Thursday, September 12, 2013

Having their cake and eating it: Perverse incentives

A friend made an excellent point the other day, upon reading my post about Consumers Union's advocacy for warranties on orthopaedic devices.

"The thing about CU and the warranty struck me hard as a revelation. We in the health care field are brainwashed into thinking these normal business practices shouldn't apply to medicine, while embracing the idea that the money-making business ideas (like ROI) should apply. But basically it adds up to doctors, administrators, and equipment suppliers having their cake and eating it, too: Getting to apply the positives from business, while avoiding the negatives which apply in all other industries, like guarantees of your work."

The big costly examples are obvious:  An alliance among the three groups (doctors, administrators, and equipment suppliers) to install a surgical robot or a proton beam machine to gain market share, but take no responsibility for determining clinical efficacy or adverse impacts or overall inflation of medical costs.

But as my friend points out, the small, ongoing ones are equally obvious.  Orthopaedic devices that regularly fail after installation in human bodies, with no recourse to the suppliers, and no adverse consequences for the hospitals or doctors that have used them without insisting on warranties.  Ditto for minimally invasive surgical equipment, which is notorious for failing after normal cleaning and sterilization processes.

You would think that the payers--Medicare, Medicaid, and private insurers--would step in, but they are complicit or oblivious.  You would think that the group purchasing organizations would step in, but they, too, are complicit or oblivious.  Maybe they are motivated by the implicit or explicit kick-backs they get by favoring certain suppliers.


Anonymous said...

The very fact that until now, no one thought to ask for a warranty on a medical device, which would be normal practice elsewhere - and that the idea came from a consumer oriented group outside the industry - tells us how cowed we have all been by the magical, shaman-like aspects of medicine, into being grateful for a positive outcome but too forgiving of a negative one. This has applied not only to the public but to thought leaders within the industry.

Many hospital processes and operations have been subjected to great internal scrutiny for how much money they will save or make for the hospital, while how harmful vs beneficial they are has been completely ignored. This would not happen in any other industry. Time to start making many, many more CU-type demands.

nonlocal MD

Joleen Chambers said...

Can we appeal also to the surgeons/hospitals who implant these devices? Please don't allow institutional risk management to stifle the voice of the harmed patient. The harmed patient is the 'canary in the coal mine' and trusted you with his/her life. Scientific inquiry into the origin of the harm and professional ongoing medical care for the harmed patient is essential. Without this commitment, you are merely an "installer". It is the preventable harm of patients that is so damning.

Anonymous said...

In a post of long ago, you described purchasing a robot for your previous employer. Can you describe the thought process that was involved at the many decision making levels?

Paul Levy said...

Here you go:

akhan13 said...

Glad for this post. I asked you before why you write so much about proton beam therapy, not because I didn't agree with you, but because the acceptance of modalities that are far from cost-effective is so pervasive that I found that particular selection to be curious. I have since done more research and found that PBT is among the worst offenders (as you have been telling us), but as you mention here, our entire sense of cost/value in healthcare is completely absent (or has not been enforced at all through our payors).

Anonymous said...

To answer one of the previous comments.... In any hospital, the purchase of the robot is influenced a little by marketers and administrators and mainly by MDs. In an environment where services may be commoditized MDs choose to bring to the table "something new" mainly to the advantage of their productivity (diversification) with significant moral adversity (I am not paying for the robot and if I don't do this someone else will). Doing so they lobby with their clout (I will bring my patients somewhere else) the purchase of the robot, that is the most useless piece of technology ever invented and the data prove it. More to say... who uses the robot? those who have had no training with other techniques and who would do the operation open at most without referring him/her to the expert. The robot has the fantastic advantage to minimize learning curve for minimally invasive surgery, as a matter of fact. On the contrary, expert surgeons do not find the need to use the robot as someone claims that he/she may be even faster than the robot itself. The company, Intuitive, has recently only attracted as cosmetic testimonials only very skilled but unknown private practice surgeons, as most of so called "academics" (data driven) are still reluctant to use it. The last marketing idea of the company is to state that robotic surgery is better than open when compared to traditional laparoscopy. The responsibilities of the different constituencies are therefore fascinating.... An in the middle, lies the administrator without medical background that trust bona fide the MD.