Do cheaper doctors provide inferior care?

Answers to your questions about the news.
July 19 2010 6:00 PM

Rich Doc, Poor Doc

Do cheaper doctors provide inferior care?

Dr. Office. Click image to expand.
Do higher medical bills equal better care?

Many health insurance companies have responded to health care reform by pushing cheaper plans with a smaller selection of doctors, reports the New York Times. Do these cheaper doctors provide inferior care?

No one really knows. There are mountains of studies on the relationship between systemic health care costs and quality of care. (Most suggest that we're not getting a very good deal in the United States.) But those reports typically focus on unnecessary procedures and prolonged hospital stays. Few researchers, if any, examine whether highly paid doctors provide better care than their bargain-basement colleagues. In any case, you shouldn't assume that pricier doctors will be better for your health.

The rates a physician can squeeze out of an insurance company have more to do with market power than quality of care. Some hospitals, with their vast network of affiliated doctors, now dominate particular markets so thoroughly that they practically dictate their own fees. The company that manages the Massachusetts General and Brigham and Women's hospitals in Boston, for example, has been accused of establishing a monopoly over Beantown medicine. While those hospitals are among the finest in the country, the 4,000 individual doctors in their system earned their high reimbursement rates by joining the right network, not necessarily by providing better care than their Boston-based colleagues.


In addition, a doctor's ability to build a large client base—and gain leverage for negotiating with insurers—might have little to do with patient outcomes. Studies have shown that patients' hospital preferences are more responsive to improvements in amenities like wireless Internet and on-demand video than the likelihood that the hospital will help them get well.

If you're bargain-hunting, you might consider a large university hospital, where some of the world's finest physicians accept the cheapest insurance plans. Many doctors at the Johns Hopkins Hospital, for example, accept Medicaid's pitifully low reimbursement rate s.

The lack of data on this topic isn't surprising. It's not always easy to figure out how much a doctor gets for an appointment or procedure. Large insurance companies typically offer take-it-or-leave-it prices to smaller offices, but hospitals and large physicians' practices haggle over the reimbursement rate for everything from a primary-care visit to freezing a wart. The negotiated price usually isn't made public, since neither party wants to undermine its negotiating position with third parties, making analysis of an individual doctor's compensation somewhat difficult.

It's also tough to measure the performance of individual physicians. The most common way to assess health care is to measure big-picture statistics like life expectancy or infant mortality rates, or how likely it is that someone will survive after having a heart attack. It's impossible to assign responsibility for any of these statistics to an individual doctor, because they depend on the performance of a large number of health care workers. Your likelihood of surviving a heart attack, for example, might depend on how fast the ambulance gets you to the hospital, how accurately the cardiologist assesses the state of your arteries, whether the anesthetist effectively monitors your vitals during a bypass operation, and how skillfully your surgeon repairs the damage, not to mention the work of countless nurses and pharmacists. Even the janitor who scrubs your room clean of bacteria plays a role. Outcome data speak to how well the system is working as a whole, but they can't say much about one doctor or another.

None of this means that you should automatically select the low-premium, small-network health insurance option. Sure, the doctors in the plan might be every bit as thorough as the concierge physicians down the street. The problem is that you might never get to see them. Many patients complain that none of the doctors in their limited network will accept new patients.

Got a question about today's news? Ask the Explainer.

Explainer thanks Don McCanne and Steffie Woolhandler of Physicians for a National Health Program and Joseph P. Newhouse and Meredith Rosenthal of the Harvard School of Public Health.

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