Medical Care... with a Warranty!

The group, Geisinger Health System, has overhauled its approach to surgery. And taking a cue from the makers of television sets, washing machines and consumer products, Geisinger essentially guarantees its workmanship, charging a flat fee that includes 90 days of follow-up treatment.

Even if a patient suffers complications or has to come back to the hospital, Geisinger promises not to send the insurer another bill.

I like this idea, mostly because I would prefer to see medical care presented with a constant price. As the article points out, "Under the typical system, missing an antibiotic or giving poor instructions when a patient is released from the hospital results in a perverse reward: the chance to bill the patient again if more treatment is necessary." To have each hospital set a price for each treatment, which will cover normal costs and the expected cost of followup care, would serve to allow hospitals to compete on cost. If one hospital charges $5000 less, with a guarantee of covering necessary followup care, you can be fairly certain they're not going to save that money by skimping on your care.

I don't necessarily agree with the article's next sentence, "As a result, doctors and hospitals have little incentive to ensure they consistently provide the treatments that medical research has shown to produce the best results." There can be multiple treatments, with one far more cost-effective than another. If one treatment costs $100 and is 98% effective, and another costs $10,000 and is 99.5% effective (where "not effective" is not life-threatening), then it doesn't make much sense to use the vastly more expensive treatment first.