Join the debate on “Reining in Medicare Costs without Hurting Seniors”

The January 26 post below (“How to Rein in Medicare costs without Hurting Seniors“) has drawn some 43 comments (including mine, as I responded to readers). I thought of turning a couple of my replies into posts, but then decided it might be more interesting for you to read them in the context of what other readers said.

I would love to see more readers participate in this thread. Comments are still open.

It’s a lively thread that takes on a number of third-rail issues: Does Medicare spend too much on pricey cancer drugs, end-of-life care and brand name hospitals?

 Should we try to spend less on end-of life care? Many say “Yes,” but Zeke Emanuel (a medical ethicist and oncologist who was part of the Obama team during the president’s first term), says “No.” I link to a column where he notes that “It is conventional wisdom that end-of-life care is an increasingly huge proportion of health care spending. . . Wrong. Here are the real numbers: end-of-life care (not just for the elderly, but for all Americans) accounts for just 10% to 12% of  total health care spending. This figure has not changed significantly in decades.”

He goes on to suggest that while we probably can’t make end-of-life “cheaper,” we can make it “better . . .  Here are four things the health care system should do to try to improve care for the dying, even if they won’t save money.”

A number of readers comment on what is driving Medicare spending. Is it “patient expectations,”  “doctors’ fear of litigation,”  “regulations that dictate nurse-staffing ratios,” “practice patterns that doctors learned long ago,” or is the biggest problem “promotional efforts by manufacturers?”

Other questions come up: Does anyone really have any idea how much Medicare will cost in 2022?  By then will Medicare have begun negotiating with drug-makers and device-makers for discounts on drugs (the way the VA does now, saving 40%)?  How far will Medicare go in using medical evidence to decide what to cover?

One doctor/reader points out that in his field Medicare has begun to refuse to pay for procedures when research shows that they are not effective. He and another reader agree that in this way Medicare can provide “political cover” for private sector insurers who will follow Medicare’s lead.

We also discuss the deficit, and whether we should be trying to address the deficit now — or wait until the recession ends and unemployment falls. Also, is the deficit already dissolving as CAP suggests? 

And is the deficit our biggest problem? On this question, you will find links to Paul Krugman, Peter Orszag (who analyzes the slow-down in health care spending over the past three years as a “structural change, not just the result of the recession) and Ezra Klein,

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Breaking the Curve of Health Care Inflation

The evidence is building:  As we move toward making the Affordable Care Act a reality,  Medicare spending in slowing, and even in the private sector, for the first time in more than a decade, insurers are focusing on reining in health care costs .  

The passage of reform legislation two years ago prompted a change in how both health care providers and payers think about care.  The ACA told insurers that they would no longer be able to shun the sick by refusing to cover those suffering from pre-existing conditions. They also won’t be allowed to cap how much ithey will pay out to an desperately ill patient over the course of a year –or a lifetime.  Perhaps most importantly,  going forward, insurance companies selling policies to individuals and small companies will have to reimburse for all of the “essential benefits” outlined in the ACA–benefits  that are not now covered by most policies.  This means that, if they hope to stay in business, they will have to find a way to ”manage” the cost of care–but they won’t be able to do it by denying needed care.

As for providers, they, too, will be under pressure. A growing number will no longer be paid “fee for service” that rewards them for “volume”–i.e. “doing more.” Bonuses will depend on better outcomes, and keeping patients out of the hospital–which means doing a better job of managing chronic illnesses.  Meanwhile, Medicare will be shaving 1% a year from annual increases in payments to hospitals. If medical centers want to stay in the black, they, too, will have to provide greater “value” for health care dollars– better outcomes at a lower cost.

This summer the Supreme Court’s decision sealed the deal. The ACA is constitutional. Health care reform is here to stay.

(Granted, if Mitt Romney wins the White House in November, all bets are off. But the Five Thirty Eight f’orecast, which has an impressive track record, suggests that Obama has a 70 percent chance of winning.  That said, liberals  should not be smug. The economy remains the greatest threat to President Obama’s re-election.)

Medicare Spending

The Obama administration should be broadcasting the news: Medicare spending is no longer growing at an unsustainable rate. Wednesday, Bloomberg columnist Peter Orszag commented on the “sharp deceleration” in Medicare’s outlays. A common way to evaluate the growth in spending for Medicare is to compare the increase per beneficiary to income per capita,” the former director of the Office of Management and Budget (OMB) wrote.  “Over the past 30 years, this excess cost growth for Medicare has averaged about 2 percent a year. The goal of many policy proposals, including provisions in the 2010 Affordable Care Act, is to reduce the future excess cost growth to about 1 percent annually.”

What is astonishing is that Medicare is now exceeding that goal. Over the past year, “excess cost growth has been much less than the target of 1 percent,” Orszag reports. “According to the most recent figures from the Congressional Budget Office, total Medicare spending this year through June rose 4 percent from the previous year. Meanwhile, the number of Medicare beneficiaries rose by almost 4 percent, too, and income per capita rose by about 3 percent. So excess cost growth has been significantly below zero let alone below the target of 1 percent a year.” 

This suggests that the nation’s Medicare bill does not have to pose a threat to the economy, even as the  number of Americans on Medicare’s rolls grows. Widely accepted reserach reveals that at least one-third of Medicare dollars are wasted on over-priced products and unnecessary reatments. Cut that fat, and we can accommodate an aging population.

Sweden faced the problem of a greying population years ago, and has managed to avoid what many who would like to slash “entitlement programs”  insist is an “inevitable” explosion in medical spending as a nation grows older. Healh care spending in Sweden has remained remarkably stable since the 1980s, costing roughly 9% of GDP, and when it comes to quality of care–and patient satisfaction– Sweden’s health care system is rated as one of the best in the developed world. Continue reading

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How to Avoid Avoidable Care–by George Lundberg

Below, a  guest-post by Dr. George Lundberg, Editor-at-Large of MedPageToday; Editor in Chief of Collabrx; President and Board Chair of the Lundberg Institute.  (Full disclosure: I am a member of the Lundberg Institute’s Board)

What Lundberg says is not meant to be news.  Today, physicians tend to agree that many of the tests that patients undergo are unnecessary. Three years ago, one hospitalist shared a story on HealthBeat, describing how he warned his residents about over-testing His hospital may not have been happy about his disclosure: tests boost revenues.

But in some cases, we have solid medical evidence showing that for certain patients, these tests do more harm than good– though vested interests may try to bury that evidence. (See Dr. Hoffman’s post below.)

Yet doctors continue to order the tests– why?  

George Lundberg brings a unique perspective to this problem. Drawing on his wealth of experience, both as a practitioner and as a teacher, he puts it in a historical context.  For 40 years, he has asked physicians why they perform so many tests. The frankness of their responses is matched only by Lundberg’s own candor as he diagnoses the excesses in our medical system . 

How to Avoid Avoidable Care 

George Lundberg

Why do physicians order laboratory tests?  The traditional reasons are: diagnosis 37%, monitoring 33%, screening 32%, previous abnormal result 12%, prognosis 7%, education 2%, and medicolegal 1%.

In  order to confirm these data, I began to ask the same question of many groups of clinical and laboratory workers over three continents in the 1970s, ‘80s and ‘90s during  Socratic teaching sessions on how to use the clinical laboratory correctly. And I began to get very different answers.  

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Urologists Threaten the Autonomy of the U.S. Preventive Services Task Force

Over at HealthNewsReview.org  Gary Schwitzer has published a disturbing piece that looks at American Urological Association support for a bll that would make “significant changes to the U.S. Preventive Services Task Force.”

The guest post is written by Dr.Richard Hoffman, who is both one of HealthNewsReivew’s reviewers, and an editor at the Informed Medical Decisions Foundation a group that promotes “shared decision making.”   The Foundation, which was co-founded by Dr.Jack Wennber, the father of the Dartmouth Reserach,uses medical evidence to produce outstanding videos, pamphlets and web-based programs that help patients understand the potential risks and benefits of  elective surgeries and tests..  (I have written about “shared decision making” in past posts ). 

Below, an excerpt from Hoffman’s piece:

“Last week, the Supreme Court largely upheld the Affordable Care Act. Two weeks ago, legislation (H.R. 5998) was introduced that threatens the autonomy of the U.S. Preventive Services Task Force.

“The legislation proposes to mandate a more transparent process for guideline development, a greater role for specialists and advocacy groups, and eliminating the Department of Health and Human Services’ secretarial discretion to withhold Medicare funding for interventions that lack convincing evidence for benefit The legislation, which comes on the heels of the Task Force’s controversial D rating against prostate cancer screening, is strongly supported by several prominent urological associations. 

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Pilots Use Checklists. Doctors Don’t. Why Not?

This is a question Dr. Atul Gawande explores in the December 10 issue of The New Yorker. “The Checklist” is a shocking story, it’s an important story—and it’s also very long. I, of course, would be the last person on earth to criticize someone for “writing long” but it occurs to me that many of HealthBeat’s readers may not have the time to peruse the full nine-page story, so I decided to offer a capsule summary here. (To read the story in its entirety, click here).

Gawande is the author of one of my favorite healthcare books, Complications: A Surgeon’s Notes on an Imperfect Science, and he writes wonderfully well. This piece begins with a riveting tale of a three-year-old who falls into in icy fishpond in a small Austrian town in the Alps. “She is lost beneath the surface for 30 minutes before her parents find her on the bottom of the pond and pull her up.” By then “she has a body temperature of 68 degrees—and no pulse.” A helicopter takes her to a near-by hospital. 
There a surgical team puts her on a heart-lung bypass machine. She now has been lifeless for an hour and a half. Gradually, the machine begins to work. After six hours, her core temperature reaches 98.6 degrees, but she is hardly out of the woods. Her lungs are too badly damaged to function, so the surgeons use a power saw to open her chest down the middle and sew lines to and from an artificial lung system into her aorta and beating heart. “Over the next two days, all of her organs recover except her brain. When a CT scan shows global brain swelling, the team drills a hole into her skull, threads in a probe to monitor cerebral pressure, and adjusts fluids and medications to keep her stable. “

Slowly, over two weeks, she comes back to life. “Her right leg and left arm [are] partially paralyzed.  Her speech [is] thick and slurry.  But by age five, after extensive outpatient therapy, she has recovered her faculties completely. She [is] like any little girl again.” 

“What makes her recovery astounding,” Gawande writes, is “the idea that a group of people in an ordinary hospital could do something so enormously complex. To save this one child, scores of people had to carry out thousands of step correctly; placing the heart-pump tubing into her without letting in air bubbles, maintaining the sterility of her lines, her open chest, the burr hole in her skull; keeping a temperamental battery of machines up and running” all the while “orchestrating each of these steps in the right sequence, with nothing dropped . . .”

This, Gawande says, is what happens in intensive care units, every day of the year, all across the country. “Intensive care medicine has become the art of managing extreme complexity—and a test of whether such complexity can, in fact, be humanly mastered.”

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How the Media Covers Health Care

Sometimes health care reporters remind me of the financial journalists who helped hype the bull market of the 1980s and 1990s. I began my career as a journalist at Money magazine, and I remember sitting in an editorial meeting where we talked about an upcoming cover story: “The Ten Best Mutual Funds NOW.”  One intrepid reporter asked: “What if there aren’t ten great mutual funds that you really should invest in right now?”

“Let the fact-checker worry about that,” someone else quipped, referring to the person who would be double-checking the details of the story just before it went to press. Almost everyone sitting around the table laughed.

And Money was generally a pretty responsible magazine that tried to warn investors against the risks of the market. Still, “good news” cover stories sold magazines—just as “breakthrough” medical stories on the local evening news keep viewers from changing the channel.

Gary Schwitzer, an associate professor in the School of Journalism and Mass Communication at the University of Minnesota, recently published a provocative piece about how the media covers health care in the American Editor. Schwitzer begins his piece by asking his reader to “Imagine a reporter filing a story from the Detroit Auto Show. She writes about one car maker’s hot new model as if it is the best thing since the ’57 Corvette. But in the excitement over the chrome and style, she doesn’t mention the cost of the new model, doesn’t compare it with other manufacturers’ offerings in the same class, and doesn’t mention anything about performance (fuel efficiency, handling, braking, safety issues, etc.)

“An editor would certainly raise questions about this kind of puffery.

“But over on the health care beat,” Schwitzer observes, “the majority of stories on new products, procedures, treatments and tests are published without including comparable information. Claims that would never be accepted unchallenged from a politician are accepted unquestioningly from physicians and researchers and company spokespersons.”

Schwitzer, who publishes HealthNewsReview.org, a website that grades health care news stories for accuracy, balance, and completeness, has evidence to back up his claim.  Below I’ve re-posted some of his data on some 400 stories from almost 60 major news organizations (available at his website) to demonstrate how many health care stories “provide a kid-in-the-candy-store portrayal of the health care system that leaves readers with the impression that most products or procedures in health care are amazing, harmless and without a price tag”:

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What Rudy–and Most Americans–Still Don’t Understand about Prostate Cancer

Presidential candidate Rudy Giuliani recently made the mistake of trying to turn his brush with prostate cancer into a campaign issue: “I had prostate cancer, five, six years ago. My chance of surviving prostate cancer, and thank God I was cured of it, in the United States, [is] 82 percent. My chances of surviving prostate cancer in England, [is] only 44 percent under socialized medicine,” Giuliani declared.

Rudy, of course, was wrong.

Merrill Goozner has done the best job that I’ve see of cutting through to the truth of the matter. In a Nov. 2  post titled “Columnists Miss Chance to Educate on PSA Testing,” he points out that “Paul Krugman’s column in the New York Times and Eugene Robinson’s column in the Washington Post justifiably attack Rudy Giuliani’s misuse of prostate cancer stats, all but accusing him of lying.

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A Transaction Based on Trust

The consumer of health care is unlike any other consumer, and the product he purchases is unlike any other product. This is something that those who embrace “consumer-driven medicine” choose to ignore.

Advocates like Harvard Business Professor Regina Herzlinger insist that if we just
put the consumer in the driver’s seat, giving him both  transparent pricing and a little “skin in the game,” the consumer  could put a lid on health care prices while demanding the best quality care.  Herzlinger is particularly hopeful that the baby-boomers, a group she describes as “the most manipulative, the most narcissistic and the most effective generation this country has ever seen,” can do the job. (Why one would want such a group setting priorities for our health care is beyond my understanding; I’ll return to this point in a later post.)

Last week I spoke at the Massachusetts’ Medical Society’s Leadership Forum on the rising cost of care.  In two earlier posts (here and here) I’ve described what other speakers had to say about how and why Massachusetts is running into trouble trying to fund its experiment in universal care.

In my speech, I explained why I don’t think that “consumer-driven medicine” is the answer. I don’t believe the “consumer” can rein in healthcare spending.  As an alternative, I proposed a “patient-centered” model of health care which depends on patient and doctor, working together.

Begin with the flaws in the consumer-driven model. First, it assumes that the patient has the same power that a buyer has in the commercial marketplace. But in truth, the patient does not have nearly as much leverage as other consumers.

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The FDA’s Moment of Truth by Niko Karvounis

Soon we’ll see what the FDA is made of.

Yesterday the AP reported that “doctors told the Food and Drug Administration advisers that the over-the-counter [cough and cold] medicines shouldn’t be given to children younger than 6 because they don’t help them and aren’t safe.” The final recommendation of an advisory panel of outside experts tasked with determining whether or not this is the case is due to the FDA late today.

By “not safe” petitioners don’t necessarily mean that the medicines themselves cause harm, but that they encourage reliance on “quick fixes,” an approach that can mask symptoms of more serious ailments.

This is obviously a problem in and of itself, but becomes an even a bigger deal when one considers that there are no known benefits to the medication. The drugs have never been tested on children—something the FDA has known since 1972. Instead, drug makers “have used extrapolated data from studies in adults to come up with dosing recommendations based on a child’s age or size.” Hardly rigorous medical science.

The threshold for unacceptable risk is a lot lower when a medicine does nothing. Michael Shannon from the Children’s Hospital Boston pediatrician and Harvard Medical School puts it best: “when a treatment is ineffective, its risks — if not zero — always will exceed its benefits.”

So what should worried parents do when their kids have a cold?

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Do You Want to Know That You Will Be an Alzheimer Patient in Two to Six years?

Yesterday The New York Times reported a medical breakthrough: “the development of a blood test that can  accurately  diagnose Alzheimer’s disease, and even do so years before truly debilitating memory loss.”

Well, “accurately” may be a bit of a stretch. As the Times explained, the test is about “90 percent accurate in distinguishing the blood of people with Alzheimer’s from the blood of those without the disease” and “about 80 percent accurate in predicting which patients with mild memory loss would go on to develop Alzheimer’s disease two to six years later.”

Then, the Times acknowledged, there is one other problem with the test:  “At present, treatments for Alzheimer’s disease are not very effective.”

So why exactly would I want an early warning that would give me two to six years to contemplate what it will be like to observe my mind dissolving? (Of course I could comfort myself with the fact that the test is only 80 percent accurate, but somehow I suspect that would only compound my anxieties.)

“There are people who want to know what their future holds so they can plan their estates and lives,” Dr. Sam Gandy, a professor at Mount Sinai School of Medicine in New York who is chairman of the medical and scientific advisory council of the Alzheimer’s Association, told the Times.

Right, this is an estate planning tool.

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