Thread: Why is president convinced doctors make irrational decisions

Obama and the Practice of Medicine

Why is the president convinced so many doctors and patients are making irrational decisions?

By SCOTT GOTTLIEB

On the defensive because of an increasingly skeptical public, President Barack Obama has recently spoken extemporaneously about his health plan.

In doing so, he has revealed his lack of understanding about aspects of medical practice and the reasons for rising health-care costs.

One theme the president has focused on is doctors' motives. During a prime-time press conference on July 22, the president referred to a doctor who muses that she makes "a lot more money if I take this kid's tonsils out"—even if the child might not need surgery.

Responding to a woman whose spry 100-year-old mother was given a needed pacemaker despite her age, the president said a few weeks earlier (at an ABC News town-hall event at the White House) that doctors should let patients know that sometimes "you're better off not having the surgery, but taking the painkiller."

Mr. Obama's clinical scenarios represent an excessive—if not erroneous—take on how doctors are influenced by financial incentives. This jaundiced view on medical decision-making may explain why programs the White House is proposing to lower health-care costs rely on the direct regulation of medical decisions.

If Mr. Obama is serious about lowering costs, he'll need to reform the economic structures in medicine—especially programs like Medicare.

Medicare data shows that for the most part, major surgeries aren't the source of waste in health care. These kinds of procedures are typically guided by clear clinical criteria and are closely scrutinized by doctors and patients alike. Rather it is in routine procedures and treatments that economic incentives factor heavily into doctors' decisions.

The use of branded over cheaper generic drugs until recently fell into this category. Doctors would regularly prescribe the more expensive option. Today this is far less prevalent, since patients with private plans realized that they were being saddled with higher co-pays when they opted for the brand-name drugs over generic alternatives.


President Barack Obama speaks at a town hall meeting about health care.
Other areas where doctors have been accused of excessive utilization include radiology scans and home medical equipment.

In the absence of financial incentives to restrain excess use, relatively safe diagnostic procedures can often be justified—even if their benefits are slim.

Instead of addressing the distorted financial incentives that influence these kinds of routine tests and treatments, Mr. Obama's policies seek to directly regulate doctors and their decisions.

The Obama administration has proposed establishing an "Independent Medicare Advisory Committee" to set binding rules on Medicare reimbursement policies.

Mr. Obama has also called for the creation of a new federal entity that would conduct "comparative" research on the cost-effectiveness of various treatments in order to establish federal "guidelines."

The House health reform bill calls for "health information tools" that would enable Medicare to deny payment for a particular treatment right in the doctor's office.

Regulating medical decisions should not be the responsibility of a remote Washington bureaucracy.

The only way to instill more reflection at the point of medical decision making is to give doctors and patients reasons to consider the cost of various options.

For doctors whom Medicare pays per intervention, the problem isn't the fee-for-service model, but the way that the government program sets the fees.

Fees are set according to a fixed price schedule with no tie to the physician's quality, experience level, or the outcome of the service.

A more rational system would pay doctors for entire "episodes of care," rather than individual procedures. Private health systems like the Geisinger Clinic and some Blue Cross plans have adopted this model and pay doctors for taking care of an entire illness.

Medicare doesn't have the ability to track episodes of care. It has struggled to adopt even modest payment reforms such as restricted panels of providers, value-based insurance, and account-based coverage, where consumers control their own spending—all techniques used by private insurers to improve efficiency.

Medicare's size demands that it keep payment systems simple. Thus it relies on fixed prices for checklists of services tied to discrete billing codes.

These uniform payment rules reward low and high quality care the same. What's troubling is that the heart of the president's plan—a government-run "public" insurance program—is modeled directly on Medicare.

Medicare compounds its shortcomings by insulating patients from costs. This causes a total lack of financial restraint at the point of care. Cost-sharing in Medicare has actually declined over time as a percent of patients' total health bill.

My colleague at the American Enterprise Institute, Tom Miller, estimates that U.S. patients have the lowest out-of-pocket costs as a percent of total national health spending of any developed country except France, Luxembourg, the Czech Republic and Ireland.

They're even lower than the single-payer health system in Canada. Mr. Miller calculates that out-of-pocket spending on physician and clinical services in the U.S. was about 60% of total real per capita spending on health care in 1960. By 2002 it had fallen to 10%.

Unsurprisingly, Medicare data show that over the past two decades Medicare's costs for care have sharply outpaced spending in private plans, where co-pays and cost sharing are standard.

While these estimates are confounded by factors such as the age of Medicare's population, Medicare certainly hasn't been austere.

Mr. Obama says as much as one-third of medical spending is wasted on services that provide little or no benefit.
But closer scrutiny of these kinds of marginal medical decisions can't be imposed by government regulation.

Cost consideration must be internalized at the point of care by patients and doctors with a stake in the price, as well as the outcome.

Dr. Gottlieb, a former official at the Centers for Medicare and Medicaid Services, is a fellow at the American Enterprise Institute and a practicing internist. He's partner to a firm that invests in health-care companies.



http://online.wsj.com/article/SB1000142 ... 83030.html

Why is tort reform not on the table? Physicians are squeezed between getting lower reimbursement and raised insurance costs for them. Other countries with socialist health care systems have committees that handle malpractice cases. There can be no reasonable costs as long as there are outrageous malpractice awards and contingent fees. Guess there are too many lawyers in Congress and the Senate.

Even though NC has some of the best medical care in the country, the thing that really bothers me is that my elderly mom, who has Medicare and supplemental, we cannot do a thing without our primary doctor, who always refers her to specialists. At this count, she has six.
I have no real idea why she must go to the primary doc, who listens to her heart, lungs, basically pats her on the head and gives us a phone number to call a specialist.
We have homecare nurses coming occasionally and she is doing fine. And it really gets fun when one doctor has no idea what the other diagnosed, even though they send each other reports. Each specialist appointment has proven the cardiologist has no idea what the nephrologist, nor the gastroenterologist has determined. The expensive office visits are spent mostly watching the doctors reading the reports from other doctors. Max visit time, 15 minutes. No problem, she has full insurance coverage.

If Mr. Obama is serious about lowering costs, he'll need to reform the economic structures in medicine—especially programs like Medicare.

And furthermore, those under Medicare see that the program continually throws out excessive charges for thousands of dollars in outrageous costs. You have an operation, and all of a sudden you need speech therapy? An aspirin or Tylenol is $4 a pill because some nurse aide brought you that pill? They bring a toothbrush, mouthwash and all kinds of stuff wrapped in plastic, but if you don't take them home from the hospital, they throw that all away. Medicare at least tells them to stuff it.

Socialized medicine is why my mother suffered and died earlier than she had to. She kept going to her primary care physician with the same complaint of back pain in the kidney area. She was always told that she had a bladder infection that moved to her kidneys and was given anti biotics. No scan was ever done as there was a waiting list for them. This went on for almost 2 years. My parents had a condo in Florida on the west coast where they would spend the winter and had insurance while here. My mom got worse pain and had more blood in her urine than she had in the past. My dad took her to the closest hospital where they did do a scan and found she had a large tumor on her kidney. They flew back and my mom was immediately take to the hospital where they did a biospy and found it was cancer. She had a kidney removed but by this time it was too late and 3 months later the cancer spread to her lungs. a year and a half later she was dead.
My grandmother also wasn't sent for tests that would have been done here. She suffered in pain for years. One day I was visiting her and she was in agony so I took her to the hospital and told them I refused to leave until she was properly diagnosed. They did a regular xray and found something but did not tell us and called her primary care physician immediately. She had undiagnosed uterine cancer and when she was in surgery they found her abdomen was full of cancer and was inoperable. She died 6 days later.
Is this the kind of care people really want?