Crossroads/Health Care is a forum on the future of health care posted on the sacbee.com website. Sacramento Bee columnist Daniel Weintraub is the moderator. Following are submissions from James Knight, M.D., CEO of Consumer Directed Health Care, Inc. in San Diego, and Don McCanne, M.D., Senior Health Policy Fellow of Physicians for a National Health Program.
June 27, 2007
James Knight on economical care
From James Knight, MD
Primary care has been the holy grail of health care for quite some time now. The prevailing notion has been that investing more scarce health care dollars in relatively inexpensive preventive care as opposed to high quality (read: expensive) management of manifest disease would save money over the long run. The belief that robust first dollar coverage that pays for day-to-day care (including preventive care) is cost effective over the long run has now been shown to be a myth. Moreover, robust first dollar coverage has incontrovertibly been shown to drive significant unnecessary health care spending (the Rand Health Insurance Experiment.
From a medical perspective, management of manifest disease by specialists in the field provides the most qualified person for the neediest patients. Doctors and other paraprofessionals are generally paid according to the Common Procedural Terminology (CPT codes, trademark American Medical Association) for the services rendered; same codes same payment. While specialists’ management of manifest disease often does costs more, that’s more a function of their training and thus their ability (and perhaps inclination) to provide more advance services, rather than some inherent excess cost. Of note, for more advanced services, specialist fees are generally only a small portion of the total cost as compared to the hospital and technological fees that represent the lion’s share of the cost of a major medical intervention, for example a coronary artery bypass procedure.
The Rand study clearly shows that folks who are financially responsible for the cost of their day-to-day care make very good decisions (on average get the same health care outcomes http://cdhcinc.com/HIE.htm#HealthOutcomes ) but reduce overall health care spending by as much as 40% or more. As consumer directed health care solutions become more common, putting more consumers in charge of purchasing day-to-day care, innovative solutions such as in-store clinics providing access to more affordable preventive and day-to-day care will ultimately drive down the cost of these services.
I believe the AMA’s distaste for this competition is largely economic. That being said, there is also clearly some potential risk to patients that could arise with lax supervision of these new health care venues. Patients must be protected from the snake-oil salesmen so prevalent in the past before physician quality initiatives such as standardized, broad based medical training, board certification and recertification, continuing education requirements and credentialing and re-credentialing.
As we enter a new world in the way people access and purchase day-to-day health care, everyone can expect change. For some physicians that may mean less importance in the new paradigm than they have historically enjoyed. Routine day-to-day care needn’t be delivered by the most expensive provider any more than everybody with a headache must have an MRI and a full evaluation by a neurologist.
In my humble opinion, the person best suited to make these kinds of decisions is the financially responsible patient working with a properly trained and credentialed health care provider of the patient’s choosing (in my view that also includes properly trained and credentialed paraprofessionals who are appropriately supervised by a responsible professional).
June 28, 2007
Public comment on primary care
From Don McCanne, M.D.
James Knight’s comments on “economical care” are puzzling. A strong primary care infrastructure has been proven repeatedly to provide higher quality care by ensuring better access to more appropriate care, and does so at a lower cost. Yet he cynically dismisses primary care as a “holy grail” and suggests using in-store clinics. In-store clinics provide only single-visit care for very minor problems and can’t possibly manage major acute or chronic problems. He apparently would abandon the benefit of coordinated, integrated care in a primary care medical home.
He then suggests that specialists are the “most qualified” physicians, but also defends their high fees. How does increasing the use of highly specialized services reduce health care spending? In fact, the Dartmouth studies have shown that in many areas of the country we spend too much on highly specialized services and often have worse outcomes as a result.
He repeats his oft-made assertion that the results of the Rand Health Insurance Experiment provide a basis for adopting consumer directed health care (i.e., requiring patients to pay cash for their care). He omits the fact that hypertensive patients in the study had a higher death rate when they were exposed to cost sharing. Death is hardly the same outcome as that of those who didn’t die.
The Rand HIE was a study of a healthy workforce and their healthy families during a few healthy years of their lives. It has intrinsic validity for a similar healthy population, but it has no extrinsic validity for our entire population, throughout life, with our full basket of health problems. About 80 percent of health spending is for the 20 percent of individuals with significant health problems. The RAND HIE does not apply to this 80 percent of spending, and can have very little impact on our overall health care costs. Pretending that wasteful patient spending is why we have high health care costs is totally off target.
We know how to reduce waste while improving the overall quality of our system. We can eliminate a tremendous amount of administrative waste, due to our fragmented system of financing care, by changing to a single, efficient insurance system. We can improve quality and reduce costs by realigning incentives to support our rapidly deteriorating primary care infrastructure. We can realign incentives to encourage appropriate use of high-tech specialized services while discouraging wasteful, detrimental excesses. We can negotiate prices and fees to pay for legitimate costs and fair profits, while eliminating payment for costs that do not benefit patients (such as DTC drug marketing).
This year Medicare identified excesses in spending on imaging. They responded by shifting funds from these excesses to improve reimbursement for primary care. The fragmented private insurance industry is not capable of providing the structural reforms in financing that we need. If we really want to contain costs and improve quality in a system that’s affordable for everyone, then we need to change to a single, equitably-funded risk pool with administrators dedicated to patients rather than to enterprises. An improved Medicare for all of us would accomplish that.