| In most sectors of the economy, it is
the seller who attempts to act a potential buyer with various inducements of
price, quality, and utility, and it is the buyer who makes the decision. In the
health care industry, however, the doctor-patient relationship is a mirror image
of the ordinary relationship between producer and consumer. Once an individual
has chosen to see a physician, the physician usually makes all significant
purchasing decisions: whether the patient should return "next Wednesday",
whether X-rays are needed, whether drugs should be prescribed, etc. This is particularly significant in relation to hospital care. The physician must certify the need for hospitalization, determine what procedures will be performed, and announce when the patient may be discharged. The patient may be consulted about some of these decisions, but in the main it is the doctor's judgments that are final. Little wonder then that in the eyes of the hospital it is the physician who is the real "consumer". As a consequence, the medical staff represents the "power centre" in hospital policy and decision-making, not the administration. Although usually, there are in this situation four identifiable participants--the physician, the hospital, the patient and the payer (generally an insurance carrier or government) -- the physician makes the essential decision for all of them. The hospital becomes an extension of the physician, the payer generally meets most of the bona fide bills generated by the physician/ hospital, and for the most part, the patient plays a passive role. In routine or minor illensses, or just plain worries, the patient's options are, of course, much greater with respect to use and price. But in illnesses that are of some significance, such choice tends to evaporate. And it is for these illnesses that the bulk of the health care dollar is spent. We estimate that about 75 --80 percent of health care expenditures are determined by physicians. For this reason, economy measures directed at patients or the general public are relatively ineffective. |