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November 11, 1983

Costs, Charges, Conscience, and Control (Lost)

JAMA. 1983;250(18):2509. doi:10.1001/jama.1983.03340180063030

Have you seen the most recent report on the rate of inflation overall and by its several components?1

The Consumer Price Index rose at an annualized rate of 4.1% during August 1983. By comparable calculations, physician services rose by only 3.4%, but medical care rose by 8.0%. This increase was produced primarily by the hospital room component, which climbed at an annualized rate of 17.8%.

Good grief!! Can't we do better than that? This 17.8% figure doesn't even include many other hospital budget elements wherein creative hospital directors and accountants have traditionally "laid it off on the ancillaries."

Is the hospital industry (wherein physicians certainly influence costs) intentionally riding "hell bent for leather" toward destruction of self-control or is this simply ignorance? From many years of working with large bureaucratic budgets, I am tempted to lay part of the blame for this extraordinary spurt on what was the then-impending