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A Quick Way to Rein in Medical Costs

Posted Aug 14 2009 4:42pm

I've been participating in an excellent conversation on healthcare reform between healthcare providers, patients, and others, which has been taking place at this link. In this post I summarize the conversation and share my thoughts.

The original post, written by Dr. George Lundberg and titled "How to Rein in Medical Costs, RIGHT NOW," describes an immediate strategy for saving money by:

  • Eliminating six costly tests and procedures that research has shown (with differing degrees of certainty) to be unnecessary (excessive, inappropriate) for certain types of patients
  • Ceasing to "prolong dying" and providing a "dignified" death that is "free from pain and suffering as possible."

While no one rejected the basic premise of the post, our conversation has focused on examining the scientific, economic, and ethical challenges of implementing that strategy. The many comments readers made can be divided into 12 strategies for dealing with these challenges; they are:

  1. The need for more and better research related to the creation and use of evidence-based guidelines from which to base healthcare decisions
  2. The need for tort reform to counter the excessive cost of defensive medicine
  3. Dealing with overutilization due to fee-for-service incentives
  4. Overutilization of specialists and excessive number of surgeries
  5. Dealing with the end-of-life care
  6. Empathy & compassion versus greed & dishonesty
  7. The question of who should run healthcare
  8. The need for government reform
  9. Reliance of "free market" forces
  10. The need to reduce administrative waste
  11. The need to put more people to work
  12. The issue of legalization of marijuana.

I discuss each of these issues below. I've included snips of a sampling of comments that were made (the screen name of each commenter is included so you can go back to original posts and read them in full). I added some remarks in italics.

  1. Research and Evidence-Based Guidelines. Everyone seems to agree that care decisions should be evidence-based as much as possible. That means obtaining and using the results of valid and reliable scientific research on the comparative-effectiveness and cost-effectiveness of tests, procedures, meds, and preventive actions. This information should be disseminated to patients/consumers and clinicians in a way that supports decisions (e.g., through guideline, protocols, best practice recommendations, etc.). The guidelines should let everyone know what is most likely to help the individual, what is unlikely to help (or even harm) the person, what the alternatives there may be, how to implement them efficiently and effectively, and how much it all will cost. In this way, everyone is adequately informed and the consumer can make a valid decision based on value (bang-for-the buck).

    There are several issues concerning implementing this strategy. One has to do with determining the areas in which scientific (statistical) certainty exists. This includes the challenge of being able to identify outliers, i.e., people who would benefit from a test/procedure/medication, although the vast majority of others would not benefit. For example, Dr. Oberlander wrote: "My wife was diagnosed with high-grade breast cancer in an asymptomatic breast cancer screen via mammography. She was well less than fifty at the time…She successfully underwent chemotherapy, mastectomy with reconstruction…is my wife really such an outlier? Was it worth it' to go and pay for that 'asymptomatic' patient's mammogram?...There's the rub. I find outliers and exceptions each week in my practice. Is it worth it? Perhaps not in the global perspective vis-a-vis health care costs, but try explaining that to someone you love." Our country has to become prepared to deal with such painful ethical dilemmas.

    The ethical issues aside, an example of where scientific certainty exists is the kind of low-hanging fruit offered by Dr. Bestermann: "14 studies now showing that stents do nothing to prevent heart attack in patients with stable angina who receive optimal medical therapy. 85% of stents are done in stable angina patients." While having this knowledge is essential, to encourage its use in utilization decisions requires the kind of financial incentives and disincentives that would promote rational decisions based on cost-effectiveness.

    In many (most?) other areas, however, such scientific certainty is lacking. For example, maggiemahar wrote: "The scientific evidence from randomized trials on the impact of screening mammography in saving lives is conflicted, and the quality of the individual trials limited." Several other comments voiced similar uncertainty.

    The solution, I suggested, is to establish international collaborative networks of clinicians and researchers who focus (a) on defining the areas of outcomes research that's needed and then (b) on doing such research to determine the most cost-effective methods of delivering personalized care by answering these three questions:

    1. Who (or what) should decide if a test or procedure is unnecessary or inappropriate for a particular patient in a particular situation? Should it be the clinician, the patient, the insurance company, the government … Who?
    2. What guidelines (if any) should be followed by those making the utilization decisions? Should the guidelines be evidence-based? How will political influence of vested interests be prevented from pressuring the guideline developers, so that only sound (valid and reliable) science is used to justify the guidelines? What do we do if the necessary guidelines are not yet developed? And for those that exist, how do we assure that they continually evolve? How should the guidelines be disseminated?
    3. Should the use of clinical decision support software systems be used, or should be simply rely on the unaided human mind? If decision systems are used, should they implement patient-centered cognitive support (see http://curinghealthcare.blogspot.com/2009/06/meaningful-use-clinical-decision.ht

    Since obtaining valid results from such research (that includes taking genetics into account) can take many years, current decisions should be based on the best available evidence, if any. But since we know so little about so much, our healthcare system will have to continue to operate in a high-ignorance mode in the near future. This means cost savings and quality improvements will be low compared to operating in the kind of high-knowledge mode that will emerge and evolve over time. No quick fix/silver bullet here; but there are no rational alternatives!

  2. Tort Reform & Defensive Medicine. Numerous comments focused on the need to reform malpractice litigation in order to minimize defensive medicine. Suggestions included use of special health courts were recommended (see the Common Good website at http://commongood.org/society.html ).

    For example, Barry Carol wrote: "…substantive tort reform is essential if we are ever going to convince physicians to give up some of their cherished autonomy and accept some accountability for the healthcare utilization…if we replace the current jury system for settling medical disputes with specialized health courts and we provide robust safe harbor protections against suits based on a failure to diagnose a disease or condition as long as evidence based protocols were followed, it should be easier to convince doctors to embrace reform, at least over a reasonable timeframe…it should be much easier to ask for and expect physician cooperation on the utilization issue." AndyS wrote: "We need to understand that the focus on malpractice originates in the legitimate frustration of doctors -- but it is fueled by those with political objectives and is absolutely irrelevant to the struggle to control healthcare costs." DocJ wrote: "I would gladly order fewer tests & provide fewer services when I feel they were unnecessary or inappropriate, if the necessary changes in our system could be implemented. This would take things like tort reform with economic damage caps, 'loser pays' rules, medical court reviews for merit of claims, and legal protection for providers to refuse unrealistic demands of patients/family members without fear of legal entanglements & costs. Until these things happen". Steve h wrote: "As a practicing ER physician, I know that MOST of the tests I order are not designed to find the correct diagnosis, of which about 80 percent is a good history and physical, but rather defensive in nature, to rule out the 1 in 100 or 1 in 1000 chance of the presentations being a atypical presentation of something nasty. I routinely order expensive tests for this reason, and the truth is, it is better to spend the patients money on testing than for them to sue you and get to spend your money. Most practicing physician, whether they admit it or not, practice the same way…the truth is, most physicians dont get paid any extra no matter what tests they order or how many they order." And even though maggiemahar doubts that fear of malpractice suits really explain such significant variations in Medicare expenditures, she agrees that "…we could handle malpractice differently."

    I'd add that a good deal of defensive medicine would be eliminated it we do a better job with the first item, developing and using evidence-based guidelines. The reason, if clinicians follow an approved guideline in making their decisions, and if they are given ample opportunity to explain why they chose not to follow it for a particular patient, then they will be better protected from the kind of malpractice suits that give rise to defensive medicine. For example, pcb wrote: "I would love to have the support, guideline, whatever you want to call it to stop routinely ordering them. I personally believe the evidence suggests more harm than good from routine PSA screening…So I order the test. Not because I make any money (quite the contrary) But for almost exclusively defensive medicine reasons…Until I legitimately feel protected from the lawyers on these topics, I have a disincentive to change. And it has nothing to do with fee for service. So I order the test. Not because I make any money (quite the contrary) But for almost exclusively defensive medicine reasons."

  3. Fee for Service. Dr. Lundberg wrote in the initial post that "fee-for-service incentives are a key reason why at least 30% of the $2.5 trillion expended annually for American health care is unnecessary [and] eliminating that waste could save $750 billion annually with no harm to patient outcomes." This was refuted by two comments. Dr. Reece wrote: "I don't see how you can end fee-for-service, herd doctors into multispecialty clinics nationwide, or put them all on salary." propensity wrote: "There are many academic medical centers at which doctors are salaried without fee for service, yet the over utilization is high." And Peter Nesbit wrote: "…in many cases fees have been driven sufficiently low that service suffers. In turn, the clearest result has been to drive over-utilization, perhaps to make up some of the differences in income. It's time to look at medical fees not as the problem but as the solution…[and] follow the medical science that most benefits patients and the public health at lowest cost."

    Thus, as with tort reform, fee-for-service would become much less of an issue if the decisions made by patients and clinicians were guided the sound scientific evidence based on cost-effectiveness research (as per strategy #1).

  4. Overutilization of Specialists and Excessive Surgeries. Denise Cleveland wrote: "Medicine is first and foremost a business. The proof is that as many as 99% of c-sections and 98% of hysterectomies can be avoided with conservative treatment options, or no treatment at all…What we need is emergency care for everyone and to stop making doctors and corporate executives rich with damaging, unwarranted surgeries." J Bean wrote: "The big, fat, low-hanging fruit of waste that I see from my perspective as a community primary care physician, is over-utilization of specialist care. We have so many specialists and so few primary care docs that many specialists wind up doing the primary care functions that correspond to their specialty…In reality, the care is fragmented, contradictory at times, and the total cost is 3 or 4 times what it should be. Note that the French are trying to control their costs by restricting access to specialists…British diabetics always refer to their doc as "my GP" while the US diabetics always refer to "my endo". Otherwise, they get the same care."

    This issue can also be addressed in part by use of valid, reliable evidence-based guidelines (#1) shared between primary care physicians and specialists, as well as establishing patient centered medical homes. These guidelines would advise PCPs when it is appropriate to refer a particular patient to a particular type of specialist, and the medical homes would help coordinate the care (see this link ). And, as Rob MD wrote: It would be great if "Primary Care Doctors regain…comparable pay for effort and build Medical Homes."

  5. End-of-Life Care. This is certainly a thorny issue. fnp wrote: "…allowing someone to die with dignity is all good and well unless that patient is your child, you sister, your brother, your parents, etc…I have seen and watched families torn apart do to this terrible disease. And I have seen teenagers and children come back from what looked terminal." Dr. Ransom wrote: "I think knowing when to stop is a major problem in healthcare...however, this problem is NOT generated by MDs in most cases. It results from the American culture of denial of mortality. I see this in the ICU all the time." Ron wrote: "…how many physicians are going to rein in a family's desire to extend heroic measures to prolong life - especially when its highly profitable? Until and unless you change the fundamental incentives, you won't change the fundamental trends." Yana wrote: "It is ridiculous, cruel and transparent to suggest physical therapy/rehab for a patient who is obviously on his deathbed, but I have seen that happen. On the other hand, where there IS hope, everything should be done in favor of life." Maggiemahar wrote: "Doctors and nurses can make sure that the patient knows that the hospital has a palliative care team--and that the patient has a chance to talk to that team about treatment options, potential benefits and risks before deciding on further treatment. Palliative care specialists also are experts at keeping patients out of pain. Too often, doctors are reluctant to hand 'my patient' over to palliative care." Margalit Gur-Arie wrote: "…the end-of-life discussions and the rationing discussions are emotional for most people and everybody falls back on a personal experience…or the natural fear of mortality…The discourse needs to be based on logic and numbers and dollar figures, not the 'what if MY granny has a stroke' argument. Ethical questions do not belong in a public policy debate, and in this case, they are derailing the case for health care reform…I am suggesting is that in the interest of passing some sort of health care reform, we decouple the emotional debate from the factual one."

    I see this as an extremely emotionally-laden issue with religious belief overtones that tend to defy logic and reason. Yet the end-of-life care discussion must be a rational debate that balances the needs of the terminally ill with the needs of society. The only way that can happen, imo, is if our culture comes to terms with the question: What's the most humane way to treat a person who will soon be dead? (i.e., is death to be avoided at all costs, or is it more important to die with dignity as decently as possible; e.g., see this link ). It ought not to be based on: What will make the family of the dying person feel less sorrowful or guilty? I therefore agree with Margalit that we should have an unemotional discussion about this issue, which is going to be very difficult to do.

  6. Empathy & Compassion versus Greed & Dishonesty. RD wrote: "It may be true that billions could be saved...but there are several underlying problems: Greed, Stupidity, Dishonesty, Irresponsibility…When is the US/World going to wake up and realize that when you look in the mirror, do you really like the person looking back at you?" Margalit Gur-Arie wrote: "We all know that we are being grossly overcharged for pharmaceutical products. We all know that insurance companies realize significant profits and spend many health care dollars on archaic administration." John Brooks wrote: "The corruption associated with inflated costs for medicare extends to such items as oxygen concentrators, which medicare pays up to 10x the free market price for. The corruption just seems too endemic [that it]…will lead to the collapse of the medical care system sooner than later." I written and debated about this issue at length at a series of posts starting at this link.
  7. Who Should Run Healthcare. Peter Nesbit wrote: "…it is abundantly clear that neither the government nor private insurers have been able to control the cost of health care. [Instead]…place the control of health care in the hands of the medical community. Who better to oversee how doctors are paid and whether they are providing appropriate care to their patients. Who can speak with more authority when individual doctors stray away from the course of appropriate care? Creating an independent, non governmental medical agency to manage and control medical care has the potential to both assure appropriate patient care and control medical costs. This agency could negotiate medical fees fairly, provide care guidelines, process medical bills, collect treatment data, and pay providers in a timely manner. This independent medical agency could work with doctors to help them follow appropriate treatment patterns thereby reducing over-utilization, the most important factor in lowering overall medical costs. It could bring substantial cost saving in medical losses to insurers, government and private." See strategy #8.
  8. Government Reform. Bill wrote: "Let's start with eliminating the incentive of Congress to waste our money on pork, jets, 'gold plated' healthcare, retirement benefits, etc. Paying for a massive new healthcare bureaucracy and expanding coverage will not lower healthcare costs and will continue to generational transfer of wealth to current seniors from our children and grandchildren." This seems to go hand-in-hand with the strategy #7 about who should run healthcare. The question is: Can government be reformed in such a way—e.g., through transparency and independent oversight—that it can do the job of running healthcare more efficiently and effectively than an independent, non governmental medical agency?
  9. Free Market Forces. Dr. Dubey wrote: "The best way to bring down the Healthcare cost is to have the consumer manage the healthcare dollars, i.e. bring free market forces to bring down the cost. Have the cost and quality data available to the consumer aka. the patient, and have then shop very similar to shopping for airline tickets." This actually reinforces the Research and Evidence-Based Guidelines strategy (#1) because it's based on assuring the availability of good information a about value to the consumer.
  10. Administrative Waste. Ravi wrote: "Too many Officers. The cost is not just in care but also in administrative waste, organizational efficient or there-lack-of, and so much more." If we're going to focusing on cutting clinical waste by increase efficiency, etc., why not do the same for administrative waste?
  11. Put People to Work. Dr. Kuthuru wrote: "We can have a flat 10% tax to have them pay for their care…Lets make everyone work who can. This will increase the amount of people paying into the system so taxes can go down." Can't argue with getting people decent jobs!
  12. Legalize Marijuana. Jason H. Monroe wrote: "If we could follow CA and legalize weed and the taxes from THAT along will absolutely pay for anyone's and everyone's health care!" A proposal worth discussing, imo.

Conclusion

The most important strategy, I contend, is #1: focusing long and hard on getting and using the scientific knowledge need to guide decisions based on cost-effective care and prevention. This is because such knowledge would help to deal with some of the top issues by helping to:

  • Diminish the number of malpractice suits and overutilization due to defensive medicine (#2)
  • Curb the overutilization tendency of fee-for-service (#3) and of specialists and surgeries (#4)
  • Enable whoever (or whatever) controls the healthcare system to make evidence-based decisions (#'s 7 & 8)
  • Bring down costs through "free market" forces (#9).

However, unless our country begins to evidence greater empathy & compassion, a "me-only" mentality by those how have decent insurance and don't care about those who are suffering will make healthcare reform more difficult, as well as making it even more problematic to deal with greed and dishonesty (#6).

Cutting administrative waste and getting people to work are certainly valid strategies. Finally, legalizing marijuana and using the tax money to help pay for healthcare reform is also worth consideration, although likely a hard sell (#s 10-12).

What should be done right now?

First, anyone with empathy and compassion could not tolerate the fact that many tens of millions of Americans lack health insurance or are underinsured. Sadly, unlike European, Canadian, and other societies, many in America have little concern for the wellbeing of less fortunate Americans because:

  • Have a vested interest in the status quo (i.e., they are greedy—they are making plenty of money and want to keep things the way they are, or they young & healthy or have a stable job with good benefits and can't stand the idea of paying more taxes to help others get good care)
  • Are afraid of change because they believe that if our country takes better care of the less fortunate (e.g., via a public plan options) it will somehow harm them (e.g., they believe in the "death panel" fabrication or that they will lose their Medicare)
  • Believe that private insurance is superior to a publically (government run) plan and don't want to risk losing it
  • They are self-centered, heartless, prejudiced and believe they are simply more worthy than others.

Such beliefs, attitudes and emotions are, in the long run, very self-defeating since our current healthcare system is simply unsustainable (i.e., doing nothing is bad for everyone), human nature is such that we are too easily driven by irrational fear, ignorance, self-deception, and ego (e.g., "me-ness"—greed & selfishness); these are just natural human fallibilities. And when conservative organizations hire clever lobbyist-run groups (such as Americans for Prosperity and FreedomWorks) to disrupt rational dialogue by manipulating human fallibilities and spurring irrational fears, meaningful reform becomes ever more difficult.

This means proponents have to present a healthcare reform plan that is easily understood by all and refutes people's irrational fears. The plan, I contend, should include a publically funded option, and can include private insurance options, so long as everyone is covered, regardless of their income, age, and health. The cost of such a plan, the coverage if provides, and the means of paying for it should be spelled out clearly, so that everyone knows what it means for them. This includes directly and convincingly dispelling all falsehoods propagandized by the opposition.

Equally important is for the plan to have a sharp focus on these two goals (as I discussed i n a previous post ):

  1. Enabling all clinicians to continually learn how to make (and keep) their patients healthiest and happiest for longest, using the most cost-effective methods of treatment and prevention, and encourage/reward them for doing so.
  2. Enabling all consumers/patients to continually learn how to make (and keep) themselves healthiest and happiest for longest, using the most cost-effective methods of self-care and self-maintenance, and encourage/reward them for doing so.

That requires doing whatever is necessary to work diligently toward answering these three questions about value to the consumer:

  1. What are the most cost-effective (high-value) ways to prevent, manage, and treat problems with people's physical health and psychological wellbeing?
  2. How can such high-value care (including prevention, self-maintenance, and sick-care treatment) be implemented safely, effectively, and reliably by all persons involved?
  3. How do we put into action an incentive program that makes it increasingly likely the high-value this will implemented successfully by everyone?

Enabling and rewarding clinicians and consumers/patients to do these things would save huge amounts of money, continually improve care quality, and vastly improve the health and wellbeing of all by:

  • Eliminating waste, over-treatment, and excessive expenses
  • Minimizing errors, omissions (under-treatment), and legal expenses
  • Fostering wise decisions and competent actions based on valid, ever-evolving, evidence-based knowledge
  • Making healthy living more feasible (e.g., making good foods more available and affordable than unhealthy foods).
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