The Tom Coburn samizdat Medicare reform proposal

Economist Tyler Cowen highlighted one of those “isn’t that obvious?” observations by physician/senator Dr. Tom Coburn (conservative R-OK)

As reported by Ezra Klein:

‘If I had the magic wand,’ he told me, ‘I’d change how we pay for Medicare.’ That’s a common enough sentiment, but the policy Coburn has in mind is a bit more radical than what’s typically offered in Washington.

‘I’d change all physicians to time instead of fee-for- service,’ he says. ‘What we’re doing with fee-for-service, and most people don’t realize this, is when you go to the doctor, they have this pressure to see X number of patients a day to meet their numbers.’

If we cut payments to doctors, Coburn says, ‘they’re going to cut the time they spend per patient. When a patient is in a room and you haven’t used your skills as a physician to really listen, you walk out and cover that absence of time by ordering tests. So if you say here’s all the hours we’ll pay for if you’re a Medicare doctor, and we can actually audit that time, doctors would have to demonstrate proof that they’re spending this time with patients.’

That wasn’t, I noted to Coburn, a policy that appeared in any of the bills he had sponsored, a fact he acknowledged with a laugh. ‘I didn’t put that in there,’ he said, admitting the idea has little political support. ‘It’s just something I’ve thought about a long time. Nobody should be seen for less than 20 or 30 minutes if you’re doing this properly. And if I knew I was going to get paid for my time I wouldn’t be in a hurry to see the next patient.’

Here are further ideas on Medicare reform.

Fee-for-service cannot be the basis for any sort of optimal medical system. Most of the managed-care organizations that have emerged have compensation based first on salary, secondly on performance (results). Measuring results is extremely tricky, not least because of physician patient-selection bias. But I think it can be done (it’s just math and sufficient data).