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The Greedy Doctor Problem

universalprior.substack.com

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Re: The Greedy Doctor Problem

#101

Post by ashtonkem »

SuoDuanDao wrote: post #73
xondono wrote: post #52

Someone uses “greedy doctor” as an example to talk about an easy to understand version of the Control Problem, and the comments make it into a discussion of healthcare systems. I’m starting to think most readers on HN don’t really read the articles and go straight into the comment section..

I noticed that when the 'laws of stupidity' article [1] came up here. I'm very familiar with it as I read it when I was young and impressionable, almost all the comments had nothing to do with the substance of the article. What makes it more poignant is that I typically go straight to the comments myself, assuming that intelligent commentary on an article will convey what the article was about faster than the article…

There’s a tragedy of the commons going on here. The best outcome as a group is if everyone reads the article. The best outcome individually is if you’re the only one that doesn’t read the article, then you get all the informed comments without spending the time to read it personally. The actual outcome is that very few people read the article, and the entire discussion is about the title and how people interpreted it.

Re: The Greedy Doctor Problem

#102

Post by brezelgoring »

ryanmcbride wrote: post #97
kwhitefoot wrote: post #96

Earlier quoted context omitted.

> Why not go to the "other, other obvious" solution, which is results-based payments? There is a story about doctors in ancient China who are paid by their clients only so long as the client is healthy. When they fall sick, the doctor is not paid again until the patient is healthy again. Then the goal is not a cure for a disease but the prevention of disease. I don't know if any such thing ever really happened but it…

It's an interesting idea but the pessimist in me just sees this as incentivizing under-diagnosing, running fewer tests, etc.

Well the other option, which is to pay when a problem is found, can lead to over-diagnosis and finding issues where there are none. Its 'taking your car to an unknown mechanic' problem, he _will_ find a problem, and that is a problem too.

Re: The Greedy Doctor Problem

#104

Post by dahfizz »

rectang wrote: post #74
dasudasu wrote: post #61

Earlier quoted context omitted.

Many countries with universal healthcare still pay by the act. In Canada, doctors are mostly independent service providers that bill the government directly. This can lead to two problems: a) they don’t do a whole lot of medical acts because it already pays so well that they can afford to slack off (e.g., work 3-4 days a week, see very little patients), or b) do a lot of unnecessary acts because it goes directly into…

It's clear why performing unnecessary medical acts is problematic, but what is the issue if doctors being paid by the act work 3-4 days a week? Isn't this just piece work and you can add more doctors?

The median wait time to see a specialist in canada is 78 days[1].

Yes, in theory you could "just add more doctors". But there is clearly already less doctors than there needs to be. Policy that encourages doctors to work less exacerbates this issue.

You can't just say "add more doctors" as if that helps anything. Shortages exist for a reason, and analyzing and fixing the system which creates the shortage is the only way to resolve the shortage. You can't just tell poor people to "make more money" and solve poverty in the blink of an eye.

[1] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7292524/

Re: The Greedy Doctor Problem

#105

Post by ProjectArcturis »

lotsofpulp wrote: post #32
mattficke wrote: post #24

Earlier quoted context omitted.

This is basically the Kaiser model. Kaiser's doctors are salaried, rather than getting paid per procedure. Works pretty well! (I think the actual answer to the question in the OP is, at least in part, to license more doctors. Then the cartel doesn't have as much pricing power and medical care is less of a luxury good. The rich person should really hire a lobbyist.)

The golden days of the doctor “cartel” (and people in the healthcare chain in general) are over. https://www.beckersasc.com/asc-news/9-cms-pay-cut-for-physic... The 80s/90s/00s were probably the golden years for them, but they got in the political spotlight, and combined with the decreasing proportion of young to old people, the government is going to push down cuts to whoever lacks political power to push back. Such…

I'm kind of surprised that med schools haven't dramatically opened up their admissions, like law schools have over the past 20 years. It's such an obvious source of funds for the school.

Re: The Greedy Doctor Problem

#106

Post by ProjectArcturis »

Robotbeat wrote: post #80
lotsofpulp wrote: post #32

Earlier quoted context omitted.

The golden days of the doctor “cartel” (and people in the healthcare chain in general) are over. https://www.beckersasc.com/asc-news/9-cms-pay-cut-for-physic... The 80s/90s/00s were probably the golden years for them, but they got in the political spotlight, and combined with the decreasing proportion of young to old people, the government is going to push down cuts to whoever lacks political power to push back. Such…

Increasing the supply doesn't mean the average quality of care will fall. If I pay doctors $400,000 a year to work 80 hours a week and then double the number of doctors and pay them $200,000 a year to work 40 hours per week, the quality of care would almost certainly improve but costs would be constant. And actually, do we pay doctors a premium for those overtime hours where they're actually probably less effective?…

In theory, if you want to train twice as many doctors, you have to relax admissions criteria to let in twice as many people, and the new admitees wouldn't have qualified under the previous system.

Re: The Greedy Doctor Problem

#107

Post by snarf21 »

goopthink wrote: post #85

The article proposes prepayment options. Why not go to the "other, other obvious" solution, which is results-based payments? In healthcare, that's value-based care. In other industries w/ agent-principle problems, it's called "taking on risk". You're incentivizing results and outcomes, rather than whatever specific actions lead up to those results. It means that the focus is no longer on the activity provided by the…

This is such an awful take. So if a doctor prescribes a medicine and the patient never takes it and the patient dies it is somehow the doctor's fault or they don't get paid?

Some doctors are greedy. Some ________ are greedy. There are major factors in the waste in our health care system but by and large it isn't doctor's fees. There are so many rent seekers taking a cut.

There are other models than fee-for-service. They have tried population health models where the Provider (Dr, nurse, etc.) get $X per person per year. They are incentivized to be more preventative where they basically get to keep whatever they don't spend on patient care. However, you can lead a horse to water but can't make him drink. Ask yourself this: would you write web code where you got paid based on how many unique visitors viewed the page your wrote?

We can easily fix health care with a few simple changes but there is no real appetite to do so. One simple change is to go to referenced based pricing. You can't charge more than 1.2 the Medicare reimbursement. This change alone would reduce our spending by 25%.

Re: The Greedy Doctor Problem

#108

Post by rsj_hn »

snarf21 wrote: post #107
goopthink wrote: post #85

The article proposes prepayment options. Why not go to the "other, other obvious" solution, which is results-based payments? In healthcare, that's value-based care. In other industries w/ agent-principle problems, it's called "taking on risk". You're incentivizing results and outcomes, rather than whatever specific actions lead up to those results. It means that the focus is no longer on the activity provided by the…

This is such an awful take. So if a doctor prescribes a medicine and the patient never takes it and the patient dies it is somehow the doctor's fault or they don't get paid? Some doctors are greedy. Some ________ are greedy. There are major factors in the waste in our health care system but by and large it isn't doctor's fees. There are so many rent seekers taking a cut. There are other models than fee-for-service. T…

> One simple change is to go to referenced based pricing. You can't charge more than 1.2 the Medicare reimbursement.

Agree that this is huge. Price transparency, reference pricing. You know "the law of one price" is supposed to be a pillar of market economics, so this should be a no-brainer. Additionally, don't allow charging more than the insurance will pay with the exception of an agreed upon co-pay ahead of time. If a hospital accepts insurance, then it shouldn't be able to send you a bill later on that the insurance refuses to pay. That needs to be worked out between the hospital and the insurer. I would also like to see binding quotes before any procedure, with no surprise billing.

Re: The Greedy Doctor Problem

#109

Post by efitz »

The ways to address this problem are “usual and customary[ed- autocorrect] prices”, consumer ratings, information transparency, externalities such as courts to punish fraud and malpractice, and skin in the game.

I have thought about this a lot in the context of real estate- up to recently, agents typically got a fixed commission (generally 3% each for buyer and seller in the places I’ve lived).

There is a moral hazard in that, assuming that the agent can impact my sales price favorably with effort on their part. If they’re helping me buy a house, and they get a percentage, then it’s in their interest for me to overpay. If I’m selling a house, then the margin for increasing the sale price above market value is probably not worth the effort ($300 for every $10k increase in sale price).

My solution (I have not tried it yet) is to structure a sales rep contract such that we agree on a target price for the standard commission, but increase the commission greatly for the sale price amount above the target price. Maybe 3% up to the sale price and 50% above that. That’s what I term “skin in the game”.

Assuming I have done a minimum of homework (looked for agent ratings and avoided bad or inexperienced agents; looked at comparables on Zillow to make sure the proposed sale price is market appropriate, etc.) then I should get a good outcome.

Doctors and state license boards often make it difficult to get informed consumer type information on doctors. Our insane medical system in the US almost never supports price transparency. So we have a long way to go there.

Note one other thing. I am trying to optimize for the best outcome I can assuming limited resources. If you have unlimited resources then you can hire and fire lots of doctors, overpay for performance, and generally do things that are unavailable to mere mortals. Also I am not assuming or eve trying to achieve perfect results (most beneficial result available at the lowest price point). I think that is a fool’s game.

Re: The Greedy Doctor Problem

#110

Post by handrous »

dasudasu wrote: post #98
goopthink wrote: post #85

The article proposes prepayment options. Why not go to the "other, other obvious" solution, which is results-based payments? In healthcare, that's value-based care. In other industries w/ agent-principle problems, it's called "taking on risk". You're incentivizing results and outcomes, rather than whatever specific actions lead up to those results. It means that the focus is no longer on the activity provided by the…

Then doctors filter what patients they take to guarantee these good outcomes. This is already done by some surgeons. Surgery is already a subset of medicine heavily judged on outcomes.

This is featured in the Doctor Strange movie, in fact. IIRC the good doctor is presented with a patient whose case is so difficult that he's one of the only people in the world with a chance at successfully performing the procedure they need—but he turns it down because he thinks the odds would still be too low, and it might hurt his record. I think there might also be a karmic turn with that when his hands get messed up—I wanna say there's a scene or short sequence of the same thing happening to him, at least implicitly.
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