One of the factors seems to be that Hospitals and Radiology Centers have to have the latest magic machines. We started with x-ray machines to detect cancer--and I get a simple chest X ray every two years which is the allowance of my insurance.
But then came CAT scanners. And then MRIs and finally PET scanners. Look at the cost of these newer diagnostics: CAT scan: $1100 MRI scan: $1500 PET scan: $3000 http://www.babcn.org/images/news/petscan.htm If your community has two Hospitals, expect them both to have all 4 machines--never mind it would make sense to share machines to save money. And if you have a large (say 15 partner) Radiology practice, you may well have the same 4 or more machines in their offices. These machines are overused by doctors who must practice defensive medicine. Just as an Obstetrician must produce perfect babies, patients must have all the latest most expensive tests to avoid malpractice suits. My community has run out of patience with this duplication and we have seen a wave of cost cutting mergers etc. We do need the legislature to pass better "good samaritan" legislation insulating doctors and other health professionals from litigation absent SERIOUS, almost intentional malpractice. If that were done we would have a start on cost control. And I don't know about your doctor, but my Primary Care Doc would be delighted not to put me through lab tests I don't need etc. because she is an honest person, and dislikes all the extras she now has to pile onto the treatment. GP And the just cited source discusses the next level of treatment as developed at Stanford. Doubtless the next magic machine will cost more to buy, and thus more per scan. A second factor is the misuse of these machines. Doctors, as we know, must practice defensive medicine. On May 23, 7:25 am, bruce majors <[email protected]> wrote: > ------------------------------ > > Technology and Medical Care (by Don > Boudreaux)<http://www.cafehayek.com/hayek/2009/05/technology-and-medical-care.html> > > Posted: 22 May 2009 12:56 PM PDT > > One often-heard explanation for rising medical-care costs centers on the > advance of technology. I'm sure that there are variations on this theme, > but fundamentally it sounds like this: technological advances improve > medical-care treatments but are quite expensive; this technology must be > paid for, so at least part of the higher prices for medical care is a > reflection of technological improvements in medical care. > > Perhaps this explanation is correct; I have no data to contradict it. But > my priors make me skeptical of this explanation. Technology creates great > improvements in telecommunications and computing, yet the prices of wonders > such as cell phones, telephone calls, and personal computers have fallen > dramatically over the years. > > The same is true for transportation. Huge investments in transportation > technology -- engine design, the construction of container-shipping > facilities, airplane engineering, and on and on and on -- are all, both > individually and taken together, quite expensive. Yet the price of moving a > ton of freight from New York to London, or a half-ton of family members from > home to the regional shopping mall, has fallen continually. > > Why should medical care be different? It must be the case that some other > factor is at work driving up the cost of medical care – a factor that either > works in tandem with technological improvements to raise these costs or that > works independently of technological improvements to raise these costs. > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=ZnvuX7fXGGE:O8hGrwLi3g...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=ZnvuX7fXGGE:O8hGrwLi3g...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=ZnvuX7fXGGE:O8hGrwLi3g...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=ZnvuX7fXGGE:O8hGrwLi3g...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=ZnvuX7fXGGE:O8hGrwLi3g...> > > The Mind of the Market (by Don > Boudreaux)<http://www.cafehayek.com/hayek/2009/05/the-mind-of-the-market.html> > > Posted: 22 May 2009 06:39 AM PDT > > Here's a fine paragraph from page 67 of Pietra Rivoli's wonderful 2005 book > *The Travels of a T-Shirt in the Global > Economy<http://www.amazon.com/Travels-T-Shirt-Global-Economy-Economist/dp/047...> > *: > Americans, and now Russians and Slovaks and Chinese, disdain such central > planning for its inefficiencies. A system that ignores market signals, that > provides no incentives, that subsidizes losers cannot be efficient in > producing goods and services. Central planners will produce the wrong > goods, use the wrong inputs, set the wrong prices, hire the wrong people, > and ultimately produce shoddy products, and not enough of them, anyway. But > to meet [Chinese textile-mill manager] Tao [Yong Fang] in the Number 36 > factory is to realize that the real tragedy of central planning lies not in > its inefficiency but in its crushing of the intellect, of 20 years of Tao's > energy and intelligence laid to waste. For 35 years the spindles in the > Number 36 mill clattered, and no one working in the mill had to > *decide*anything. So today there is determination but bewilderment as > Tao faces the > basic questions of running a business rather than turning a cog: what to > produce, where to sell, whom to hire, what to pay? [original emphasis] > > Beautiful -- both the explanation and the humanity-building capacity of > markets. > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=Fe-FwMR9Lb4:k-BhXX_d3a...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=Fe-FwMR9Lb4:k-BhXX_d3a...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=Fe-FwMR9Lb4:k-BhXX_d3a...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=Fe-FwMR9Lb4:k-BhXX_d3a...> > <http://feeds2.feedburner.com/%7Eff/CafeHayek?a=Fe-FwMR9Lb4:k-BhXX_d3a...> > You are subscribed to email updates from Cafe > Hayek<http://www.cafehayek.com/hayek/> > To stop receiving these emails, you may unsubscribe > now<http://feedburner.google.com/fb/a/mailunsubscribe?k=RD87GWo2xMyNcdDv2...> > .Email delivery powered by Google Inbox too full? [image: > (feed)]<http://feeds2.feedburner.com/CafeHayek> > Subscribe <http://feeds2.feedburner.com/CafeHayek> to the feed version of > Cafe Hayek in a feed reader. 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