Falling Behind In Answering The Mail

The notion that private enterprises are efficient and well run is a persistent but profoundly inaccurate myth.

Falling Behind In Answering The Mail

Delta Airlines is about a month behind in opening and dealing with mail from its customers according to a customer service representative in its frequent flier mile department. Imagine what would happen to a typical law practice, or a typical household, if you were routinely opening mail received and dealing with it a month late. But, this seems to be business as usual at the moment at Delta.

Loan modification application processing by mortgage lenders and mortgage services is just as much of a morass. Papers sent to lenders are routinely lost. It is hard for borrowers to find out what more information or action is expected of them. And, completed files languish for months until the information in them becomes outdated.

Private Industry Not Precisely Fiscally Responsible Either

While large financial institutions, as well as companies and governments that issue bonds are considered to be at the brink of collapse if they make scheduled payments even a day or two late, it can be stunning how far behind on their accounts payable small and medium sized businesses and trade credit payments by large "real economy" firms can get on a fairly routine basis. Back in the days when I did defense work for casualty insurance companies, it was routine to have bills paid several months after they were submitted to these large, publicly held companies.

Few industries have escaped having entities that collapsed financially due to major missteps in their business plans. Among the major companies that have gone bankrupt, failed, or needed a bailout to survive (or to that didn't survive) in the last decade or so are: General Motors, Chrysler, Blockbuster, Enron, Circuit City, Adam Aircraft, Bennigans, eToys, Frontier Airlines, Crabtree & Evelyn, The Walking Company, Daphne's Greek Cafe, Old Country Buffet, Village Inn, Mrs. Fields Famous Brands, Ponderosa, Ritz Camera, Sportsman's Warehouse, Big 10 Tire Stores, Inc., Z Gallerie, Filene's Basement, Eddie Bauer, Dunkin' Donuts, Samsonite, Max & Erma's, Unos Pizza, Schlotzsky's, the Chicago Tribune, the Los Angeles Times, the Hartford Courant, the Orlando Sentinel, the South Florida Sun-Sentinel, the Baltimore Sun, The Morning Call, ForSaleByOwner.com, South Park, the Chicago Cubs, WGN 720 AM, KWGN, the Denver Post, the Rocky Mountain News, the Tucson Citizen, the Baltimore Examiner, the Cincinnati Post, the Albuquerque Tribune, the Honolulu Advertiser, Los Angeles Daily News, the Boulder Daily Camera, the Brush News-Tribune, the Fort Morgan Times, the Lamar Daily News of Lamar, the Sterling Colorado Journal Advocate, the Oakland Tribune, KTVA in Anchorage, The Augusta Chronicle, the Savannah Morning News, the Juneau Empire, AIG, Lehman Brothers, the Shane Company, the Mexicana Airline, Movie Gallery, Japan Airlines, Skybus, Northwest Airlines, Aloha Airlines, Delta Airlines, Mervyns, MCI, Montgomery Ward, MGM (movie studio), U.S. Airways, Air Canada, United Airlines, TWA, Washington Mutual, any subprime mortgage finance company, Six Flags Fannie Mae, Freddie Mac, Indy Mac Bank, the Bank of New England, the Arena Football League, Goldman Sachs, or any of a host of other major American businesses.

The Abyss Of Health Care Administration

Oh, and don't get me started about the arcane and mysterious world of health care billing and health insurance claims processing. It isn't uncommon for even the most routine preventative care visit to become mired in billing mistakes, and any medical condition of consequence is almost sure to require phone calls and correspondence that takes much longer than the medical care itself did to resolve. While these mistakes made by medical office administrative staff and insurance companies are worked out, often over a period of many months, medical office billing personnel (often outsourced) make dire threats to patients explaining that the patient will be held responsible and treated as a bad debtor if the insurance company fails to live up to its promises to the patient.

And, of course, the number of medical appointments that frequently take just a few minutes themselves, are often delayed beyond their scheduled times make the ontime rates of major airlines look absolutely stellar by comparison. An hour delay at a doctor's office for a three minute visit is routine.

There is little wonder that it is complex, because the distinctions made often make no sense at the patient level. For example, a specialist doctor's office that is independent of any hospital, and one that has some sort of hospital affiliation look identical from a patient's point of view in all respects. The waiting room, the interaction with the office staff, the treatment room, and what takes place in the visit with the doctor are the same. The hospital affiliation is rarely proclaimed loudly, there are no benefits in patient service that result, and the specialist doctor's office is often in a separate building from the hospital. But, the patient's share of the cost under an insurance contract is often much lower in a specialist doctor's office that is independent of any hospital than it is from one with a hospital affiliation.

Moreover, it isn't uncommon for a visit to a hospital affiliated specialist doctor's office to produce three or more separate invoices - once for the doctor, one for the hospital and one for laboratory tests. Actual inpatient stays at hospitals are even worse. It isn't unusual for a single brief inpatient stay to produce invoices from half a dozen different providers, each processed in a vacuum by the health insurance company and each with its own outsourced billing firm. Even huge law firms that keep track in itemized invoices of dozens of different kinds of costs and service providers over the course of work for a single client usually manage to consolidate their charges into one or two invoices (sometimes an expert witness or local counsel providing services at a separate geographic location sends separate invoices).

Needless to say, medical providers (with the sometimes exception of dentists) almost never make public their schedule of fees or even tell patients what their visits will cost in advance. And, medical providers routine charge wildly differing amounts to different people for the same service based on their insurance company and/or ability to negotiate a price based on a cash up front payment and/or ability to pay. Like the prices of hotel rooms that are publicly posted, almost nobody pays the "regular price" for health care services except those who are uninsured and can't pay in cash -- most of the "regular price" for health care services is really a hidden finance charge.

Health insurance companies provide more information, but since some of their charges depend upon what providers charge, and since rates negotiated with providers are not generally disclosed to patients until after services are provided, and since the distinctions health insurance companies make often make no sense to patients, even post-health insurance prices of health care are hard to predict. Frequently in hospitals and hospital affiliated situations, the patient doesn't even know who the providers managed by their physician or the hospital were until after the bill is received.

Don't forget that everybody, not just administratively competent college graduates, needs health care services, that health care needs are frequently urgent in ways that make comparison shopping for price (even if prices were available, which they aren't) impossible, and that many patients dealing with health care billing messes are sick themselves.

Is it any wonder that market based capitalism doesn't work well in these circumstances?

Health care reform, if House Republicans in Congress don't manage to derail it, will at least finally bring the United States much closer to a universal ability to pay for health care and will control some medical costs, but even this juggernaut of allegedly dramatic reform doesn't seriously deal with the absolute disaster that is medical billing in this country.

Government Bureaucracy Snafus

This isn't to say that large government bureaucracies are good examples either. Bill Johnson discusses in his Denver Post column the troubling delays that Colorado is experiencing in processing food stamp recertification. Colorado's unemployment office is almost as backed up as Delta is in dealing with claims. Mostly, these problems are due to ongoing problems with profoundly flawed execution of contracts to upgrade the state's computers made by very expensive private contractors who failed to deliver the services promised in prior gubernatorial administrations.

The IRS isn't even going to start processing certain kinds of tax returns until Valentine's Day because it's computers need to be reprogrammed to handle last minute changes in the tax laws (mostly due to the failure of Congress to pass tax laws for 2011 until the lame duck session in December). It is a rare day indeed that a major Department of Defense contract is performed on time and on budget. I've had the Patent and Trademark Office lose materials that I've properly submitted to them several times in a single application.

At a smaller scale, the Douglas County Schools in Colorado, as of this point in January already, have still provided no meaningful budget planning guidance to its employees for the coming year. Voucher debates and strategic planning have pushed the day to day business of running their district off the school board's agenda.