I blog about free markets in medical care and transparent pricing.
Last last Friday brought us yet another sad story from Canada. Readers new to this blog should be aware that many Canadians in long waiting lines at home have opted to come all the way to Oklahoma City for the affordable and high quality care available at our facility. Here is the picture: a painful gynecological condition that had left a woman basically house-bound and clinically depressed; a condition that is curable with a routine outpatient procedure; 18 months to see the gynecologist; no time estimate about when she might see the inside of an operating room after that, and certainly no guarantee that she wouldn’t be “bumped” for something considered more urgent.
Her husband makes the call that many Canadians have made: a big name outfit in Minnesota. Her procedure will cost $40,000. This amount doesn’t include the surgeon or anesthesia or “incedentals.”
Making a long story short, she had her procedure here at our facility for about 1/5th of that. Our price included the facility, the surgeon, the anesthesia charges (including an epidural for postoperative pain control) and an overnight stay at our facility. Here’s the punchline: we made a profit. We would be happy to take care of patients with her condition at this price all day long.
I can’t help but think of Basiat when the price difference is so vast between our facility and the next best price. Always remember to think of “what is not seen,” that is, what use will be made of the $40,000 that this patient didn’t spend on her procedure. There are two glaring lessons here: the abject failure of the Canadian system and the resulting human suffering it has directly caused and second, the prevalence of medical price insanity in the United States.
Ludwig von Mises proved that without prices, and by that he meant rational prices, no economic system makes sense and cannot survive. In order for prices to be rational, they must be transparent, visible to the buyer. I believe that this idea will catch on and that those refusing to provide transparent pricing will receive the beating that only the free market can provide. We are happy to have helped this poor patient and also to have denied once again, one of the “big box boys” a $40,000 meal.
G. Keith Smith, M.D.