Health Care and Price Gouging

Friday, March 15, 2013

Page 7

IN MY OPINION (Column)

Health Care and Price Gouging

By GERT K. HIRSCHBERG

(The writer is a retired trial lawyer, an American Board of Trial Advocates member since 1978 and a former professor of torts at five California law schools. He counts 4,000 of his former students among California’s lawyers and judges. He was presiding referee of the Disciplinary Board, later called the State Bar Court. He is a former member of the State Bar Board of Governors—1980 to 1983—and the Judicial Council of California.)

The description of health care as a mess seems to be a myth, although not exclusively so. Heavy artillery is leveled against the drug manufacturers. Not all of it is fair, although it is difficult to be objective when you have just been charged $5.00 for an aspirin. Time magazine which has just knocked out its chief competitor at the newsstand, published the longest article in its history, to wit, 24,000 words to the exclusion of all other articles, entitled Why Medical Bills Are Killing Us. Overkill?

The charges for drugs and pharmaceuticals are just the beginning. The “mess” description applies equally to the treatment rendered by hospitals and medical staff to the public, i.e., its largest customers, Medicare and MediCal. Upon receipt, these suppliers cavalierly agree to accept a much smaller sum and the consumer is notified that the supplier will accept this smaller sum, or that “you” the health consumer may be billed for a smaller remaining sum. While this occurs frequently, the subsequent “billing” almost never occurs. The whole process resembles a game—a game which does not befit a mature citizenry.

Nor is this the end of the “mess.” There is the problem of unnecessary but profitable testing. Are MRI’s and x-rays really necessary to the extent that they are prescribed? Doctors refer to these as defensive measures which are described as protection against malpractice suits. Surely, the threat of a malpractice suit is a real one, but proportionally, nowhere near the number of times such tests are ordered. This can also be said of mammography and other tests.

The threat of a malpractice suit is itself overblown. Few are filed, fewer proceed to a trial and fewer yet are resolved in favor of a plaintiff. The burden on a plaintiff is nearly insurmountable, including the term “malpractice.” Malpractice involves medical negligence. Can we not just call it that? After all, the negligent driver of an automobile is referred to as a negligent actor, not as a mal-driver.

Our system of government does not lend itself to strict price legislation, yet that is precisely what is advocated as an assault upon medical price gouging. The medical profession and our hospitals are honorable institutions. Yet, there exists always a need to repair that which is wrong or is threatened.

During World War II, the mess of price gouging was anticipated. The Roosevelt administration enacted the O.P.A., the Office of Price Administration, headed at that time by Leon Henderson, who quickly became one of the most powerful, albeit unpopular persons in government. One of the regulations was that prices of products and services had to be posted in all businesses. That became the battle cry for the emerging Nixon forces and established the road map for our government in 1946. Here, in this column, it is not advocated to return to strict government control of prices. What we do advocate is a limited control to be posed upon the suppliers of Medicare and MediCal. That is what Lyndon Johnson had in mind.