dr. solomon's dilemma


Join the Discussion Should doctors have a financial incentive for keeping  treatment costs under control? How should the U.S. deal with the rising costs of health care?

solomon profile
financial incentives
cost v. care


For all the combined medical expertise of Dr. Solomon and the members of his "pod"; none seemed aware that they were being blatanly set up by health insurance companies to both lose money and the respect of the patients they'd cultivated relationships with over many years. In the end, the insurance companies had collected big money while the physicians were left with the "dilemma" of how to treat sick people without adequate financial resources to do so.

The truth is, our health care system is in a state of meltdown. The solution to the dilemma that we all face does not lie with just controlling the costs of doctors and hospitals by the way, did you notice how few hospital staff were caught on film? Except for a few residents packing a patient's chest wound, I don't recall seeing many extra nurses or other health care professionals around -- another grim side effect of "lean" staffing of health care facilities. The solution must involve all the players in the health care system, especially health care consumers.

Our health care costs as much as it does, because of a huge amount of gouging as well as a lack of awareness on the part of consumers about how eroded the health care delivery system has become. Unfortunately, doctors and hospitals have little control over the cost of medical equipment, supplies, pharmaceuticals and other components of the high costs of care.

Additionally, physicians and hospitals are oftentimes providing free care. Yes, free. When a sick person shows up at an emergency room, they are treated without regard to their ability to pay for the treatment.

As Dr. Solomon's Dilemma demonstrated, hospitals and physicians are currently trapped in a squeeze play between insurance companies who have little or no intention of paying claims and the high costs of providing the most basic level of care.

Maybe government regulation will be the ultimate solution. Until pharmaceutical companies, medical equipment companies and other players in the health care arena are pressed to offer their products and services at a reasonable cost, there is no realistic way that health care will ever be affordable. Thanks for a sobering and somewhat frightening edition of Frontline.

Paul Clark
Jacksonville, Florida


The most frustrating thing in your program is that, from all the people you interviewed, no one understood the real problem. All those highly paid people overpaid people did not have a clue on the root cause of the problem. The major issue here is that the health care is the least efficient industry ever existed. Why should a four-day stay in the hospital cost $5000? This is the question that should be addressed.

Excuse my frustration but I am a medical doctor who left medicine to study business so that I will have better idea on how to handle this dilemma rising cost of care. I firmly believe now that we can actually cut cost while at the same time improve the quality of health care. All we have to do is learn from other industries and from other nations experiences.

What we need in health care is new fresh ideas; we need young bright business graduates to bring new, out of the box solutions to this industry. Unfortunately, executives and human resource departments in this industry look for MD's with 10 or more years of experience to hire as managers. Those managers prove to be highly paid underachievers who cannot understand the root causes of the problem, and therefore cannot solve any thing.

This is from my personal experience, I have great new ideas on how to cut cost without compromising quality, but nobody is willing to listen, I applied to all major hospitals and HMOs without any result. They actively seek those overpaid underachievers instead of young people with new ides. It is frustrating.

Until we change our way of thinking and start to adopt a new, different point of view on these issues, healthcare will not improve and cost will keep rising.

Abraham Hanounik
Kalamazoo, MI


Dear Frontline, I've just finished reading other viewers comments and the thing that stood out for me was the number of people who are mad at doctors because they make a lot of money, drive good cars, etc. The attitude seems to be, who can feel sorry for them? Surely there IS a difference between the medical profession and many others - the years of education required, the enormous amount of knowledge needed in order to give proper treatment, the extra long hours spent at the office or hospital. I don't advocate giving doctors all our money, but I'd put the medical profession at the top of all the professions and say that good doctors deserve their large salaries. They earn them by working to keep their patients alive and healthy; we respect their expertise and put our lives in their hands. It's awful to see them coerced into partnership with "big business," as Dr. Solomon has been.

Ginny Cornue
Lake Geneva, Wisconsin


I watched your program with avid interest as Alberta is, this week, pushing ahead to privatize certain medical procedures as well as overnight surgical stays. Having been a pharmacist here for 23 years, I've seen the rapid deteriorazation of medicare due to extremely high and unnecessary administration costs, government waste and patient overuse. Rather than keeping the good areas of public health and work efficiently and knowledgibly to strive toward excellent, cost efficient service, our government instead chose to cut across the board by some 20% funding in 1993 and establish APPOINTED regional boards to administer funding. Front line staff like nurses were cut back, waiting lines increased and, of course, administration remained relatively unscathed.

The problems here are not so much a lack of money but rather it's most efficent use. The solutions are there, but unfortunately the politics of government paybacks stop the process cold. Retiring government leaders, doctors, administrators, pharmaceutical giants, etc. need a well padded retirement, and what better way than a seat on the board of directors of a private health care facility? I waited 6 months for a CAT scan and 10 months for surgery in 1994 as a result of a broken vertebrae and blown disc. I have massive pain which I'll never get relief from now, due to an absurd wait and a 3-day hospital stay immediately after which I had to take a long flight home.

Please don't stop fighting against the money-first patient-last concept I viewed last night. We shudder at the vision of the holocaust. The callous diatribe I heard last night seemed to be just a lengthy version of letting people suffer in pain until death instead of sealing their fate in an instant!

Kathryn Kieser
Lethbridge, Alberta,Canada


Did I miss something? Dr. Solomon lost money over a bad business investment he made selling his practice to CareGroup. He's been minimizing his losses by providing a lower standard of health care to his patients without telling them his profit motives. He refuses necessary referrals to competing medical institutions that the patients insurance covers because, due to his business arrangement that has nothing to do with the patient's best interests, he'd loose money. Because he's willing to admit this on camera Frontline portrays him to be some sort of hero? Sounds more like a guy who forgot why he became a doctor crying over a bad investment, hardly worthy of the "Doctor of the Year" award. If the Beth Israel Hospital thought they had it bad before, who's going to want to entrust their health care to a hospital that makes decision based on profitability? Or, did I miss something?



I thank you for such an excellent article.

One point I wish to make is that although I am sure these doctors are excellent physicians I doubt that they have been trained in risk management, or any kind of probabilistic analysis. On the other hand, the insurance companies that offer the contracts have done very sophisticated risk analysis. So the doctors' assumption of risk amounts to nothing more than a trip to a casino with very unfavorable odds.

I really recommend that Dr. Solomon include in his POD consultants that are more qualified to analyze the risks and rewards.

Sungill Kim
Ann Arbor, MI


The Frontline program talked at length about cost of care, but I don't believe anything was said about the cost for belonging to an HMO. The fact is, HMOs, like many other organizations, including defense contractors, engage in low-balling to secure customers. Unfortunately, unlike defense contractors who can go back to procuring agencies with hat in hand, the HMOs have to start weeding out, or cherry picking as it is sometimes called, in order to eliminate those who might actually need medical services just to survive. It seems to me that the basic tenet of insurance is to spread cost AND risk. When HMOs engage in cherry picking, rather than pricing their product at a realistic rate, they are violating the very justification for their existence.

Alex Miczo
Mt. View, CA


Thank you for presenting such a thoughtful and informative program. Here in California, the market is more mature than it is in Boston, and we are seeing the next phase. As a follow-up to Dr. Solomon's story, please consider coming out to the Bay Area and interviewing our doctors, who, after years of trying to make managed care work, are now experiencing bankruptcies. As they leave the practice of medicine, it is becoming increasingly difficult for consumers in our area to find high-quality physicians, particularly in internal medicine and OB-Gyn. Those of us who can afford to do so are increasingly paying fee-for-service out of pocket in order to get the quality of care we want. The managed care experiment has not achieved the results that were promised ie, lower costs and higher quality of care, but the structural changes in the healthcare system imposed by managed care arrangements will be difficult, if not impossible, to reverse. I hope you will continue to investigate and report on the evolution of managed care so that consumers in other areas of the country may learn from our sad experience and prevent the same from happening to them.

Lisa Lai


I am responding to the program on last night about Dr. Soloman's dilemma. The content of the show had me feeling many different things as I watched. I work for two PCP's in a "pod" in the Hartford, Ct. area. My overall opinion of belonging to such a corporation is disgust. I am in charge of billing for the pod I work for and I am constantly approaching the doctors to make them aware of what diagnoses will be covered by insurance and what will not. They keep this in mind, but diagnose on the basis of the patient, not the insurance. I know for a fact they lose money over this. In fact, they lost a considerable amount of money the first year they joined this "pod" mostly to poor management of the corporation. But, what bothered me the most about your broadcast is that you did not interview one nurse, medical assistant, office manager or other staff that have to deal with the insurances on a one-to-one basis daily. The majority of these workers are women, so I feel it is a direct offense to all the women staff working in doctor's offices and hospitals in this country. You would've discovered a gold mine of information on how the we struggle with the insurances policies and verifying the different requirements for each of them on the down and dirty end of the spectrum. I can guarantee you that Dr. Solomon doesn't do his own billing, physically do his own referrals or any the other tedious problems which plaque the average doctor's office daily. So, while I empathize with Dr. Solomon because I see first hand both of the doctors I work for visibly suffering with stress over the very same issues, how about some credit and recognition to the women who work the "frontline" of the medical and insurance wars?? Holly Lynn Danyliw 4/5/00

Holly Danyliw
East Hartford, CT


From the responses I have read, much of which I agree with, your piece didn't nearly go far enough into the key factors regarding our health care system. The role of insurance companies--do insurance companies offer any value to the health care equation? Some would argue they do through market/cost discipline. Others would argue that they offer no value whatsoever; that in fact they take away resources, risk, and appropriate health solutions all for profit. Also, why not do a thorough comparison of national health care systems/single payer with ours? Why aren't we Frontline, etc. investigating the fact that when polls show that people prefer a single-payer type system, the debate/policy is muted or goes in the opposite direction?

The U.S. is most hypocritcal regarding market solutions. It's alright if the general population is exposed to the disciplines of the "market" system that really isn't a free market but insurance companies are protected by legal arrangements.

If we were truly a free market, insurance companies would be voted out of the equation, people would pay their fair share into one pool of money, and individuals would be free to contract for the services of any doctor/hospital in the market. The problem goes back to Thomas Jefferson's concern about the erosion of democratic values. Jefferson saw that democracy is something feared by those who control power and wealth.

John Karnuth
Chicago, Illinois


This a very shocking report! I live in Minnesota and I would like to know if my state has the same situation. Please tell me if it's the same in every state?

BJ Bourret

FRONTLINE's editors respond:

The areas of this country generally considered to be furthest along in shifting risk to physicians are 1. the West Coast, particularly California, 2. Minnesota, and 3. Massachussetts.


The rising costs and reduction of quality care your peice describes is very similar to problems we see in the DEFENSE INDUSTRY. We also have many specialists that need to work togther to provide value to our customers. Thermal, Structural, Systems, Software, and Reliability engineers to name only a few. Just like the Doctors and Nurses, our employees and running around "putting out fires", feel overworked and with the defense cutbacks, the pressure will definitely impact contract performance and god forbid product quality.

Our industry has implemented quality initiatives such as Total Quality Mangement and recently Six Sigma. What is proving to be more effective is something that Dr. James Reinertsen is just skimming the surface of, and that is "LEAN THINKING". In our industry as well as the medical world, there are many tasks that fill our days that do not add value to the external customer. If your doing more than 5% value added after the correct analysis, you are probably world class. This waste has to be looked at up and down the stream that applies value or doesn't. Quality is much easier to concentrate after the waste is removed.

The way we have done business in the past has to, and is changing. Quality care does not have to be sacrified. What should be sacrified is the wasteful activites between players in the stream. Integration between HMO providers, Hospitals and Labs needs to be explored for completely new approaches.

I suggest that Dr. Reinertsen, Dr. Solomon and others studying this issue, read "LEAN THINKING" by James Womack, et al. There are direct correlations between the examples in the book to the medical industry including an actually discussion of LEAN application in medicine.

Robert O'Shea
Harvard, MA


Very interesting program. The first question that comes to mind is, if the physician does not like the global risk arrangement, why did they sign the contract and assume the risk? Shouldn't they be responsible enough to accept the consequences of their decision to accept the risks for the period they are under contract? [And I realize the consequence of not entering a contract is at times loosing patients/members; at that point you have to stand upon principle.]

An issue that was not raised was that managed care companies can only raise premiums so much according to what the market will bear. If a managed care company bids a 25% premium hike to an employer, the employer is going to be looking for another health insurer. The result is that consumers gravitate toward the managed care companies that are charging the the lowest premium and keeping costs down. In turn, those managed care companies have less to turn around to pay out to the physicians. So in a sense, the sicker patients are not getting as much care as they would like because they represented by their employer did not want to pay for it in terms of higher premiums. The real problem is with ourselves; we want the best of everything, but we do not want to pay for it.

We live in a world with limited resources, and until we limit our health care appetites especially in the areas of technology and pharmaceuticals or decide to pay more in premiums, we are going to continue to deal with these problems. We are all dealing with this issue; not only the providers and patients, but the managed care companies and employer groups are well. I'm optimistic that America will work through it, although not without pain and paying a price.

Thank you for the program.

Gary Chew
Tulsa, OK


I am a vice president of a marketing organization that sells health insurance to individuals nationwide and utilizing many insurance companies.

I am surprised that you failed to mention that Massachusetts enacted laws around 3 years ago that only about 5 other states have done i.e. NY, NJ, KY and that is to reguire any insurance company that sells health policies in that state to take any individual regardless of health on a guaranteed issue basis.

As your program noted medical care is very expensive and if a insurance company is forced to take anyone, they feel like they cannot make a profit and therefore pull out of the state and that is exactly what happened in Massachusetts!

Only a handful of companies are left and they sell mostly HMO's due to the capitation controls that they have. I have visited the Massachusetts insurance department web site and premiums on average for a male 25 are $355 per month you go over a state to say Pennsylvania and cost would be around $80 per month. Doesn't seem fair to the people that are relatively healthy having to pay this amount of premium.

What approximately 30 states have done is have a state risk pool that is funded by all insurance companies that do business in the state and therefore creates less financial burden and it also takes care of the individuals that could not find a policy due to their health history. If that individual gets a job with an employer that employs 2 to 50 individuals laws are in place to make sure those people can get insurance regardless of health.

Doctors and myself have never been a fan of HMO's due to the incentives primary care physicians PCP have to not send you out of the network to possibly a more qualified specialist. As well as not having the flexability to go to anyone you wish in alot of cases HMO's would deny payment of a claim if you are not in the network whereas PPO's can never deny payment that is covered in the policy instead they can reduce benefits to a certain extent Example is 90/10 coinsurance goes to 70/30 of say a $5,000 stop-loss. So if the person is in network the amount the individual pays is $500 out of network the amount would be $1,500 but then the claims would be paid at a 100%.

My final thought is for those that want a national health care program just think the medical industry is a 1 trillion dollar business do you really think the government can handle it? They can't seem to manage Medicare or Social Security.

Chris Fuchs
Kansas City, MO


Your program was an excellent synopsis of our current health care crisis. In avoiding any suggested solutions, you have mirrored our society perfectly.

Almost everyone has an opinion about how everyone else should behave but few seem ready to graple with the core issues.

Is the CEO who demands lower healthcare premiums for his employee health plan really prepared to have his father discharged after one day in the ICU rather than the sixty seven days shown in your example, simply because the medical concensus suggests that he will most likely die anyway?

Your cardiologist warned the patient having coronary angiography that he "would feel hot" during the injection indicating he was using an ionic contrast material rather than the more expensive, but safer, non-ionic contrast agent. Was that decision driven by the hospital accountant or by what he felt was best for the patient? I am certain that both the hospital adminstrator and the cardiologist would have non-ionic contrast material for their own angiography as would every attorney in the U.S.

To meet the economic requirements of our business community we are forcing physicians to ration care. The same people who are thrilled with the financial performance of the drug companies and the business folks who now take 23 cents out of every health care dollar for profit and non-care related activities are the first to complain if Grandma is dicharged early from the hospital or is not given every diagnostic test for her two day bout with constipation.

Most important is the requirement facing every physician to give up hope. The hope that is communicated by the physician to the patient and without which healing is either delayed or prevented. The hope that energizes and motivates most physicians and their associates that we are doing our best for our patients. The hope that something good and lasting will have come out of the doctor/patient interaction.

Without a rapid and substantive change in the public and private attitude that engulfs this dilema we will see a destuction of the doctor/patient relationship. A good start would be the public acknowledgement of the incompatability of the public demand for cost containment in the abstract while demanding limitless health care expenditures for themselves and their families.

Norman Silverman, M.D.
Dallas, Texas


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