More health care isn’t always better, just more expensive.
Post-Dispatch file photo.
What’s the difference between a senior citizen in St. Louis and another in Kansas City? About $700, as far as Medicare is concerned.
In 2006, Medicare spent an average of $702 more per patient in St. Louis than it did in Kansas City. Why should this be?
Doctors in Kansas City are just as good and have access to the same technology as those in St. Louis. People in the two metro regions aren’t much different, either. They fall prey to the same illnesses and infirmities. But caring for them costs an average of about 9 percent more in St. Louis.
Even at that price, St. Louis (average spending: $8,306 per Medicare enrollee) is a bargain compared to McAllen, Texas ($14,946) or Miami ($16,351). Spending in Miami is a staggering 144 percent more than Minneapolis ($6,705). What gives?
Americans have the most expensive health care system in the world. That’s not so much about the quality as it as about quantity.
For the most part, people in other developed nations have access to the same treatments and drugs that Americans do. But when we get sick, we’re more likely to receive very intensive treatment, often involving expensive high-tech equipment and newer drugs or medical devices.
We expect it. Our approach to health care is like Oliver Twist’s approach to dinner: “Please, sir, I want more.”
But more health care isn’t necessarily better. In 2001, “over use” — too much medical care — was identified by the Institute of Medicine as one of three categories of medical error.
Some variations in Medicare spending reflect differences in the cost of living. New York is much more expensive than St. Louis; it’s not surprising that Medicare spending is higher there.
But San Francisco has a much higher cost of living than Miami. Yet Medicare spends about half as much in San Francisco as it does in Miami.
Researchers at Dartmouth College, who compiled those figures, have worked for decades to decipher the differences. People in some cities may be sicker than those in others, they believe. But even after adjusting for that, significant spending differences remain.
The most likely explanation: Roemer’s Law.
During the 1960s, researcher Milton Roemer noticed that the more hospital rooms that were built in Los Angeles, the more patients were admitted to fill them.
Health care often turns the law of supply and demand on its head. The more supply there is, the more demand it creates.
Dartmouth researchers found that they could predict how long a Medicare patient would be hospitalized just by knowing hospital capacity in the city where they lived. The more hospital beds, the longer patients are hospitalized and the more Medicare spends. That’s Roemer’s Law.
People who have a heart attack in St. Louis or Kansas City — or Miami or Minneapolis — get pretty much the same care. But in many other areas of medicine, treatment protocols are less clear. That’s where judgment comes into play.
Should a procedure that’s been shown to help patients who already had a heart attack be used on those who haven’t, but might? Which patients should be referred to specialists or admitted to a hospital?
Those are medical questions. But because of how we pay for health care, they’re also economic questions. Doctors and hospitals don’t get paid for managing care; they get paid for providing it. The more they do, the more they bill and the more they’re paid.
Roemer’s law also applies to expensive equipment such as MRI and CT scanners. The more there are, the more scans are done and the more it costs. Spending for those tests doubled over 10 years.
Medicare patients in expensive cities are hospitalized more often, see specialists more often and have more expensive tests.
What they don’t do is live longer or better. Many, in fact, have shorter lives.
Dartmouth researchers have shown that in high-spending regions, patients with heart attacks, hip fractures and colorectal cancer had worse survival rates than those in lower-spending regions. They also were less likely to get care that met established treatment guidelines. Even more surprisingly, both doctors and patients in high-spending regions say they face longer waits to see medical specialists or be admitted to a hospital.
Between one-fifth and one-third of all U.S. medical spending — as much as $800 billion — goes for care that does nothing to improve our health.
If all that extra spending doesn’t buy better care, why bother? Getting control of waste, and potentially harmful over treatment, is complicated. Among the solutions:
• Pay doctors for managing care, not just providing more of it.
• Increase research into which treatments and drugs work best.
• Encourage doctors and hospitals to adopt practices from the best-performing, most cost-efficient regions. That doesn’t mean scrimping on care; it means doing a better job of providing it.
The stakes are considerable. Dartmouth researchers estimate those reforms could save $1.4 trillion over the next 15 years. If you’re looking to pay for national health care reform, that’s a pretty good start.
some problems with the nation’s healthcare might be remedied by compliance on the part of the patient. the patients and their families need to follow the doctor’s orders, change dietary habits, exercise(if able), and everyone needs to start from childhood to be more active, be respectful of your body, follow the rules. and, sometimes there is nothing more that can be done to prolong life. people should think about the quality of life, not the length. have respect for yourself and your surroundings.
If the trial lawyers and the politicians would go away, maybe then defensive medicine would go away. Once the individual takes responsibility for themselves and tells the idiots in DC to take the lawyers and go jump in the lake, maybe then true health care reform could occur. Putting the federal and state governments in charge is synonymous to avarice, greed and mismanagement through not listening to the voters but the special interests. Much like the Post Dispatch…..er…Post Disgrace. Not holding any individual responsible for their actions is just plain stupid. We have over 20 million illegal aliens, we are supposed to support them with free health care? We have over 10 million Y generation types who care more about their cell phone plans than insurance. Give me a break. 50 million without healthcare, nuts. Show me the statistics.
A blogger on the Wall Street Journal told a chiling story, last month, about health care rationing in East Germany. When a pensioner asked the government bureaucrat why he was being denied care, the response was “You’re a pensioner”. We are heading down a very dangerous path when we let the government take over both our health care and our retirement. The more of our money we allow the government to take from us, the less free we will be to control our own destinies.
Most of the uninsured are uninsured temporarily because they are in between jobs. Here’s a link on the stats.
http://www.heritage.org/Research/Welfare/wm556.cfm
John,
I keep hoping for a citation from the Naional Review. I got my info from a full-time doctor in McAllen, not a surgeon in Boston and writer from New York.
Isn’t it interesting that more than 40 years of government control in Medicare has resulted in such disparities? Saving $1.4 Trillion is a pipe dream. Look at the projections made by the government of what Medicare costs would be at specific points in time. The estimates were always far below actual costs.
The answer lies in putting consumers (patients) back in the mix. When the person receiving the services is the same person paying for the services, real reform and cost containment will result.
Nowhere in the “proposed solutions” is tort reform. The so-called “necessary tests” aren’t what medical professionals choose to do.
As long as the loser suffers no consequences for filing suit, the system can’t be fixed. Simple as that.
The PD editorial board is just doing its job, carrying water for the Obama administration………that why it is now dubbed “state-run media” Obama is going to Russia next week to get some more ideas on how to manage information…….likely will pick up an award or two on his recent “Town Hall” on health care. Is this what you voted for?
If this were an issue the Republican Party wanted then the PD Ed Board would have 2 articles a day on why Universal Healthcare would be terrible.
“Getting control of waste, and potentially harmful over treatment, is complicated. Among the solutions:…
• Pay doctors for managing care, not just providing more of it.
You mean like HMOs have done for decades? Funny the statists should suddenly embrace the health care model they’ve spent years bashing. Not that this isn’t a good idea, but how about we get medicare and the other federal health programs to do it before we destroy a system that works perfectly well for 80% of us?
• Increase research into which treatments and drugs work best.
You know those large buildings right across the street from Forest Park? They’ve been doing this since forever.
You don’t need a massive new federal bureacracy to duplicate clinical trials. Besides, the feds already have control over a lot of this. That’s what the FDA, CMS, and NIH are for.
• Encourage doctors and hospitals to adopt practices from the best-performing, most cost-efficient regions. That doesn’t mean scrimping on care; it means doing a better job of providing it.
No better place to start than right here in our own backyard:
http://www.ssmhc.com/internet/home/ssmcorp.nsf/31060168df94973f86256a0e0058c993/0013a0529f4465fc862573cd005cf099?OpenDocument
Instead of searching thither and yon for specious reports and obscure statistics, why doesn’t the PD ask the experts who live right here? Oh right, they won’t back your narrative.
“The stakes are considerable. Dartmouth researchers estimate those reforms could save $1.4 trillion over the next 15 years. If you’re looking to pay for national health care reform, that’s a pretty good start.”
This sort of thing has been going on all across the country for years. Health care costs peaked in the last decade and have been coming down ever since. That last thing we need is a massive new beauracracy that duplicates efforts and sticks it’s grubby little mitts where they don’t belong. If you think Obamacare is going to “save” a single dime, you’re delusional..