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Glen P. Mays, Gary Claxton, and Justin White, MarketWatch: Managed Care Rebound? Recent Changes In Health Plans’ Cost Containment Strategies, Health Affairs Web Exclusive, August 11, 2004 [Abstract] [PDF] [HTML Version] [Reprints & Permissions]

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Health care's biggest expense

Robert Guzauskas   ( 23 August 2004 )

Health care's biggest expense 23 August 2004
Robert Guzauskas, Dentist Private practice, and, Gingrich Group's Center for Health Transformation Send comment to journal: Re: Health care's biggest expense rguzauskas{at}earthlink.net Robert Guzauskas	Look at an Income Statement for a doctor's practice and you'll find that the biggest single expense is usually the doctor's compensation. It often amounts to half of the practice revenue. So the logical place to look for cost cuts is to the Doc's compensation. About 68% of physicians and 72% of dentists practice alone. These solo practitioners operate health care boutiques where the cash register is always open to their wants and needs. Most of the current fee-for-service business models provide a powerful incentive -- money -- to (over)diagnose and (over)treat the patient. And forty-two states mandate that only a doctor can own a health care office. Laws that may have been desireable in the early 20th century are today a monopolistic restraint of trade. Laws restricting the ownership of heath care practices to licensed professionals MUST be struck down. Put the doctors on an hourly wage or a salary with a benefits package just like other Americans. And watch the cost of health care plummet. You will also see a great reduction in medical malpractice as the incentive to overtreat is eliminated. Bonuses: (1) Most doctors will love it; and (2) the cost of this improved business model -- it's free.