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Steven Brill: The Problem with Health Care is it Costs Too Much

Steven Brill AAMC

Author and journalist Steven Brill admits knowing very little about health care before writing his influential Time magazine exposé on inflated hospital bills.

“All along I’ve had this bug to write about stuff that interests me. … the temerity to want to write about things I don’t know anything about,” said Brill, speaking at the annual conference of the Association of American Academic Medical Centers (AAMC) in Baltimore.

This blind curiosity has paid off handsomely for Brill who has made a career out of parachuting into complex issues and asking the questions no one else thinks to ask. While the country was mired in debate over Obamacare—or who should shoulder our soaring health care costs—Brill asked why it costs so much. The resulting Time article, “Bitter Pill: Why Medical Bills are Killing Us,” was one of the most widely read in the magazine’s history, and the seed of a best-selling book.

With similar clarity and brazenness, Brill has written critically about the criminal justice and education systems, and the media. The way he describes it, there is a power in not knowing. He sees unfamiliarity as an asset, and says it’s given him “a distinct advantage,” allowing him to see past the blind spots that tend to develop for anyone who inhabits a system or institution for any length of time.

The son of a liquor store owner in Queens, N.Y., Brill attended public school until—upon reading about prep schools in a biography of John F. Kennedy—he applied for, and won, a scholarship to Deerfield Academy. He later enrolled in law school at Yale University, writing speeches his senior year for New York Mayor John Lindsay’s failed presidential bid and contributing to New York Magazine. Upon graduation, he veered from the conventional attorney career path. “I wanted to start a magazine about lawyers instead of being one,” he says, referring to The American Lawyer. He also founded Court TV, a profitable enterprise and just one of his many entrepreneurial pursuits.

Brill’s foray into health care started simply enough, with a desire to deconstruct and understand hospital bills. His book grew, in part, from a personal health crisis: Heart surgery to repair an aortic aneurysm. Lying there on the gurney, he said, all the high-level policy arguments about the cost of care, and how to control it, evaporated and all that mattered was survival. The MRI, which for him had been “a symbol of profligate American health care,” was now a “miraculous lifesaver that had found, and taken a crystal clear picture of, the bomb hiding” in his chest, he writes in his book.

It is for this reason that market-based, consumer-driven health care reforms so beloved by conservatives won’t work, believes Brill who is equally dismissive of the Affordable Care Act. “Obamacare was terrific in that tens-of-millions more people now have access to health care, which is an unambiguously good thing. But it achieved this without doing anything about the cost of health care,” Brill told conference attendees.

The solution, according to Brill: Give large health systems with monopoly or oligopoly power even more power by having them also sell health insurance—but heavily regulate them. Such vertically integrated health systems already exist, and have managed to hold down costs in some markets through better alignment of incentives.

Whether this model is scalable is in question. Even Brill acknowledges it’s an incremental step. But the idea certainly sparks interesting debate, as evidenced by Brill’s appearance at the AAMC. Here, excerpted from his Q&A with moderator Steve Lipstein, president and CEO of BJC HealthCare, are the highlights:

What makes health care different from other goods and services?

Health care, as anyone in this audience knows, is unlike any other policy issue because it affects everyone and scares everyone, and unlike any other commodity or service we buy in the marketplace, it is the one service that I think can’t be treated [as such]. Because consumers, when they’re buying it, have no idea what they’re buying—no leverage, or sense of the cost or quality of what they’re buying. Even after you get the bill you have no idea what the cost is or the quality.

Can’t we give consumers the information they need to make smarter health purchases? 

Two or three days after [my heart surgery] I developed this cough, and it was so painful I would pass out. …So the nurse comes and says, “Mr. Brill, would you like this throat lozenge. It’ll stop your cough.” …Am I going to stop and ask, “What’s that going to cost me?” I would have paid $500. When you are a consumer of health care you aren’t thinking about that.

If you’re going to buy a car for your family and you go to Consumer Reports and the Ford you’re looking at has all the right stuff…and [it] costs 60 percent less than the Chrysler and Consumer Reports says it’s 90 percent as good as the Chrysler, you’re going to buy the Ford. If you have a baby daughter that needs a heart valve, and the doctor says, “This heart valve is 90 percent as good as that one and only costs 60 percent as much,” you’re buying the 100 percent heart valve. In fact, even if doctor says these two are same and one costs less than the other, you’re likely to buy the most expensive one because it’s health care and it’s your daughter.

What about a single-payer system? Why won’t that work?

Every other developed country has done [health care] differently with some form of government provision and government regulation and, by in large, they produce systems that are less expensive and more effective. So if we could start all over again we would do that. But we can’t start all over again. As the President said, “You can’t put the toothpaste back in the tube,” and the toothpaste [in this case] is one-sixth of the economy.

What can we do to fix health care?

The problem with health care is everyone involved in it, except for doctors and nurses, makes too much money. You can make more money selling an MRI in New Haven, Conn., than a doctor in New Haven, Conn. As someone who has looked at my doctor in the eye while on a gurney, that’s not a good thing. … The core issue is the cost. The rest is just window dressing.

So, what can we do? There are many things, and one of them is to stop being the only country in the free world that grants a monopoly to people (called a patent) to sell lifesaving drugs and then doesn’t, unlike every other country, try to control the prices that the monopolists can charge for those lifesaving drugs.

I looked across the landscape and saw the increasing dominance of hospital systems…and said: “Well maybe there’s a way, sort of judo style, to turn that to our advantage.” Maybe there’s a way to call them what they by and large are, which is oligopolies, and say, “That’s not a bad thing. Now let’s regulate them like oligopolies. Let’s regulate what they can charge, and most important, encourage them to sell health insurance.” If I lived in Cleveland…I would rather buy my health insurance from Toby Cosgrove at Cleveland Clinic than I would from United HealthCare. …However, I’d want to regulate Toby Cosgrove—a lot.

Will that go far enough?

I suggested some incremental changes...but I think ultimately the system is going to snap. …The cost to a middle class person for health insurance, plus deductibles and out-of-pocket limits, is such that you could have someone making $65,000 to $75,000 a year who is basically on the hook for the first $15,000 to $20,000 of their health care expenses before their insurance even kicks in. That’s unsustainable and it’s going up. It’s going up 7,8,10 percent a year. And sooner or later even the most bought-off politicians who reject basic reform may be moved to act. In this country our democracy only acts decisively when there’s a crisis. And this may get to the point where it’s a crisis. The problem now is it’s one of those slow-moving crises.

By: Kirsten Stewart

Kirsten Stewart is a senior writer for University of Utah Health Sciences