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A doctor should get paid if the patient is healthy, not the other way around. This might sound strange, but actually, it’s what you and I do already. We pay insurance and we expect that our insurance will cover whatever comes up.However, it is when insurers pay doctors that doctors are paid for service, not health.
With principle in mind, I came up with this thought experiment:
“Imagine that there is one disease in the world and doctors are able to cure this disease with 97% effectiveness. Furthermore, the custom is to pay for health, not for service. How would a doctor make a living?
She would collect an annual flat fee from her patients. If in any given year, she expects only a certain number of them to get this disease, she charges accordingly — enough to cover the cost of treatment, damages from botched treatments, her own salary and that of assistants, and a cushion in case there is an unexpectedly high number of outbreaks this year.”
What is the doctor doing here? Well, she’s running an insurance company! She is both a provider of medical care (a doctor) and the one who takes on the task of spreading out health risk among a pool of people (insurance).
Unlike our current system, this system works because the provider and the insurance company are one and the same. The current system features an adversarial relationship in which insurance companies try to underpay providers and providers try to get their maximum payment by needlessly tacking on procedures, with nobody incentivized to lower costs. In this ideal system, the incentive for reducing costs is internalized in the doctor/insurer. A doctor who behaves inefficiently will eat into his own profits.
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shaun james bockert 