Is the medical world flattening?

"A severe depression like that of 1920-1921 is outside the range of possibility." -The Harvard Economic Society, 1929

To many children growing up at that time, including my parents, the lessons learned persisted throughout their lives. As a boy, my father seldom had the money (two cents) to buy a candy bar, so as an adult he always kept a candy bar around. My parents' families had no savings, so as adults they eschewed anything that smacked of conspicuous consumption and became careful savers. To my sisters and me they frequently quoted the old saying: "Neither a borrower nor a lender be."

Outsourcing services

So it is interesting to see some of the changes and potential changes that are occurring in our health-care system. During a recent trip to Princeton, NJ, I discovered that the medical center there "outsources" its radiology services during non-business hours (after 6 p.m. to before 8 a.m.) to Australia.

Apparently, for a very reasonable fee, board-certified radiologists sitting in front of video screens during business hours in Australia can easily read studies beamed to them from the United States while they are also reading their domestic studies.

U.S. radiologists keep what used to be called "bankers' hours," spend the dinner hour and evening at home with their spouses and children, and rarely are interrupted by work demands. The hospital saves money. Patients and their treating physicians get high-quality radiology services from someone who is not drowsy from being awakened in the middle of the night to read the study. Everybody is happy.

"I had some concerns a year ago when I first heard we were going to do this," said my surgeon friend in Princeton, "but it is working out great!" When I shared this anecdote with the chairman of radiology in my medical school, he did not seem so happy.

Is radiology unique among medical specialties in that the work can be "offshored?" Maybe not. According to economist Shlomo Maital:

"More and more of the labor market is open to global competition. Some 57 million Americans hold professional jobs-engineering, accounting, medical care, finance-that are susceptible to outsourcing. A hip replacement that would cost $30,000 to $50,000 in the United States costs only $9,000 at a hospital in India run by the Apollo Co. Many clients find the quality is the same. What will this do to American surgeons' incomes? . . . Many Americans may earn less as a result, including many who thought their work was innately superior to factory work."

But what does an economist know about the quality of health care? A while after I read the article by Dr. Maital, Dean Edward Miller of my medical school returned from a visit to India that included Apollo-run hospitals. He was obviously impressed by what he saw, telling us in the room that any of us would be comfortable with having a family member cared for in that system.

Economics could dictate

Hospitals and physicians outside the United States have clear competitive advantages: no enormous malpractice costs, less regulation, generally lower costs of doing business. But it is one thing to distribute radiologic images electronically around the globe (at 186,000 miles per second) and another to distribute patients who need surgery (at a slightly slower speed).