Pricing madness in health care, the worst run industry in America

 

I've written about how health care providers have two sets of books. There's one book with the prices for insured patients. And there's a second book with prices for uninsured patients.

I was wrong about that. Heath care providers don't have two sets of books. They have dozens. They set different prices for all kinds of different customers: insurance company A, insurance company B, Medicare, Medicaid, uninsured patients and so on. On top of that they have so many different prices for so many different procedures that no one can keep track of them all unless they're a billing specialist.

This has led to a couple bizarre outcomes. One is that there is a particular job for an expert billing specialist. It's called a coder. The entire job of a coder is to translate the procedure a doctor did into a code used to bill the insurance company. It is a full time job for thousands of people. People with this job get paid enough to own a house and raise a child. (I know this because my niece has this job.) Can you imagine another industry where this kind of cost waste would be allowed to exist? Can you imagine Apple hiring thousands of people who, after you ordered and received an iPhone, sat at home and checked the code on your order—only the code, not whether you ordered the correct phone, not whether it worked well, not whether you liked it, not anything at all other than making sure the correct code was billed? It's like a scene from Brazil, except it's real and it's how we run what's arguably one of the most important industries in our country.

Another outcome from this pricing madness is that there is no way for you and I to find out how much a medical procedure costs until we get the bill. You can't find out beforehand. Try it, ask someone. The nurse won't know, the doctor won't know, the administrator who charges your co-pay won't know, your insurance company won't know. Even my niece won't know; coders only know codes, not costs, and they're not on any Contact Us list anyway. None of these people will even know who to call to find out—I've tried, I've asked. So who knows? Actually, I have no idea, I've never figured it out. There's no other business I can think of where you can't find out what something costs before you buy it.

More reading on the terrifying inscrutability of American healthcare pricing:

My dog's healthcare is better than mine.

That gall bladder surgery could cost you $41,000. Or maybe $90,000. Hard to say.

The U.S. leads the world in health care expenditures (but not results).

The Worst Run Industry In America is my look at the American health care industry, its service, prices and promises, from my view as a merchant.

Did you mean that?

This bus stop ad for the Whitney museum's every-two-years art show appeared in New York this week. Clearly it wants to be make a point about being a discoverer versus being a follower. But the phrasing makes me feel like it's promoting overpaying and inconvenience today versus ubiquitous easy access tomorrow. Tomorrow sounds better, I think I'll wait thanks.

 

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What the hell happens after you click submit? Radiolab makes a masterful edit of Mac McClelland's amazing Mother Jones story of being a picker in a giant fulfillment warehouse. Hat tip Betsy Bruner.

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—Whole Foods, the temple of culinary pseudoscience.

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This I share for no reason other than it's staggeringly good writing and it's about food and babies and one of those just arrived on my stoop. 

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A restaurant that sells food past its expiration date? This might just have a chance. An ex president of Trader Joe's is starting a very different kind of food experiment. 

Annie's Mac and Cheese is everywhere. It sells itself as the slightly-better-for-you version of boxed mac and cheese. Is it? Who knows. What's crazy is the "sauce" is based on cheese popcorn—her ex-husband invented Smartfood.  Annie essentially turned Smartfood's topping into Mac and Cheese, convinced everyone it was healthy, sold stock to their customers, then got very, very rich. Welcome to the new "food" business.

Do cheese and tuna have anything in common? What happened when I selected tinned tuna at Ortiz.

Decades ago chefs used to select their preferred tuna batches from the factory at Ortiz, Spain's highly esteemed fifth generation tinned fish titan. Cheesemongers do this with cheese, in fact it's a specialty of some exporters like Neal's Yard Dairy and Essex Street Cheese. But it's something that hasn't been done for decades with tinned fish. Last fall I visited with my colleague Brad to see if we could revive the practice.

We landed in Barcelona on a sunny November Sunday, a couple weeks after the six month tuna season had ended. It was a four hour drive northwest to Getaria, a small town on the Bay of Biscay, where the weather got progressively more Irish along the way: wetter, mistier, greener. Tasting was 9am Monday, a fifteen foot table in the break room set up with twenty-six batches of tuna and sardines. We had a round of Nespresso pod coffees and went to work.

The first question on all of our minds—including the folks from Ortiz, who, being in their 30s and 40s, had never batch tasted either—was "Can we taste a difference?" That got answered quickly. The second tin we tasted was very different than the first. That continued throughout the morning with some batches being good, some excellent, and a couple extraordinary. There is a big difference between batches of tinned fish.

The main differences in flavor were complexity, balance between sweetness and brine, and length. The best tunas had a range of high and low notes, were never just sweet or just salty, and had great length of flavor. Color foreshadows flavor: if a tuna was rosier, it was often better tasting. Texture played a smaller part on these tins, just made this summer, but over time it has a much bigger role. The older a tinned tuna in oil, the softer and more luxurious its mouthfeel.

The fishing boats in Getaria.

One thing that you may be asking is, "What constitutes a batch of tinned fish?" It's a little more complicated than with cheese, where a batch is a single day's make, usually a mix of last night's and that morning's milk. A tuna batch is a single catch from a single boat, brought in at one time and sold to one buyer. That's how fish are managed in the Biscay auction market and Ortiz stays faithful to the one boat one batch cooking, which means the tin you get from Ortiz is traceable back to a single boat on a single day's catch (that said, a catch may last longer than a day, but it comes from a single shoal of fish). It may take several days to cook a big catch and, since the fish in it are different sizes and different ages, there's bound to be more variability than with a single batch of cheese.

We decided on a single catch of bonito, caught that summer, but brought examples of nearly every tin we tasted back to Michigan so we can taste again and confirm what we thought. A second round of tasting is one of those steps that I've learned, over time, to be important when I'm making a big flavor decision. Sometimes, out on the road where everything may be a bit more exciting, I can talk myself into liking something that, second time around, doesn't live up to the hype. 

We're going to cellar a few thousand tins, too. I tasted some two and three year old tunas at Ortiz and pretty much everything I likede about a young tuna got better when they aged. (This is only true for good tuna stored in oil—water-packed tuna gets worse with age.) The good thing about aging tuna is its a lot easier than aging wine. You don't need a special cellar with specific humidity and temperature. Tuna in a tin is practically indestructible. Our aging room is going to consist of boxes stacked on a pallet stored high up on the racks in our warehouse, wrapped in plastic with a note that says "Don't Touch till 2016!"

Our first selected tunas will arrive this May.

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Planet Money makes a T shirt. From cotton to cloth and everything in between. A great five part (though brief) video series about how an everyday product is made in the 21st Century. This is THE story of the modern world and to me it's amazing how rarely it's told. Hat tip to Betsy.