This is a blog by a former CEO of a large Boston hospital to share thoughts about negotiation theory and practice, leadership training and mentoring, and teaching.
Thursday, January 21, 2010
Election's over. Problems remain.
Dear Republicans and Democrats,
This is from National Geographic. Please think about it as you decide what to do about health care.
I had trouble enlarging it enough to read it, but I could read the numbers! National Geographic must be expanding its subject matter! I just hope they decide to do SOMETHING about health care,instead of dropping the entire subject for another 16 years (Clinton - now).
Good point, the election is done and gone we still have reform to make happen.
After reading the news yesterday I suggested that Sen. Grassley entertain becoming an e-patient too, I'm with Dave on participating and learning how to be better informed on your own care plus you have a better understanding all the way around about how healthcare is rapidly evolving with technology and it's availability to save lives. A little tongue and cheek with the post but trying to perhaps open an awareness out there.
It is hard to read, but it illustrates a good point. Every time I mention the facts that we spend lots more and seemingly do worse by most parameter of community health, my medical colleugues claim that it is because we do all the medical innovation in this country and the rest of the world benefits from our innovations. I don't know if this is true, but I seriously doubt this could account for cost that are 2-4 times higher than the rest of the developed world.
So the chart shows we spends a lot more money than the other countries but our life expectancy is no better. Hardly a news flash, that statistic has been around for many years.
Sound bite graphs are nice but this is a very complex economic and social issue. We will not get to the numbers these others countries spend per capita in our lifetime, this country will not accept such radical change. Sooo, we focus on incremental changes to begin scaling back the ridiculous increases. Those "fixes" have been discussed ad nauseum in this blog.
Lots of apples and oranges bumping into each other on that chart. Those who adore Canada's "single-payer" system would do well to take a close look at what passes for nursing home care in that country.
The UK National Health Service is often mentioned and the cost compared with medical services in the US. I read the Times (UK) and there are serious problems with health care in National Health Service in the UK. People are denied effective procedures and drugs based on cost and budgets, with variations depending on where they live.
Someone should do an honest comparison study to identify elements that contribute to the differences in cost and effectiveness. Let's see a comparison analysis of the cost elements that make up 90% of the costs of US, UK, Canadian, Netherlands, and Swiss systems; and an assessment of how those differences affect delivery of health care.
It probably won't get done because the people who have the means to do it also have vested interests in maintaining many of the high cost elements in the US health care system. Why bother with facts when the current political process can result in giving Nebraska a few hundred billion in a back room deal?
T. R. Reid, in his recent book, “The Healing of America,” covers this subject in some detail. The biggest single difference between the U.S. and other healthcare systems in Western Europe, Canada, and Japan is the prices paid per procedure, per office visit, per drug, etc. To cite a couple of examples, a routine office visit in the Paris area costs €21 and a visit to a specialist runs €26. It would be 3 to 4 times that or more in the U.S. An MRI that lists for $1,200 in Denver is $98 in Tokyo. Germans consume about the same amount of drugs per person as we do yet pay 40% less on average. Specialists in Europe earn a third of what many American specialists earn, though they do emerge from medical school with no debt. Malpractice insurance in Europe costs one-tenth or less what an American doctor would have to pay. Most doctors overseas are never sued, and they perceive that they will never be sued, so defensive medicine is not the issue it is here. Drug prices are controlled by the governments in other countries. The industry goes along with this because marginal production costs are minimal which allows free riding while U.S. patients pay what the traffic will bear.
Utilization is more intense in the U.S. with respect to end of life care, and established standards of care generally call for aggressive treatment patterns in certain markets including the Boston to Washington corridor, Houston, Miami, Southern California and a few others. Finally, most of the visits to doctors in other countries compared to the U.S. are for primary care. Higher medical prices are the key reason for our high costs which is why we need robust price and quality transparency tools that would be available in a user friendly format to both referring doctors and patients who care about what services, tests and procedures cost even when insurance is paying.
On this point: Doctors there "emerge from medical school with no debt." I know this is often true because those countries offer free medical education. I wonder if these numbers generally include the cost of that susbidized medical education in their GNP figures.
It Italy, for example, there is a surplus of doctors because admission requirements for medical school are so low. And tuition is free. Thus MD salaries are bid down very, very low.
On this: "most of the visits to doctors in other countries compared to the U.S. are for primary care." I think this is a key factor. Instread of triaging patients up to higher cost specialty care, many more things are handled at the primary care level.
We could do that here, too, if (paradoxically) we paid our PCPs better. Then they would not have to rush through to see patients in 18-minute visits. So, I believe paying PCPs more would eventually lower our overall cost of care.
The notion that specialty care is driving up costs is a fallacy. Specialist having a greater depth of knowledge often will treat diseases with more efficiency, and thus at lower cost. One example from the Otolaryngology literature is the treatment of otitis externa. Average number of visits to PCP for treatment, FIVE. Average number of visits to the ENT specialist for treatment, ONE. Which costs less?
This doesn't take into account the cost of time off work to go four additional doctor visits.
I agree with you on your point about paying PCPs more. That would allow the PCP to provide better, more thorough care, thus improving overall health and lowering costs. At the same time, it would probably help with the national shortage of PCPs. More might go that route if they were sure of a decent income. Might it also eventually lead large medical centers to spend more money on primary care centers and less on fancy specialty centers?
Acknowledging the above comments regarding Barry's information, I would like to highlight his information on malpractice premiums and defensive medicine. I believe this difference between the U.S. and other countries leads to more specialty care as well as many more tests per patient episode, thus contributing to costs. As anyone who has ever investigated a medical error knows, the causes are almost always multifactorial. The same is true with the entire system's fallacies - the root causes are multifactorial, and the solutions will have to be multifactorial also. Good info, Barry.
I think the comments by Barry Carol are relevant to answering the question about why medical care costs more in the US. If the rates for an office visit in Paris are about $40 US, and more than $100 in the US, we aren't going to get costs down by increasing the fees for PCPs. If an MRI costs 12 times as much in Tokyo as it does in the US, and if other procedures have similar ratios of costs, then the cost of care in the US is always going to be greater than in those countries. If the drug companies can charge $20,000 or more per month for a regimen that may increase life of a terminally ill cancer patient by a few months, there is is little hope for reducing US costs compared to other countries where the national health services simply refuses to pay such costs.
We need a comprehensive analysis of the costs of all of the elements of health care, compared to the "other countries" standard represented by the "National Geographic" chart; and then we need to have a very open public discussion leading to decisions on what we want to pay for as a country.
The result will be that some people will be paid less for some of the goods and services they provide, and some people will not be provided with "Cost is no object" health care paid for by "Other people's money".
Re: Brenda RN - If we pay PCPs more, and therefore get more of them out where the patients live, then what elements of the health care system should/would be cut to result in a net lowering of health care costs?
Maybe someone at BIDMC could suggest some areas where such an increase in PCP payments and numbers of PCPs would result in lower budgets and billings from the major hospitals in Boston. Who or what among those hospitals would be displaced? What would be the Return on Investment in terms of net cost reduction per dollar of increased payments to PCPs?
All this discussion about paying PCPs more makes no sense. Paying PCPs more will only increase the cost of care. Increasing the number of PCPs (by paying more for them) is moving backwards. The evolution of medicine is toward more specialization. Besides, this model was tried already in the late 80's and early 90's with the HMO/gatekeeper model. It was a failure.
American medicine is moving in the direction of more specialized care. You cannot obtain privileges to do a procedure at most medical centers these days unless you have ongoing experience doing those procedures (eg laser surgery). With greater specialization, however, comes more experience in the hands of fewer physicians. More experience in turn leads to more efficient treatments, better outcomes, fewer morbidities, and lower costs.
Why should we continue utilize physicians (who are expensive to train and pay) to manage routine blood pressure problems, diabetes, and well visits? What we should be discussing is how to replace most PCPs with midlevel providers who cost less to train and pay. Physicians and surgeons can then focus more complicated speciality care.
I presume you are a specialist, as am I (pathologist, though, so different). There is one problem with your ideal of specialist nirvana - specialists only pay attention to their organ systems when seeing a patient. Both as a physician and as a patient, I have seen/experienced many cases where a specialist has missed something because they fail to look beyond their own narrow focus. Now having said that, the flip side of the coin is that the primary may not have the knowledge base to put disparate symptoms together - but at least they are aware of all the symptoms. Endocrine diseases are an excellent case in point, where the patient has multiple symptoms involving several organ systems, and spends much time on the hamster wheel of visiting a separate doc for each symptom (at great expense per visit), never getting the full picture. In my experience midlevel providers are even worse at diagnostics. Let a doc make the diagnosis, then the NP/PA can provide the treatment and follow up.
I'm not advocating all medical care should be specialty only, there certainly is a need for skilled diagnosticians and generalists to treat routine problems and even coordinate care for complex patients at times. Also many patients need guidance as to what diagnostic or treatment path to pursue.
I have also seen as many missed diagnoses due to a lack of familiarity with a certain disease process. Your example of the endocrine specialist is a good one. A skilled and experienced endocrinologist will be able to recognize and understand patterns of disease that would lead to a quicker diagnosis and more efficient treatments.
Michael I agree with you that we are headed for more specialization and everything I have read suggests that specialization results in more streamlining, better safety, and greater efficiencies.
But to Paul Levy's point, how can we hope to control costs without changing our treatment of PCPs? I agree in paying them more if we can reform their role in such a way that its beneficial for them to keep patients from needing to see specialists, and increase the overall cost of care. Right now I feel that PCPs don't have the resources, especially time, to really effectively keep patients from needing higher level treatment. But I also feel that to reform how PCPs are paid and practice would require truly massive reform not just in payment but in Medical schools as well.
As nonlocal MD suggests, healthcare costs in the U.S. are higher than anywhere else in the world for lots of reasons. One issue that doesn’t get the attention I think it deserves is what I would call the combination of unreasonable patient expectations and an entitlement mentality. There seems to be a widespread belief among the public that more care is better care and patients should have access to any service, test, drug or procedure that has even the slightest chance of benefiting them no matter how expensive and that someone else (insurers or taxpayers) should pay for it. Any suggestion that we use comparative effectiveness research or cost-effectiveness criteria to influence what insurance will cover is blasted as bureaucrats and/or insurers inserting themselves between the patient and the doctor. The recent uproar over the U.S. Preventive Services Taskforce recommendations regarding breast cancer screening is the most recent example of this attitude. At the same time, I wonder to what extent the community standard of care in more aggressive treatment geographies is driven by the combination of the profession’s assessment of patient expectations and the prevailing litigation environment as opposed to good, sound medical practice and cost-effectiveness. As I’ve said several times, the enemy is us.
I agree on the matter of considering the cost versus effectiveness of treatments. However, the whole process should be completely open and standards established ahead of time.
If the drug companies know that cancer drugs will not be covered at more than $XXXX per month of life extension, and other procedures will be restricted on the same basis, then that should apply across the board. Rank up lung transplants, live donor liver transplants, renal dialysis, end-stage cancer treatments, and whatever else is available on the same $/month basis. Whatever the standards are will apply to everyone.
All of the costs must be considered. It would not be acceptable to let a hospital run an inefficient transplant program and distribute the cost over other patients.
If the answer is $60,000 per quality adjusted year of life then it would be impossible to justify Medicaid paying $80,000 per year to keep someone on a feeding tube in a nursing care facility.
The next question is, who among the medical profession and the political class will write those rules and make them stick?
Dear Republicans and Democrats,
I had trouble enlarging it enough to read it, but I could read the numbers! National Geographic must be expanding its subject matter!
ReplyDeleteI just hope they decide to do SOMETHING about health care,instead of dropping the entire subject for another 16 years (Clinton - now).
nonlocal
Good point, the election is done and gone we still have reform to make happen.
ReplyDeleteAfter reading the news yesterday I suggested that Sen. Grassley entertain becoming an e-patient too, I'm with Dave on participating and learning how to be better informed on your own care plus you have a better understanding all the way around about how healthcare is rapidly evolving with technology and it's availability to save lives. A little tongue and cheek with the post but trying to perhaps open an awareness out there.
http://ducknetweb.blogspot.com/2010/01/grassley-send-hospitals-if-he.html
Thanks Paul, but cannot really make out the image...do you have a link to the article?
ReplyDeleteThe link to the origignal grpahic is embedded in the word "This". When you get to it, you can click on it and make it bigger.
ReplyDeleteWhere's the chart showing the productivity of the US workforce compared to healthcare spending? The results would show a much different picture.
ReplyDeleteAlso, why is this same graph not shown comparing per pupil cost of education verses literacy? I think you would see similar results.
It is hard to read, but it illustrates a good point. Every time I mention the facts that we spend lots more and seemingly do worse by most parameter of community health, my medical colleugues claim that it is because we do all the medical innovation in this country and the rest of the world benefits from our innovations. I don't know if this is true, but I seriously doubt this could account for cost that are 2-4 times higher than the rest of the developed world.
ReplyDeleteThanks for posting this!
So the chart shows we spends a lot more money than the other countries but our life expectancy is no better. Hardly a news flash, that statistic has been around for many years.
ReplyDeleteSound bite graphs are nice but this is a very complex economic and social issue. We will not get to the numbers these others countries spend per capita in our lifetime, this country will not accept such radical change. Sooo, we focus on incremental changes to begin scaling back the ridiculous increases. Those "fixes" have been discussed ad nauseum in this blog.
Lots of apples and oranges bumping into each other on that chart. Those who adore Canada's "single-payer" system would do well to take a close look at what passes for nursing home care in that country.
ReplyDeleteThe UK National Health Service is often mentioned and the cost compared with medical services in the US. I read the Times (UK) and there are serious problems with health care in National Health Service in the UK. People are denied effective procedures and drugs based on cost and budgets, with variations depending on where they live.
ReplyDeletehttp://www.timesonline.co.uk/tol/life_and_style/health/article6997644.ece
http://www.timesonline.co.uk/tol/life_and_style/health/article6995938.ece
http://www.timesonline.co.uk/tol/life_and_style/health/article6993185.ece
Someone should do an honest comparison study to identify elements that contribute to the differences in cost and effectiveness. Let's see a comparison analysis of the cost elements that make up 90% of the costs of US, UK, Canadian, Netherlands, and Swiss systems; and an assessment of how those differences affect delivery of health care.
It probably won't get done because the people who have the means to do it also have vested interests in maintaining many of the high cost elements in the US health care system. Why bother with facts when the current political process can result in giving Nebraska a few hundred billion in a back room deal?
T. R. Reid, in his recent book, “The Healing of America,” covers this subject in some detail. The biggest single difference between the U.S. and other healthcare systems in Western Europe, Canada, and Japan is the prices paid per procedure, per office visit, per drug, etc. To cite a couple of examples, a routine office visit in the Paris area costs €21 and a visit to a specialist runs €26. It would be 3 to 4 times that or more in the U.S. An MRI that lists for $1,200 in Denver is $98 in Tokyo. Germans consume about the same amount of drugs per person as we do yet pay 40% less on average. Specialists in Europe earn a third of what many American specialists earn, though they do emerge from medical school with no debt. Malpractice insurance in Europe costs one-tenth or less what an American doctor would have to pay. Most doctors overseas are never sued, and they perceive that they will never be sued, so defensive medicine is not the issue it is here. Drug prices are controlled by the governments in other countries. The industry goes along with this because marginal production costs are minimal which allows free riding while U.S. patients pay what the traffic will bear.
ReplyDeleteUtilization is more intense in the U.S. with respect to end of life care, and established standards of care generally call for aggressive treatment patterns in certain markets including the Boston to Washington corridor, Houston, Miami, Southern California and a few others. Finally, most of the visits to doctors in other countries compared to the U.S. are for primary care. Higher medical prices are the key reason for our high costs which is why we need robust price and quality transparency tools that would be available in a user friendly format to both referring doctors and patients who care about what services, tests and procedures cost even when insurance is paying.
On this point: Doctors there "emerge from medical school with no debt." I know this is often true because those countries offer free medical education. I wonder if these numbers generally include the cost of that susbidized medical education in their GNP figures.
ReplyDeleteIt Italy, for example, there is a surplus of doctors because admission requirements for medical school are so low. And tuition is free. Thus MD salaries are bid down very, very low.
On this: "most of the visits to doctors in other countries compared to the U.S. are for primary care." I think this is a key factor. Instread of triaging patients up to higher cost specialty care, many more things are handled at the primary care level.
ReplyDeleteWe could do that here, too, if (paradoxically) we paid our PCPs better. Then they would not have to rush through to see patients in 18-minute visits. So, I believe paying PCPs more would eventually lower our overall cost of care.
The notion that specialty care is driving up costs is a fallacy. Specialist having a greater depth of knowledge often will treat diseases with more efficiency, and thus at lower cost. One example from the Otolaryngology literature is the treatment of otitis externa. Average number of visits to PCP for treatment, FIVE. Average number of visits to the ENT specialist for treatment, ONE. Which costs less?
ReplyDeleteThis doesn't take into account the cost of time off work to go four additional doctor visits.
Paul,
ReplyDeleteI agree with you on your point about paying PCPs more. That would allow the PCP to provide better, more thorough care, thus improving overall health and lowering costs. At the same time, it would probably help with the national shortage of PCPs. More might go that route if they were sure of a decent income. Might it also eventually lead large medical centers to spend more money on primary care centers and less on fancy specialty centers?
Acknowledging the above comments regarding Barry's information, I would like to highlight his information on malpractice premiums and defensive medicine. I believe this difference between the U.S. and other countries leads to more specialty care as well as many more tests per patient episode, thus contributing to costs.
ReplyDeleteAs anyone who has ever investigated a medical error knows, the causes are almost always multifactorial. The same is true with the entire system's fallacies - the root causes are multifactorial, and the solutions will have to be multifactorial also. Good info, Barry.
nonlocal
I think the comments by Barry Carol are relevant to answering the question about why medical care costs more in the US. If the rates for an office visit in Paris are about $40 US, and more than $100 in the US, we aren't going to get costs down by increasing the fees for PCPs. If an MRI costs 12 times as much in Tokyo as it does in the US, and if other procedures have similar ratios of costs, then the cost of care in the US is always going to be greater than in those countries. If the drug companies can charge $20,000 or more per month for a regimen that may increase life of a terminally ill cancer patient by a few months, there is is little hope for reducing US costs compared to other countries where the national health services simply refuses to pay such costs.
ReplyDeleteWe need a comprehensive analysis of the costs of all of the elements of health care, compared to the "other countries" standard represented by the "National Geographic" chart; and then we need to have a very open public discussion leading to decisions on what we want to pay for as a country.
The result will be that some people will be paid less for some of the goods and services they provide, and some people will not be provided with "Cost is no object" health care paid for by "Other people's money".
Re: Brenda RN - If we pay PCPs more, and therefore get more of them out where the patients live, then what elements of the health care system should/would be cut to result in a net lowering of health care costs?
ReplyDeleteMaybe someone at BIDMC could suggest some areas where such an increase in PCP payments and numbers of PCPs would result in lower budgets and billings from the major hospitals in Boston. Who or what among those hospitals would be displaced? What would be the Return on Investment in terms of net cost reduction per dollar of increased payments to PCPs?
All this discussion about paying PCPs more makes no sense. Paying PCPs more will only increase the cost of care. Increasing the number of PCPs (by paying more for them) is moving backwards. The evolution of medicine is toward more specialization. Besides, this model was tried already in the late 80's and early 90's with the HMO/gatekeeper model. It was a failure.
ReplyDeleteAmerican medicine is moving in the direction of more specialized care. You cannot obtain privileges to do a procedure at most medical centers these days unless you have ongoing experience doing those procedures (eg laser surgery). With greater specialization, however, comes more experience in the hands of fewer physicians. More experience in turn leads to more efficient treatments, better outcomes, fewer morbidities, and lower costs.
Why should we continue utilize physicians (who are expensive to train and pay) to manage routine blood pressure problems, diabetes, and well visits? What we should be discussing is how to replace most PCPs with midlevel providers who cost less to train and pay. Physicians and surgeons can then focus more complicated speciality care.
Michael;
ReplyDeleteI presume you are a specialist, as am I (pathologist, though, so different). There is one problem with your ideal of specialist nirvana - specialists only pay attention to their organ systems when seeing a patient. Both as a physician and as a patient, I have seen/experienced many cases where a specialist has missed something because they fail to look beyond their own narrow focus. Now having said that, the flip side of the coin is that the primary may not have the knowledge base to put disparate symptoms together - but at least they are aware of all the symptoms.
Endocrine diseases are an excellent case in point, where the patient has multiple symptoms involving several organ systems, and spends much time on the hamster wheel of visiting a separate doc for each symptom (at great expense per visit), never getting the full picture.
In my experience midlevel providers are even worse at diagnostics. Let a doc make the diagnosis, then the NP/PA can provide the treatment and follow up.
nonlocal MD
nonlocal MD,
ReplyDeleteI'm not advocating all medical care should be specialty only, there certainly is a need for skilled diagnosticians and generalists to treat routine problems and even coordinate care for complex patients at times. Also many patients need guidance as to what diagnostic or treatment path to pursue.
I have also seen as many missed diagnoses due to a lack of familiarity with a certain disease process. Your example of the endocrine specialist is a good one. A skilled and experienced endocrinologist will be able to recognize and understand patterns of disease that would lead to a quicker diagnosis and more efficient treatments.
Michael I agree with you that we are headed for more specialization and everything I have read suggests that specialization results in more streamlining, better safety, and greater efficiencies.
ReplyDeleteBut to Paul Levy's point, how can we hope to control costs without changing our treatment of PCPs? I agree in paying them more if we can reform their role in such a way that its beneficial for them to keep patients from needing to see specialists, and increase the overall cost of care. Right now I feel that PCPs don't have the resources, especially time, to really effectively keep patients from needing higher level treatment. But I also feel that to reform how PCPs are paid and practice would require truly massive reform not just in payment but in Medical schools as well.
As nonlocal MD suggests, healthcare costs in the U.S. are higher than anywhere else in the world for lots of reasons. One issue that doesn’t get the attention I think it deserves is what I would call the combination of unreasonable patient expectations and an entitlement mentality. There seems to be a widespread belief among the public that more care is better care and patients should have access to any service, test, drug or procedure that has even the slightest chance of benefiting them no matter how expensive and that someone else (insurers or taxpayers) should pay for it. Any suggestion that we use comparative effectiveness research or cost-effectiveness criteria to influence what insurance will cover is blasted as bureaucrats and/or insurers inserting themselves between the patient and the doctor. The recent uproar over the U.S. Preventive Services Taskforce recommendations regarding breast cancer screening is the most recent example of this attitude. At the same time, I wonder to what extent the community standard of care in more aggressive treatment geographies is driven by the combination of the profession’s assessment of patient expectations and the prevailing litigation environment as opposed to good, sound medical practice and cost-effectiveness. As I’ve said several times, the enemy is us.
ReplyDeleteI agree on the matter of considering the cost versus effectiveness of treatments. However, the whole process should be completely open and standards established ahead of time.
ReplyDeleteIf the drug companies know that cancer drugs will not be covered at more than $XXXX per month of life extension, and other procedures will be restricted on the same basis, then that should apply across the board. Rank up lung transplants, live donor liver transplants, renal dialysis, end-stage cancer treatments, and whatever else is available on the same $/month basis. Whatever the standards are will apply to everyone.
All of the costs must be considered. It would not be acceptable to let a hospital run an inefficient transplant program and distribute the cost over other patients.
If the answer is $60,000 per quality adjusted year of life then it would be impossible to justify Medicaid paying $80,000 per year to keep someone on a feeding tube in a nursing care facility.
The next question is, who among the medical profession and the political class will write those rules and make them stick?
Would restructuring Medicare into competitive HMO's deter "overutilization"?
ReplyDelete