent and deadly fiascos in their hospital system should come as no surprise, though, as any government program that fails only does so because not enough money was allocated in the first place, right?  Coburn, cited a 60% budget increase at the VA in the last few years to argue against the idea that a lack of loot was the trouble.  He basically said the congress was about to give the alcoholic VA another drink.  Not exactly what they need.

What they need is to not exist at all.  Any one who claims to be a fan of single payer health care or government-provided health care should tour or possibly receive their “healthcare” at a VA hospital.  Nothing could open such an individual’s mind to market alternatives any faster.  Compassion and competence doesn’t typically come from the untouchable folks who are paid the same whether they do or don’t provide compassion and competence.  If you think I am kidding, notice carefully the number of times you will see the difficulty firing someone at the VA is referenced when you read about pending reforms.  

The free market destroys businesses and institutions providing the type of “care” rendered at the VA, a concept the Austrian economists refer to as “creative destruction.”  This powerful cleansing mechanism of the market allows for a better allocation of resources to those businesses or institutions that provide the products and services that people actually want.  No such mechanism exists in governmental programs.  The opposite incentive exists, rather, to generate sufficient complaints and misery, a strategy which guarantees even more taxpayer money.  Unfortunately with the disaster of the VA’s version of Obamacare, we have seen this demonstrated once again.

G. Keith Smith, M.D.

For more information about free market healthcare visit:


www. marketmedicine.org

Obamacare, Goebbels and Ginsburg

A friend recently opined to me about his increasing frustration with those who are unable to distinguish between politics and religion, particularly those for whom politics is their religion.  This describes statists of all stripes, I think.  Folks either want to use the power of the state to abscond with the property of others in order to better complete “the Lord’s work,” or they justify the state’s trampling of individual rights in the name of “the greater good.”  The fascist, Joseph Goebbels had the following to say:

"My Party is my church and I believe I serve the Lord best if I do his will, and liberate my oppressed people from the fetters of slavery.  That is my gospel."  Or how about this one from Mr. Goebbels:

"I am only the instrument that God uses to sing his song.  I am only the vessel that nature smilingly fills with new wine."

It is no mistake that Germany’s national anthem is entitled “Deutschland uber Alles.”  The supremacy of the state and the individual’s role in feeding this parasitic institution are unapologetically clear in the writings of men like Goebbels, while more subtle, but no less fascistic musings and thoughts surround us today.  

Here is a quote from supreme court justice Ruth Bader Ginsburg:

"Frankly I had thought that at the time Roe was decided, there was concern about population growth and particularly growth in populations that we don’t want to have too many of."  Actually, that isn’t very subtle at all, is it? While the German fascists claimed to hate the socialists, Hayek’s “Road to Serfdom” shook everyone who read it by the collar, pointing to the central planning that characterized both of these economic and political systems.  Ginsburg’s quote indicates that she sees herself as someone who knows who should be born and who should not, perhaps who should be allowed to stay and alive and who should not.  I cannot say that I have ever met anyone smart enough to wield that level of power.

What does any of this have to do with health care?  My old friend Lawrence Huntoon writes in “AAPS News,” August 2014 this:

"According to an article in the Wall Street Journal, insurance companies are paying oncologists $350 per patient per month for strict adherence to treatment protocols-which are geared to cost containment.  It is very predictable.  Obamacare forces physicians into accountable care organizations (ACO’s), and then strict cost-containment protocols are implemented. In the realm of cancer care, these are death panels.”

Combining health care with government invariably results in the individual’s interests versus the state’s interests scenario playing out.  Guess who has historically won this battle?  Once the “state” is paying for healthcare, the “state” determines what health care will be paid for-even what qualifies as meeting the definition of health care.  After all, “public” resources are distributed by popular vote and that’s not good news for the sick minority. That the federal government is mandating the collection of virtually everyone’s health information and data should be of great concern to anyone who has followed any history of what governments typically do with information.  They desire this information simply because they intend to use it.  To ration.

Those same folks who claim to want all of this data for our own good, those same folks who mandate vaccinations to ostensibly prevent the spread of communicable diseases are the same ones who just brought the ebola virus into Georgia.  Doesn’t square, does it?

G. Keith Smith, M.D.

N.B.  Many thanks to the American Association of Physicians and Surgeons for the Ginsburg and Huntoon quotes from their fine newsletter.

For more information about free markets in health care, visit:



Dr. Parente and I Agree (and disagree)

Our local newspaper, the Daily Oklahoman, recently published this editorial by Stephen Parente, PhD, of the Carlson School of Management, University of Minnesota.  Make no mistake, Dr. Parente, writing opinion pieces like this one is in no danger of receiving an appointment to the president’s council of economic advisors.  I would like to expand on some of his points and then use his reasoning to explain why the “Austrian” brand of economics, rather than those varieties relying on economic modeling remains so appealing to me as an aid to understanding events and the business environment.

Dr. Parente correctly points out that health insurance premiums will skyrocket over the next two years and in fact, this has already begun.  Mandating certain coverages and admitting those with pre-exisitng conditions to risk pools has contributed significantly to the initial surge in the cost of health insurance.  I have written previously that forcing an insurance company to cover someone with a pre-existing condition is like allowing someone to purchase homeowner’s insurance after their house has caught fire.  The effect on the policy price for the neighbors if this is allowed, is predictable.

Parente writes, correctly, that when the Obamacare re-insurance and risk corridor provisions end, the insurance companies will no longer have access to taxpayer money in order to subsidize the highest risk individuals. This, he maintains, will result in an even more aggressive surge in premium charges.  At this point in the piece, I wondered if Dr. Parente thought of Obamacare as poorly crafted or whether, like me, he entertained the idea that the train wreck he has predicted was intentional and deliberate. 

Is it possible, for instance, that ending the insurance companies’ access to taxpayer loot, was a symbolic kick in the teeth that so many on the left wanted to see delivered to the “evil” insurance companies, only to see yet another executive order at the 11th hour to suspend this aspect of the “law?”  (Remember that the uncompensated care scam, Disproportionate Share Hospital Payments, was to end with the passage of Obamacare, only to have this provision suspended, a huge gift to the corporate hospital industry.)  Or will ending these insurance subsidies bring ruin to all of the insurance companies except for a few big boys who will control the whole game when the dust of consolidation settles?  History is on my side, I think, in ascribing the worst of motives to the gang in D.C.  I would love to get Dr. Parente’s thoughts on this at some point.

Towards the end of Parente’s piece is where he and I part ways and I believe it is due to his faith in his economic models to provide an accurate forecast of the future health care landscape.  The economists of the “Austrian School” place little or no faith in models primarily due to their adherence to the theory of subjective value, a theory that basically states that something is worth what you can get for it, each purchaser, as an individual, valuing goods differently, depending on their most urgent need at any given time (my apologies to economists for my butchering this, if I have).  

To say that employer health care coverage won’t “stem the losses,” as Parente writes, neglects the fact that employer groups are seceding from the insurance game in record numbers, self-insuring for the health needs of employees, removing themselves from the gunsights of government and their insurance cronies.  

Traditionally an option for only the most gigantic companies, self-insurance, thanks to the expense associated with the Unaffordable Care Act, has become more attractive to companies with as few as 50 employees. (We have 42 full time employees at Surgery Center of Oklahoma and have been self-insured for 7 years now).  A surge in the number of competitive and transparently-priced medical providers (physicians and facilities) has also significantly ameliorated the risk of self-insurance.  After all, to be self-insured (often referred to as self-funded) means paying health claims out of operational revenue, backed up by “re-insurance,” a catastrophic, disaster-type policy, often very reasonably purchased.  In this arrangement, the self-insured employer is a highly motivated consumer, always seeking value in the health marketplace.  Self-funded employers all over the country are steering their employees to facilities like ours by offering to pay the entire bill (no co-pays or deductibles), travel and lodging, as well, in an effort to keep their costs down.

It should come as no surprise that the Surgery Center of Oklahoma is very popular with many self-insured companies and their employees, our prices representing savings that translate into better profits and profit-sharing with company employees.  As more self-insured companies seek out the value of transparently-priced health facilities and physicians, the deflationary effect on the actual price of health care should not be underestimated, something that Dr. Parente fails to take into account.  That is the problem with economic models, after all.  There is simply no way to account for all of the variables involved, much less the shifting of the known variables as conditions change.

Finally, as premiums surge for individuals and their insurance becomes unaffordable, many individuals will drop their insurance altogether or simply increase their deductible.  The purchase of healthcare will then be largely (or entirely) out of the pocket of these individuals, and people spending their own money tend to ask the same question, don’t they?  People want to know “how much is it,” and they want to know up front.  Just asking this question is deflationary, as knowing that the patient will walk away seeking a more reasonable price if too large a quote is given, will tend to keep prices in check.  

In all fairness to Parente, he had little space to share his thoughts and he and I might actually be on the same page.  I am going to give him the benefit of the doubt due to his devastating finish:

"The Affordable Care Act was supposed to make health care cheaper while providing universal health care. Instead, it will make health care unaffordable for many while leaving more Oklahomans uninsured. This health care cure may be worse than the disease."  

I remain optimistic.  I believe that the Unaffordable Care Act will very unintentionally and paradoxically give us a shot at a true consumer and market-based health care industry thanks to this one simple truth:  the government never gets it right.  Obamacare’s attempt to line the crony’s pockets will more likely destroy them as the empowered consumers shun the low-value providers and increasingly understand the entire scam.

G. Keith Smith, M.D.

Beginning of the End for the Health Cartel?

Kelly Carson, writing for Watchdog.org here, praises the leader of Oklahoma County’s group health plan (Jon Wilkerson) for the success of their arrangement with our facility. I thought it might be informative to summarize the nature of our “arrangement” with Oklahoma County. Ready? We provided a list of procedures and prices and said basically, “here is what we do and what we charge for it.” The “contract” is all of two pages, other than the pricing page which is attached.  

We have contracts like this in place with many self-funded companies or through their benefit administrator (third party administrator) now, all of them essentially a handshake type of agreement.  More businesses every day are sending us their employees for various surgeries in the absence of any agreement, knowing that dealing with us fairly guarantees their continued access to our facility and our pricing.  Many times my office feels like a “situation room” where the requests from individual patients and self-funded companies with employees they are trying to help appear on my Outlook faster than I can type in response!  

While this movement is truly radical and transforming in healthcare, more and more facilities are joining this effort, so many now that I predict this will be seen as the normal way of doing business in the healthcare industry very soon.  The momentum is definitely with those of us who are willing to provide (or display!) healthcare pricing.  Soon, even those whose livelihoods are most threatened by honest healthcare pricing will embrace transparency or face the loss of patients and business to those of us who are transparent.  This has already started with false claims of price transparency by many of the large corporate hospitals, not unlike when a legislator claims to be “conservative,” while clearly and openly auctioning off his/her vote to the highest bidder.  Perception is not everything, as these big hospitals are finding out.

While the beauty of the market is demonstrated with the best allocation of resources and the mutually beneficial pricing from true competition, the power of the market is also something to behold, a power that is bringing the health cartel to its knees and will neuter the heavily bribed D.C. power brokers.  To see the corporatist healthcare scam is to end the scam.  Even as a fan and believer in the power of the market, I am amazed at the deflationary effect the posting of prices has had and will continue to have, this price movement serving to shine a very bright light on the scammers.  Needless to say, the hundreds of thousands of dollars saved by Oklahoma County in just the first few months of our “contract” has opened many previously closed eyes to the possibility that “robbery” is too soft a word to describe their past arrangement with the cartel players.  

In a new effort, I am creating video blogs, links to the first of which are below.  I decided to initially focus on a discussion of how the cartel’s scam works.  Many of you following this blog have reblogged and shared my thoughts, opening the eyes of countless individuals to the healthcare scam in this country.  If you have done so, you are truly part of the team that has begun the demise of one of the most corrupt public-private partnerships that has ever existed.  I thank all of you for your support in this effort.

G. Keith Smith, M.D.

www.surgerycenterok.com     and www.marketmedicine.org

Vlog #1   www.youtube.com/watch?v=UKjmcPpb_JY

Vlog #2   www.youtube.com/watch?v=nk_bfQ03pLE

Vlog #3   www.youtube.com/watch?v=y9H0CGgMnAM

Vlog #4   www.youtube.com/watch?v=14llmetQrwM&feature=youtu.be

Vapor Cigarettes and Veiled Medicaid Expansion in Arkansas

Forbes Magazine’s Josh Archambault wrote recently about the trouble the hospitals in Arkansas are having getting their grubby hands on more taxpayer dollars.  You can read it here.  His story centers around how a popular and powerful Republican legislator, the architect of Medicaid expansion in Arkansas, was just crushed in his bid for re-election by an upstart, no-name.  

Now keep in mind that this just-defeated so-called “conservative” didn’t support Medicaid expansion by that name.  He authored an alternative expansion that has come to be known as “Private Option.”  This “Private Option” was merely the theft of the Arkansas taxpayers’ earnings, wrapped up in all manner of free market double-speak and then handed with a bow on it to the usual health care cronies.  The great news is that the people in Arkansas saw this as a fraud in a package, a “pig in a blanket,” if you will.

It is also important to point out that the corporate healthcare cronies didn’t care about the justification or arguments used to deliver more taxpayer money to them.  They just wanted the money.  Unable to secure straight-up Medicaid expansion, they turned to the Republicans who were up to the task of renaming this theft in return for the financial support of the big hospitals among others.  The real money came in when, as Mr. Archambault cleverly states, “legislators publicly traded their votes.”

Permit me to digress for a moment.  The appearance of nicotine by vapor rather than cigarette delivery has unmasked another fraud in a package, a comparison I cannot resist.  Rather than celebrate this new lung-sparing development, state governments are scrambling to regulate and tax the vapor devices.  Is it possible that the rabid anti-smoking campaign provided a justification for an incredibly high tax on cigarettes, a tax which has produced revenue upon which state governments now depend?  No other explanation holds water, for if state bureaucrats really cared about our health they would subsidize the non-burning delivery of nicotine, utilizing this new delivery method to save future cigarette-burned lungs.  Very simply, state budgets can’t stand for people to quit smoking taxed cigarettes unless this revenue is somehow replaced.  The lungs mean little, the money everything.  Similarly, the sick poor were never the intended beneficiary of Arkansas’ Private Option.  The cronies benefitting from this loot always were.

The strategy of creating a weigh station decoy for the Medicaid loot on its way to its normal crony destination didn’t work.  These schemes are actually easy to comprehend if you first identify that someone’s property was taken from them by force and then seek to identify the beneficiary of this theft.  More and more people simply don’t care what the mugger (government) intends to do with their money.  People are focused on the fact that they have been mugged and when they suspect that their “representative” is driving the getaway car for his crony pals, his political career is jeopardized if not finished.

Hats off to the folks in Arkansas who threw this bum out.  Others who followed his corrupt lead are likely to meet the same political fate and deservedly so.  The “state” is likely the most corrupting device ever invented by man and a regular repudiation of those with political power is a healthy thing, indeed.

G. Keith Smith, M.D.