Published in Volume
119, Issue 10 (October 1, 2009)
J Clin Invest.
2009;119(10):2849–2850.
doi:10.1172/JCI40995.
Copyright © 2009, American Society for Clinical
Investigation. Published under the Creative Commons Attribution-No Derivative Works 3.0
License (United States)
Personal Perspective
The debate over health care reform: Houston, we have a
problem
Eric G. Neilson
Vanderbilt University School of Medicine, Nashville, Tennessee, USA. E-mail:
eric.neilson@vanderbilt.edu.
First published September 10, 2009
The political debate over health care reform will reach a tipping point early
this fall. No one knows for sure what will happen. All summer we have seen a complicated
subject confuse politicians, pundits, health care planners, employers, and the public. At
this point one might ask, what problem are we trying to solve?
My answer to this question comes in two parts: one is reducing out-year costs for health
care by bending the curve on incremental growth, and the other is enacting insurance reform
to provide universal coverage and portability regardless of preexisting conditions.
Changing one part has weighty consequences for the other, and so my thesis for discussion
in this JCI forum is quite simple: affording insurance reform is not
possible without cultural change. To pay for insurance reform, we must either accept real
reductions in health care costs or be willing to pay higher taxes or higher copayments for
low-value clinical services, or some combination of all three.
In truth, solutions to health care reform are always cultural and must be cautiously
incremental for one important reason: health care delivery at the moment
is the economy (1). At 16% of gross
national product, in spite of wide recession, the health care sector still provides most of
our current job growth. Whether it is provider reimbursement, general labor costs for
clinical care, medicinal or device manufacturing, facilities construction, insurance
administration, information technology, or nursing home and hospice expansion, there are
real incomes at stake. The middle of a recession is probably the worst time to fix
something this big.
De Tocqueville, on his visit to the United States in the 1830s, observed that Americans are
uniquely fixated on their sense of well-being, and Paul Starr has written there is no
better example than our concern for better health (2); it is ineluctably part of our culture. While doctor-patient relationships are
still the focal point of American medicine, someone else pays for them today, and this is
why physicians face new, sobering demands for cost containment. As one example, at least 27
percent of health care costs are created in the last year of patients’ lives
(3), a percentage that has fluctuated little over
time. One obvious solution would be expansion of the hospice movement as an alternative for
cost-sensitive, high-quality, end-of-life care (4),
but even this has been contentious. For cultural or religious reasons, the profession and
public are unable to face this choice in a forthright, sensitive manner without
disintegrating into hyperbolic rhetoric.
There probably is enough money in our present health care system to enact insurance reform
without new taxes if we were more careful with our clinical and administrative resources.
The historical fragmentation of the health care sector, however, requires large numbers of
small pieces to reassemble for this single purpose. Such a gathering will likely raise the
false alarm of rationing and undermine serious discussion about something physicians can do
right now, namely, reducing the variability in practice costs among doctors treating
similar patients (5, 6). Attention to minimizing this variability is not rationing and has tremendous
possibility for real savings. Reducing the cost of health care is also complicated by
various motivations. The free market profit motives in health care relationships would have
to change, and physicians would have to live with more clinical uncertainty —
not every question a doctor could ask need be answered with a test (5). Yes, overtesting or overtreating is a hedge against malpractice
suits, but absent that, many physicians today feel no additional responsibly for
cost-effectiveness. This indifference leads to thoughtless application of expensive halfway
technologies in the setting of minor illness or futility (1). Physicians today increasingly find it difficult to do the right thing and
only the right thing for their patients.
It is not surprising that per capita costs for health care in the United States are twice
those in other developed countries (7). One reason is
salaries across the entire health care sector have grown large under the guiding influence
of free market health insurance. Providers use historically generous reimbursement dollars
wrestled away from competing insurance plans to stimulate the growth of other goods and
services needed for clinical practice. Robust insurance reimbursement over the last 50
years also greatly benefited physicians by consolidating their professional authority and
status as decision makers (2). Together these
relationships drive capital investment to support demand for more modern facilities,
imaging, drugs, and devices — all of which we need for the right patient.
The other reason we have high per capita costs is the emergence of competitive health plans
in our free market culture: their goals are more than just paying medical bills
— they also compete among themselves and between employers and providers to
make profits; for its scale, this is uniquely American (2). Outside the United States, non–free market insurance plans and
other social safety net programs hold down the rate of rising health care costs. In Japan
you can see a doctor at little expense or get an MRI for $98 (8), but what T.R. Reid doesn’t say in his recent article is
that costs are also lower in Japan because health care salaries are truly dreadful. It
seems we are hampered in reforming health care by our own historical affluence and by an
unwillingness to take health insurance out of the free market — they are linked
inextricably.
Although I am not an alarmist by nature, certainly a shift away from free market insurance
to one gradually dominated by government would risk capricious wage and price controls,
much like what happened when Philadelphia was conquered by the dominance of Independence
Blue Cross and U.S. Healthcare Inc. in the early 1990s (9). If, for example, we pegged all provider reimbursements to current Medicare
rates tomorrow, virtually every hospital in America would be under water, and, to restore
solvency, all other costs for ancillary goods and services would have to fall, leaving
various sectors of the human economy without jobs. On the face of it, this concern
principally underlies general worry over government proposals to form a new public
insurance program for the uninsured. It may not happen and government may just subsidize
free market insurance plans with new tax revenue, but even this approach is not financially
viable without voluntary or legislated cost containment.
The scale of this new tax burden could be partially offset by adjusting insurance
copayments. Copayments are another way to bend the curve on incremental costs. The question
is, can they be adapted to our cultural norms regarding unfettered access to health care.
The Rand Health Insurance Experiment, now 25 years old, foretells that patients with health
insurance seek more access unless copayments rise (10). Copayments are a form of cost sharing, and they do reduce clinical usage, but
there is a wrinkle. Higher copayments cause some patients to forego medications, critical
tests, or preventive care. This perversity can be minimized by value-based insurance
design, where copayments are kept low for high-value health care services and raised for
everything else (11); this strategy could be applied
selectively across all insurance plans, perhaps adjusted for income or age, and probably
deserves more attention.
Finally, the flurry of debate over health care reform neglects one other related point, and
it is one of my favorites. Holly Smith once remarked that the continued existence of
diseases for which we have no answers is the most pressing health care problem of our
times. If health care were universally available tomorrow, even at no cost, people would
still be sickened by many diseases from which they will die (12). More and better clinical science is fundamental to restoring
health and lowering costs. Science, after all, is the only pathway to transforming
technologies that are truly more affordable because they are decisive. Unfortunately, no
one can easily absorb this latter message with all the dirt and twigs in the air.
Footnotes
J. Clin. Invest.119:2849–2850 (2009). doi: 10.1172/JCI40995.
References
-
Neilson, E.G. 2008. Baumol’s curse on medicine. J. Am. Soc. Nephrol. 19:1049-1053.
-
Starr, P. 1982.The social transformation of American
medicine . Basic Books. New York, New York, USA. 514 pp.
-
Hogan, C., Lunney, J., Gabel, J., Lynn, J. 2001. Medicare beneficiaries’ costs of care in the last year of
life. Health Aff. (Millwood). 20:188-195.
-
Palangkaraya, A., and Yong, J. 2009. Population ageing and its implications
on aggregate health care demand: empirical evidence from 22 OECD
countries.Int. J. Health Care Finance Econ . Online
publication ahead of print.
-
Ghosh, A.K. 2004. On the challenges of using evidence-based information: the role of
clinical uncertainty. J. Lab. Clin. Med. 144:60-64.
-
Keckley, P.H. 2004. Evidence-based medicine in managed care: a survey of current and
emerging strategies. MedGenMed. 6:56.
-
Peterson, C.L., and Burton, R. 2007. CRS report for Congress: U.S. health
care spending: comparison with other OECD countries (RL34175). Congressional
Research Service. Washington, DC. 65 pp.
-
Reid, T.R. 2009 August 23. 5 Myths about health care around the
world.The Washington Post .
http://www.washingtonpost.com/wp-dyn/content/article/2009/08/21/AR2009082101778.html
.
-
Iglehart, J.K. 1995. Academic medical centers enter the market: the case of Philadelphia. N. Engl. J. Med. 333:1019-1023.
-
Manning, W.G., Leibowitz, A., Goldberg, G.A., Rogers, W.H., Newhouse, J.P. 1984. A controlled trial of the effect of a prepaid group practice on use of
services. N. Engl. J. Med. 310:1505-1510.
-
Chernew, M.E., Newhouse, J.P. 2008. What does the RAND Health Insurance Experiment tell us about the
impact of patient cost sharing on health outcomes? Am. J. Manag. Care. 14:412-414.
-
Smith (Jr.), L.H. 1985. Alan Gregg memorial lecture. Medical education for the 21st century. J. Med. Educ. 60:106-112.
