NPR reports on New Hampshire governor John Lynch's call for hospitals to rein in their building boom in his state. The problem, he says, is that all the new construction isn't leading to better care:
Governor Lynch: “Instead of using that excess cash to reduce health care costs, hospitals spend it on advertising, trying to attract market share from each other; on buying physician and laboratory practices across the state and increasing overhead charges to patients.”
....Paul Spiess chairs a legislative study committee on hospital cost containment. He says hospitals have spent close to a billion dollars in the last decade on new facilities and amenities — from fancy lobbies to color MRIs.
Paul Spiess, former chair, Citizens Health Initiative and chair, SB 505 Hospital Cost Containment Commission: “It’s sort of developed into an arms race.”
....Former State Senator Kathy Sgambati: “You will get extra referrals to an MRI machine because it’s there. There are studies at Dartmouth that show when you have more surgeons, the more surgeries will be performed...so more supply means higher health care costs.”
It will be interesting to see how this plays out. The issue of supply creating its own demand is a real one, but politically it just has to be dangerous to be against having the latest and greatest toys in every hospital. After all, as we're told over and over and over, America has the best healthcare in the world, and we often convince ourselves of that by pointing to the number of MRI machines we have. This should be an interesting showdown.