The OTHER Health Care Crisis…
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I’m not normally a NYTimes kind of guy, but I thought this article from yesterday’s paper was really good. Someday, somehow, if we really want to DO SOMETHING about the cost of health care, we have to get our arms around variation and performance. This article does a terrific job of articulating the problem. It also supports — at least implicitly — my one BIG IDEA — creating some kind of national institute to study health care delivery. And this is not a new concept. The approach mentioned late in the article of certifying care is a big deal in other countries — most notably, the National Institute for Clinical Excellence (NICE) in Britain. Health care costs will probably continue to grow faster than income (some might say “our capacity to pay”), and this article does a nice job of explaining why this issue is at least as important as getting everyone covered. Thoughts/comments welcome.
I disagree with the author’s assessment that the lumbar fusion procedure (and other like it) is not the reason so many are uninsured. Health insurance rates are tied to the cost of healthcare, so an increase in procedural cost leads to higher premiums. These higher premiums force many people to gamble on their health, and decline health insurance.
The idea of a national agency to study delivery, as referenced by both Charlie and the article, is interesting. Does anyone have any idea how the allocation of Medicare reimbursement would be ultimately be affected by a Federal review board, or the like? Charlie, a past post stressed the importance of continuing to focus on “older” health concerns, that may not be on the forefront of the public’s mind. Do you think that could correlate to a system of favorably reimbursing providers based on their adherence to “tried and true” technology, and limiting reimbursement if their allocation of funds going towards developing marginally more effective, but tremendously more expensive, new technologies is deemed “excessive”?
It seems that it would be quite a challenge to effectively and consistently determine in advance which patients will benefit from back surgery and which won’t. That said, I like the concept of a Best Practices Institute to assess the comparative effectiveness of similar drugs, devices, and other treatment options. QALY metrics might also be useful in deciding which new drugs and devices we should pay for.
Personally, I would like to see us move toward a system where everyone has a living will or advance medical directive and, perhaps, even make it a requirement for having insurance. Moreover, those who would like every heroic measure that medical science has to offer used to keep them alive as long as possible should probably pay higher insurance premiums than those who opt for nothing heroic when the end of life appears near.
I also think we should take a hard look at how other countries define good, sound medical practice at or near the end of life. Just because we have the technical knowhow to do a surgical intervention or prescribe a very expensive drug doesn’t always mean that we should. If the U.S. is, in fact, expending a lot more resources on futile or dubious care at or near the end of life as compared to other countries, why is this the case? Is it cultural? Is it that doctors and hospitals want the revenue that comes with aggressive treatment? Is it because middle age children can’t let go because they haven’t come to grips with their own mortality? Is it that other countries, in effect, overrule what the patient and/or family wants in order to save money for the system overall?
We are constantly told that other countries provide universal health care for half the cost per capita vs what it costs here with essentially no difference in outcomes. At the very least, we really need to understand the differences in our respective approaches to end of life care. There are systemic differences in healthcare costs among countries related to how much doctors and other providers are paid and the fact that we pay more for brand name drugs in the U.S. Those factors probably won’t change anytime soon. We can also probably save some money if we could reform the malpractice system, implement a good system of electronic medical records and streamline insurance offerings.
I think there is a lot of money to be saved by doing a vastly better job of reducing healthcare utilization at or near the end of life. Bringing about more convergence in practice variations elsewhere in the system also deserves a lot more attention that it has gotten so far. We will always be able to provide more healthcare than we can pay for which is why we need to make some tough choices. The sooner we start making them, the better.
We do have a procedure driven reimbursement system - set up, for the most part - by Medicare rules and requirements. The private payors - and some Medicaid programs - tried capitation, that is, paying a lump sum per person and having clinicians work within that amount. That did not go over well with most docs or patients. While capitation was a reaction to a general view that fee-for-service encouraged over-treatment, people reacted to capitation by saying that incentives to under-treat were far worse than what came before it. And hence, we’re back, for the most part, where we were before.
There is some interest in a Best Practices-type Institute for health care services - which would, over time - start to influence reimbursement policy. I think that would be a good thing. But no health plan - except maybe Medicare - is going to pursue an evidence-based reimbursement policy on its own. There’s simply no percentage in taking this issue on without a major investment by a government entity - or some other “disinterested” third party.
Charlie – I absolutely agree that the leadership on this has to come from the government (most likely, CMS). I get frustrated when I hear leading Democrats putting almost all of their emphasis on trying to achieve universal coverage while ignoring the utilization related issues. It is also not helpful to demonize the for profit insurers and drug companies as though all our problems can be solved by just taking the profit out of these two industries. I wonder if people who express this viewpoint ever took a course in economics or met a payroll. Some think there are huge savings to be harvested from lower administrative costs if Government were the single payer for healthcare services while others think electronic records can save the day. Unfortunately, electronic records would require substantial up front costs to implement while the savings would probably be slow in coming. As for potential administrative savings from a single payer system, I would bet a lot of money that they are being wildly overestimated by advocates. While universal coverage is a laudable goal, we will never get healthcare costs under control and onto a more sustainable path if we don’t aggressively address utilization.
Charlie,
You often mention that leadership on alternative forms of coverage needs to come from Medicare. Why? Are you saying, in essence, that it is commercially impractical for private insurers to come up with plans that would reward quantifiable quality and outcomes? Certainly they could be designed. Are you suggesting that employers will not buy them for their employees? Perhaps because they would not be viewed as advantageous by employers facing a competitive labor market?
In other industries (telecomm, computers, energy), there is often a market participant who comes out with a new pricing plan that creates a leadership position for that company and then sets the stage for industry transformation. Why is that not so here? (It could be offered as an option, so you don’t have to bet the farm.)
Please note that I am not criticizing you or others for not doing this. I assume that you and BCBS and Tufts have anlayzed this kind of product, and I’m just wondering what might be behind the decision not to offer it.
While “evidence based medicine” is a great concept, applying it has significant challenges and dangers: First, what was the “best” way to treat a condition 3-5 years ago because by inherently the evidence to make these assessments is at least that old. Therefore, advancements in care made since they are not included in the EBM guidance. Second, there is the danger that EBM assessments will be used as rhetorical cover for decisions to cut costs or use the least costly alternative. The VA has did a marvelous job of this when they started their national formulary, and CMS/HCFA has done this cost estimates of proposed benefit changes. And lastly, any EBM/cost-benefit analyses can be biased because of who what populations they are examining, i.e. who pays v. who benefits, etc.
I agree with Dr. Miller, and please don’t consider this just sour grapes by physicians. There is a real danger of “group think” when there is a national best practices institute, because anyone who disagrees or doesn’t use those practices opens themselves up to a problem both legally and financially. Hence the fears of “cookbook medicine” on the part of physicians. Also, many studies conflict depending on their statistical methodology or population selection, and a consensus may not emerge for years.
As an anecdotal example, take the menopausal hormone issue. For years, physicians almost automatically offered hormones to any menopausal woman. The surgeon I see for annual breast exams did so to me a couple years ago, and I explained to him that, being a pathologist, I was seeing fibrocystic-like changes in breast tissue from 80 yr old women, both at autopsy and in surgical material. (This is not normal and can be precancerous). I told him that my personal theory was that these changes were probably related to hormone therapy, and that there was no way on earth I was going to take hormones. Less than a year later, these studies showing a relationship between hormones and breast cancer emerged. Could be coincidence, of course, but there are thousands of things out there in medicine that an observant practitioner notices, that are just not studied by the medical establishment, for one reason or another.
Having said that, I am still in favor of Charlie’s idea; I just think it needs to be carefully structured and not used as a club or as an excuse.
The most important part is to include all parties in an open and collegial debate on this giant issue, and refrain from blaming any one of them for the current situation; and that all parties approach the debate with a wider view than their own self interest.
Unfortunately, the chance that it will happen like that is like the proverbial snowball in hell.
Taking a contrarian view, one person to which I mentioned the disparity in the Idaho and Maine results replied “well, there are more farmers in Idaho and they ruin their backs.”
Just keep in mind there is more than one explanation for any finding, and that’s why this issue is so complex.
To Dr. Miller I would ask: couldn’t a separation be made between the continued study of conditions and the advancement of treatments for them? In other words, it’s obvious that our understanding of many conditions will grow as time moves forward, but does that increased knowledge always have to be tied to an urge to develop a new technology based on the most recent data?
Mr. Levy, I think that Medicare needs to provide the leadership on price control, not alternate forms of coverage. Medicare is the only single body large enough to have any lasting effect on costs, and for private insurers to take this on without the lead of Medicare would be risky, and require an enormous amount of collaboration. I think both parties (the government and private insurers) will be a part of the ultimate solution. I think BC is correct to be wary of the classic concept of universal coverage that many of the Democratic candidates are advocating. The design of the MA HealthCare Reform policy is a great example of the government and private sector tackling the issue on a smaller (but still very large) scale. Hopefully, with the Quality and Cost Council up and running and having a positive impact, the state could prove to be a model to follow on a larger scale.
A national best practices institute is an idea which educated patients would welcome due to the constant back and forth research on many medical issues. If you keep up with the news and read every new study, the contradictions are overwhelming.
As a note, the Medicare agency pilot project results published this past week show that pay-for-performance does not generate a significant improvement in quality or mortality rates. Again, this is one study, and I’m sure more will follow.
Doesn’t every payor already have a series of coverage policies in place, informed largely by research on safety, efficacy and cost-effectiveness of the service in question? Is this not some form of EBM? (And many, but not all, coverage decisions track Medicare policy.)
See WSJ Health Blog post (and comments including mine) on the NYT article here:
http://blogs.wsj.com/health/2007/06/06/health-care-reform-you-cant-always-get-what-you-want/
David Harlow
HealthBlawg
Paul – Several insurers tell me that they are moving toward trying to reward quality and cost-effectiveness. UnitedHealth Group, for example, claims to be able to identify providers who achieve above average outcomes and/or are more cost-effective. United awards them a premium designation and members are encouraged to use them. Wellpoint has identified better hospitals as Centers of Excellence for cardiac care, gastric bypass, organ transplants and, soon, oncology. Cigna claims to be able to identify the best practicers vs the high utilizers and is prepared to reward the former with somewhat higher reimbursement rates.
Where I think only the government can provide leadership is in saying NO. It might refuse to pay for a new biotech drug or medical device that cannot pass a QALY threshold. It could decide that we, as a society, cannot afford and should not pay for surgical interventions for patients with advanced dementia or Alzheimer’s. Or, as they do in the UK, refuse to pay for kidney dialysis for patients beyond a certain age. Same for hip and knee replacements, angioplasty, CABG, etc. The issue is not do we reward quality or market share; it’s who has the moral authority to say that we can’t afford to give everything to everyone, and we have to draw the line somewhere. If anyone is going to make these judgments, it should probably be a politically independent government body of experts modeled after the Federal Reserve System, not the insurance industry which many people think already has too much self-interest to deny care.
There was an interesting report released last November by the GAO dealing with Medicare’s ESRD reimbursement policy. It puts forth the case that there is a measure of cost control to be gained from bundling payments for separately billable medications to the payments for all ESRD services. An interesting twist to this specific issue is that the measure has enjoyed relative success despite market competition for the one dominant medication (Epogen) used to treat the disease. This issue is also tied to some of the end of life and societal topics that BC touches upon. Here’s the link:
http://waysandmeans.house.gov/media/pdf/healthdocs/120506gaorpt.pdf
So, what’s wrong with the NYTimes anyway? I’m not usually a WSJ kinda gal, but, they do have some good articles about health care as does the NYTimes. Beats Michael Moore.
All - there are some conversations in Washington, DC concerning a public/private approach to studying and signing off on new medical technologies. The overall approach would have some kind of independent, national entity engage on several fronts…
1) Prioritze technologies for evaluation;
2) Review data on comparative effectiveness (this is the big missing piece - most of what happens now only studies whether something new is better than nothing - not whether or not it represents an improvement over what’s already available);
3) Fund studies on comparative effectiveness;
4) Develop an accepted framework for including cost effectiveness and other values into assessments (this would ultimately affect Medicare, private payors, and probably Medicaid, too);
5) Develop a lexicon for summarizing the findings (much like USPSTF did with respect to the level of evidence available to support screening recommendations.
We shouldn’t underestimate the difficulty in this. We’ve tried to do technology assessment before at the federal level, and when the assessor says some technology isnt’ much of an improvement on what’s already available, it generally gets de-listed from the next federal appropriation (witness the demise of the Office of Technology Assessment). This is, obviously, a big deal if this entity makes decisions - as it will - that affect what gets paid for and how.
My guess is that most of the research would be done by clinicians - as it should be - but it will still generate noise, controversy, etc. It won’t be perfect, and it will have to change over time. But we need something like this, and other countries have already proven it can be done.