Finally, someone is putting some heat on doctors, who, just like mortgage lenders and AIG execs and the rest of us, are sometimes motivated by greed:
Somewhere in the United States at this moment, a patient with chest pain, or a tumor, or a cough is seeing a doctor. And the damning question we have to ask is whether the doctor is set up to meet the needs of the patient, first and foremost, or to maximize revenue.
There is no insurance system that will make the two aims match perfectly. But having a system that does so much to misalign them has proved disastrous. As economists have often pointed out, we pay doctors for quantity, not quality. As they point out less often, we also pay them as individuals, rather than as members of a team working together for their patients. Both practices have made for serious problems.
That passage is from Atul Gawande’s article in the New Yorker, and his words are sure to earn him a few enemies in the ranks of the American Medical Association. Let’s hope Obama and health secretary Katherine Sebelius read it.
Gawande, a practicing surgeon and award-winning author, visited a small border town in Texas that has the highest per capita health care spending in the country. He wanted to understand why this town was spending so much for care yet not actually delivering better health outcomes.
Doctors in McAllen, Texas, it seems, are a uniquely enterprising bunch, and they “treat patients the way subprime-mortgage lenders treated home buyers: as profit centers.”
Gawande isn’t the first to put the screws to doctors, but his article is perhaps one of the most unflattering portraits of the medical profession to date. We tend to idolize doctors and assume they operate solely with our best interests in mind. While most do, a few have let the profit motive take center stage.
If we’re to adequately reform our health care system, Gawande writes, we must address the issue of doctor compensation—specifically, we must develop a payment structure that rewards quality, not just quantity:
Activists and policymakers spend an inordinate amount of time arguing about whether the solution to high medical costs is to have government or private insurance companies write the checks … When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care. Otherwise, you get a system that has no brakes. You get McAllen.
Writing for the New Yorker, economist James Surowiecki notes that the FIRE economy–which stands for finance, insurance, and real estate–shrank for the first time in 16 years. “Since 1980, this sector’s share of the economy has grown by almost half. Now, apparently, the worm has turned,” says Surowiecki.
Looking at credit default swaps and mortgage-backed securities, it’s easy to understand how and why the finance and real estate markets are shrinking. And the insurance industry, of course, is so interconnected with those two that it was only a matter of time before it started to feel the pain as well, even if it wasn’t as reckless as its siblings in the banking and property sectors.
Surowiecki looks back at the last 10-20 year period as the “financialization” of our domestic economy, when Wall Street became an economic driver in its own right, as opposed to a follower. And that’s where things went wrong.
“Wall Street needs to recognize that its proper role is, as it has been in the past, to follow the real economy, rather than trying to drive it,” says Surowiecki. ” During the housing bubble, the financial sector essentially tried to create reality. Now’s the time for it to respond to reality instead.”
Maybe it’s because I’m a little sleep deprived, but this short video, with its upbeat message and inspiring piano track, made me a little misty. (Grasshopper, a telecommunications company, put it together.)
It made me lot more optimistic about our country’s future. It reminded me of why our country is so great: we have an indomitable entrepreneurial spirit, a restless drive to innovate. It’s an impulse that begins in childhood and if it’s nurtured properly, extends into adulthood.
Fear and inertia can dull this creative impulse, but we need only look back to our youthful desire to create to get it back.
ComScore released its annual report on online insurance shopping last month. The company presented its findings at the Auto Insurance Report 2009, sponsored by Risk Information, Inc.
A whopping 32 million consumers used the Internet to submit a quote request for auto insurance last year, which was about the same number as the previous year. In the years before, comScore reported the growth rate of quote requests increasing about 15 percent annually.
Last year, of course, was a different kind of year. But even in this economic retraction era, seven percent more people purchased auto insurance online than the previous year.
And there are millions using the Internet to start researching insurance before they request a quote. According to Google, in April the keyword ‘auto insurance’ was used as a search word 30 million times. ‘Auto insurance quote’ and ‘auto insurance quotes’ were shown to comprise another 6 million or so searches.
These statistics fluctuate and aren’t 100 percent accurate; but suffice it to say, there are a huge number of potentially interested consumers checking out insurance through the search engines.
Of course, with the growing number of consumers online, there is a growing (exploding) number of insurance marketers online. If a consumer enters the search term ‘auto insurance’ in Google, there are over 90 million matches (links to Web pages).
So in essence, there are 90 million sources of information for people researching insurance offerings (98 million for ‘car insurance’). The search engines list those 90 million links in a particular order, based on a number of (secret) criteria; but you can imagine it takes a lot of marketing savvy to rank in the first couple of page results. Most consumers don’t venture much past the first few listings.
The Internet has become congested with information—so much so that it is very difficult for consumers to find what they are looking for. But it is even worse for small businesses—and insurance agents—to try and be noticed when there are so many distractions.
But watch out for someone who promises guaranteed results: no one can guarantee anything with search engines, and there are plenty of shysters taking people for a ride when it comes to Internet marketing services.
Internet insurance shopping: friend or foe? The verdict is still out.
We invite every consumer who goes through our quote application to fill out a survey. We send the survey invitation two weeks after they’ve been matched to agents on our network.
Most are happy with their experience, but there are always people who had a really bad experience and use the survey as an opportunity TO SHOUT AT US IN ALL CAPS and use the exclamation point with furious abandon.
A common complaint among the disgruntled is that they never got called or that they were contacted once and never again. Some even contacted agents only to be snubbed!
I called the agent , left a message and never heard from him after that…
Your site was awful. I got one contact and I had to call hime – a Mr. Furgeson from a co I don’t remember. I called him twice and have never heard back from him. He sounded like an idiot. I don’t know how you get the ins agents but your site is an utter failure
I did receive several quotes from different company. But the one I am most intersted in did not actively follow up. I left several voice message,but never got response. I ended up calling directly the company he represents and had it done right away.
Only received 1 acknowledgement from State Farm that they were working on my quote, but never received quote even after I sent them a 2nd request a week later. The other 2 matches never contacted me.
I never had a response from anyone.
I never got an answer!!!!!!!!!!
Two agents called but never followed up with a quote for property insurance.
This is rather astounding, isn’t it? Agents pay us for leads. Why on earth would an agent pay for a lead only to never call the person or, even more bizarre, ignore their calls? It boggles the mind.
But I don’t want to go out on a sour note. There are always plentiful comments that point to excellent and attentive customer service.
The woman who handled my request by phone was knowledgeable and informed. She was competent and courteous. I found great insurance coverage for almost half what I was paying with Nationwide. Thanks.
The response was above my expectations. Every one I spoke to offered me their insurance but gave me suggestions and support, thank you
Agent, I believe her first name is Jody was very helpful. Very professional. Great follow up to my questions.
The recipient of the unwanted advances, a guy named Terry, contacted an agent listed in one of the letters in an attempt to stop the deluge. The agent replied that the mailers came from corporate and there was nothing he could do to stop the onslaught.
So Terry sent a pleading email to corporate. He received this response, which is both helpful and sort of depressing at the same time:
Dear Terry,
Thank you for contacting State Farm regarding our Privacy Policy. No, but there are ways you can reduce the number of solicitations you receive from companies with whom you do not have a customer relationship if they are members of the Direct Marketing Association. You can write to the following addresses: • For marketing solicitations received by mail, write to: Mail Preference Service, c/o Direct Marketing Association, PO Box 9008, Farmingdale, NY 11735-9008. • For marketing solicitations received by telephone, write to: Telephone Preference Service, c/o Direct Marketing Association, PO Box 9014, Farmingdale, NY 11735-9014. You may also contact specific companies and ask that they do not contact you either through direct mail or telephone solicitations. This will not stop calls relating to your existing relationship with the company. Certain states may have state-run programs whereby individuals can be placed on a “do-not-call” list to avoid marketing calls from businesses with whom they do not have an existing relationship. Your state will provide details on how to be placed on such a list. The Privacy Policy can be viewed online at If you have further questions regarding the State Farm Privacy Policy or would like to indicate your do not share preference, please call the State Farm Privacy Information Line at 800-865-6035.
State Farm Insurance®
Internet Support Representative
On one hand, State Farm producers ought to be happy that corporate is spending big bucks in an attempt to generate new business. On the other, these producers ought to demand that those big bucks be spent in a better way. [On, say, internet leads from InsureMe—where consumers are already looking for insurance.]
Despite a mixed track record at best, direct mail continues to litter mailboxes and annoy recipients. Scanning the comments to the Consumerist article, I learned that some people are so irritated by junk mail that they use return envelopes to send candy wrappers back to the soliciting company. Another commenter says he turns junk mail into ‘fireplace logs.’
That’s where your advertising dollars are going, State Farm. Right into Blueskylaw’s fireplace.
