Slowdown in Health Spending Could Be at Risk – WSJ.com

2013

A recent article in the WSJ talks about the costs of new medical procedures and technology which in some cases, perhaps many cases, add little additional health care value. This cost benefit discussion will add controversy to the issue of controlling costs. Unlike many other countries, the US does not generally factor cost in the value equation. Thus, a very minor gain in health may cost millions of dollars which is routinely paid for by public and private health plans. To do otherwise in our society would generate cries of “rationing.”

Can we afford to continue this philosophy? Is it even good health care? More health care is not automatically better health care. To date every effort to change recommendations on the use of certain technology or medical procedures is met with an outcry from one group or another based not on science or experience, but rather perception. Certainly, one extra test or the use of a multi-million dollar piece of equipment may uncover that one in a thousand diagnosis, but that also means health care at any cost no matter the value added. If that is what we want … simply more …then the idea of “affordable” health care is a cruel joke.

Medicare covers all those treatment options. By law, it can’t consider price when making coverage decisions. Nor can it insist that a new technology be significantly better than existing ones or encourage doctors or patients to seek less-costly alternatives. And once Medicare starts writing checks, private health plans generally follow, distorting the usual market mechanisms, says Arthur Kellermann, a physician and senior policy analyst at Rand Corp.

Comparative-effectiveness research called for in the new health law could help assess which advances are worth paying for, but only if Medicare is allowed to use it. “Industry has done a good job of tying any discussion of cost to that scary word rationing, ” says Dr. Kellermann.

He has a simple solution: Let Medicare pay full dollar for the least-expensive highly effective treatments, and let patients who want costlier alternatives pay the difference on their own. That would diffuse the “rationing” argument, retain individual choice and reward manufacturers for creating real innovations and lower-cost alternatives, Dr. Kellermann says.

Slowdown in Health Spending Could Be at Risk – WSJ.com