Cost

Who You See Is What You Get

September 16, 2011
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In one of the great comedy skits of the 20th century, Geraldine Jones, played by comedian Flip Wilson in drag, delivers chicken to football player Jim Brown. Geraldine holds up the bucket of fried chicken, wiggles her hips and says, “No fancy ribbons on our meat. What you see is what you get!”

In medicine, it’s not so much what you see as who you see that determines what you get. In a new report (by the Health Policy Program’s Shannon Brownlee and Vanessa Hurley, based on analysis by Stanford’s Laurence Baker), the California HealthCare Foundation argues that who you see for your care (and where you live) have a huge effect on the likelihood of receiving a broad variety of elective medical procedures. The variation can’t be explained away by levels of illness in different communitiesthe study controlled for a number of factors related to illness, including income, level of education, and rates of heart attack and diabetes in the area, as well as typical controls like age, sex, and race. Even after adjusting for all of those factors, the variation didn’t disappear. Areas with the highest usage of angioplasty*, for instance, had rates ten times as high as areas with the lowest use.

Some readers of this blog have heard this before, but it bears repeating: Poor patient understanding of treatment options is a primary cause of such unwarranted variation. When patients don’t have enough information, or information they can understand in order to participate fully in their treatment decisions, the choice of how to manage a condition falls to their doctor.

Magic bullets, no more

September 14, 2011

The 1940 biopic Dr. Ehrlich’s Magic Bullet made famous both the physician who found a treatment for syphilis and the idea there was a single cure for every disease. Most of the old infectious killers have been eradicated, or nearly so, by drugs and vaccines, but the era of the magic bullet is coming to a close. Today’s medical challenges are chronic diseases like diabetes, heart disease, cancer, and Alzheimer’s – diseases that can’t be cured, but only prevented or managed – and we’re trying to address them with a health care delivery system made inefficient in part by the fact that it is caring for chronically ill patients as if they had acute ailments.    

Yet the notion that there’s a single solution to the conundrum of today’s health care delivery system lives on. Proponents of ideas like consumer-driven health care, electronic medical records, the patient centered medical home, comparative effectiveness research, ACOs, and training primary care doctors like to imagine that their preferred solution is the magic bullet, the one technocratic fix that’s going to bring down costs and improve quality.

Maybe it’s time to take a hint from another complex problem: climate change. In a paper published in Science in 2004, climate scientists Robert Socolow and Stephen Pacala argued that rather than waiting around for some new innovation that will magically make all that excess carbon go away, we should be tackling carbon emissions with existing technologies.

Socolow and Pacala called their seven intervention ideas “wedges” because of their shape on the graph (left). Each intervention has a small effect on the level of carbon dioxide emissions, and each effect shows up on the graph as a slice of the stabilization triangle, shaped like a wedge. Put into effect simultaneously, there are enough emissions-reducing technologies–such as carbon capture and storage at power plants and broader use of solar, wind, and nuclear power—to stabilize carbon dioxide levels in the atmosphere for the next 50 years.

In a speech last week at a Health Affairs briefing on “The New Urgency of Cost Control,” Don Berwick, the Administrator of the Center for Medicare and Medicaid Services, applied Socolow and Pacala’s idea to health care costs, arguing that we need to look at a broad range of existing delivery and payment system reforms—each of which is too small to stabilize medical costs individually, but that meet that goal when taken together.

Good News, Taken Badly

September 1, 2011

Two weeks ago, a new study funded by the National Cancer Institute of the NIH released its findings: low-dose CT scanning to screen longtime smokers for lung cancer can reduce mortality by 20 percent relative to x-ray screening.*  That might seem like great news—if not for the reaction from hospitals and medical providers, which are using the study as an excuse to market CT scans.

 

The study received broad coverage when it was released, which isn't surprising—a 20 percent reduction in deaths among smokers is a pretty important result. However, the patients in the study were all longtime smokers between the ages of 55 and 74, with more than 30 pack years (meaning they smoked an average of a pack a day for 30 years, or two packs a day for 15 years—over 200,000 cigarettes in all). Since the study was so narrowly focused, it didn't establish that CT screening offered any benefit to younger smokers or those who hadn't smoked as long.

When Medicine Becomes Security Theater

August 30, 2011
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Over at NPR’s Planet Money blog, Jacob Goldstein has commented on Columbia professor Barron Lerner's New York Times op-ed about the trouble with unproven, risky cancer treatments. The op-ed calls out heated chemotherapy, an intense treatment for colorectal and ovarian cancer, as dangerous and ineffective. More importantly, he places heated chemotherapy in its place relative to other radical, painful and ineffective treatments like radical and super-radical masectomy, fore- and hindquarter amputation, and very-high-dose chemotherapy. Those treatments all had a moment of popularity, but none was demonstrably more effective than less invasive and dangerous standard treatment options. Rather than actually benefiting the patient, such radical treatments are the illusion of action, serving only to provide false hope while denying patients palliative care that might actually improve their quality of life.

Number of the day: 18.1%

August 12, 2011
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NUMBER OF THE DAY: 18.1%

Today's number is 18.1 percent -- according to new data released today, that's the portion of our GDP going to health spending. That's up from 16.3 percent when the recession began back in 2007. GDP isn't yet back to where it was at the beginning of the recession.

 

That means that instead of having more luxury cars, education, and infrastructure development, we've spent the minimal economic growth we've had on health care. We're neither adequately slowed cost growth nor addressed the massive amounts of waste in the medical system. Hopefully before the next recession, we'll have decided to stop wasting money on useless diagnostic tests, rather than slashing budgets for things that really matter.

Variation Marks the Spot

August 11, 2011
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A new study in the Journal the American College of Cardiology finds that doctors at different hospitals vary widely in their assessment of who qualifies as an appropriate candidate for elective coronary angiography (a way to look for clogged coronary arteries).  If Jack Wennberg and his daring band of disruptive Dartmouth Atlas docs have taught us anything, it’s that variation marks the spot for the inconsistent -- and often inappropriate -- use of health care services.

According to researchers at Duke University Medical Center, different hospitals use wildly disparate criteria for determining which patients need non-emergency coronary angiography.  The authors found that hospitals with a lower rate of positive tests -- meaning they test a lot of people who end up not having heart disease -- tend to be more likely to perform angiography on younger, asymptomatic patients. Out of more than half a million medical records examined, the researchers found some hospitals with rates of positive tests as low as 23 percent.

When Less is More, or Less, and for Whom?

August 1, 2011

Last year, health care spending grew 3.9 percent (Health Affairs), only 1.4 percent faster than GDP. That’s low, compared to previous years’ growth over GDP. From 1975 to 2005, the CBO found that health spending grew nearly twice as fast as the overall economy, driving the increase of health spending from around 8 percent of GDP to 16 percent today (OMB).

To some, this comes as long-awaited good news. A major goal of the Affordable Care Act is to 'bend the curve' of health spending. Although many of the truly impactful cost-saving provisions of the bill (IPAB, Cadillac-taxes, etc.) are backloaded for full implementation after 2017, some went into effect right away. One such provision was lowering the government's payments to private Medicare Advantage plans to compensate for their inefficiency compared to their traditional public counterpart.* The CMS Office of the Actuary published its spending projections in Health Affairs:

The continued low rate of estimated growth in national health spending in 2010 reflects two major factors. First, Medicare spending growth is estimated to have been lower as the rate of growth in payments to private plans under the Medicare Advantage program slowed in 2010.

If you were hoping that health reform would actually help control health care costs, this looks like great news! The program is working as intended. Not everyone, however, is thrilled by this recent drop in health care spending. After all, one person's health spending is another's health revenue.

Number of the Day: 5008

August 2, 2011
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NUMBER OF THE DAY: 5008

There are 5008 community hospitals in the United States. They care for over 35 million patients each year--one in every nine Americans, if distributed equally. Total payments to community hospitals amount to over $650 billion per year. That’s a lot of money: about the same as the entire budget of the Department of Defense, including the wars in Iraq and Afghanistan. It’s nearly a quarter of our total health spending; over four percent of GDP; over $2100 per American. Community hospitals employ 5.4 million people. What’s more, all those hospitals are the training sites for our next generation of doctors, nurses, and PA’s: the very medical practitioners who will push for efficient delivery of health services, or drive unsustainable and destructive cost growth in the coming decades.

Clearly, hospitals matter.

That’s why this is the first in a series of posts examining the hospital system, and especially the role of nonprofit hospitals. Of the 5008 community hospitals, nearly sixty percent are nonprofit, private organizations. It’s pretty rare in the US to have a market so dominated by non-profit, non-governmental producers. What makes the hospital system so different? Do such nonprofit hospitals provide any more benefit to their communities than for-profit hospitals? Would we be better off with more government-owned hospitals? Most importantly, can changes to the current non-profit model improve our hospital system?

We’ll examine all of those questions and more in the coming days and weeks. Be sure to follow our Twitter for new posts and other updates!

Today's Good Stuff for Lunch Rundown

July 26, 2011

We don't normally do a Daily Briefing here on the New Health Dialogue. There are simply so many good breakdowns and newletters in the health policy community already -- from Kaiser Health News to WaPo Wonkbook and HHS News Alerts coming out our ears -- that anything we did here would be redundant.

That said, there are so many interesting articles today (and not enough time to give them the full blog-post treatment) that we wanted to point a few out.

First Up: Avastin - Achieving health care debate ubiquity

---Ed Silverman at Pharmalot wades into the Avastin debate (which we've discussed before here & here) and asks whether or not the National Comprehensive Cancer Network has a conflict of interest problem. The NCCN voted 24 to 0 (with one abstention) to support the continued use of Avastin for treating breast cancer, even though last month the FDA revoked its approval for this use.

One Man's Waste is Another Man's Revenue Stream

July 25, 2011
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Many aspects of health care reform require revolutionary thinking and groundbreaking research to move the system down unexplored pathways to new heights of efficiency and excellence.

...And some things don't. There are some solutions we see clearly right in front of our noses, with their implementation stymied by perpetual politicing. If you ever needed a clearer pictures of how our current Congressional process is ill suited to actually controlling the ever increasing costs of Medicare (and why IPAB, despite all the hemming and hawing on the Hill, is desperately needed), look no further than Sam Baker's report today in The Hill:

A bipartisan majority of House lawmakers is pressing Medicare to reverse a proposed cut to hospital payments.

The Medicare agency recently proposed a 3.5 percent cut in payments to hospitals as well as a 2.9 percent adjustment to offset payments that it said are the result of changes in how come claims are filed. But 219 House members said hospitals can't afford the cuts, and urged Medicare to reconsider the proposal.

"If the proposed rule is enacted, the net impact for hospitals would be an average decrease in inpatient payments," the lawmakers said in a letter to Medicare Administrator Don Berwick. "This is a decrease that hospitals can ill afford."

The letter says hospitals could lose more than $6 billion from the proposal. It was signed by 95 Republicans and 124 Democrats. A similar letter in the Senate garnered 45 signatures.

If we actually want the government to spend less on health care, we need to actually spend less on health care. And yes, this means somebody WILL make less money. Today's unacceptably high levels of Medicare spending will always be somebody else's acceptably high levels of Medicare income. It's the inability to contemplate short term "belt tightening" and shared sacrifice, at the expense of the long term sustainability of the health care system as a whole, that turns today's symptoms into the combined fiscal-healthcare crisis (and graph) everyone predicts.

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