Ian Morrison

I’ve often joked that there is a unique field of health economics because of the special nature of health care, while there is no field of dog food economics. I suddenly realized that I am wrong. There is a remarkable similarity between health care economics and dog food economics. I had this epiphany while listening to a panel of health care experts debate the consumer’s role in health care versus the role of managed care.

To economists, health care is seen as different from other markets. The reason, they argue, is that there is asymmetry of information: Providers know what they are selling, while consumers largely do not know what they are buying. The asymmetry of information is the cause of market failure in health care and the reason the doctor plays such a special role as agent for the patient in the health care transaction. Third-party payment makes the issues even more complex, yet we buy other forms of insurance in a marketplace without the need for special agents.

Then it struck me. Dogs don’t buy dog food. They may eat it, but they don’t buy it. Dogs have preferences and may refuse to eat something (voting with their paws, so to speak) but they don’t generally select the food they eat. Sometimes they have choice. My large and aged golden retriever has demonstrated that he prefers pepperoni pizza, prawns and whole sticks of butter (given the opportunity to steal food) over the dry, boring pellets for overweight old dogs we feed him. Dogs rely on an agent (the owner) to help them make decisions and pay the tab.

In the past, we patients were just like the dogs. We knew what we didn’t like but all we could do was bitch about it (pardon the pun) and change doctors. Armed with information, we patients now are supposed to be intelligent consumers. Yet, I think to a large extent we do need to have some help. Harris Interactive surveys show that the square root of zero humans (actually less than 1 percent) have ever made a decision on selecting a plan or doctor based on a report card they saw or read. Don’t get me wrong–I am a big fan of report cards, and dog shows for that matter. But dog shows and report cards are more important to dog owners and providers than they are to dogs and patients.

Dogs need help, and patients do, too. There is still an important role for agency in health care. Clearly, we are moving away from the paternalistic notion that only the dog owner, or doctor, or health plan knows best. Managed competition put the consumer more in the decision-making role, but the plan sponsor helped orchestrate the choice of health plans and set the consequences for lack of cost-conscious choice. We do this with our dog, too: If he is foolish enough to steal pizza, he sleeps outside.

But the current trend toward consumer-directed health care doesn’t give us much in the way of help. Health plans and purchasing coalitions are arming us with Web sites. Some sophisticated providers offer medical concierge services to help us navigate through the complexity of health care. Yet, surveys show that we still rely heavily on our doctors and our friends and family to navigate through the health care system. We trust them to do what’s right, just like my dog trusts me.

Before we all get too carried away with consumerizing health care, we need to think through this issue of agency. As more responsibility for cost and choice is forced on the patient, it becomes both difficult and dangerous to ask the doctor to be both retailer to and trusted confidante of the patient. That’s like asking her to be a cross between St. Thomas Aquinas and H&R Block: She has to do your tax return before she can prescribe anything. We need to develop a new cadre of trusted agents; otherwise health care will go to the dogs.

Ian Morrison is an author, consultant and futurist based in Menlo Park, California