Cost

We spend a lot of time combating myths about how doctors make medical decisions. Among the most prominent of those delusions is the belief that doctors don't order extra treatments based on how they're paid--rather, all of their recommendations and prescriptions are based purely on the patient's need.

We've pretty thoroughly established by now that we don't buy it.

This article from last week's edition of JAMA doesn't buy it, either. The study compared rates of stress-testing as a follow-up after heart surgery, based on whether patients went to a practice that typically billed for such testing or didn't bill. The practice's billing patterns indicate whether they do the tests that they order in-house (and thus profit by the test), or if they send patients elsewhere. The results were striking: patients in practices that both performed and interpreted the tests in-house were about twice as likely to get a stress echocardiogram or nuclear stress test (two kinds of high-tech stress test, measuring the flow of blood through the heart). For stress echocardiography, in particular, patients at practices who did their own tests were almost 13 times as likely to get the test as patients who would have had to go elsewhere. The differences aren't based on different patient populations, either - the study included adjustments for age, sex, and prior medical conditions.

It's long past time to start thinking about payment reform. 

Matt Yglesias of the Center for American Progress made a major departure from his usually well-reasoned analysis of politics and policy last week in his post, “America Needs More Doctors.” We felt it was important to set the record straight.

The mistake of thinking we’re going to run into a crisis-level physician shortage is an understandable one, given the dominance of that narrative among health policy observers. Most of the arguments are justified along the lines Yglesias uses: we spend a lot of money on medical care, and we pay higher prices for most of it than the rest of the world. We also have fewer doctors per capita than many other countries, especially in primary care. Add to that the limited number of residency slots that determines how many new physicians can enter the workforce each year and the rapid growth in our elderly population, and the problem seems obvious: Low supply equals high prices and therefore high health care costs.

Unfortunately, this analysis misses a couple of fundamental points. Most importantly, new doctors don’t go where they’re needed! When doctors leave residency, they tend to stay in areas that already have high levels of physician staffing. Part of this is due to the simple fact that many of the places where there are lots of doctors are attractive places to live (i.e. New York City). However, the wage adjustment that would normally happen when professionals over-concentrate in one location (i.e. wages drop in that area, and some people decide to move elsewhere to make more money) doesn’t happen much in medicine. Instead, as the Dartmouth Atlas has demonstrated, areas with lots of doctors see the volume of medical services delivered increase, allowing physicians to continue making high salaries even in places that are overendowed with doctors. One demonstration of the disconnect between need and physician distribution is in the graph to the right: there is practically no relationship between the number of very low birth weight infants and the number of neonatologists in an area. (Image from this paper.)

While it’s true that some parts of the US (particularly rural areas and inner cities) may be legitimately understaffed, it’s also important to note that not all low-supply areas have too few doctors. Rather, there appears to be some “threshold” level of physician capacity, below which people’s health suffers, but above which there are few additional health benefits.* That means in many parts of the country, we really don’t need all of the doctors that we have right now. We especially don’t need as many interventional cardiologists and other specialists as we have. (For reference, we have about two specialists per primary care doc, while other developed countries with as good or better health have about two primary care docs per specialist.) We should concentrate on getting underserved areas to have sufficient primary care capacity, but expanding capacity everywhere else is, at best, useless; at worst, it’s harmful because it will drive up spending without improving health.

The folks downstairs at the Committee for a Responsible Federal Budget clued us in last week to an ongoing debate they've been having with the Center on Budget and Policy Priorities. The central piece of the debate is CRFB board member Erskine Bowles's recommendations to the Supercommittee, which included about $600 billion in reduced Medicare and Medicaid spending. The posts are interesting throughout, and as the deadline approaches, we felt it was important to check in on the federal budget side of health policy.

Here's the debate, with a our commentary:

The initial post: Bowles Plan Offers Path to Compromise

The most important aspect of Bowles' plan, from our perspective, is the method proposed by the Fiscal Commission for fixing the Sustainable Growth Rate (the ironically unsustainable Medicare reimbursement cuts that Congress pushes back each year). In order to pay for a long-term "doc fix" (which would bring down spending on physician fees by cutting rates of reimbursement), the commission recommended that Medicare "develop an improved physician payment formula that encourages care coordination across multiple providers and settings, and pays doctors based on quality instead of quantity of services."

This recommendation is critical. Moving away from the current fee-for-service system is among the most important ways to change how doctors make decisions; at a bare minimum, the Supercommittee should recommend changing reimbursements to reflect the value of primary care instead of encouraging the overcapacity of specialists we have right now.

CRFB didn't specifically mention it, but another critical Medicare fix that the Fiscal Commission recommended is removing the hospital exemption from IPAB recommendations. Given that hospitals make up a huge amount of our total medical spending and are the setting for a huge amount of unnecessary treatment, it's crucial that IPAB have the authority to recommend changes that improve hospitals' incentives to treat patients efficiently.

Related to the initial post: Actually, Raising the Medicare Age Is Also A Good Idea

CRFB's discussion of raising the Medicare age from 65 to 67 is the primary inspiration for this post's second title: we just can't find any good reason to support it.  (If you're really interested in why, we recommend The Incidental Economist's podcast on the subject.)

The thing is, we agree with CRFB on the facts surrounding the issue. Raising the Medicare age would decrease federal health spending somewhat. (The CBO numbers they mention are higher than the ones cited by Carroll and Frakt in the podcast, but not unreasonably so.) On the other hand, they also acknowledge that the shift would increase costs in the private market beyond the savings to the government (because Medicare pays lower reimbursement rates than private insurance). We at New Health Dialogue are concerned with the high total level of spending on health care, rather than simply the level of federal spending on health care. Unnecessarily increasing total medical spending therefore seems like a high cost to pay for a slight reduction in the federal budget which would probably be shortlived, since many of those 65-67 year olds would need help getting insurance, probably through the exchanges specificed in the ACA.

CBPP's initial response: Bowles “Compromise” Proposal to the Right of Boehner Offer to Obama in July

We have to point out a framing problem in CBPP's analysis: not all Medicare and Medicaid cuts are created equal. Some cuts (like those generated by raising the Medicare age) are simply shifting costs from the federal budget to beneficiaries. Those can be fairly labeled as "cuts," and they do increase the burden of health care spending on the elderly. Some of the $600 billion in lower Medicare/Medicaid spending, though, is intended to come from eliminating overtreatment and waste in the medical system. We're well aware that "eliminating waste, fraud, and abuse" is usually what politicians say they'll do to pay for things that they have no intention of actually paying for. However, the Dartmouth Atlas and other analyses have demonstrated that health care really does have a huge amount of wasteful care. Deciding to give patients only the medical care they need, rather than whatever local practice patterns dictate, deserves to be called what it is: responsible management of taxpayer dollars (and of the health system more generally). Demagoguing against such cuts because they reduce health entitlement spending ignores the possibility of making the health system work better, and stands in the way of real progress.

Here’s a list of the recent fibs, misdirections, misstatements and outright lies uttered by a wide variety of opinionmongers in reaction to the new guidelines on prostate cancer screening with the PSA test issued by the U.S. Preventive Services Task Force.

CLAIM 1:

“There weren’t any urologists on the task force!” This was uttered by none other than Newt Gingrich, former Speaker of the House and now-presidential candidate, during the Republican debate at Dartmouth College this week. The charge was also leveled by Dr. Patrick Walsh, University Distinguished Professor of Urology at Johns Hopkins Medical Institutions. (Walsh also pioneered “nerve sparing surgery,” a technique for removing the prostate that helps preserve a man’s ability to get an erection.)

They’re right: there were no urologists on the task force. Instead, there were 15 experts, all of whom have advanced degrees in addition to their medical training, and the statistical knowledge to parse medical evidence. You don’t need to be a urologist to dissect a scientific study, and there are plenty of urologists out there who wouldn’t know the first thing about doing so.

Perhaps Paul Goldberg, publisher of The Cancer Letter, said it best when describing the urologist Gingrich cited: “I wouldn’t call him an expert in prevention; I would call him a urologist.”

In light of the media discussion surrounding PSA testing at the moment, Health Dialog (a producer of patient decision aids for medical decisions) is making their PSA test decision aid available free of charge on their website. The decision aid includes video, booklet, and web-based formats, and presents the evidence about the risks and benefits of PSA testing impartially. If you are a man considering having a PSA test, the decision aid may help you come to an informed decision.

The medical blogs are on fire this week with comments about the US Preventive Services Task Force (USPSTF)'s newest recommendation on the prostate specific antigen (PSA) test. On the basis of the latest scientific data, the task force is now recommending against PSA screening. An earlier recommendation said that routine screening was unnecessary in men over 75, or those with life expectancy shorter than 10 years; the update will recommend against routine PSA testing for any man of any age.*

Not surprisingly, this has set off an angry howl from many pro-PSA patient advocacy groups, some physicians, and battalions of outraged men, many of whom gave personal testimonials to the effect that the PSA test saved their lives. In the words of one Bruce Rogers, from Champain, Ill., "Were it not for the PSA tests, today I would be dead and buried."

Of course, all the men who have died from the treatment for prostate cancer or are too sick or debilitated to get to their keyboards aren't able to tell their side of the story, and whether or not the test actually saves lives is at best debatable. (You can read about the evidence for and against the test in a story that will appear in this Sunday's New York Times Magazine.)

The other common reaction to the new task force recommendation was expressed by a fellow calling himself "whoami2day," who wrote in response to a CNN story:

"Here we go again. OUR government in the pockets of the insurance companies and oil companies. How much longer are we going to put up with this crap.  . . . "

In other words, the task force's recommendation is all about saving the government money by denying men a test that could save their lives. Whoami2day is right that the debate over PSA testing is partly about money, but he may be targeting the wrong villain.

The Dartmouth Atlas has long made a mission of pointing out the variation in medical practice across the US, and in the process, the Atlas has gained a reputation for innovative, incisive research. Among health policy geeks, its maps are legendary.

That explains the general dismay over “After Hospitalization,”  the most recent Atlas report, which came out last Wednesday. According to the report, the hospital community has done a lousy job of making sure patients don’t land right back in a hospital bed after they’re discharged. Preventable readmissions are recognized as a serious problem, taking patients out of their homes and costing billions of dollars each year. Medicare has decided to link hospital payments to success in meeting a readmission standard, and that means a lot of hospitals have a big problem according to the Dartmouth Atlas.

Efforts to reduce readmissions thus far have sputtered. According to the Dartmouth report, surgical and medical readmission rates between 2004 and 2009 were essentially constant. Poor coordination of care between hospitals and post-hospital recovery are the primary reason for readmissions. When chronically ill patients leave the hospital, their medical needs are often far from complete—they require medication, follow-up, and management over an extended period. Even knowing that, many patients still don’t see a primary care doctor within two weeks of their discharge—a step that Dartmouth and others see as crucial to proper care management.

Health Wonk Review, Muppet Edition!

Hello all, and welcome to another exciting episode of Health Wonk Review! (Regular readers will note that yes, I used line last time. I have half a mind to make Alistair Cookie the official HWR mascot, here at New Health Dialogue.) In honor of what would have been Jim Henson’s 75^th birthday last week, I bring you the Muppet Edition of Health Wonk Review!

Now, without further silliness, the articles!

Quality Care

Here at New Health Dialogue, we’re exulting in doctors’ acceptance that yes, they do overtreat patients! Now, getting them to accept that money is part of the reason why…

Jonena Relth of Healthcare Talent Transformation draws attention to the cool new physician payment system being tried at Fairview clinics in Minnesota: payments are based on patient satisfaction and health, rather than by the number services provided.

David Williams draws a parallel between diagnosis and management consulting: experienced clinicians need to be wary of “early closure,” and avoid becoming like the “more experienced managers [who] are satisfied with two data points – after all, that’s enough to make a line, [or the partners who] just need one data point – they can assume the slope.”

Jessie Gruman, at the Prepared Patient Forum, wonders if the collaboration between HHS, the Robert Wood Johnson Foundation, Dr. Oz, and others will help Americans learn to pay attention to their medical care and improve communication with their providers.

Chris Langston points out that there are fewer people entering training for geriatric specialties—a workforce that may be critical in addressing the communications issue Jessie discussed.

The most recent issue of the Archives of Internal Medicine includes a provocative survey of primary care physicians—one that indicates a significant, long-overdue change in how both providers and patients see medical care.

The study surveyed over 600 physicians by mail, and found that 42 percent believe their patients are getting too much medical care. That’s seven times as many as the six percent who believe their patients aren’t getting enough. Further pressing the case, about 30 percent of PCPs surveyed said that their own practice was more aggressive than they’d like.

Think about what this means. Four years ago, when the Health Policy Program’s director, Shannon Brownlee, published her book Overtreated, most Americans, and a lot of providers, legislators and policy experts thought the only real problem in U.S. healthcare was too little care – because nearly 1 in every 6 Americans was uninsured. Now we have a study that shows that physicians are well aware that overtreatment is also a problem

In one of the great comedy skits of the 20^th 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 communities—the 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.

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.