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Healthcare Reform – Myths And Miracles

 

The U.S. must join the rest of the Western world and ensure that every American has access to modern healthcare. We will however accomplish nothing worthwhile if we provide universal healthcare insurance and don’t have a real plan to deliver healthcare to the 46 million Americans who are now uninsured. Liberals, conservatives and moderates in Congress have developed innumerable insurance schemes, electronic medical record systems, a cliché or two about living healthy lives, tax mechanisms to pay the bill but have no plan to actually deliver healthcare the day after they congratulate themselves on reforming the “healthcare system”. Maybe they can borrow George Bush’s “Mission Accomplished” sign.

Those of us who have worked with dozens of differing universal healthcare systems throughout the world come to the problem with a very different perspective. Universal insurance is the easy part, it only costs money, and depending on the political flavor of the month, we will make our choice on how to pay for it.

Let’s examine some of the myths and deal with the reality.

Myth I - Preventative care by primary care physician will save the system hundreds of billions of dollars - If the prevention strategies we employ are just platitudes - Eat better, lose weight, exercise more, stop smoking - then they will cost very little and they will save money by keeping people healthy. But we don’t need a healthcare system for that - A public service advertising campaign will probably be more effective. If prevention requires medical intervention however, it will cost a lot of money. Medical prevention is a great thing but it requires extensive and often costly screening to find risk factors such as hypertension, elevated cholesterol genetic predisposition to certain cancers etc.

In an essay in a recent edition of the Wall Street Journal Dr. Abraham Verghese explained - “Discovering high cholesterol in a person who is feeling well, is really just discovering a risk factor and not a disease; it predicts that you have a greater chance of having a heart attack than someone with a normal cholesterol. Now you can reduce the probability of a heart attack by swallowing a statin, and it will make good sense for you personally….. But if you are treating a population, keep in mind that you may have to treat several hundred people to prevent one heart attack. Using a statin costs about $150,000 for every year of life it saves in men, and even more in women since their risk of heart attack is lower.”

The more that preventative medicine is applied to increasingly large populations for an expanding list of preventable diseases, the greater the current cost to the system. Saving money on a heart attack that does not occur 20 years from now will not pay for the necessary prevention that will allow Americans to live longer and healthier lives. We have to pay for it today.

Myth II - If we can convince more young physicians to enter primary care we will be able to efficiently treat the increased patient load - If we make the reasonable assumption that American physicians currently work a full day; who is going to treat this new influx of patients. While it may overstate the case to say that these patients are not receiving any healthcare, it is instructive to calculate how many physicians would be needed to treat 46 million additional patients. In the U.S. we have approximately 3.0 physicians per 1,000 people thus, if we extrapolate we would need an additional 138,000 physicians to treat this population.

We are already behind the curve; there were 15,242 medical school seniors in 2008 to fill approximately 22,000 residencies. Not surprisingly, roughly 4,650 were filled with foreign graduates, some of whom were Americans who had studied abroad. The balance was filled with graduates of osteopathic schools. The medical-colleges association has called for a 30% increase in enrollment by 2015 as compared with 2002 primarily by expanding existing schools and opening new campuses. This goal may be unachievable. Thus, in the future, larger numbers of foreign medical school graduates will be needed to meet our needs since, expansion of medical education is unlikely keep pace with the increased need for physicians.  For example, the medical-college association estimates that if physician supply and use patterns stay the same, the United States will experience a shortage of 124,000 full-time physicians by 2025. Universal healthcare will further increase the need for physicians.

A recent study published in the New England Journal of Medicine estimated that 23% of medical school graduates begin their professional life with $200,000 or more of debt from pre-med and medical school loans. In addition, a substantial number have over $100,000 in debt by the time they graduate. At what point is it uneconomical to become a U.S. physician knowing that government is dedicated to reducing its expenses by limiting the income a physician can earn?

Medical students in Europe and elsewhere, where national health programs are virtually universal do not pay to attend medical school, the government who in a very real sense limits the ability of these future doctors to earn a living, has made a implicit bargain with the students; education is free but the government reserves the right to determine your level of compensation throughout your professional career. At the moment, the American medical student is asked to go into hock for $200,000 or more while their ability to control their level of compensation once they graduate may be determined by government bureaucrats.  Americans are likely to perceive such a system as inherently unfair, and may insist that government pay for medical education, like the rest of the Western world.  Has Congress calculated the potential cost? Will they increase the quota for foreign trained physicians to enter the U.S. to help alleviate the shortage?

Myth III - Expensive misuse of emergency rooms for primary care will decrease when all patients have insurance - This logic is perverse. Since we have a shortage of physicians patients with insurance cards will be showing up at emergency rooms in even greater numbers. They have nowhere else to go. If we don’t first solve the physician shortage problem emergency rooms all over the country will be overwhelmed.

Myth IV - Government purchasing power will reduce the cost of prescription drugs and thereby significantly reduce health costs- We spent $2.2 trillion in 2007 on healthcare, or 16.2% of our Gross Domestic Product (GDP). Even more worrisome is that expenditures continue to rise at an alarming rate of 6% annually. Prescription drugs account for approximately 10% of that total. Prescription drugs have always accounted for only 10% of the total going back as far as the Eisenhower administration. A simple calculation will show that even if you cut prescription drug cost by 25% tomorrow the cost of health care would still grow at 3.5% the first year and return to its 6% trend line by the following year. Prescriptions drugs are to small a fraction of the total cost to make a significant difference.

In fact, if used properly prescriptions drugs should reduce the cost of more expensive care. Moreover the use of prescription drugs per se will not decrease it will increase to a per capita level that is commensurate with other Western countries that have universal healthcare systems. Forget the propaganda that we are a drug-oriented culture, the reality is that our per capita consumption is far below Western Europe. We may decrease the cost per unit with government pressure but our overall prescription bill will increase and it will have virtually no impact on overall healthcare costs.

Myth V - Electronic medical records (EMR) will save billions - EMR will make the practice of medicine more efficient and safer but it is unlikely to reduce costs significantly. Doctors, nurses, therapists, particularly in hospitals will be spending more and more time focused on the computer, communicating with each other, ordering and getting test results etc. People are what cost money in any business and they will be spending increasing amounts of time feeding the computerized monster.

Myth VI - We can have a cost effective healthcare system without tort reform - Elimination of the cost of defensive medicine is a crucial step in a “real” healthcare reform effort. Defensive medicine occurs when doctors order tests, procedures, or visits, or avoid high-risk patients or procedures, primarily to reduce their exposure to malpractice liability. The cost to Americans is difficult to calculate because it is divided between inappropriate behavior and the more insidious and costly subversion of the whole health care system. 

Several studies give us at least a sense of the magnitude of the easily identifiable problem of inappropriate behavior. Conservative estimates put its cost at more than $100 billion annually. According to one study of more than 900 physicians by the Massachusetts Medical Society and UConn Health Center researcher Robert Aseltine Jr., about 83 percent of physicians reported practicing defensive medicine, with an average of between 18 percent and 28 percent of tests, procedures, referrals, and consultations and 13 percent of hospitalizations ordered for defensive reasons.

It is instructive to look at a common example of the more insidious systemic problems that our overzealous malpractice system creates. Since the 1960s, hysterectomy has been one of the most frequently performed inpatient surgical procedures in the United States, with an estimated 33% of women undergoing a hysterectomy by 60 years of age. The medical/legal “rationale” for this excessive number of hysterectomies is that it prevents cancer and prolongs the life of women.

There is a relatively easy way to calculate how many of these procedures are medically unnecessary. In Western Europe, for example, only about 10%-12% of women under 60 have undergone a hysterectomy. Yet European women do not have a higher incidence of reproductive cancer and they actually have a longer life expectancy than American women. Conclusion, two-thirds of all hysterectomies performed in the United States are unnecessary.

For lack of a better phase I will call this ubiquitous problem the “Legal Hysterectomy” procedure. What gynecologist in the U.S. will cease performing questionable hysterectomies, knowing that in the unlikely event the patient develops a reproductive cancer or just excessive menstrual bleeding a lawsuit is a virtually certainty? Therein lies the problem. Every medical specialty has its own “Legal Hysterectomy” procedures and combined they not only waste unconscionable sums of healthcare dollars but subvert the medical system itself.

America needs special health courts aimed not at stopping lawsuits but at delivering fair, predicable and reliable decisions. A special court would provide expedited proceedings with knowledgeable staff that would work to settle claims quickly. Trials would be conducted before a judge who is advised by a neutral expert, with written rulings on standards of care.

Myth VII - Government will ensure that the most cost effective treatments are utilized - When Congress is involved can special interests be far behind. For example, Massachusetts which recently initiated a State based healthcare reform system has found it essential to cover hair transplants. If for one moment you believe that the cosmetic dermatologists engorged with their collagen shots and herbal therapists with a nutritional cure-alls etc. are not lining the halls of Congress as well as lining the pockets of Congressmen then you have been out of the country too long.

The current debate is less about healthcare reform and more about insurance reform, perhaps if we reverse our priorities we could focus on the big issue - Providing every Americans with not only affordable healthcare but first-rate healthcare as well.

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8 Responses to “Healthcare Reform – Myths And Miracles”

  1. Put a big ol’ McDonald’s-type menu board at every point of service and people will start making informed decisions. Does anyone really know what it costs to see the doc and why? That is the crux of the problem.

  2. This is an excellent analysis of the issue. My knowledge of how the government handles things leads me to believe that it will not anger its trial lawyer supporters by reducing malpractice litigation; it will just lower all standards of medical education to increase the number of “doctors,” and will simply ration healthcare as it sees fit.


  3. Your analysis of impact of threat of malpractice law suits on final medical costs is if anything, conservative. As a recently retired radiologist (and therefore one who benefited from defensive medical practices) I have experienced this impact on medical practice first hand. Threat of medical malpractice lawsuits is deeply ingrained in the minds of the practitioners in medicine and directs ALL their activities to the detriment of the general public. Even if you grant that it has a beneficial effect in that, the US medical practice is second to none when it comes to diagnostic acumen, it more than makes up for it in treatment and therapeutics and an unbearable cost of delivering health care to all. As long as our politicians are controlled by trial lawyers, we should not expect lower medical costs. Physicians will either give up practice of medicine or will continue to practice the way it is practiced now. They have no choice in this matter.


  4. As a bankruptcy lawyer (who taught torts for 7 years), i see medical malpractice and medical costs from two sides. The cost of medicine is a major contributor to patient bankruptcies (along with divorce and loss of jobs, of course). Medical malpractice is a clumsy effort to achieve two goals: prevent malpractice (that is, get rid of the bad apple physicians) and provide some financial support to the victim of malpractice when that person is injured (sometimes the injury is so great that the victim can no longer support him/herself; in other instancesthe support is needed to offset the cost of continuing treatment; and in others it’s just a way of compensating for the loss of enjoyment of life).

    Money has a lot of flexibility, but the system has a lot of flaws: (1) it’s a very costly way of making a determination; (2) it doesn’t necessarily get rid ofthe bad apples; (3) insurance provides a lot of the money but shields the doctor from the consequences of his/her errors.

    A better system would be to have an efficient “bad apple” removal system (with consumer input as well as professional input, thank you) that operated directly on the problem. As far as compensation is concerned, the risk of being a malpractice victim should be treated no differently than the risk of being struck by lightning or by a falling tree limb. By that I mean that the cost of occurrence should be compensated reasonably, so that the victim has financial support and as good a life as can be expected. The insurance should be a general fund, not one specifically directed at doctors or increasing the cost of medicine. (A few Australian states adopt this solution).

    So far as preventiion is concerned, I would advocate forceful steps to eradicate obesity and increase exercise. Obesity should be treated as a serious, life-threatening illness. We should provide monetary (tax credit) incentives for people to go to gyms (and they only get the credits if they submit a certificate of attendance). “Bad foods” should get red warning labels. Smoking should be prohibited except in public spaces. In other words, every social mechanism should be erected root out harmful, personal acts and encourage ones which make people healthy and — ultiamtely — happier.

    It’s really time to start thinking outside the box (I mention ideas above — each has its flaws and advantages. But I think that many of them could lead to an overall better society, and that’s the goal).


  5. It seems to me that this health care situation needs to be open for more discusssion instead of bo, the prez, not the dog just coming up a plan that will surely endear him to many voters so his bio will look good at the end of his time in office and sending same to congress where the liberals will gush and the press will gush even more about how great he is. And the workers will be taxed! It is entirely possible that the government is not part of a solution but in fact may be the problem? There is no inherent skill of management endowed in govt just because they are elected or have a lot of money to spend. They are fearless spenders, probably because they don’t have to work for the money. Instead they get it by taxation of the working class.

    Furthermore it is not clear what Constitutional authority, supposedly the law of the land, our elected officials use to enact all this social legislation. To them it is a Robin Hood deal where they rob, tax, the workers and give to the non-workers. This appears to be the central and driving thinking behind the liberal philosophy in America. And the national debt is really nothing more than a no cap credit card.

    It is really the moral obligation of the govt to provide everything to a certain class of people? When to do so they have to discriminate against the majority by taxing them to be able to provide everything to the “chosen class”. The real problem with govt interference in society is not because there are no people that do not need help, but it is in determining which people need help. If people were not taxed for these social programs, including interest on the national debt, then we would all have more money in our pocket to use for charitable works. And as a Catholic it is my moral responsiblity to help those in need. Govts don’t go to heaven. People do. Likewise govts don’t go to hell, but some of them create hell on earth for their citizens. People also populate that place and not the Roman Empire or the Catholic Chuirch. I am not so sure about the Democratic Party however! lol. However there mey be some popes there? And ayatollahs, or even Martin Luther?

    I think this is an immensly fair question to ask. Does our govt have any moral obligation of any kind and for anything? Or are they interferring with my freedom of religion when they tax me and give the money away to blatently buy votes? My right to be charitable is denied me by the govt taking the money I worked for and giving it away.

    The Constitution liberates me and all individuals while severly limiting the federal govt. The fed govt does however have enough power, just enough power to keep us free! Or it is supposed to work that way but doesn’t now.

    Can’t you hear the Amerian citizens in 1776 saying. Free at last, free at last, thank God Almighty we are free at last! Beautiful words by MLK.


  6. I am glad that the author is philanthropic enough to state the need for everyone to have access to health care. In an age when reasonable people expect an entity as counter productive as the US Government to act to change the climate, we should expect even the most intelligent among us to expound irrational thoughts. Government is not Santa Clause it cannot solve our problems no matter what our adoring expectations.
    We have a better chance of providing health care to the needy if we cut out the same bureaucrats who supposedly guard our borders and provide efficient mail delivery and provide it through private charity. If only you were half as mad about Santa Clause stealing half of the cookies in your house as well as all of the other houses in your neighborhood.


  7. Great read, thanks

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