Consumer Reports looks at current practices and finds them alarming:
The number of children taking powerful antipsychotic drugs has nearly tripled over the last 10 to 15 years, according to recent research. The increase comes not because of an epidemic of schizophrenia or other forms of serious mental illness in children, but because doctors are increasingly prescribing the drugs to treat behavior problems, a use not approved by the Food and Drug Administration (FDA). And a disproportionate number of those prescriptions are written for poor and minority children, some as young as age 2.
Doctors are prescribing antipsychotics even though there’s minimal evidence that the drugs help kids for approved uses, much less the unapproved ones, such as behavioral problems. And to make matters worse, the little research there is suggests the drugs can cause troubling side effects, including weight gain, high cholesterol, and an increased risk of type-2 diabetes.
This pattern repeats itself throughout the medical system. A drug that may be helpful for certain severe cases is prescribed for vastly greater numbers of people. As we move down the severity scale, the risk-benefit ratio gets worse and worse. Milder cases (even assuming the diagnosis is correct) are those least likely to benefit from drug treatment and most likely to have a cost-benefit ratio that’s underwater.
This sums up the bizarre economics of the hospital business in the United States as well as anything I’ve seen. Oversimplification? Sure. But what a clarifying example!
With blood oozing from deep lacerations, the two patients arrived at California Pacific Medical Center’s tidy emergency room. Deepika Singh, 26, had gashed her knee at a backyard barbecue. Orla Roche, a rambunctious toddler on vacation with her family, had tumbled from a couch, splitting open her forehead on a table.
On a quiet Saturday in May, nurses in blue scrubs quickly ushered the two patients into treatment rooms. The wounds were cleaned, numbed and mended in under an hour. “It was great they had good DVDs, the staff couldn’t have been nicer,” said Emer Duffy, Orla’s mother.
Then the bills arrived. Ms. Singh’s three stitches cost $2,229.11. Orla’s forehead was sealed with a dab of skin glue for $1,696. “When I first saw the charge, I said, ‘What could possibly have cost that much?’ ” recalled Ms. Singh. “They billed for everything, every pill.”
There is little science to how hospitals determine the prices they print on hospital bills.
“Charge master prices are basically arbitrary, not connected to underlying costs or market prices,” said Professor Melnick, the economist. Hospitals “can set them at any level they want. There are no market constraints.”
Prices for any item or service are set by each hospital and move up and down yearly, and show extraordinary variability, health economists say. The codeine that costs $20 and the bag of IV fluid that costs $137 at California Pacific are charged at $1 and $16 at the University of California San Francisco Medical Center, across town. But U.C.S.F. Medical Center charges $1,600 for an amniocentesis, which costs $687 at California Pacific.