Andy Calman, MD, PhD responds to the message on physician behavior under the Medicare Sustainable Growth Rate:
Wow. Where to begin? Time does not permit a full response so I’ll summarize.
You equate “cost-effectiveness” with “noble” behavior. The fact is that technology enables us to help people who previously could not be helped.
This month, in my field of ophthalmology, a new drug was approved for macular degeneration, the leading cause of legal blindness in Medicare-age Americans. This treatment is inordinately expensive ($1000 per injection just for the drug cost, and about $200 to the doc). But should we withhold this treatment, which is the first to offer the possibility of actual visual improvement? Would it be noble to do so? How would I explain this to my father-in-law, an engineer now blinded and unable to practice his profession because such treatments did not exist when he lost his vision to this disease?
Don’t assume that performing more service is ignoble or equates to “gaming the system” or “lacking integrity”. We pay more than we used to, and we get more than we used to (we pay more than other countries do, but that is a different issue). Whether it’s hip replacements, cataract surgery, arthritis meds, psychotherapy, or laparoscopic surgery, the recipients of these services are generally delighted that they are able to get on with healthier lives as a result. They do not view their physicians as ignoble because they made these services available.
Policymakers need to make rational decisions about how much it is worth to society to have the benefits of advanced medical care. I am not swayed by the arguments that we devote increasing amounts of our GDP to healthcare. We get real benefits for large numbers of people as a result of this investment. Sure, we could spend more of our GDP on other things that people want, like consumer electronics and SUV’s, but is this automatically the best public policy?
Also, be careful how strongly you defend the SGR. The SGR has some serious flaws: it does not adequately account for the increase in the over-80 demographic,it inappropriately ties services to GDP, and it includes in-office prescription drugs in the calculation — a component which has tripled in the last several years in its percentage of overall part B services.
I’m with you in general, but this editorial really turned me off. I want to see universal access to healthcare just as much as you do, and am working hard to help bring it about. But demonizing the physicians (or ennobling our critics) will not gain you many converts among our ranks. And universal access to substandard care is only marginally better than what we have now.
Andy Calman MD PhD
Founder and National Chair
Physicians for a Democratic Majority
Don’s response: We emphatically agree that beneficial technological advances are clearly desirable and should be incorporated into the payment structure of the health care system, even if that results in an increase in the health care component of the GDP.
The dispute is over whether the increases in physician spending represent the increased costs in technological advances. Keep in mind that we are addressing physician compensation only, which excludes most of the capital investments in operating rooms, imaging centers, specialty hospitals, and the purchase of prosthetic devices or of most drugs. From the physicians’ perspective, most of the impact of new technology is on the time and effort that the physicians devote to added services necessitated by the technology.
For 2003, this was estimated to be about a 1.5% increase, and another 1% for
2004. Intuitively about 1.25% per year seems reasonable since there has
not been an explosion of technology in the past two years that required an inordinate increase in physician effort. In fact, because of time constraints, some older, less effective interventions are abandoned, freeing up more time for the new.
Beginning with 100% of physician spending in 1996, a target level of spending was recalculated yearly by adding adjustments for demographics, for inflation, and for increased physician time and expense for newly approved technological advances (as above). The target amount for 2004, including the factor for technological advances, was $77.1 billion, but actual physician spending was $84.9 billion. It seems highly unlikely that physicians increased their effort an additional 15% over that which already includes a correction for new technology. And we know that they didn’t increase their working hours by 15%.
I think that it is much more likely that the physician adjustment factor (PAF) demonstrates what we feared: that physicians are pushing the limit on coding in an attempt to achieve income levels to which they believe they are entitled. I do not believe that this represents unethical behavior, but, rather, represents the fact that they are making the most of the somewhat flawed system that we have. I still stand by my position that we should investigate whether we could make changes that, instead, incentivize the most noble behavior on the part of physicians.