Monetary Medicine: Putting a Price Tag on Saving Lives

Physician (n): “A person skilled in the art of healing” (“Physician”).

Administrator (n): “A person who manages a business” (“Administrator”).

These seemingly opposed professions have managed to keep their distance for decades.

With that said, a dramatic surge in healthcare costs, combined with a spike in medical innovation

has resulted in the roles of administrators and physicians becoming more entwined.

Furthermore, a lack of mutual appreciation among these occupations has manifested in

conflicting agendas that drive culture and procedure within hospitals today. The once simplistic

view of medicine has evolved into a web of complicated relationships, medical procedures, and

stern policies. This evolution is something that has dramatically influenced the development of

modern medicine. The question of ethics has moved to the forefront of what defines optimal

healthcare. The heart of this debate lies in the contrasts between the value of ​premium ​patient

care versus hospital profitability.

The fundamentals of medicine are built upon the idea of healing. The earliest versions of

hospitals were not defined by technology or innovative procedures but rather cramped rows of

beds, minimal medical supplies, and the presence of a physician. These hospitals operated

exclusively on the talent, knowledge, and motivation of physicians. In fact, from the 1920s to

1940s, a limit had to be created for hospital residents to work no longer than eighty hours work

weeks, since so many physicians were risking their health to help others (Leonard). At this time

in medical history, the patient’s needs and the physicians’ passion to heal were the primary focus

of healthcare. The lack of sophisticated technology made medical decisions less complicated

which resulted in doctors, not technology, making decisions on how to care for their patients.
The reality of the time was that there were few outside sources that could be called upon when a

person was in need of medical care. This resulted in medical professionals having the sole

responsibility for making medical decisions for their patients.

Following World War II, there was a spike in scientific innovation that lead to numerous

discoveries. These advancements paved the way for modern medicine. Some examples include:

the polio vaccine, the cure for tuberculosis, and the discovery of penicillin. These lifesaving

breakthroughs supported the view that doctors and scientists were “God-like.” Polio and

tuberculosis used to be common causes of death. They were widespread, fearful diseases that

people knew little about. After the discoveries of such cures and vaccines, people were able to

live healthier, longer lives. Despite this positivity, many people still failed to understand the

science behind these cures. The general public’s scientific knowledge outside of the news

headlines was limited. Therefore, patients commonly trusted the guidance and knowledge of

medical professionals without question.

During the 1950s, a large portion of the population began to move to suburbs. This fact,

paired with the erosion of tax bases, resulted in most urban hospitals being surrounded by

impoverished communities (Wall). This shift also resulted in a lack of funding within urban

hospitals. Doctors found that the only way to make money was to provide care to suburban

families with reliable incomes. This mindset continued for decades and created a foundation for

the erosion of altruistic medicine. In 1982, the Prospective Payment System was established to

help distribute Medicare money based on a classification system (Wall). This system furthered

the divide between the patient’s requirements and a physician’s ability to effectively meet those

needs. Consequently, only certain medical practices provided specified care to families located
in impoverished areas. Medicine was no longer motivated by who could provide the best care.

The emphasis of medicine shifted to a focus on which patient could afford their bill.

As this transition occurred, for-profit hospitals made their way into the spotlight.

Community-based hospitals began shutting their doors at disproportionate rates in favor of large

hospital networks. These hospital chains took the “community” element out of medical care.

Doctors were no longer seen as members of the community but rather affiliates of these hospital

networks. In parallel, the creation of diagnosis related groups (DRGs) in 1983 gave hospitals an

additional incentive to base treatments off of their financial impact on the hospital system

(Davis). DRGs understood that Medicare would only pay a fixed amount of patient care based

on the specific procedure performed. If a hospital or physician chose to treat the patient in a

manner that costs less than the DRG anticipated, their profit margin vicariously increased. This

reality triggered a major shift away from patient-centered care towards an emphasis on

minimizing operational costs and maximizing the margin per procedure. As a result, Feelings of

disconnectivity between patients and physicians became prevalent, causing feelings of

doctor-patient trust to erode.

By the turn of the century, trust between patients and their physicians was at an all-time

low. Patients commonly felt that seeking help from a physician resulted in an economic

evaluation as opposed to a health evaluation. Consequently, in 1996, the Health Insurance

Portability and Accountability Act (HIPAA) was established in an attempt to restore a trusting

relationship between doctor and patient. HIPAA protects the confidentiality of patients by

putting limits on what doctors can and cannot discuss with people unrelated with specific

medical cases (“HIPAA”). The creation of this program motivated patients to share more
information with doctors, knowing that the specific information cannot be shared with others.

Although this act was successful in establishing a newfound sense of trust between doctors and

patients, it did not address the underlying problem of valuing money over patient care.

The creation of the Balanced Budget Act in 1997 continued to fuel the hunger for

profitability for hospitals. This act “reduced the payment for fees for service providers and

reduced the subsidy paid by the government for teaching hospitals” (Younis). Previously, the

DRG incentivized hospitals to use the cheapest treatments possible, but the Balanced Budget Act

added a new level of pressure for physicians to operate in a “budget-conscious” manner. This

idea is often met with opposition from physicians due to the fact that the cheapest methods of

care do not always coincide with optimal treatments.

The malpractice crisis of 2000 evoked fear among doctors from border to border. With

an influx of malpractice suits, insurance companies skyrocketed their premiums, forcing many

physicians out of business. Those that were left feared for their jobs, so they began to practice

medicine far more cautiously. For example, a recent ​HealthAffairs ​article noted that shortly after

the malpractice crisis, most neurosurgeons cut back the volume of brain surgeries they were

performing (Dranove). Doctors were now increasingly aware that they are pressured from both

sides of the spectrum to do what is “right.” Patients demand better care as they have a

heightened sense of knowledge of the scientific world around them. Due to this unmitigated

increase of malpractice cases, hospital administrators were forced to create limitations on how

physicians can go about their jobs.

The utilization of technology in the workplace has created yet another obstacle. Hospital

administrators and physicians alike are generally eager to jump at the idea of using the “latest
technology” to keep up with the trends of the time. As a result, physicians often find themselves

lacking proper training with such equipment. Their desire to “dive in” to the latest procedures to

become pioneers often puts patients at risk. For example, the da Vinci Surgery System was

approved into practice in 2000. This system allows laparoscopic surgery to result in “less

contact between exposed interior tissue and the surgical device, which greatly reduces the risk of

infection” (“History”). Although physicians must undergo training for these robots, the training

is often rushed, leaving doctors feeling uncomfortable with the equipment being used. While it

sounds appealing to leverage treatments with the “latest” state-of-the-art technology, often these

approaches are not the safest option. Inadequate exposure to equipment, combined with feelings

of uncertainty greatly increase the chance for surgical errors. Ironically, these surgical errors

often create the opposite economic result that they were intended to do. The struggle for

complications Thus, the interests of the patients, physicians, as well as administrators, are

unintentionally put at risk.

In 2009, the Health Information Technology for Economic and Clinical Health

(HITECH) Act was created to promote the “meaningful use of health information technology”

(“HITECH”). With the pervasiveness of technology not only in the healthcare system but

throughout the world, it is increasingly important to ensure that technology is being used in an

intelligent and appropriate manner. With confidential healthcare information being stored in

large databases, it is essential to keep patient information private in order to maintain

doctor-patient trust. This task has been proven to be difficult. The presence of technology is

creating a growing barrier between the communications of doctors and patients. Although patient
information is becoming more protected by these technological advancements, vital relationships

are being severed in the process.

Nearly everyone has access to the internet. As a result, patients often take it upon

themselves to conduct research on their symptoms and treatments. Consequently, when patients

see doctors, they already feel as though they have some knowledge of their ailment or disease.

Doctors are no longer viewed as the “God-like” resources as they were decades ago. Instead,

they are viewed as a resource not much different than the internet. Today’s society commonly

associates technology with perfection. Therefore, technology is frequently trusted more than

human intelligence. Not only is the physical presence of technology in hospitals threatening the

role of physicians, but the mere presence of the internet has made the general public less reliant

on people practicing medicine.

Additionally, it is noted, “The number of physicians in the United States grew one

hundred and fifty percent between 1975 and 2010, roughly in keeping with population growth,

while the number of healthcare administrators increased 3,200 percent for the same time period”

(Cantlupe). With healthcare administrators outnumbering physicians at such staggering rates, it

is extremely difficult for physicians to gain a voice that is prominently heard. A recent survey

conducted by ​Forbes ​noted, “Over fifty-four percent of physicians report a loss of enthusiasm for

work, feelings of cynicism, and a low sense of personal accomplishment. The number is up ten

percent from just three years ago” (Jain). This industry-wide challenge does not lay solely at the

feet of either hospital administration or practicing physicians. The predicament has arisen as a

result of a lack of trust and understanding from all parties involved. Physicians attend medical

school to learn about the human body and all it entails. Administrators attend college to gain
knowledge on the workings of the business world and how money impacts networks. When their

efforts are combined, disagreements are inevitable.

As the interactions between these professions continue to intersect, both doctors and

administrators will continue to feel separated in both values and ideals. Their frustrations are

being amplified based on the earning characteristics of their respective professions. For

example, it is noted that those that oversee the practicing of medicine are the top earners in the

industry. On average, a practicing physician makes on average $185,000 per year. In contrast,

the average hospital administrator will earn a yearly salary of $237,000 (Rosenthal). Although

the role of those that oversee hospitals is crucial, it can be argued that the responsibilities of

physicians are equally as important.

Medicine used to be based on much simpler principles. At their roots, hospitals were

nothing more than a few beds, an open floor plan, and a couple of doctors. There were

little-to-no distractions to get in the way of the physician and patient relationships. The vast

expansion of scientific knowledge, coupled with an increase in the push for the use of

technological advancements has since created a stiff divide between patients and doctors. The

increasing prevalence of malpractice suits has even furthered this divide. These realities have

forced the roles of physicians and administrators to become intertwined as they work together to

run hospitals in an increasingly interconnected world.

At the same time, the collision of the decision making roles of executives and physicians

are commonly resulting in the compromisation of optimal patient care due to a lack of

understanding between both parties. While doctors and administors alike do not intend on

putting patients at risk, the increasing stress put on the monetary values of the healthcare industry
often results in putting profit before patient care. As a result, the altruistic nature of medicine is

no longer a simplistic factor. Instead, the evolution of the surrounding world has created a

medical culture that is dependant upon a plethora of people, paperwork, and policies.
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