Monday, June 20, 2011

Lessons Learned from my Uncle's Sacrifice: A Proposal to Reform Medicare

The following anecdote is by Dr. John Maa, Assistant Professor of Surgery at the University of California, San Francisco. It is a follow-up to his original story published here three months ago ("Ultimate Sacrifice"). You can also read the story of his mother in this week's New England Journal of Medicine ("The Waits that Matter").

My uncle’s tale illustrates the fundamentally American tragedy of experiencing financial and medical catastrophes simultaneously, and having to choose between rationing one’s own care or depleting precious financial resources for potentially lifesaving treatment that could as well be futile.

From my perspective as a surgeon, an additional tragedy is that my uncle never got the chance to know his cause of death with certainty. There is a small chance (approximately 5 percent) that his jaundice arose from a benign or treatable condition such as lymphoma, an autoimmune process, or another noncancerous condition, and that if he had received full treatment he would be alive and well today. But a diagnostic surgery would likely have added $100,000 to his final medical costs. Thus my uncle weighed the odds and rationed his own care to preserve his daughters’ inheritance for their future benefit.

To answer the question I posed at the end of the previous article, I do not believe that my uncle was treated fairly by the system. Sadly, he was just a few years too young to receive Medicare benefits, despite having paid into the system for decades. I was especially struck by the feedback about my uncle’s story from readers in France, Poland, Canada, Cyprus, and other countries with universal health care who were stunned to read of the dreadful timing in this desperate situation.

The Problem:
Only in the American employment-linked health insurance system does the loss of job also bring with it a loss in access to health care. The special irony is that my uncle had actually just become employed as an independent contractor a few weeks before falling ill. He thus had not felt the need to purchase COBRA as he hoped to soon receive health benefits. His charity care application had been denied as he was employed when he fell ill and had truthfully reported his future inheritance from his mother (even though he would not have access to it for over a year). Given these assets, he likely would not have qualified for Medicaid either.

In 2000, the WHO rated health systems worldwide. The most interesting aspect of this report was the methodology. One fourth of the ranking was dependent on the concept of “financial fairness”, with the ideal that the system be progressive, wherein wealthier people would pay a higher percentage of their income for healthcare than poorer people. Instead, the way Americans pay for healthcare is actually the opposite of the ideal championed by the WHO. The underinsured and poor pay a higher proportion of their household income for health insurance and are particularly vulnerable to bankruptcy from medical illnesses, while wealthier people are more likely to receive tax free complete health coverage as a benefit of employment.

Except for patients who require dialysis or develop certain disabilities, Medicare is generally an all or nothing proposition, with the magic threshold at 65 years of age. According to the Medicare website, “Generally, you are eligible for Medicare if you or your spouse worked for at least 10 years in Medicare-covered employment and you are 65 years or older and a citizen or permanent resident of the United States.”

Between joining the workforce at age 25 and retiring at age 65, many Americans will make Medicare payments for many years beyond the mandatory 10- year requirement. No credit is given to people like my uncle, who pay into the system for decades but fall ill before the age of 65, whereas pitfalls and loopholes in the current Medicare system cover others who never paid into the system at all.

I observed one such loophole during my time working as a general surgeon at a county medical facility serving the indigent population in California. Not infrequently, I witnessed “medical travelers” with kidney failure who came to the United States from other countries, where dialysis was no longer offered to them cost-free after the age of 65, thereby requiring them to pay out of pocket. These patients would apply for “emergency” Medicare in the U.S. to continue life-saving dialysis that they could not afford in their own countries. In other instances, patients actually possess sizable financial assets but conceal them by giving these away to their children or not reporting these truthfully (unlike my uncle) to qualify for charity care or meet Medicare eligibility requirements.

It is hardly news that the existing Medicare scheme already includes an element of rationing by limiting the number of Medicare inpatient and long-term care days a person can receive. Our nation has yet to meaningfully discuss end of life care and the potential solutions by setting a budget to overall spending, but starting this discussion will inevitably become necessary.

In 2010, Medicare had 47 million beneficiaries or 15.3% of the total population. In 1965, there were 19 million enrollees (9% of the total US population). This increase is partly due to the significantly greater life expectancy (age 70 in 1965 to age 79 in 2011) achieved by the successes of the American health care delivery system. This more than doubling of the number of recipients is a contributory factor to the looming insolvency of Medicare.

Reforming Medicare:
An alternate construct might be for individuals to accumulate a budget of health care benefits for personal use that varies according to the contributions they made into the Medicare system over their lifetime, and is available regardless of the age at which they would like to make withdrawals. Perhaps this individual allocation could be supplemented by a fixed baseline contribution from the government, which we could place in the range of $20,000. In this alternate world, medical prices and costs would be completely transparent, and the patient (or decision-maker if the patient is incapacitated) could choose from a menu of options for how aggressively to spend this allocation, recognizing that if they exceed the budget is exceeded then he or she must pay the balance on their own. Luxuries and optional care will either deplete the budget, or be paid for out of pocket. The concept of personal responsibility and taking care of one’s health will be reinforced in this scheme, though an adjustment must be made for those who fall ill to diseases that are the result of bad luck and circumstances beyond their control. Perhaps an individual can even choose to opt out of the program (as my uncle would have done), to be able to save some fraction of the remaining balance as an inheritance for his or her descendants.

Equally important, this mechanism may drive health care prices down, as purchasers will be motivated to be frugal and educated, rather than ignorant, of the true costs of care, while providers, hospitals and manufacturers will need to lower prices as they compete for business.

I discovered the Costs of Care essay competition while researching the key difference between the “costs of care”, and the “price of care”. The two are quite distinct, and have been fundamentally misunderstood in the health reform debate. In addition to “bending the cost curve”, our nation should seek to “bend the price curve” through a deeper understanding and transparency into how the health care industry sets the prices of medical care in America.

Ultimately, my goal in writing this essay is to assist in reframing the national dialogue about health reform. The debate about rationing of health care should not simply be about the extremes of either denying access to all care, or allowing unlimited access to full treatment. Instead the time has arrived for our nation to intelligently explore the full range of possible solutions in between.

Epilogue: I celebrated the two year anniversary of my uncle’s passing by visiting the long term care facility where he spent his final days. I was impressed by several visible changes for the better (new services, a higher occupancy, social programs, and a refurbished lounge for residents). It gave me hope that progress is possible. My uncle’s younger daughter will begin college in Pennsylvania this fall. His elder daughter graduated with honors from college in May 2011 and will begin work in Manhattan over the summer. At her commencement, a video was played from freshman week four years earlier, and footage of my uncle that our family had never seen before was displayed to all of the graduating seniors. Despite making the ultimate sacrifice, my uncle’s presence was palpable at the celebration, and his intent fulfilled.

Sunday, June 5, 2011

Thanks for shopping: Cost-consciousness and clinical decision-making

Ian Metzler is a medical student at Harvard Medical School, currently studying health systems improvement at Children's Hospital Boston.

With computerized health systems, physicians can place orders as easily as they can shop online at Just a few clicks and your physician can purchase a panel of blood tests, futuristic imaging and diagnostic procedures that will hopefully guide their path to solving your ailments.

Search. Click. Submit. Repeat.

Except, unlike online shopping, physicians don’t see the price tags and they never get the bill. Doctors are the true consumers of health care dollars, but the rules of economics falter when the consumers aren’t the ones that pay up. This disconnect is a fundamental cause of the uncontrollable inflation of health care costs in the US. Ignorance about cost fuels spiraling inflation in healthcare because without cost-related restraint in utilization there is no incentive for suppliers of healthcare services to get any cheaper.

But the system’s stuck. While physicians ultimately control the tap of healthcare costs, exerting that control can contradict their primary objectives. Physicians feel a responsibility to do the most they can to make the patient in front of them better. If young doctors don’t order a test, a superior may berate them for not considering it in their differential. Malpractice always lingers as a consequence for a diagnosis missed. Some claim that it is irresponsible or unethical for physicians to consider cost in their clinical decision making. Perhaps good doctoring should be blind to finances. And after all, it’s no skin off the doc’s back to just click a little more, some of that money may even end up back in their own pockets.

Despite all these pressures pushing physicians to just do everything imaginable, many realize that physicians also have a responsibility to balance the health of the individual and the health of the community. No matter how much we try to ignore it, health care is a limited resource and giving more to one inevitably means less for another. In Cooke’s 2010 NEJM article on cost-consciousness in medical education she writes, “[We must] stop hiding behind the myth that every physician should and does apply every resource in unlimited degree to every patient for even minimal potential benefit”. The reality is, physicians already dictate how finite resources are allocated in the hospital. Physicians decide who gets how much of their time, who deserves a consult from a specialist and who should be in an ICU bed. Why don’t physicians exhibit the same judgment and restraint for expensive tests and imaging studies? Cost-consciousness at this scale may be beyond human cognitive capacity, especially when competing with disease differentials and medication lists. It’s far easier to count down the hours in the day and notice when all the ICU beds on one wing are full than to be mindful of the obscure strings of digits and commas that represent their health care spending. The finances of health care are far less visible but just as real.

While respect is growing for skyrocketing health care costs, the average doctor is clueless about the price tag of their day-to-day clinical shopping-sprees. In a 2008 review of 14 studies, Allan et al. found that doctors came up with estimates that were within 25% of the true cost of diagnostic tests less than one-third of the time. And, interestingly, they found that the country, level of training, and specialty of those surveyed did not impact accuracy. This tells us a few things: doctors have no idea how much they’re spending for their patients, it’s not just US doctors or super-specialists who are clueless, and most importantly, it doesn’t get better the farther along young docs get in their training. The Chief of Medicine who can diagnose Peutz–Jeghers syndrome from across the room may have no idea how much it costs to do a colonoscopy or a genetic workup for the patient. It’s not just students who are na├»ve and, sadly, financial insight doesn’t come with time.

For our generation, this deficit threatens to spin out of control. The stakes rise as physicians become capable of doing more and more for each and every bullet point on their differential diagnosis. Immunoassays and genetic tests are available for the obscurest pathologies. Imaging technology can produce increasingly fantastic windows into the human body. But as these options become more numerous and specialized, our grasp on what’s necessary to produce quality care only slips further.

If cost-consciousness among physicians is the goal, how do we achieve it? Competition for doctor’s time and brain-space is fierce. Cooke thinks that health finance should be integrated into medical school curriculum from the start. Educators suggest dual-degrees in business. Researchers have tried post-graduate education campaigns. Hospitals try to intervene with computerized decision-support systems. Insurance companies stall with mandatory pre-authorizations. But few interventions have shown substantial increases in awareness of cost or changes in physician behavior.

Health information technology (IT) may be partly contributing to the ease of over-zealous ordering, but it may also hold the potential to curb it. Two large randomized controlled trials conducted at a large teaching hospital attempted to show that the inclusion of costs in the ordering system itself might increase awareness of physicians and decrease the over-utilization of diagnostic laboratory tests and radiological imaging. Although it was conducted over four months and involved over 24,000 patients, the study showed a statistically insignificant 4.5% decrease in the number of laboratory tests ordered and almost identical rates in the number of imaging studies ordered. The authors concluded that more intrusive measures were needed in order to affect change, like prompts similar to those in decision-support. Price tags alone weren’t enough.

Ultimately, the judicious and cost-effective utilization of limited health care resources remains a physician’s responsibility. They’re trained to make clinical decisions and manage treatment plans but those same decisions dictate the finances of patients and the health sector as a whole. These dual roles are inseparable and increasingly consequential yet the majority of physicians are too unaware or unprepared to meaningfully incorporate financial consequences into clinical decision-making. Any efforts to reform health care policy to reduce costs and spend our health care dollars more efficiently and equitably must start with assisting doctors make better and more informed decisions for their patients. Physicians must wake up to the reality of modern medical practice and start educating themselves about the economics of their patient care methods and they must demand the information when it’s lacking. This will require a culture shift in how medicine is practiced and future generations of doctors are trained. In a world of competing priorities and information overload, physicians will need help. More cost-effectiveness data is needed so that physicians have an evidence base for rational allocation of resources. Health IT, decision-support, payment reform and institutional leadership are all essential strategies to encourage cost-consciousness and appropriate health care spending, but none can be effective in isolation. The tap of health care dollars that threatens to run dry is controlled by thousands of physicians and their daily interactions with unique patients. Only through innovative programs and education campaigns can we reduce the flow of excessive health care spending and help physicians avoid irresponsible clinical shopping sprees and begin to make evidence-based decisions with a broader context in mind.

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