Doctors' strange economic role

Doctors play an unusual role in the economy. "When asked what profession, economically speaking, the doctor resembles most, many economists say auto mechanic — because of… the information problem," NPR reports.

 Like doctor's patients, a mechanic's customer may not be able to understand what he or she is buying. In one example, "'Car doctor' Ari Cohen, who runs ABC Erikson, says that recently a customer came in with a Buick. The customer says that every time he steps on the brakes, the entire steering wheel shakes. Cohen says, no problem, it's a $320 fix," NPR reports. "But then, Cohen says, the mechanics examine the car more closely and discover problems with the wheel bearings and axles. It could cost another $1,000."

Also like mechanics, doctors are paid in a way that gives them an incentive to fix more things, while they've got the hood open, so to speak. "In fact, most doctors get paid for every single sale, every surgery and every procedure. So, another proposal: The doctor is a salesman just like the guy who sells you sunglasses on the street." But, patients are ill equipped to be good shoppers. Many reformers say changing the way doctors are paid would help their economic role make more sense (Joffe-Walt and Kestenbaum, 8/21).

Doctors, however, say changing the way insurance companies operate is the key, the Las Vegas Sun reports. An ad by the American Medical Association in major newspapers says doctors support health reform "that would provide affordable health insurance for all and eliminate insurance company denials of a patient's preexisting conditions." Doctors also say they want reform to protect the "sacred relationship" they have with patients (Lucht, 8/21).