One significant and seemingly unsolvable issue in this country (and elsewhere) is the high and rising cost of health care. An extensive government program, Obamacare, was implemented, which, while it did increase coverage, especially for low-income people, has “saved” costs by lowering reimbursements and implementing closed panels of providers. This has resulted in significant problems with access, as providers cannot cover even their expenses at these rates — the same problem exists with Medicaid — and thus, though you may have coverage, the inability to find providers who accept these plans can be difficult or impossible.
Another aspect of these transformational coverage plans that receive little or no attention is their heavy emphasis on preventive medicine. We have heard about how preventive medicine will save substantial sums of money and make the healthcare system far less costly. Of course, such rhetoric has enormous appeal at a surface level—after all, if you can prevent diseases, you certainly don’t need to spend money to cure them.
But this innocent-sounding, simplistic Trojan horse will ultimately prove damaging to American health care and empower the bureaucrats and politicians who will gain the most from this change in direction.
When discussing preventive medicine, we generally speak of two general areas: the screening and early detection of diseases and lifestyle changes and therapy to reduce long-term medical risk. Screening and early detection of diseases is an appealing concept but devilishly difficult in practice. The idea sounds terrific: do a simple, inexpensive test; detect the disease earlier, when it is simpler and less expensive to treat; and you will be healthier in the future, requiring far fewer health resources. The problem lies in the malignant mathematics and sickening statistics of applying medical screening to large populations.
Simply put, no screening test is perfect, and all such tests generate both false positives — telling you that you have a disease when you do not — and false negatives — telling you you’re fine when you have the disease. Even with an extraordinarily accurate test, the problem lies in applying it to large populations. If you have a cancer screening test with a 1% false positive rate (an extraordinarily low number in the screening business) and have a disease that occurs in one patient out of every 10,000, applying the test to 10,000 patients will generate 100 false alarms (false positives) for every patient with the disease. These false positives all require additional testing or procedures to determine whether the abnormal test means you have the disease.
Herein lies the economic trap: for every detected patient with the disease, you will spend an extraordinary amount of money on patients without the disease. This phenomenon has been well demonstrated in almost every screening study; screening increases rather than reduces medical costs.
Of course, many simple screening tests and procedures are used daily in medicine. When you go to the doctor, your blood pressure is checked, your cholesterol is measured, you stand on the scale, are weighed, and asked whether or not you smoke. If your blood pressure is high, you will likely be started on medication, and it is also likely that you will need to stay on this medication indefinitely. If your cholesterol is elevated, you will be encouraged to exercise, make dietary changes, and lose weight (most of which you won’t do). Still, you will also likely be started on cholesterol-reducing medication for the long term. Of course, we recognize this is appropriate for reducing the risk of high blood pressure or cholesterol. What may not be recognized is that many people with high blood pressure or high cholesterol, unrecognized and untreated, may not have significant problems from these disorders for many years, if ever.
Suppose that 100 people with high cholesterol levels take statins, a standard treatment for high cholesterol. Of them, about 93 wouldn’t have had heart attacks even if they had not taken the medication. Five people, on the other hand, will have heart attacks despite taking the statin. Only the remaining two out of the original 100 avoided a heart attack by taking the daily pills. In the end, 100 people needed to be treated to prevent two heart attacks during the study period — so the number of people who must get the treatment for a single person to benefit is 50. This is known as the “number needed to treat” — and is a common way health researchers determine the cost and effectiveness of preventive therapy. Ideally, we will get better at selecting those patients at the front end who actually will benefit from taking the drug and, therefore, avoid administering it to those who ultimately will not need it. However, such health forecasting is far from perfect, and there will always be a need to treat patients who are perceived to be at risk even though time will ultimately find them not to be at risk at all. The human organism in health and disease is far too complex to eliminate this reality.
Problems such as these arise in every aspect of preventive medicine. Implementing lifestyle changes, such as weight reduction, regular exercise, smoking cessation, and dietary modifications, is largely a fool’s pursuit. We humans love our addictions and rarely overcome them even when they threaten our health and well-being.
The myth of the economic benefits of preventive medicine dies hard, however, and the resulting changes in the healthcare system are placing a massive bet on this loser’s hand. The systemic manifestation of this crap shoot is the glorification and indemnification of primary care as the solution to all of our healthcare woes, economic or otherwise. There is a heavy emphasis on steering patients toward primary care physicians and away from specialists in managed plans.
Healthcare bean counters have long known that care delivered by specialists is more expensive than that supplied by primary care physicians. The specialist who performs the costly surgeries, procedures, and diagnostic studies costs the government and health insurers a substantial percentage of their total outlays. From an economist’s standpoint, it makes perfect sense to reduce the utilization of more expensive specialty care and increase the utilization of less costly primary care. There has been a substantial increase in reimbursement to primary care physicians and a reduction in reimbursement to specialists by eliminating higher payments for consultations, procedures, and surgeries. These changes have already been implemented in Medicare and Medicaid. There are plans to bundle payments for chronic disease management, paying the primary care physicians who manage them higher rates, most likely on a fixed payment schedule designed to motivate physicians to reduce costs and improve outcomes.
The insurance industry came up with this idea over a decade ago and implemented it extensively in systems, using capitation (bulk payments to physicians upfront for future care) and the gatekeeper model (having the primary care physician who receives such bulk payments control referrals to specialists, with a strong financial incentive not to send them there).
There were a host of difficulties with this approach to medicine. First of all, it puts the physician in a position of conflict of interest by giving them a financial incentive not to order additional tests or make referrals to expensive specialists. While this incentive would reduce unnecessary tests and referrals, it also gave the physician an economic incentive to defer or eliminate such tests and referrals when they were in the patient’s best interest. Simply put, your doctor made more money if he did not order your CAT scan, even if a CAT scan had a strong medical indication.
These policies have led to no small amount of disgruntlement among patients covered under such plans. It became clear that patients could not see specialists when needed because their physician or insurance company refused to allow them. Patients demanded these treatments even when the system worked as ideally designed — preventing referrals for unproven experimental or unnecessary treatments. They often resorted to heart-rending media exposes on how the evil insurance companies had refused to pay for their experimental cancer treatment. In one sense, this approach did work as intended: by restricting access to care, particularly specialist referrals and expensive diagnostic testing, HMOs and other similar insurance schemes did reduce substantially the rise in medical costs. But they did so by rationing — thereby sealing their fate when this became enormously unpopular among patients and (of course) exploited by politicians.
Although some remnants of this system remain intact, particularly preauthorization for specialist referrals, specific procedures, and diagnostic imaging studies, the coercive restrictions in place during the height of this trend have somewhat mitigated. Those restrictions, however, are still the most common source of discontent among patients and physicians, as insurance companies continue to refuse payment for medical services recommended by their physicians or require onerous paperwork for their authorization.
As you can imagine, primary care physicians, who have been lobbying for higher reimbursement rates for many years (and not unreasonably so), find many aspects of a new financial emphasis on primary care attractive.
One of the deadliest traps of bundled payments, such as capitation, was the problem of medical outliers. To manage all their care, getting a monthly fee for your entire patient population is a great deal if all your patients are healthy, as they cost you very little, and you get to keep the difference. The problem arises when your practice involves many patients whose care is costly. Your lump sum payment begins to look very small when a large number of your patients require costly hospitalization, surgery, expensive medical therapy, or drugs — the payment for which is coming out of your pocket. This reality created an entire consulting industry to analyze patient populations versus capitation rates, intending to reduce physicians’ exposure to potentially disastrous financial consequences. Physicians and their consultants got very good at selecting populations of healthier patients — which often excluded those patients who needed medical care the most. Physicians who got burned on this complex calculus frequently ended up terminating their relationship with specific insurance carriers, resulting in many patients abruptly losing their physicians and being forced to hunt around for new physicians who would accept their insurance.
For these and a host of other reasons, such insurance models have died mainly an ignominious and well-deserved death. But their rotting corpses are being raised to life again. The Undead will walk the earth, this time with even more extraordinary powers granted them by the federal government.
With private insurers, physicians and physician groups at least have the option of terminating their contracts with insurance carriers whose reimbursements or capitation rates were insufficient to cover the risks of the patient populations they covered. This escape route will no longer be available with universal health care, especially one predominantly or exclusively provided by the government. The primary care physician who finds his reimbursement improved for managing chronic diseases will also find himself burdened by a blizzard of additional paperwork to document that the “quality” of his care meets government standards — whether such standards are realistic or even in the patient’s best interest. Furthermore, if such reimbursements do not cover the inevitable increase in management overhead, there will be nowhere else to turn. One cannot fire the federal government when they are the only payment source for medical services. The only option available to physicians will be to opt out of medicine altogether — and you may anticipate the increasing numbers of physicians will do precisely this. Universal health insurance is not the same as universal health access — a lesson we are about to learn painfully if we continue down this path. A seat at the Captain’s table on the Titanic seems propitious until the chairs start sliding toward the bow of the sinking ship.
However, there is another aspect to this heavy emphasis on primary care that has received virtually no attention. Although certainly not without problems and potential abuses, the simple fact remains that America’s specialist-intensive healthcare system is, in fact, the driving force behind its technologically advanced benefits. Simply put, we are not living longer, healthier lives because our beloved family doctors hold our hands and listen to our complaints. The considerable advances in medicine in the past 50 years have occurred primarily because of the specialization of medicine. The extraordinary complexity of contemporary medicine has made its mastery by any one type of physician utterly impossible. Even the brightest internist or family practice physician cannot be a master of all of the complex aspects of cardiology, surgery, oncology, or the management of increasingly challenging infectious diseases. Indeed, good physicians in primary care are well-versed in many of these areas at some level. Still, it has long since been unrealistic to expect primary care providers to be masters of such vast and ever-increasing knowledge and complexity in the different realms of specialty medicine. This is not to denigrate the importance of primary care physicians, who are highly accomplished at the health maintenance of large numbers of patients — a skill that has contributed significantly to our improved quality of life and longer lifespans. But our system provides enormous benefits in high quality and longer, healthier lives because the primary care physician has a deep bench of specialists at his beck and call.
At some point, even the most skilled and capable primary care physicians will encounter complex, difficult, or intractable problems that they are not trained or qualified to manage. Specialty care is indeed expensive—and it is costly in no small part because the patients who need such care have more difficult or complex medical problems that cannot be best treated without the expertise of specialists.
As our system increasingly steers patients away from such specialty care for economic reasons, it will do so at significant cost in various realms. Much of the advanced medical innovation, which has given us longer and better lives, has arisen out of specialty care, and significant restrictions on such care will inevitably blunt and slow such medical advances. However, there are costs hidden in such an approach, which will also become apparent with such an unbalanced emphasis. When we, through financial coercion, force primary care physicians to assume the care of increasingly complex patients for which they have neither the training nor depth of experience to manage, such care will inevitably end up being inferior in quality — and likely will end up in the long run, being far more costly. Without access to specialty support, primary care physicians tend to fall back on using more expensive medications, diagnostic studies, and therapies, sometimes inappropriately. The unusual skin condition, which can be promptly diagnosed and appropriately treated in a few visits to the dermatologist, may instead be treated with an increasing array of expensive and ineffective therapies or drugs by primary care providers who are unwilling or unable to avail themselves of specialty consultation and treatment. The insurance companies learned this long ago, and it was one of the factors motivating them to dismantle the gatekeeper model.
The enormous push toward primary care and preventive medicine embodied in the current transformation of the health care system will fail, brought down by the flawed premises upon which it is based. However, it will prove successful to those currently pushing for its implementation in one crucial regard. The system presently designed, emphasizing primary care and preventive medicine, will not improve quality or reduce costs but will give the government a greater degree of control over physicians and the nature of their care. Increasingly, it will be the government, not the physician, who dictates what care you will receive, which specialists you will see (if any), and whether the medically appropriate care you need will meet its financial standards for return on investment. We will all be asked to “take the pain pill” rather than undergo the surgery we need, which will save or improve our lives.
The most recent variation on managed care themes is the Accountable Care Organization. These panels of physicians and other health care providers are designed to improve communication among medical providers, hospitals, and other supporting services, especially for patients with chronic diseases such as diabetes and heart disease. They also emphasize reimbursement rates based on compliance with quality standards: Providers get paid more if they comply with these standards and less if they don’t. The organization was originally designed for Medicare but has been extended outside this program to many private plans.
Once again, theory is trumped by reality. These organizations become massive bureaucracies, typically managed by hospitals or large healthcare organizations, whose financial priorities often run counter to the physicians and other providers at the patient’s point of care. Physicians are rarely, if ever, paid more for “good” care, as defined by hospitals, and are often pressured to discharge patients prematurely before they are clinically stable to prevent financial. Furthermore, there is a strong tendency toward ossification of the standards, which remain outdated and unchanged when medical science progresses – especially if superior clinical care proves more costly than indicated by outdated, misdiagnosed, or financially-driven “quality measures.”
This system inevitably leads to a massive increase in healthcare bureaucracy, and an ever-growing percentage of reimbursement dollars goes to feed the monster: like the flourishing flora in Little Shop of Horrors, the beast unceasingly growls, “Feed Me!!”
Unfortunately, moving away from these massive, expensive, and dysfunctional healthcare organizations and government programs seems unlikely. As a country, we spend more per capita on health services while quality deteriorates. Simplistic solutions like “preventive medicine” will not deliver us from this overgrown ogre. Decentralization, catastrophic-only coverage for most, and eliminating the middle man from the equation are the only options for long-term liberation from our current dilemma.
