Friday, January 21, 2005

Dentists as businessmen

Dr. Smith, at Medpundit, notes "While medical reimbursement declines, dentistry is booming."

I had a similar discussion with our vet recently. They are just getting into the insurance business, and, for now, are being paid fee for service.

I told him the story of the hunters of wild pigs. The hunters would select a field known to the wild pigs and put food in the middle of this field. Initially, the pigs were afraid and wouldn't go to the field. Eventually, they were overcome by the desire for the food and lost their fear.

Next, the hunters fenced in one side of the field and continued to place food in the middle. Again, the pigs were nervous and afraid, this time of the fence. However, they overcame their fear, realizing that they could come and go as they pleased and this was easier than getting their own food, plus they got as much as they wanted.

Over time, the hunters fenced in the rest of the field, leaving only an open gate. The pigs learned they could come and go through the gate and eat what they wanted. Then, when the field was full of pigs, the hunters just came up and closed the gate. Now the pigs were theirs.

Insurers did this to doctors. We have become so dependent on the insurance industry that the insurers are now dictating what we get paid. What other profession lets someone else establish their rates?

There is some effort out there to return to a cash practice, but mainly with boutique services.

Eventually, dentists and vets will find the gate shut on them, too.

UPDATE: More here