Texas town's healthcare conundrum

In the country that reveres the free market, competition is supposed to drive quality up and costs down.

But not in healthcare - and not in McAllen, Texas.

In the past 15 years, this sleepy town has reinvented itself as a boom place for modern medicine. Wherever you look there are hospitals, clinics, and laboratories.

In the same period the cost of healthcare has soared faster here than anywhere else in the country.

The 'McAllen problem'

McAllen, on average, now spends $14,946 (£9,263) on healthcare for every patient enrolled in the government's Medicare scheme, almost double the national average of $8,304 per Medicare enrollee.

Patients in McAllen certainly receive more tests and treatment for their money. The New Yorker magazine recently reported that critically-ill elderly patients in McAllen received 50% more specialist visits than in nearby El Paso.

Doctors in McAllen ordered 20% more abdominal ultrasounds, 30% more bone density studies and 550% more urine-flow studies to look for prostate problems.

But the extra dollars and extra tests do not appear to translate into better care. Hospitals in El Paso - which has a similar population, but spends just $7,504 per Medicare patient - recently performed better than McAllen hospitals on 23 out of 25 health indicators.

Thanks to the New Yorker article, the crisis in McAllen has even caught the attention of President Obama: the puzzle of why some places spend so much on treatment without providing better healthcare is apparently known in the White House as the "McAllen problem".

So what exactly is causing the problem?

We spoke to Dr Lester Dyke, a McAllen heart surgeon. He believes the fusion of business and medicine here has gone too far, and that profit rather than patient need drives many decisions.