Winter has arrived in full force around here, which means lots of snow, ice, and cold — a weather combo that produces a good deal of uncertain footing for walking commuters like myself. This point was driven home to me last Monday, when I strode a bit too confidently outside my office building on my way to the bank and crashed quite violently on my left hip. I regained my footing quickly and hobbled on more carefully. Then, walking back to the office, I promptly slipped and toppled onto the same hip once again.
A new colleague of mine, recently transplanted from the balmier climate of Washington, DC, observed that local drivers don’t seem to know how to navigate through the frictionless streets on her morning commute. I know she’s not exaggerating. We all seem to need to relearn how to drive every winter. I apparently need to relearn how to walk. (Small steps. . . .)
I made my way home without further difficulties and, despite the sore hip, headed over to Anderson School to join my old basketball buddies for the first game of the season. The court was a bit slick and, of course, at one point I tried to make a quick cut to the basket, slipped and landed — yes — on my tender left hip.
Nearly a week has passed since this series of events and, while my hip remains sore to the touch, it’s perfectly functional. I cranked through my morning workout today with no ill effects. But it does give me pause. More than 330,000 people (most around my age, I presume) will have their hips replaced next year, and I’d prefer to not be among that number.
It’s not just that I’d like to retain all my original body parts. The more I learn about how our healthcare system handles these sorts of procedures, the less I want to participate in the dysfunction. As Elizabeth Rosenthal recently reported in the New York Times, the U.S. hip-replacement industry is controlled by a cartel of five manufacturers that have been gouging hospitals, insurance companies — and patients — for years, and shows no sign of letting up.
The cost to manufacture a hip implant, according to Rosenthal, is about $350, yet the “list price” that a hospital pays for it can run as high as $7,500. When you add installation equipment, assorted fees, and the hospital markup, the cost to the patient can rise to nearly $40,000.
How is this possible?
Here’s what Rosenthal found:
So why are implant list prices so high, and rising by more than 5 percent a year? In the United States, nearly all hip and knee implants — sterilized pieces of tooled metal, plastic or ceramics — are made by five companies, which some economists describe as a cartel. Manufacturers tweak old models and patent the changes as new products, with ever-bigger price tags.
Generic or foreign-made joint implants have been kept out of the United States by trade policy, patents and an expensive Food and Drug Administration approval process that deters start-ups from entering the market. The “companies defend this turf ferociously,” said Dr. Peter M. Cram, a physician at the University of Iowa medical school who studies the costs of health care.”
Plus, the manufacturers require that hospitals sign nondisclosure agreements, so they can’t compare pricing. “Manufacturers will tell you it’s R&D and liability that makes implants so expensive and that they have the only one like it,” Dr. Rory Wright, an orthopedist at the Orthopedic Hospital of Wisconsin, told Rosenthal. “They price this way because they can.”
Or, as Cram put it, “Why charge $1,000 for the implant in the U.S. when you can charge $14,000? How would you answer to your shareholders?
This sort of thinking speaks volumes about what is wrong with the American healthcare system, and it will remind me to walk more mindfully on my way to the office tomorrow.