Tag Archives: Spreco

HTA in Italia: pessimismo dell’intelligenza, ottimismo della volontà

Il 24 ottobre scorso sono stato invitato da Giovanni Morana, dinamico direttore della radiologia dell’ospedale di Treviso, ad un convegno sul tema della TAC Dual Energy. Il programma prevedeva una parte dedicata a questa interessante tecnologia ancora in fase di sviluppo e ricerca e una dedicata all’HTA.

hta-venezia-2016hta-2-venezia-2016

L’incontro si è tenuto all’Ateneo Veneto, una fondazione istituita da Napoleone dopo il disfacimento della Serenissima Repubblica di Venezia, in uno splendido palazzo a fianco del Gran Teatro La Fenice.

Per un accidente della storia, il 9 ottobre 1996, nella stessa sede avevo organizzato un workshop, alla presenza dei politici e direttori generali della aziende sanitarie del tempo, dal titolo: “Razionamento o razionalizzazione dell’assistenza sanitaria – il ruolo dell’HTA”, starring Renaldo N. Battista al quale il collega direttore generale di Venezia (il compianto Carlo Crepas) aveva tributato gli onori che la Serenissima Repubblica tributava ai Capi di Stato e agli Ambasciatori in visita a Venezia: il corteo in barca lungo il Canal Grande.

hta-venezia-1996

L’invito di Giovanni Morana ha suscitato in me due sentimenti: il piacere di discutere oggi con i clinici (italiani, stranieri e un brillante giovane collega italiano che lavora a Charleston, Carlo De Cecco) e i produttori di tecnologia i metodi e le opportunità offerte dall’HTA; l’amarezza di toccare con mano la lentezza con la quale in questi vent’anni l’HTA si è diffusa in Italia!

Quanta strada ancora da percorrere! Se smettessimo di buttarci a pesce sulle cose urgenti e ci occupassimo un po’ di più delle cose importanti (De Gaulle) …..!!!

Il XXI secolo non ci ha portato ancora superare lo storicismo gramsciano: “Tutti i più ridicoli fantasticatori che nei loro nascondigli di geni incompresi fanno scoperte strabilianti e definitive, si precipitano su ogni movimento nuovo persuasi di poter spacciare le loro fanfaluche. D’altronde ogni collasso porta con sé disordine intellettuale e morale. Pessimismo dell’intelligenza, ottimismo della volontà”. (Q28, III)

Anzi…..

 

Terremoto e paradossi economici @WRicciardi @drsilenzi @redhenry88

Titolo su Milano Finanza: “Il paradosso del terremoto: le spese per la ricostruzione non incideranno sul deficit e daranno una mano al pil”. E’ l’articolo più interessante e utile pubblicato sui quotidiani. Il passaggio chiave è questo: “La contabilità della ricostruzione ha a che fare con le disposizioni del nuovo articolo 81 della Costituzione, in cui si prevede la deroga all’obbligo del pareggio di bilancio, facendo dunque ricorso all’ indebitamento, solo quando si debbano fronteggiare un ciclo economico o circostanze eccezionali. Tra queste ultime, sono espressamente considerate le gravi calamità naturali. Spetterà al Parlamento, con una conforme deliberazione di Camera e Senato assunta a maggioranza dei rispettivi componenti, dichiarare che si versa in una delle citate situazioni. Anche il Fiscal compact, ma in maniera più generica, considera due circostanze eccezionali che consentono di derogare all’ obbligo di pervenire al pareggio strutturale del bilancio: si tratta degli “eventi inconsueti non soggetti al controllo della parte contraente interessata che abbiano rilevanti ripercussioni sulla situazione finanziaria della pubblica amministrazione”, e quindi nel nostro caso delle gravi calamità naturali. La deviazione temporanea è ammessa, purché non comprometta la sostenibilità del bilancio a medio termine. Nel caso di gravi calamità si attiva la clausola di flessibilità che consente di peggiorare il deficit congiunturale, ma si deve trattare infatti di spese una tantum, che si esauriscono con la soluzione del problema insorto. Tutte le spese pubbliche e le sovvenzioni concesse ai privati a seguito di una calamità naturale concorrono a far aumentare il prodotto, dacché mobilitano risorse materiali e umane che altrimenti sarebbero rimaste inerti. A differenza di qualsiasi investimento, o altra spesa pubblica, di questi interventi non si tiene conto ai fini del rispetto degli obblighi costituzionali ed internazionali sul pareggio di bilancio. La considerazione è ancora più amara se si pensa che le spese edilizie volte alla messa in sicurezza a fini antisismici, sia che derivino da spese pubbliche dirette, sia che dipendano da detrazioni di imposta a favore dei privati che le effettuino, non hanno lo stesso trattamento di favore”. Sì, è un paradosso.

Mario Sechi, Il Foglio List, 25 agosto 2016

Cost Containment: The Importance of Nurses @Medici_Manager @helenbevan @pash22

by September Wallingford, RN, BSN http://bit.ly/1aBpqvv

Due to ever increasing healthcare costs, stakeholders in the healthcare system rely heavily upon front-line workers to assist in containing costs to help make healthcare more affordable. Since nursing is the largest sector of front-line workers, the field has an opportunity to greatly impact cost containment. Currently, there are 2.7 million nurses in the workforce, with an expected growth rate of 26% over the next decade; however, there has been limited discussion on how nurses can help contain healthcare costs.

Why are nurses not usually integrated into the cost containment discussion? Why have we not been invited to the table? Likely, it is because we don’t have the power to order (or discontinue) tests, labs, or medications, all of which are major factors in the rising costs of care. Even so, a nursing perspective can be important and should be considered when doctors make treatment decisions.

For example, I recently treated a patient who had undergone abdominal surgery. Despite uncomplicated post-operative days 1 and 2, on day 3, he developed nausea, vomiting, and an increasingly distended abdomen. I administered intravenous anti-nausea medications, along with back rubs and cool cloths on his forehead. None of the treatments worked. While waiting for the doctor, I sat with the patient and spoke to him about the possibility of receiving a nasogastric tube to alleviate his symptoms. Given an understanding of the process, the patient agreed to this possibility and I paged the doctor once again. The doctor eventually placed the nasogastric tube, the tube was connected to suction, and out came a liter of gastric contents.

I then noticed that the doctor had put in an order for an abdominal x-ray to “check nasogastric tube placement.” Seeing this, I initiated a conversation with the doctor to discuss the patient’s symptomatic improvement as well as his current state of exhaustion. I assured the doctor that nurses would be at the patient’s bedside to monitor for signs and symptoms of tube malfunction. As a result, the doctor cancelled the x-ray, which not only eliminated an unnecessary test for the patient, but also reduced the cost associated with his care.

Situations like these are commonplace to nurses across the country. We witness daily that more is not necessarily better, and we are in a position to help make decisions that lower costs without negatively impacting the patient’s care. Nurses bring a unique perspective to the healthcare cost conversation, so include us in the discussions, give us a seat at the table, and utilize us as active participants in the fight against rising healthcare costs.

September Wallingford is a registered nurse at an academic medical center in Boston, Massachusetts. She is currently completing her graduate nursing education to become an Acute Care Clinical Nurse specialist.

Doing what’s right for patients demands a culture change @muirgray @Medici_Manager @pash22 @helenbevan

We are pleased to announce the dates of our 2013 Lown Conference:
From Avoidable Care to Right Care 

For more information on the 2013 conference, please visit our website:
http://lowninstitute.org/project/2013-lown-conference/

2013 LOWN CONFERENCE: FROM AVOIDABLE CARE TO RIGHT CARE

June 24, 2013   Avoidable Care Admin   

This year’s Lown Conference, From Avoidable Care to Right Care, will take place on December 3-4, 2013 in Boston, MA.

The 2013 invitation only conference will gather clinicians, patient advocates, and civic leaders to deepen our mutual understanding of the cultural, scientific, and ethical issues surrounding the overuse of medical services.

Attendees will leave this meeting with priorities for addressing this pervasive problem, and collaborators who are prepared to begin building bridges to the right care in their communities.

Major themes at this year’s event:

  • fostering a new kind of conversation among clinicians, patients, and civil society
  • envisioning health and health care 25 years from now
  • the global epidemic of overuse

Speakers include:

  • Don Berwick, MD, MPH, Former Administrator, Centers for Medicare and Medicaid Services (invited)
  • Katy Butler, Author of Knocking on Heaven’s Door
  • Bernard Lown, MD, Professor Emeritus, Harvard School of Public Health; Senior Physician (ret.), Brigham and Women’s Hospital, Boston
  • Richard Smith, MD, Former Editor BMJ
  • Rabbi Richard Address, D.Min, Senior Rabbi, Congregation Mkor Shalom

Our working groups for Medical Education, Community Engagement, International Collaboration, and Setting the Research Agenda will convene for a working session on December 5, 2013 following the conference. If you are interested in participating on one of these working groups, please email us for more information atinfo@lowninstitute.org.

For more information on the conference, including how to register, please visit the Lown Institute website at www.lowninstitute.org.

More Treatments Equal Better Care? @Medici_Manager @pash22 @helenbevan

by

American HealthScare : 

How the healthcare industry’s scare tactics have screwed up our economy — and our future http://bit.ly/18TFCaf

There are multiple lines of evidence that doing more things to patients doesn’t always result in better health. I summarize a few examples here.

Dartmouth Studies

Researchers at Dartmouth University examined the relationship between medical resources used and the resulting health outcomes in people nearing the end of their lives in two California regions, Los Angeles and Sacramento.

In Los Angeles, the patients used 61% more hospital beds, 128% more intensive care unit (ICU) beds, and 89% more physician labor in the management of chronically ill patients during the last two years of life compared to Sacramento. In spite of this intense use of medical resources, the quality of care for patients with heart attacks, heart failure, and pneumonia was worse in Los Angeles. Patients did not enjoy this aggressive care either. Patients rated 57% of Los Angeles hospitals as below average compared to 13% of Sacramento hospitals.

What are the cost implications of the overly aggressive care in Los Angeles? If the Los Angeles hospitals had functioned at the same level as the Sacramento hospitals over the five years of the study measuring these differences, the savings to the Medicare system would have been approximately $1.7 billion.

Brain Aneurysms

Researchers studied immediate family members of patients who had symptomatic brain aneurysms. The researchers wanted to know if finding and surgically fixing aneurysms in the healthy family members who had no aneurysm symptoms would prevent strokes and deaths. The results were basically that many people were injured as a result of the surgery, which the researchers didn’t feel justified the few saved lives.

The Medical Outcomes Studies

In the late 1980s and early 1990s a series of studies called the Medical Outcomes Studies were completed. Their purpose was to measure differences in medical resources used and health outcomes in patients with common conditions who saw different kinds of doctors. They wanted to know if ologist care led to better health compared to primary care, and how the doctors differed in practice styles. The researchers studied patients with high blood pressure and diabetes.

For high blood pressure, patients of cardiologists had more office visits, more prescriptions, more lab tests per physician visit, and were more likely to be hospitalized. There was no difference between the three physician types for average blood pressure, complications, or physical function.

For diabetes, patients of endocrinologists were found to have higher hospitalization rates, more office visits, more prescription drugs, and more lab tests per physician visit than family physicians. There was no difference between the three physicians for average sugar levels, physical functioning, and almost all diabetic complications.

Summary

These are just a few examples of how more aggressive medical care doesn’t always result in better health. All of the GIMeC members typically support the notion that more is better. Overcoming this aggression bias will be one of our big challenges in reforming our healthcare system.

References

Wennberg DE, Fisher ES, Goodman DC, Skinner JS, Bronner KK, Sharp SM. Taking care of patients with severe chronic disease: the Dartmouth atlas of health care 2008. The Dartmouth Institute for Health Policy and Clinical Practice Center for Health Policy Research [online]2008 [cited 2009 May 2]. Available from: http://www.dartmouthatlas.org/atlases/2008_Chronic_Care_Atlas.pdf.

Risks and benefits of screening for intracranial aneurysms in first-degree relatives of patients with sporadic subarachnoid hemorrhage. N Engl J Med. Oct 28 1999;341(18):1344-1350.

Vernooij MW, Ikram MA, Tanghe HL, et al. Incidental findings on brain MRI in the general population. N Engl J Med. Nov 1 2007;357(18):1821-1828.

Greenfield S, Nelson EC, Zubkoff M, et al. Variations in resource utilization among medical specialties and systems of care. Results from the medical outcomes study. JAMA. Mar 25 1992;267(12):1624-1630.

Greenfield S, Rogers W, Mangotich M, Carney MF, Tarlov AR. Outcomes of patients with hypertension and non-insulin dependent diabetes mellitus treated by different systems and specialties. Results from the medical outcomes study. JAMA. Nov 8 1995;274(18):1436-1444.

6° Congresso Nazionale SIHTA – Bari, 7-9 novembre 2013 @Medici_Manager @SIHTA_Italia

Segnate la data del 6° Congresso di SIHTA: per la prima volta organizzato al Sud, a Bari; per la prima volta analizzata la metodologia della valutazione etica e d’impatto sociale nell’HTA; per la prima volta focalizzati i temi del cambiamento di cultura dei professionisti e degli stakeholder a sostegno dei cambiamenti organizzativi e strutturali.

Dal 7 al 9 novembre 2013

Quattro sessioni plenarie dedicate a: la valutazione etica e di impatto sociale in HTA; HTA come leva per lo sviluppo economico del Paese; HTA tra innovazione e disinvestimento; equità e sostenibilità del Servizio Sanitario Nazionale.

Sessioni parallele e workshops.

Sessioni posters.

Eventi precongressuali tra cui la sessione autunnale dell’Health Policy Forum (a invito).

Quote d’iscrizione molto ridotte rispetto alle edizioni precedenti.

DOVETE ESSERE PRESENTI

http://slidesha.re/14VpOjH

Shared Decision Making to Improve Care and Reduce Costs @Medici_Manager

Emily Oshima Lee, M.A., and Ezekiel J. Emanuel, M.D., Ph.D.

http://www.nejm.org/doi/pdf/10.1056/NEJMp1209500

A sleeper provision of the Affordable Care Act (ACA) encourages greater use of shared decision making in health care. For many health situations in which there’s not one clearly superior course of treatment, shared decision making can ensure that medical care better aligns with patients’ preferences and values. One way to implement this approach is by using patient decision aids — written materials, videos, or interactive electronic presentations designed to inform patients and their families about care options; each option’s outcomes, including benefits and possible side effects; the health care team’s skills; and costs. Shared decision making has the potential to provide numerous benefits for patients, clinicians, and the health care system, including increased patient knowledge, less anxiety over the care process, improved health outcomes, reductions in unwarranted variation in care and costs, and greater alignment of care with patients’ values.

However, more than 2 years after enactment of the ACA, little has been done to promote shared decision making. We believe that the Centers for Medicare and Medicaid Services (CMS) should begin certifying and implementing patient decision aids, aiming to achieve three important goals: promote an ideal approach to clinician–patient decision making, improve the quality of medical decisions, and reduce costs.

In a 2001 report, Crossing the Quality Chasm, the Institute of Medicine recommended redesigning health care processes according to 10 rules, many of which emphasize shared decision making. One rule, for instance, underlines the importance of the patient as the source of control, envisioning a health care system that encourages shared decision making and accommodates patients’ preferences.

Unfortunately, this ideal is inconsistently realized today. The care patients receive doesn’t always align with their preferences. For example, in a study of more than 1000 office visits in which more than 3500 medical decisions were made, less than 10% of decisions met the minimum standards for informed decision making.1 Similarly, a study showed that only 41% of Medicare patients believed that their treatment reflected their preference for palliative care over more aggressive interventions.2

There’s also significant variation in the utilization of procedures, particularly those for preference-sensitive conditions, which suggests that patients may receive care aligned not with their values and preferences, but with their physicians’ payment incentives. Among Medicare patients in more than 300 hospital regions, the rate of joint-replacement procedures for chronic hip arthritis varied by as much as a factor of five, and the use of surgery to treat lower back pain varied by nearly a factor of six. Other studies have found wide regional variation in the treatment of early-stage breast and prostate cancers and in the use of cardiac procedures.

Section 3506 of the ACA aims to facilitate shared decision making. Primarily, it funds an independent entity that would develop consensus-based standards and certify patient decision aids for use by federal health programs and other interested parties. In addition, the secretary of health and human services is empowered to fund, through grants or contracts, the development and evaluation of these tools. Decision aids are meant to be evidence-based and inform patients of the risks and benefits of tests and treatments, their relative effectiveness, and their costs. Health care providers will be eligible for grants to implement these tools and to receive training and technical support for shared decision making at new resource centers. The ACA also authorizes the Center for Medicare and Medicaid Innovation to test shared-decision-making models designed to improve patients’ and caregivers’ understanding of medical decisions and assist them in making informed care decisions. For approaches that provide savings or improve quality of care, implementation can be mandated throughout Medicare without additional legislation.

Randomized trials consistently demonstrate the effectiveness of patient decision aids. A 2011 Cochrane Collaborative review of 86 studies showed that as compared with patients who received usual care, those who used decision aids had increased knowledge, more accurate risk perceptions, reduced internal conflict about decisions, and a greater likelihood of receiving care aligned with their values. Moreover, fewer patients were undecided or passive in the decision-making process — changes that are essential for patients’ adherence to therapies.

Studies also illustrate the potential for wider adoption of shared decision making to reduce costs. Consistently, as many as 20% of patients who participate in shared decision making choose less invasive surgical options and more conservative treatment than do patients who do not use decision aids.3 In 2008, the Lewin Group estimated that implementing shared decision making for just 11 procedures would yield more than $9 billion in savings nationally over 10 years. In addition, a 2012 study by Group Health in Washington State showed that providing decision aids to patients eligible for hip and knee replacements substantially reduced both surgery rates and costs — with up to 38% fewer surgeries and savings of 12 to 21% over 6 months.4 The myriad benefits of this approach argue for more rapid implementation of Section 3506 of the ACA.

The Department of Health and Human Services could quickly launch pilot programs for shared decision making while it works to standardize and certify decision aids. The International Patient Decision Aid Standards Collaboration has developed evidence-based guidelines for certification indicating that decision aids should include questions to help patients clarify their values and understand how those values affect their decisions; information about treatment options, presented in a balanced manner and in plain language; and up-to-date data from published studies on the likelihood of achieving the treatment goal with the proposed intervention and on the nature and frequency of side effects and complications. In addition, it would be helpful to include validated, institution-specific data on how often the specified procedure has been performed, the frequency of side effects and complications, and the cost of the procedure and any associated medication and rehabilitation regimens. We believe that decision aids should be written at an eighth-grade level and should be brief.5

In our view, it seems most critical to begin with the 20 most frequently performed procedures and to require the use of decision aids in those cases. Many decision aids have already been rigorously evaluated, so CMS could rapidly certify these tools and require their use in the Medicare and Medicaid programs. To give such a requirement teeth, full Medicare reimbursement could be made contingent on having documentation in the patient’s file of the proper use of a decision aid for these 20 procedures. Providers who did not document the shared-decision-making process could face a 10% reduction in Medicare payment for claims related to the procedure in year 1, with reductions gradually increasing to 20% over 10 years. This payment scheme is similar to that currently tied to hospital-readmissions metrics.

In addition, the improved quality of care and savings gained through shared decision making can be maximized by integrating this approach into other ACA initiatives. For example, the documented use of patient decision aids could be used as a quality metric in patient-centered medical homes, accountable care organizations, and systems caring for patients eligible for both Medicare and Medicaid. Eligibility criteria for incentives to adopt electronic health record technology might be expanded to include the use of shared decision making and patient decision aids. Moreover, information gathered by the Patient-Centered Outcomes Research Institute (PCORI) could be incorporated into certified decision aids and used to provide physicians and patients with valuable information for making health care decisions. Data about the effectiveness of shared-decision-making techniques could also be collected and disseminated by PCORI for continuous improvement of these approaches.

Unfortunately, implementation of ACA Section 3506 has been slow. More rapid progress on this front would benefit patients and the health care system as a whole.

Selling Proton Therapy to the Public: High Costs Without Benefit @Medici_Manager

In Trentino si sta mettendo in funzione la protonterapia! Auguri per la sostenibilità!

Written by Daniel Wolfson on March 20, 2013 http://bit.ly/WEuqap

Arriving in a train station in a Northeast city the other day, I was struck by the number of advertisements for proton therapy at a local academic medical center (AMC) plastered throughout the station and in local subways. The ads feature a bicycle racer with the tag line: “THE WIND IN YOUR FACE IS WORTH PROTON THERAPY: A cancer treatment that has fewer side effects.”

A bold statement, I thought, considering several studies have shown that proton therapy provides no long-term benefit over traditional radiation and comes with significantly higher cost for most conditions. There are a limited number of conditions—such as pediatric oncology—where proton therapy is shown to be effective.  Most striking, however, was the fact that this ad was specifically created to target a public that is not aware of the proton therapy’s marginal benefit and in what limited conditions it is effective.

“Marginal benefit” is when two procedures have small differences in benefits but large cost differences. Usually the more expensive intervention yields more benefits, like fewer side effects. But in this case, we have a procedure with no added benefits that is a lot more expensive.

Proton therapy uses atomic particles to treat cancer rather than X-rays. The particle accelerator is the size of a football field and costs about $180 million. According to the Yale study, Medicare pays over $32,000 for the treatment compared to under $19,000 for radiation. When applied to treat prostate cancer, outcomes were no different than intensity-modulated radiotherapy. Urinary function side effects were slightly better within six months but those advantages disappeared with 12 months post-therapy.

The ad directly contradicts the findings of this study and claims that proton therapy has fewer side effects than traditional therapy. This claim is true for pediatric cases but not for prostate cancer, the one primarily targeted by these ads.

What bothers me the most is that an AMC is peddling a more expensive procedure with no clear added benefit to the public through a massive advertising campaign. Isn’t there a moral imperative for an AMC to work in the best interest of their community based on the best available clinical evidence? Isn’t this supposed to be the era of value services? If they must advertise the therapy (possibly to recoup some of their costs or at least break even), why not target referring physicians rather than an unsuspecting public that is prone to request the latest and greatest technology just because it’s new? Perhaps referring physicians are wise to the lack of proton therapy’s marginal benefit and the AMC is hoping they will acquiesce to their patients’ demand for this marginal procedure. Is the public to know what cases are best for this type of therapy and for which conditions it is not well suited?

We should expect more and we should demand better. Proton therapy is clearly a more expensive procedure where a just-as-effective procedure exists. Quality and safety has not been raised, only the cost of medicine.

OECD’s Gurria Says Austerity Versus Growth Is a False Dilemma @Medici_Manager @WRicciardi

By Mark Deen, http://bloom.bg/XZQAQ9

Angel Gurria, secretary general of the Organization for Economic Cooperation and Development, said policy makers in the euro area should push ahead with deficit cuts and avoid the “false dilemma” of the austerity debate.

“You need fiscal consolidation in many countries and at the same time you need to plant the seeds of future growth,” Gurria said today in an interview at the World Economic Forum in Davos, Switzerland. “Let’s go for the reforms, accelerate the reforms, so we can consolidate the recovery.”

The International Monetary Fund cut its growth forecast for the 17-nation euro area yesterday, predicting a second year of contraction as the region’s governments seek to reduce public borrowing and revamp their economies in the wake of a sovereign debt crisis. Gurria said that increasing flexibility of both labor and product markets is key to reviving growth.

“If you really want to go for a durable recovery, you really have to go for the fundamental measures,” Gurria said. “Some of these take a long time to get results but today, paradoxically, your best short-term policies may be your best long-term reforms. The announcement and communication of where you want to go may be your best bet.”

To contact the reporter on this story: Mark Deen in Paris at markdeen@bloomberg.net

To contact the editor responsible for this story: Craig Stirling at cstirling1@bloomberg.net

Per salvare il SSN, i politici devono dire ciò che non possono dire! @Medici_Manager @wricciardi

Come in Gran Bretagna, i politici devono dire “l’indicibile” per salvare il SSN: dobbiamo ristrutturate i nostri servizi per malati acuti. In sostanza, bisogna chiudere ospedali!

To fix the NHS politicians must say the unsayable

We need to restructure our acute healthcare services, which will involve district general hospital closures

Up to 50pc of deaths at Mid-Staffs NHS trust on Care Pathway

By Philip Lee http://bit.ly/13EMa52

For a government to aim for constant popularity in a world of 24-hour news is surely pointless, especially when it comes to the NHS. The religiosity surrounding our health system, graphically displayed in the Olympics opening ceremony, has long prevented honest discussion of its shortcomings. Our continual blind faith in a system designed in the shadow of war to serve a stoic nation is perplexing — and has cost lives.

The realities on the ground, along with the poor clinical outcomes when compared with other equivalent countries, can no longer be ignored. The NHS has been showing signs of terminal illness for some time. Yet hospitals that are inadequate continue to be maintained. Any politicians who think that the current system, including the financing model and physical structures, can be sustained in the longer term, under the weight of increasing clinical demands, are deluding themselves.

Indeed, by doing so, they risk further undermining the trust of an increasingly cynical public. Continuing to pay lip service to failed systems is just not acceptable. Neither is a short-termist and timid five-year plan. It is high time that politicians told the truth about the NHS. The system we have is not the envy of the Western world and outcomes are not as good as they should be. It cannot be right that criticism of the status quo is a political taboo. Professional politicians should cease ducking the issue just because it fails to deliver short-term electoral gain.

Lives are worth more than votes. The last Labour government attempted to prop up the NHS by increasing spending significantly. Such financial largesse required the support of Middle England. As measurement was popular with the centre Right, targets were introduced to “guarantee” better care.

The bitter irony for the people affected by the Mid Staffordshire scandal is that this target culture created the environment in which managers chased financial goals at the expense of humane care. Instead of looking for figures to fill election pledge cards, the last administration should have been concentrating on changing the NHS for the longer term. Sadly, it didn’t. A feel-good solution was delivered that left us all feeling worse.

But we have no choice. Those of us who want to protect the fundamental principle of access for all need to make the case. The financing of health care also needs reform. I believe that the responsibility for funding should be moving slowly from the state to the individual. Technological advances, ageing, obesity and an increased appetite for medical treatments all load costs on to the taxpayer. New approaches to these challenges often fit poorly within old systems.

I want people to be free to choose any lifestyle they wish, while understanding that their choices may lead to health care costs later in life. I want to be able to give more to the truly deserving because we have spent less on those able to provide for themselves. I also want the very best 21st-century health care to be delivered in safe and appropriate clinical environments.

If politicians like me do not persuade the public of the need for these changes, then the vulnerable in our society will be put at risk. In return for this candour, the British people must accept this new reality. It is an untenable position for the public to demand politicians to tell the truth, only then to vote them out because what they’ve said is unpopular. If you really want a better NHS, then you will have to find the courage to vote for it.

Dr Phillip Lee is Conservative MP for Bracknell and a practising GP

Related Articles

Costi standard in sanità: i documento del Convegno N.I. San. @Medici_Manager

Ecco i documenti del II Workshop Nazionale sui Costi Standard tenutosi il 18 Ottobre 2012 aSan Giovanni Rotondo, a cura del N.I.SAN.

http://bit.ly/YmOKuR

The Future of Health – World Economic Forum @Medici_Manager @IlonaKickbusch

The future of health is being shaped by many global transformations, of which technology and connectivity are the most salient. Hence, “digital technologies and personalized medicines” was an appropriate tag line for this Annual Meeting session.

As an emerging domain – at the intersection of heath and technology – this should be viewed in two contexts:

The first one, centred on personalized technologies, is transforming the way in which patients engage with healthcare in chronic disease management settings; people in general enhance wellness independence. These are important objectives given the likely emphasis on non-communicable disease prevention and incentive-based wellness in the foreseeable future. By linking big data in the cloud with mobile applications, new engagement mechanisms and social media connectivity, a number of health endpoints can now being pursued – from safety, adherence and compliance, to improved access and healthy behaviour change.

The second emerging domain is digital health (eHealth, mHealth, tHealth and cHealth), where its context-specific applications can help achieve broader health systems goals: data management and information for policy can be transformed; e-learning can be enabled; costs and errors can be mitigated through e-solutions in healthcare settings; and transparency and efficiency can be institutionalized in health governance.

Digital health can be the single most important lever to lift heath systems out of their existing systemic problems. By linking entitlements with health data repositories, it can additionally help in the attainment of wider social objectives and universal health coverage goals, which are fast gaining traction as a policy agenda; at the international level as an umbrella post-MDG health goal and at the domestic level as a deterrent against Arab Spring type of social unrest.

The promise within these approaches underscores the need for policies to harness their potential and creates imperatives for global and domestic normative action. Recognition that this promise can only be fulfilled by leveraging the strength of technological tools, which are outside of traditional healthcare, necessitates multisectoral action and effective engagement with the private sector.

An out-of-the box domestic policy appetite needs to be generated for the establishment of an enabling environment for innovation and research. Capacity needs to be built for translating evidence into policy and taking pilots to scale. Governments need to appreciate the “business case” for investment in this area and should create enabling regulations, incentives as well as the necessary infrastructure.

Appropriate investment and partnerships can help achieve double bottom line objectives and a win-win situation for all stakeholders within and beyond the health sector.

http://www.weforum.org/sessions/summary/future-health

Focus on Health-Care Costs Causes More Spending @Medici_Manager @muirgray

By David Goldhill Jan 2, 2013 http://bloom.bg/RMzfNF

In 1983, the Ronald Reagan administration enacted one of the most significant cost reforms in Medicare’s history. The prospective payment system switched inpatient hospital reimbursement from open-ended fee-for-service to fixed fees paid per diagnosis.

In theory, this would give hospitals the incentive to treat patients as quickly and economically as possible.

The new rules did drive big changes. Since 1983, the total number of days spent by Medicare patients in hospitals has fallen 40 percent, even as the number of Medicare enrollees has risen 60 percent. The average inpatient stay is now just over five days, down from 10.

But even an improvement in efficiency of such magnitude failed to slow the cost train. As the number of hospital days declined, the daily charge to Medicare rose to $1,800, from $300.

The prospective payment system is only one obvious example of a long trend. Most major developments in health care — higher doctor productivity, diagnostic scans, new pharmaceuticals, minimally invasive surgery — could be described as increasing health care’s productivity. None of these achievements has lowered prices.

Cost Fallacy

Why not? Strange as it seems, cost is only mildly relevant to the price of care. In the world of health care, cost control is based on the fallacy that there is a fixed amount of care we need. Presumably, the more efficiently it’s performed, the cheaper it will be. This ignores how providers actually respond to changes in their business. By focusing relentlessly on the cost of care, we actually drive it up.

To understand why this is inescapable, ask yourself, What would you rather pay for the items you buy: whatever price a retailer charges or a small amount — say 5 percent — above the retailer’s cost? Take your time; it’s a trick question.

The cost-based pricing seems like the better deal. We imagine going into a store, learning that the merchant paid $10 for a sweater, and buying that sweater for only $10.50. But this assumes that, once you opt for cost-based pricing, the costs will stay the same. In reality, the cost-plus-5-percent system will change the merchant’s economic incentives — so that the next sweater the store buys will “cost” far more than $10.

Imagine the impact cost-plus would have on the world’s simplest business. Your daughter sets up a lemonade stand outside your house and charges a dollar a cup. (That number just seemed right to her.) She sells 50 cups to people passing by each day.

One day the mayor comes along. He’s running for re- election, and he wants to buy a cup of lemonade every week for all 1,000 residents of the town. He doesn’t want to pay $1,000 a week, though, so he suggests paying your daughter a “fair” profit of 50 percent. He knows each cup contains about 10 cents worth of lemons and sugar, so he figures he’ll be paying 15 cents a serving.

The moment your daughter agrees to this deal, however, she will try to increase her costs, because higher costs mean bigger profits. She is better off with more expensive lemons and sugar, larger cups (maybe even glasses), an assistant to run the stand and a new Lemonada 5000 mixer, which guarantees a perfect mix of sugar and lemon in every glass.

The mayor is no idiot. He sees what is happening, so he renegotiates his deal. From now on, he’ll pay her costs plus 5 cents a cup. Unfortunately, this also creates perverse incentives. Your daughter can make more money by reducing the size of each cup. Or she can cut back on customer service, hygiene or speed. Or she can cut side deals with her vendors: The lemon seller can raise his price — passed on to the mayor – – and share the proceeds with your daughter.

Manipulation’s Cost

Bizarrely, a cost-based pricing structure actually adds a new major cost: the effort it takes to track, manipulate and justify costs. In a $2.5 trillion industry such as health care, these activities are a big reason that administrative costs exceed $300 billion a year.

An Economist article on dialysis perfectly illustrates the inflationary impact of cost-plus pricing. Because U.S. clinics are paid on a cost-plus basis, they prefer expensive drugs to cheaper ones. In fact, many appear to order drugs in units that exceed what a standard dosage requires, because they can charge the government for the waste. The article noted that many clinics preferred an injected drug with a price of $4,100 a year over the identical drug in oral form, priced at only $450 a year. Not surprisingly, the manufacturer of the oral drug responded by increasing its price above that of the injected version to make it more competitive.

Our entire health-care system suffers from what I call the cost illusion — the idea that a service has a long-term fixed cost. But every cost is merely someone else’s price. And over time, costs themselves are also determined by prices.

What is the cost of orthopedic surgery? It is the sum of all the costs of the underlying components — the surgeon, anesthesiologist, nurses, hospital, device, tests and drugs. But how are these costs determined?

Let’s look at the orthopedic surgeon. We may believe there is some objective way to measure the cost of her time — a fair return on her years of education or training, say. In reality, the cost of the surgeon’s time depends on the value of orthopedic surgery to patients. If more patients need it, the surgeon’s time becomes more valuable. In a free market, there are two ways the cost of her time could decline: more orthopedic surgeons fighting for business or patients benefiting less from orthopedic surgery.

Protected Costs

In an administered market such as health care, on the other hand, our surrogates — insurers and Medicare — substitute their calculation of cost for the workings of supply and demand. This has the strange effect of preventing costs from ever falling. Let’s say Medicare sets the reimbursement rate for a hip replacement at $15,000. Now say a new drug is invented that makes hip replacements less useful. In a free market, the price would decline. But in an administered system, these prices are viewed as costs, and once set, there is no mechanism to lower them. A hip replacement still takes the same amount of time from surgeons of the same degree of expertise, so the cost must still be $15,000.

In health care, our system is designed to shield patients from even knowing the prices. Unfortunately, a world without prices is also one that can’t achieve the purpose of prices: the allocation of resources to match what consumers want.

Five weeks after my father died from a hospital-borne infection in the intensive-care unit of aNew York City hospital, my mother received a bill for his treatment — $635,695.75! The bill was broken down into 17 items. Had I booked Dad a room at the most expensive hotel in town for the five weeks of his illness, filled the room with a million dollars’ worth of hospital equipment leased for $15,000 a month, given him round-the-clock nursing care, and paid a physician to spend an hour a day with him (roughly 50 minutes more than at the hospital), it would total roughly $150,000.

That leaves $500,000 left over for, say, drugs (billed at $145,431), oxygen ($41,695) and blood ($30,248).

This comparison with actual prices is absurd, of course, because it assumes that the prices on my father’s bill were real prices. No one was actually supposed to pay that bill. The prices didn’t even bear a relationship to the exchange of funds for Dad’s treatment. The hospital billed my mother for her share ($992), which she wisely didn’t pay and the hospital wisely didn’t try to collect. Medicare paid the hospital according to its concept of the hospital’s cost. Of course, there’s no question what the competitive price would be for the service of killing my father: zero.

Prescription Costs

A stunted price system also distorts investment in new treatments. U.S. pharmaceutical companies spent roughly $67 billion in 2010 on research to develop new drugs. But many of these new drugs target conditions for which perfectly good drugs already exist. It is the lack of consumer prices that explains their me-too approach.

Once a new drug is approved, it enters the marketplace at a high reimbursement rate, compensating the manufacturer for its expensive research. So what’s the punishment for entering a crowded market? Very little. Furthermore, even with a promising new entrant, the prices of the existing drugs don’t decline; they have already been set to compensate for their “costs.” In any normal market, a new entrant would bear not only the risk of being rejected but also the risk of a price war.

Administered pricing also explains why our health-care industry has spent far too little on information technology. Your dry cleaner computerized his inventory system because losing a shirt may mean losing a payment or even a customer. But a doctor who invests in state-of-the-art patient data management can’t charge higher prices; insurers won’t pay. Nor is there a market mechanism to force hospitals that use paper records to accept lower prices — they don’t benefit from being more efficient. So the investment is never made.

If we, the consumers, saw and paid prices, we would be looking at a very different industry. My guess is that many of us would pay only for doctors who spend more time talking to us, providers who invest in computerized records, genuinely better treatments rather than me-too drugs for chronic conditions, and hospitals that kill fewer patients.

(David Goldhill is the president and chief executive officer of the cable TV network GSN. This is the first in a series of three excerpts from his new book, “Catastrophic Care: How American Health Care Killed My Father — and How We Can Fix It,” to be published Jan. 8 by Alfred A. Knopf. The opinions expressed are his own. Read Part 2 and Part 3.)

To contact the writer of this article: David Goldhill at dgoldhill@gsn.com.

To contact the editor responsible for this article: Mary Duenwald atmduenwald@bloomberg.net.

La salute va curata meglio, dice N.Dirindin @Medici_Manager

 http://bit.ly/WO07t8

Quella che il Governo ha chiamato “manutenzione straordinaria” al Ssn non è stata in grado di incidere, almeno nel breve periodo, sulle incertezze e sulle difficoltà che assillano operatori e assistiti. Apprezzabile l’attenzione a fenomeni come la ludopatia, peraltro non seguita da provvedimenti adeguati.

 Quindici mesi di governo sono troppo pochi per incidere in modo significativo in un settore complesso e delicato come la sanità, soprattutto se il Governo è tecnico e ha poca dimestichezza con i partiti e le lobby parlamentari, la burocrazia statale e le realtà regionali. Anche la crisi economica e gli squilibri della finanza pubblica sono troppo intensi per lasciare spazio a interventi diversi da quelli strettamente necessari per affrontare le emergenze. Pur tenendo conto delle difficili condizioni in cui ha lavorato il Governo, la “manutenzione straordinaria” del Servizio sanitario nazionale messa in atto dal Governo appare deludente.
Il principale impegno è stato “contribuire al contenimento e al risanamento della spesa pubblica” attraverso “la riduzione del finanziamento” pubblico della sanità, “preservando il funzionamento del sistema sanitario, che ha mantenuto invariati i servizi”. Un’affermazione importante, composta di due parti: una reale (la riduzione del finanziamento) e una ipotetica (l’invarianza dei servizi). La riduzione del finanziamento (legge 135/12 e legge di stabilità), che si è aggiunta a quella più consistente disposta dal Governo Berlusconi, è stata reale e tale da rendere praticamente costanti le disponibilità annue per l’intero quinquennio 2010-2014: 112 miliardi di euro all’anno. Una sfida comprensibile in un momento di crisi, ma certamente molto impegnativa, anche perché le regioni non sono più in grado di integrare con risorse proprie i minori finanziamenti statali. L’invarianza dei servizi è per contro una ipotesi di scuola, un auspicio che il Governo si è limitato ad assumere a priori. Vero è che alcuni interventi mirano a ridurre le inefficienze e a contenere le inappropriatezze, ma assumere che la riduzione del finanziamento colpisca solo sprechi e inefficienze, in tutte le regioni e in tutte le aree di intervento, pare ingenuo. E comunque il Governo non può limitarsi a prescrivere “l’invarianza dei servizi”, scaricando sulle regioni la responsabilità di attuare provvedimenti che spesso richiederebbero più gradualità, più flessibilità e più selettività. Con questo non si vuole difendere l’operato delle Regioni, in alcuni casi gravemente responsabili dell’inadeguatezza del proprio sistema sanitario (soprattutto quelle sottoposte a Piano di rientro), ma si vuole sottolineare la necessità di un livello centrale più attento alla fattibilità temporale dei provvedimenti: risparmi di spesa difficili da realizzare nel breve periodo inducono le regioni (anche le più virtuose) a ridurre l’assistenza, in termini quali-quantitativi, e a far gravare i tagli sui cittadini. E di questo il Governo non può non preoccuparsi, a meno che non ritenga comunque accettabile una minore tutela e un aumento delle diseguaglianze nell’accesso ai servizi. Più volte abbiamo sostenuto che i margini di intervento sono ancora consistenti (ad esempio, nel settore della diagnostica, dove si registra un eccesso di tecnologie – spesso male utilizzate – e un ricorso improprio alle prestazioni), ma molti temi sono stati trascurati.
Altri provvedimenti paiono deboli. La riorganizzazione della rete ospedaliera (per molti aspetti sacrosanta) è stata adottata prima della riorganizzazione delle cure primarie (altrettanto sacrosanta, ma di fatto solo annunciata e anch’essa scaricata sulle regioni), mentre dovrebbe essere successiva; e così in molte regioni i cittadini si vedono ridurre l’assistenza ospedaliera prima che sia riqualificato il territorio. Gli interventi sulla sanità elettronica (fascicolo sanitario elettronico, ricetta elettronica, ecc.) costituiscono un piccolo passo in avanti all’interno di un percorso iniziato molti anni fa e che avrebbe richiesto accelerazioni ben più consistenti, anche perché di grande rilevanza per l’innovazione e la “crescita intelligente”; e anche qui il Governo ha chiesto alle regioni di intervenire a costo zero. Significativa al contrario l’attenzione riservata ad alcuni aspetti importanti per la salute delle persone: il consumo di alcol fra i minorenni, la dipendenza da gioco d’azzardo, il cibo spazzatura, provvedimenti che purtroppo non sempre sono riusciti a superare gli ostacoli frapposti da chi ha interessi antitetici alla salute della collettività.
In sintesi, una manutenzione straordinaria non in grado di incidere, almeno nel breve periodo, sulle incertezze e sulle difficoltà che assillano quotidianamente gli operatori e gli assistiti.

Autovalutazione del Governo Salute

Bio dell’autore

Nerina Dirindin: E’ docente di Economia Pubblica e di Scienza delle Finanze presso l’Università di Torino. E’ Presidente del Coripe Piemonte dove coordina il Master in Economia e Politica Sanitaria. Ha ricoperto incarichi istituzionali: è stata Direttore Generale del Dipartimento della Programmazione del Ministero della Sanità (1999-2000) e Assessore della Sanità e dell’Assistenza Sociale della Sardegna (2004-2009).

Reducing Waste in Health Care @Medici_Manager @nedwards_1

A third or more of what the US spends annually may be wasteful. How much could be pared back–and how–is a key question.

http://www.healthaffairs.org/healthpolicybriefs/brief.php?brief_id=82

What’s the issue?
Health care spending in the United States is widely deemed to be growing at an unsustainable rate, and policy makers increasingly seek ways to slow that growth or reduce spending overall. A key target is eliminating waste–spending that could be eliminated without harming consumers or reducing the quality of care that people receive and that, according to some estimates, may constitute one-third to nearly one-half of all US health spending.Waste can include spending on services that lack evidence of producing better health outcomes compared to less-expensive alternatives; inefficiencies in the provision of health care goods and services; and costs incurred while treating avoidable medical injuries, such as preventable infections in hospitals. It can also include fraud and abuse, which was the topic of a Health Policy Brief published on July 31, 2012.

This policy brief focuses on types of waste in health care other than fraud and abuse, on ideas for eliminating it, and on the considerable hurdles that must be overcome to do so.

What’s the background?
Many studies have examined the characteristics and amounts of wasteful or ineffective US health care spending in public programs, such as Medicare and Medicaid, and in care paid for by private insurance as well as out-of-pocket by consumers. By most accounts, the amount of waste is enormous.THE COST OF WASTE: By comparing health care spending by country, the McKinsey Global Institute found that, after controlling for its relative wealth, the United States spent nearly $650 billion more than did other developed countries in 2006, and that this difference was not due to the US population being sicker. This spending was fueled by factors such as growth in provider capacity for outpatient services, technological innovation, and growth in demand in response to greater availability of those services. Another $91 billion in wasteful costs or 14 percent of the total was due to inefficient and redundant health administration practices.

By looking at regional variations in Medicare spending, researchers at the Dartmouth Institute for Health Policy and Clinical Practice have estimated that 30 percent of all Medicare clinical care spending could be avoided without worsening health outcomes. This amount represents about $700 billion in savings when extrapolated to total US health care spending, according to the Congressional Budget Office.

More recently, an April 2012 study by former Centers for Medicare and Medicaid Services (CMS) administrator Donald M. Berwick and RAND Corporation analyst Andrew D. Hackbarth estimated that five categories of waste consumed $476 billion to $992 billion, or 18 percent to 37 percent of the approximately $2.6 trillion annual total of all health spending in 2011. Spending in the Medicare and Medicaid programs, including state and federal costs, contributed about one-third of this wasteful spending, or $166 billion to $304 billion (Exhibit 1). Similarly, a panel of the Institute of Medicine (IOM) estimated in a September 2012 report that $690 billion was wasted in US health care annually, not including fraud.

Exhibit 1
Download Powerpoint Slide

CATEGORIES OF WASTE: Researchers have identified a number of categories of waste in health care, including the following:

  • Failures of care delivery. This category includes poor execution or lack of widespread adoption of best practices, such as effective preventive care practices or patient safety best practices. Delivery failures can result in patient injuries, worse clinical outcomes, and higher costs.A study led by University of Utah researcher David C. Classen and published in the April 2011 issue of Health Affairs found that adverse events occurred in one-third of hospital admissions. This proportion is in line with findings from a 2010 study by the Department of Health and Human Services’ Office of Inspector General (OIG), which found that Medicare patients experienced injuries because of their care in 27 percent of hospital admissions.

    These injuries ranged from “temporary harm events,” such as prolonged vomiting and hypoglycemia, to more serious “adverse events,” such as kidney failure because of medication error. Projected nationally, these types of injuries–44 percent of which were found to be clearly or likely preventable–led to an estimated $4.4 billion in additional spending by Medicare in 2009, the OIG found. Berwick and Hackbarth estimate that failures of care delivery accounted for $102 billion to $154 billion in wasteful spending in 2011.

  • Failures of care coordination. These problems occur when patients experience care that is fragmented and disjointed–for example, when the care of patients transitioning from one care setting to another is poorly managed. These problems can include unnecessary hospital readmissions, avoidable complications, and declines in functional status, especially for the chronically ill.Nearly one-fifth of fee-for-service Medicare beneficiaries discharged from the hospital are readmitted with 30 days; three-quarters of these readmissions–costing an estimated $12 billion annually–are in categories of diagnoses that are potentially avoidable. Failures of care coordination can increase costs by $25 billion to $45 billion annually. (See the Health Policy Brief published on September 13, 2012, for more information on improving care transitions.)
  • Overtreatment. This category includes care that is rooted in outmoded habits, that is driven by providers’ preferences rather than those of informed patients, that ignores scientific findings, or that is motivated by something other than provision of optimal care for a patient. Overall, the category of overtreatment added between $158 billion and $226 billion in wasteful spending in 2011, according to Berwick and Hackbarth.An example of overtreatment is defensive medicine, in which health care providers order unnecessary tests or diagnostic procedures to guard against liability in malpractice lawsuits. A September 2010 Health Affairsstudy led by Harvard University researcher Michelle M. Mello estimated that in 2008, $55.6 billion or 2.4 percent of total US health care spending was attributed to medical liability system costs, including those for defensive medicine.

    Overtreatment can also result from overdiagnosis, which results from efforts to identify and treat disease in its earliest stages when the disease might never actually progress and when a strategy such as watchful waiting may have been preferred. For example, in July 2012 the US Preventive Services Task Force recommended against prostate-specific antigen-based screening for prostate cancer because of “substantial overdiagnosis” of tumors, many of which are benign. Excessive treatment of these tumors, including surgery, leads to unnecessary harms, the task force said.

    Overtreatment also includes intensive care at the end of a person’s life when alternative care would have been preferred by the patient and family, or excessive use of antibiotics.

    Another form of overtreatment is the use of higher-priced services that have negligible or no health benefits over less-expensive alternatives. When two approaches offer identical benefits but have very different costs, the case for steering patients and providers to the less costly alternative may be clear–for example, using generics instead of brand-name drugs.

    There is also provision of many services that may once have been considered good health care but that now have been discredited as lacking in evidence of benefit. Under the umbrella of the American Board of Internal Medicine Foundation’s “Choosing Wisely” initiative, nine different medical specialty groups and Consumer Reports have identified a series of regularly used tests or procedures whose use should be examined more closely. In 2013, 21 additional medical specialty groups will release similar lists in their respective fields.

    The National Priorities Partnership program at the National Quality Forum, a nonprofit organization that works with providers, consumer groups, and governments to establish and build consensus for specific health care quality and efficiency measures, has produced a list of specific clinical procedures, tests, medications, and other services that may not benefit patients. The next step is for physicians and payers to change their practices accordingly.

    After requesting public input, CMS on November 27, 2012, posted on its website a list of procedures or services that may be overused, misused, or provide only minimal health care benefits. They include lap-band surgery for obesity, endoscopy for gastroesophageal reflux disease, and lung volume reduction surgery. CMS said that these services may be evaluated to determine whether they should continue to be reimbursed under Medicare.

  • Administrative complexity. This category of waste consists of excess spending that occurs because private health insurance companies, the government, or accreditation agencies create inefficient or flawed rules and overly bureaucratic procedures. For example, a lack of standardized forms and procedures can result in needlessly complex and time-consuming billing work for physicians and their staff.In an August 2011 Health Affairs article, University of Toronto researcher Dante Morra and coauthors compared administrative costs incurred by small physician practices in the United States, which interact with numerous insurance plans, to small physician practices in Canada, which interact with a single payer agency. US physicians, on average, incurred nearly four times more administrative costs than did their Canadian counterparts. If US physicians’ administrative costs were similar to those of Canadian physicians, the result would be $27.6 billion in savings annually. Overall, administrative complexity added $107 billion to $389 billion in wasteful spending in 2011.
  • Pricing failures. This type of waste occurs when the price of a service exceeds that found in a properly functioning market, which would be equal to the actual cost of production plus a reasonable profit. For example, Berwick and Hackbarth note that magnetic resonance imaging and computed tomography scans are several times more expensive in the United States than they are in other countries, attributing this to an absence of transparency and lack of competitive markets. In total, they estimate that these kinds of pricing failures added $84 billion to $178 billion in wasteful spending in 2011.
  • Fraud and abuse. In addition to fake medical bills and scams, this category includes the cost of additional inspections and regulations to catch wrongdoing. Berwick and Hackbarth estimate that fraud and abuse added $82 billion to $272 billion to US health care spending in 2011.
What are the issues?
Although there is general agreement about the types and level of waste in the US health care system, there are significant challenges involved in reducing it. Much waste is driven by the way US health care is organized, delivered, and paid for and, in particular, by the economic incentives in the system that favor volume over value. An additional problem is that attacking “waste” usually means targeting someone’s income.In its September 2012 report, the IOM offered 10 broad recommendations for creating a very different health care system in which research, new incentives, partnerships between providers and patients, and a culture that supports continuous learning and development could lead to real-time improvements in the efficiency and effectiveness of US health care.

Although the IOM committee that prepared the report did not estimate cost savings, it predicted that implementing these measures would improve care and reduce expenses. The panel’s recommendations included the following:

  • Improve providers’ capacity to collect and use digital data to advance science and improve care.
  • Involve patients and their families or caregivers in care decisions. Increasing comparative effectiveness research may help physicians, patients, and their families make more informed decisions. (See the Health Policy Brief published on October 8, 2010, for more information on comparative effectiveness research.)
  • Use clinical practice guidelines and provider decision support tools to a greater extent.
  • Promote partnerships and coordination between providers and the community to improve care transitions.
  • Realign financial incentives to promote continuous learning and the delivery of high-quality, low-cost care. Numerous efforts are underway among public and private payers to move from the traditional fee-for-service mechanism, which pays based on the volume of services performed, and toward those that pay based on value and outcomes. (For more information, see theHealth Policy Brief published October 11, 2012, on pay-for-performance, and the Health Policy Brief published January 31, 2012, on accountable care organizations.
  • Improve transparency in provider performance, including quality, price, cost, and outcomes information. In a May 2003 Health Affairs article, Gerard F. Anderson from Johns Hopkins University, Uwe E. Reinhardt from Princeton University, and coauthors compared US health care spending with those of other member nations of the Organization for Economic Cooperation and Development. They found that the United States spent more on health care than any other country and that the difference was caused mostly by higher prices.

One way to improve transparency and reduce prices is through “reference pricing,” in which an employer or insurer makes a defined contribution toward covering the cost of a particular service and the patient pays the remainder. The objective is to encourage patients to choose providers with both quality and costs in mind. In a September 2012 Health Affairs article, University of California, Berkeley, researchers James C. Robinson and Kimberly MacPherson reviewed how this approach is being tested.

Many of the measures described above are in process, although they are playing out at different rates in different regions and systems around the country. There are widespread concerns about how replicable and scalable some new payment models are, and how soon they will make a major difference in the way care is provided and in what amount. There are also cross-cutting trends, including consolidation of hospital systems and their employment of physicians, which could lead to the provision of more unnecessary services, not fewer.

For example, in a May 2012 Health Affairs article, Robert A. Berenson, an institute fellow at the Urban Institute, and coauthors found that dominant hospital systems and large physician groups can often exert considerable market power to obtain steep payment rates from insurers.

FEAR OF RATIONING: In theory, a focus on eliminating waste in health care could skirt the issue of rationing because wasteful activities, by definition, carry no benefit to consumers. However, there may be a fine line between health care that is of no benefit and situations where the benefits are relatively small, especially in comparison to the cost.

A common example involves continued chemotherapy treatments for patients having certain advanced cancers. These treatments can cost tens of thousands of dollars but extend a patient’s life by only a few weeks. However, restricting the use of such treatments or services can lead to accusations of “rationing.”

To address many Americans’ fear that the Affordable Care Act would lead to rationing, the law specifically forbids the federal government from making decisions on “coverage, reimbursement, or incentive programs” under Medicare that take cost-effectiveness into account, and “in a manner that treats extending the life of an elderly, disabled, or terminally ill individual as of lower value than extending the life of an individual who is younger, nondisabled, or not terminally ill.” The law is silent on any of these activities going on outside of Medicare.

What’s Next?
Efforts to extract waste from the health care system will in all likelihood continue along a range of federal government initiatives, including information technology adoption, pay-for-performance, payment and delivery reforms, comparative effectiveness research, and competitive bidding. Similar programs are also being initiated by state Medicaid agencies and by private payers. In the view of many experts, even more vigorous efforts to pursue the reduction of waste in health care are clearly warranted.
Resources
Anderson, Gerard F., Uwe E. Reinhardt, Peter S. Hussey, and Varduhi Petrosyan, “It’s the Prices, Stupid: Why the United States Is So Different from Other Countries,” Health Affairs 22, no. 3 (2003): 89-105.Bentley, Tanya G.K., Rachel M. Effros, Kartika Palar, and Emmett B. Keeler, “Waste in the US Health Care System: A Conceptual Framework,” Milbank Quarterly 86, no. 4 (2008): 629-59.

Berenson, Robert A., Paul B. Ginsburg, Jon B. Christianson, and Tracy Yee, “The Growing Power of Some Providers to Win Steep Payment Increases from Insurers Suggests Policy Remedies May Be Needed,” Health Affairs 31, no. 5 (2012): 973-81.

Berwick, Donald M., and Andrew D. Hackbarth, “Eliminating Waste in US Health Care,” JAMA 307, no. 14 (April 11, 2012): 1513-6.

Classen, David C., Roger Resar, Frances Griffin, Frank Federico, Terri Frankel, Nancy Kimmel, et al., “‘Global Trigger Tool’ Shows That Adverse Events in Hospitals May Be Ten Times Greater Than Previously Measured,”Health Affairs 30, no. 4 (2011): 581-9.

Elmendorf, Douglas W., “Options for Controlling the Costs and Increasing the Efficiency of Health Care,” Statement before the Subcommittee on Health, Committee on Energy and Commerce, US House of Representatives, March 10, 2009.

Farrell, Diana, Eric Jensen, Bob Kocher, Nick Lovegrove, Fareed Melhem, Lenny Mendonca, et al., “Accounting for the Cost of US Health Care: A New Look at Why Americans Spend More,” McKinsey Global Institute, December 2008.

Hoffman, Ari, and Steven D. Pearson, “‘Marginal Medicine’: Targeting Comparative Effectiveness Research to Reduce Waste,” Health Affairs 28, no. 4 (2009): w710-18. DOI: 10.1377/hlthaff.28.4.w710.

Institute of Medicine, “Best Care at Lower Cost: The Path to Continuously Learning Health Care in America,” September 6, 2012.

Kelley, Robert, “Where Can $700 Billion in Waste Be Cut Annually from the US Healthcare System?” Thomson Reuters, October 2009.

Levinson, Daniel R., “Adverse Events in Hospitals: National Incidence among Medicare Beneficiaries,” Department of Health and Human Services Office of Inspector General, November 2010.

Morra, Dante, Sean Nicholson, Wendy Levinson, David N. Gans, Terry Hammons, and Lawrence P. Casalino, “US Physician Practices Versus Canadians: Spending Nearly Four Times as Much Money Interacting with Payers,” Health Affairs 30, no. 8 (2011): 1443-50.

About Health Policy Briefs
About Health Policy BriefsWritten by
Nicole Cafarella Lallemand
Research Associate
Urban Institute

Editorial review by
Andrew D. Hackbarth
Assistant Policy Analyst
RAND Corporation

Brent C. James
Executive Director
Institute for Health Care Delivery Research
Intermountain Healthcare

Bob Kelley
Senior Vice President
Truven Health Analytics

Ted Agres
Senior Editor for Special Content
Health Affairs

Susan Dentzer
Editor-in-Chief
Health Affairs

Health Policy Briefs are produced under a partnership of Health Affairs and the Robert Wood Johnson Foundation.

Cite as:
“Health Policy Brief: Reducing Waste in Health Care,” Health Affairs, December 13, 2012.

Sign up for free policy briefs at:
www.healthaffairs.org/healthpolicybriefs