Author: Health care prices are “fiction, fantasy”

David Goldhill isn’t your typical policy expert. He is the chief executive officer of GSN. That’s right, the Game Show Network. What does he know about health care?

Quite a bit, it turns out. In addition to making insurance coverage decisions at his company, Goldhill is a board member of the Leapfrog Group, which regularly scores hospitals. Now, he has written a book, called “Catastrophic Care: How American Health Care Killed My Father—and How We Can Fix It.”

Goldhill was a speaker at the Association of Health Care Journalists conference in Boston I attended last week—which, for you regular readers, is why this blog was fairly quiet.

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Goldhill didn’t sound like a policy wonk, either. His slick presentation was full of short anecdotes about the problems of the health care system, in turns funny and alarming, translated by metaphor. But are his proposed solutions to those problems as simple as he very artfully made them sound?

On health care quality, Goldhill pointed out that doctors themselves will advise family members to always accompany a loved one in the hospital, that patients can’t trust that they will be safe even in institutions dedicated to their well-being.

“Could you imagine FedEx saying to you, we’ll get your package there, but it probably would be best if you stayed with it all the way” to the destination, he said.

And he ridiculed the idea that finding the best solutions to skyrocketing health care costs requires getting all “stakeholders” on board.

“I beg you as journalists, every time you hear that, to substitute the idea of inviting a bunch of turkeys to plan your Thanksgiving meal,” he told the AHCJ lunch crowd. “You get absolutely no economic innovation, cost-saving, or disruption by talking to stakeholders. Economic disruption—true cost-savings—hurts stakeholders. There’s no way around it.”

Perhaps the most compelling part of his presentation was about his father, who died in 2007 after being hospitalized for pneumonia and acquiring other infections during his hospital stay. “The bill for killing my dad” came to $636,687.75. A couple of excerpts from his presentation:

I asked myself, if I put dad at the most expensive hotel in New York and filled it with hospital equipment, made a doctor spend an hour a day with him – which is about 50 minutes more than he got in the hospital – gave him round the clock nursing, and I also gave him some room service—and some of you probably are wondering why there’s no television charge. In hotels, they don’t charge separately for television. That’s just in hospitals. The most I could get to was $155,000 and, you know, that’s basically treating dad as if he was king of Saudi Arabia.


The important thing is, when looking at prices in health care, remember you are looking at nothing. Fiction. Fantasy. Administered numbers. And the fact that we make decisions and that hospitals themselves often allocate resources on these prices is one of the ways the system is massively broken.

One way to change that, Goldhill said: Remove the middle man. Goldhill advocated taking back the many thousands of dollars that employers and individuals contribute to health insurance each year, often never knowing what that money actually buys, and putting it into the hands of consumers—a move that could force health care providers to compete for patients, lower their prices, and become more transparent.

I asked Goldhill where the poor fit in. How do we pay for coverage for those families not already contributing tens of thousands through employer-sponsored coverage?

The country should have a basic catastrophic coverage plan that protects everyone “from cradle to grave” regardless of their need, he said. Then take some of the hundreds of billions now used to subsidize care for people who are low-income, elderly, or disabled, and distribute the money into health savings accounts, giving individuals more choice about what care to purchase.

That’s not a new idea, per se. It’s one that the analysts at the Pioneer Institute, a Boston public policy group, often write about.

I asked John McDonough, a Harvard health policy professor who helped craft both the state and federal laws expanding health insurance, for his thoughts. Like Goldhill did, he pointed to Steven Brill’s “Bitter Pill,” published in Time magazine. In careful detail, Brill outlines just how out of control health care costs are and the burden they place on real people.

Brill said in an interview that patients “are powerless buyers in a sellers’ market where the only consistent fact is the profit of the sellers.”

Goldhill would argue that putting actual money back in patients’ hands would change that. McDonough said, by e-mail, that it’s not so simple.

“Compel every consumer to fend for him- or herself for every less-than-catastrophic procedure and watch them drown in higher medical bills and unfathomable paperwork,” he said.