I was having blood drawn when the lab technician pulled out one of the big gauge needles. Suddenly I felt like the kid in the Norman Rockwell painting waiting for his shot. I started to sweat, even got a little clammy and anxious.

“Hey, why aren’t you using one of those little needles, you know, the butterfly?” I inquired.

“Oh, the butterfly needles cost $1. These big needles are only 16 cents,” he replied. As a former middle-linebacker I couldn’t allow myself to play the wimp so I obliged and stuck out my arm.

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And just then it hit me: the difference in the price of needles and profitability of a healthcare provider symbolizes the dichotomy intrinsic in our healthcare delivery system. This is why healthcare reform has become such a hot topic.

Quality of Care. I am a huge proponent for reducing the costs of healthcare delivery. It’s part of how hospitals improve profitability. But when it impacts the quality of my care, albeit on a very small level, I didn’t care about the cost. Give me the butterfly needle and to heck with the savings!

Cost Containment. Some may wonder why a healthcare provider would be concerned with cost anyway. They don’t really have to pay for supplies, the insurance company does, right? Or do they? If the healthcare provider receives a fixed level reimbursement from the insurance company for a particular procedure, they do care about how much the needle costs because it can increase their profitability. In this case, sticking a big needle in my arm increased their profitability by 84 cents. Imagine if we weren’t talking about needles, but million dollar medical devices that are similarly expensive to run? Healthcare providers don’t have a good grasp on their actual equipment spend (especially in the areas of service, parts, maintenance and upkeep).

Choice. Shouldn’t I be able to decide if I want the $1 needle or a 16-cent needle? Given what I spend on coffee every day, I would have been more than happy to pay the difference in price for a smaller needle. I wonder what would have happened if I insisted on the butterfly needle. Would we have had a contentious “treatment protocol” discussion or would they have switched to the butterfly needle without a fuss?

Equality of Care. Is it fair that the people who can afford it receive the smaller needles and those that can’t get “stuck” with the big needles? And, do 16-cent needles really qualify as inferior care? What if we aren’t talking about needles? What if we are talking about cancer treatments?

Free Market Capitalism. Will medical supply companies experience additional price pressure? If every patient starts asking for the butterfly needle and profitability demands a 16-cent Big Needle, won’t some supplier eventually figure out how to deliver the $1 butterfly needle for 16 cents? Or better yet, offer the “super butterfly” needle, complete with topical anesthesia, for only 12 cents. Couldn’t the healthcare system benefit from market forces like the rest of the world? It comes down to who ultimately makes purchasing decisions. Is it the doctors, the purchasing department, the finance department, the insurance company or the patient, and what are each party’s respective motives?

Fair and Reasonable Charges. Then there’s the bigger picture. I had just completed a stress test a few weeks before, and with needle in arm, I thought to myself “You’re squeezing me over 84 cents for a needle when you just billed my insurance company $10,000 to have me walk on a treadmill and breathe into a tube.” How can the hospital justify such a high charge for a stress test? That cost seems astronomical for the services performed (even if the $10,000 does include a combination of technical, capital and equipment cost.) I still couldn’t help but wonder what the actual equipment charge was, especially since I only used a treadmill for 30 minutes.

Where will healthcare reform take us? No one knows for certain, but we all have a lot to think about given the complexity in our care delivery system and the questions that arise when you link profitability and healthcare.

I think everyone – patients, providers, insurers and suppliers – will be feeling the “pain” of the big needle before we get to the super butterfly. And we may all begin to get a little sweaty, clammy and anxious about that.



Kevin Zerrenner is the director of the healthcare practice at Accounting Management Solutions, Inc.