CBS News reported
last week that hospitals have been cutting the pay of physicians and reducing nursing
and other staff in their Emergency Rooms in the midst of the Covid-19 pandemic. In fact there are many reports from all
across our nation of wage cuts for medical staff in hospitals and group medical
practices just at the time when they are most needed, the risk is high, the
demand is critical, and they are being honored by the public as heroes for their
commitment, Herculean efforts and life-saving skills.
In what Alice
in Wonderland world does that make any sense?
By way of
contrast a news
article in today’s Washington Post reported that the African nation
of Ghana, where Covid-19 is becoming a serious problem, announced an immediate
50% increase in wages for medical personnel, care for any staff who acquire the
disease, and death benefits.
Why do we
have this absurd difference in the treatment of essential personnel?
There is an
explanation. Most hospitals today are
owned by corporations and operate as business entities where profitability is
the goal even in hospitals that maintain the fiction that they operate as
not-for-profit entities. Some hospitals
[including my local hospital in Florida that is owned by Cleveland Clinic]
contract the operation of their ER to for-profit management companies that
employ physicians the way Walmart hires workers and treats them comparably. Hospitals are “losing” money because highly
profitable elective procedures have been postponed and treating those who need
medical care in the ER is unprofitable.
Hospitals
could choose to incur debt or transfer building or unrestricted funds to cover their
increased operating expense, suspend executive pay during the crisis and let
them volunteer, postpone the purchase of million dollar pieces of equipment, suspend
construction projects temporarily, delay acquisitions for a year and focus on
using those funds to increase wages rather than decrease them.
While some
will argue that I have oversimplified medical services’ financial problems,
which I concede have been exacerbated by Covid-19, I contend that the pandemic
has brought the real issue into focus—the profit motive that underlies almost
everything in medicine. Hospitals want
to build bigger, better, fancier. Medical
equipment is highly profitable.
Prescription drug prices are more expensive than their real costs
warrant. Personnel management companies
want a piece of medical personnel wages.
Hospital managers are driven by profits and high salaries. Insurance companies pay for some of the direct
costs but they want a piece of every service.
Every part of the system is driven by a profit motive that is
inappropriate in what--I believe--should be a service industry.
At the end
of the day it depends on whether the primary driving purpose behind physician and hospital services is to save lives and serve people or to make a profit for owners and
managers. That will determine the
priorities, how the money flows and who benefits from providing medical
services.