THE HOSPITAL
Competition among hospitals created a medical arms race of first-class proportions. The arms race metaphor refers to hospitals in close proximity to each other competing with each other for patients to create revenue. It also refers to the cold war, when the USSR and the U.S. needlessly spent billions on weapons after either side could have destroyed the world with one tenth of what already was available.

Much that I am going to describe was given to me by Jim [a hospital administrator], but not all. Anyone active in his or her community probably wonders about the same questions as I have, watching television, listening to the radio, and getting huge packages of junk mail from hospitals with a yen for profits. The rest of the “arms race” is a bit subtler, but real nonetheless.

The week of September 4th, 2005, I received a beautiful, high gloss, multi-page publication from Froedtert Hospital in Milwaukee, Wisconsin. It had imposing pictures of its leaders in administration and medicine. After reading it, one could not imagine not getting the best of the best from this hospital (it is in fact a wonderful place with a good reputation, and I am sure the care is above reproach). But my thoughts centered on the cost of the glossy publication, and why they would send it to me, when I live and work six hours away from Froedtert, yet live only two and a half hours from the world-class Mayo Clinic in Rochester, Minnesota. This publication, Jim assured me, could cost three to five dollars per piece to send out. If it went to all doctors in the state, as seems likely, then multiply the cost by 15,000. If it went out to the greater public, then all bets are off; there are five million people in Wisconsin. Froedtert Hospital invested in the mass mailing of a costly, slick flyer to somehow encourage people to use its services. Some of the money Froedtert receives comes from Medicare fees and/or patient’s insurance. Given that, one can easily imagine the implications of such high-priced advertising in rising health care costs. These massive advertising campaigns should not and indeed can not continue.

On almost any night, television carries the battle of the hospitals, each one aiming to convince people to use their hospital rather than the competition just twenty blocks away. Many times, these costly ads showcase the local “arms race” by featuring a newer machine or more sophisticated technology than the competition can boast. Sometimes the carrot dangled before the potential consumer’s nose is a raft of amenities calculated to remind a patient of home—or even of a five-star hotel. For instance, my friend Jim’s hospital has 24-hour room service with a full menu, a waterfall in the atrium, pull-out beds for relatives in patient’s rooms and obstetric suites with cherrywood cabinets. The latest plans entail offering full valet service at the front door. Jim’s hospital takes Medicare fees and part of those fees would be used to pay for these frills. These kinds of hyper-competitive expenditures can not continue; we all pay, yet no one can afford them, ultimately. The benefits of such competition accrue in too few accounts. In Jim’s defense, patients have not complained that these services were unwarranted, but all of us can stand some straight talk.

Excerpted from Health Security America: Fixing the health care crisis. Copyright © 2006 by Fred Bannister, M.D. All rights reserved. Lundquist Hills Publishing Company.

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