Dr. Tom Roberts Commentary: “Eliminating Waste, Creating Efficiency”

Costs for providing health care in our country have continued to climb at rates that are unsustainable. The evidence is not hard to see. Employers have had to make significant changes in insurance benefits for their employees. Families and individuals are increasingly asked to pay a larger portion of their health care bill. Many employers have been forced to stop providing health insurance at all. Our federal budget is increasingly strained by rising costs and our own state budget is under similar pressures. So called charity care, which our hospitals provide, is continuing to climb. Those of us still fortunate enough to be able to have private health insurance pay for this charity care through higher health care premiums, which only exacerbates the cycle.
It doesn’t take a deep understanding to realize that our current system is out of control. Change in one form or another is inevitable. We cannot continue to pay more each year for services that are no better and in some cases worse.
Dr. Don Berwick noted recently that over one third of our spending on health care is avoidable through better provision of services. He outlined a number of areas where we fall short. We spend too much money doing things to some people that have no benefit on their health or well being. For others, we spend very little on prevention or early treatment, but wait until they are really sick and need expensive hospital care. We tend to have very poor coordination of medical care. People often see multiple doctors in different locations without any communication between them. No one is able to take responsibility for overall management. This leads to repetitive testing, complications, and excessive spending; often on just a small number of chronically ill people. Our administrative complexity and costs are too high in comparison with all other developed countries in the world. And we pay way more than other countries for our medicines, medical devices, and procedures.
We have already started to see some changes in how we finance medical care. Preventive services are now covered 100% in almost every insurance plan. Insurance cannot be cut off retroactively. And the amount of money that insurance companies can keep for overhead is now more closely regulated. Unless there is a dramatic shift in Congress and the White House next year, starting in 2014 nearly everyone in the US will be expected to purchase medical insurance. For those whose employers do not provide insurance, it will be available with federal subsidies which vary depending on income. This medical insurance will be sold on a state based market place, known as an exchange. We’ll have one here in Montana in about a year. Although the Montana legislature decided not to develop our own, there will be opportunities to partner with the federal government in the running of our Montana exchange.
Massachusetts embarked down this same path 6 years ago. They have found that providing near universal insurance improves health, but by itself this does not control costs. In order to deal with the cost side of the equation, additional efforts need to be made. Massachusetts is now moving ahead with other significant reforms. It seems very likely that most of the rest of the states will eventually be following their lead, one way or another. The Massachusetts legislature has just passed a bill which will closely monitor any increase in health care spending. Their goal is to not let health costs rise any faster than overall economic growth.
To do this, a commission will monitor spending. By understanding where the money is going and who is spending it, this commission will be able to apply fines to hospitals and medical groups that have high spending growth. For the first time, many of these organizations will need to look at how they can provide the most efficient medical care. They will have to focus on providing high quality care at prices that consumers can afford. Dr. Atul Gwande, from Harvard, has an article on this topic in last week’s issue of the New Yorker magazine. It’s well worth reading.
But, this is not just a topic for easterners. Montana too is coming to the place where we need to understand what we are getting for our medical spending. As Dr. Berwick and many others have pointed out, spending more does not mean better medical care and better outcomes. We have to create a system where we spend our health care dollars wisely; something we are not doing very well today. Slowly and awkwardly, we may be finding our way there.

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