There has been a lot of hue and cry about the Clinical Establishment Act. One of the hotly debated provisions of this law is the section which governs the fees which doctors and hospitals can charge. The law demands that doctors and hospitals publish and prominently display their rate card, so that patients know exactly how much they are going to have to pay for their medical treatment.
On first blush it appears that this section makes a lot of sense. After all, won't it encourage openness and transparency ? Isn't this good for everyone ? Won't this curb overcharging ? Won't it stop doctors from taking fees under the table ?
Let's look at why the government wants to regulate medical fees . The government provides free medical care to poor citizens under a number of government health insurance schemes , and they need to know how much they have to budget for this. However, they find the lack of transparency in the medical fees frustrates their well-intentioned efforts. This is exactly the same problem health insurers face as well. Because they have to pay for medical treatment , they need to know up front what the cost of treatment is going to be, so they can estimate how much to charge their customers .
However , a sore issue is the fact that hospitals will pad their bills when they find that they are going to be paid by an insurer. They overcharge , and hospitals will often markup the costs upto 3-4 times for what they would charge a patient who is paying out of his own pocket. Even worse, a lot of doctors indulge in fraud, and will bill the health insurers for fictitious patients and make-believe surgery, because they believe the health insurer has deep pockets and is a soft target.
Because of the moral hazard issue, most patients don't care , because it’s the health insurer who has to foot the bill. The problem of progressively increasing medical costs is getting out of control , which is why the government finds that it needs to crack down.
While I agree that it's a good idea to encourage openness and transparency , I also think this smacks of double standards . One criticism is that doctors charge too much . However, many lawyers will charge much more for just talking in court for 10 minutes, as compared to what a doctor does for doing a life saving heart operation which may take over 4 hours. In a capitalistic society, the price the doctor commands is set by the market , and as long as the patient is willing to pay what the doctor charges, it is an encroachment of an individual's autonomy to control this. If a patient feels the fees are too high, he can always find another doctor who charges less !
Sadly, the medical profession is a soft target and doctors make for easy whipping boys. They don’t have the unity to stand up for themselves. The law, on the other hand, is passed by lawyers, who do their best to protect their fellow-professionals ! These double standards are completely unfair, and if doctors and hospitals are asked to put up a list of their fees, then lawyers and law firms should also be made to do so. The same set of standards need to be applied across all professions , and it's not fair that doctors and hospitals be singled out.
Another sore issue among regulators is the fact that doctors and hospitals charge differential rates for the same procedure, depending upon whether the patient is admitted in the general ward or a deluxe room. This is a fact of life, and is true is most areas today. This is something we routinely see when we buy airline tickets. Not only will they charge much more for a first class ticket ( even though from a functional point of view the plane takes all the passengers from point A to point B), they will often charge a hefty premium for exactly the same seat when the ticket is bought at the last minute, a practise called price discrimination.
If it’s fair for airlines to do this to maximize their profits , I think it’s unfair to prevent doctors and hospitals from doing exactly the same. Why discriminate against doctors , just because they're defenseless ?