We are supposed to be working on that one in Oregon, with the Coordinated Care Organizations -- which aim to "transform the way medical care is delivered". We'll see.
The biggest driver of cost is our insurance system -- which guarantees complete non-transparency of cost, and which insulates both the doctors and the patients from the financial impacts of their choices, except in that grand lottery of the Medical Malpractice system.
As you noted, it isn't just medicaid -- until recently, employer based insurance didn't charge any co-pays for ER use, just like Medicaid. People would go to the ER for a sprained ankle because it was covered -- not to my office, where they had to pay. It is a little different now, but not much. Now, the ER costs something, but it is perceived to be more convenient. And of course, the ER tells them they must follow up with an orthopedic surgeon, but of course, they need a referral, so they have to come in to our office for the referral. This is the sort of thing that I mean by the "decreasing marginal return on increasing complexity."
But we all know this -- and it is totally resistant to change, because there are so many vested interests.
