Changes Oncologists Could Make That Would Lower Costs

Today’s Managing Health Care Costs Indicator is $173 billion

Two courageous oncologists wrote in the May 26 New England Journal of Medicine (Free full text) that there were five changes in behavior and five changes in attitude that could lower overall health care costs.  They cite a projection that the cost of oncology care in the US will be $173 billion in 2020, and state that continued increases are unsustainable.   

The behavior changes (reworded by me):

1. Don’t do routine tests of cancer survivors looking for recurrence, except where there is evidence that this improves quality of life or survival
2. Give a single chemotherapy agent for most solid tumors –don’t use multiple agents except where there is good evidence to do so
3. Don’t give chemotherapy to patients who are so frail that they can’t walk
4. Don’t routinely use medicines to raise white blood cell counts. (This is for solid tumors – chemotherapy for leukemias and lymphomas does sometimes require these medications)
5. If patients fail three chemo regimens, limit further chemo to clinical trials.

The changes in attitudes (also reworded)

1. Recognize that costs are due to choices that oncologists make
2. Have realistic expectations
3. Pay more for cognitive services rather than chemo
4. Start palliative care earlier
5. Support comparative effectiveness research, and accept that there will be some limits on the care we can offer.

We’ve had over a generation of the “war on cancer,” and we’ve promised society that we can ‘cure’ cancer.   The authors suggest that we should acknowledge that palliation is often the best goal, and we should avoid costs for treatment that has not been shown to be valuable. 

This is rational – but could easily be misconstrued to be an endorsement of “death panels.”  I think this is an important addition to the dialog on how to lower health care costs. We will clearly need to bring patient advocates along for this approach, and sometimes it’s hard to tell patient advocates from parties interested in maintaining high health care costs (and company revenues). 

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Managing Health Care Costs: A Pessimistic Historical View

Today’s Managing Health Care Costs Indicator is 7.5%

That’s what portion of the GDP health care was in 1971 when Steven Schroeder, MD, began work in the trenches to control the costs of health care.  He writes personal reflections on what hasn’t worked over the last four decades, as he progressed from a medical director in a start-up provider-sponsored HMO to an academic at UCSF and on to the presidency of the Robert Wood Johnson Foundation and back to UCSF.  

He writes in the April 25, Archives of Internal Medicine    Harvard Link  

During my professional lifetime I have witnessed a succession of individual cost containment strategies, each theoretically legitimate but each doomed to failure because they were either insufficient as a single intervention or ran up against political opposition to vigorous implementation.

Schroeder recounts efforts to decrease variation in test ordering among physicians in a group practice.  Differences were 17-fold!   Efforts to lower test cost were successful – but no more so among the high utilizers than among the low utilizers.  He notes that in practice, adding more technology can triple a physician’s income.  He observes that new technologies often replace older, more invasive and dangerous technologies – but they are used more and more widely, and no savings are attained. 

It’s a sign of the times that Schroeder remembers when “catastrophic” hospitalizations were those with total costs of over $5000.   At this point, catastrophic cases are over $50,000 or more.  Most of us don’t remember the last time we saw an inpatient hospital bill of less than $5000!

I'll let Schroeder have the last word:

In the long run, reining in costs will require mobilizing political forces that can withstand the inevitable claims of rationing sure to come from the industries currently benefiting from the 17% of the economy spent on health care, and from consumers who have come to expect unlimited access to what they feel they need. Until there exist sufficient countervailing forces so that a comprehensive, multipronged strategy could be implemented, politicians and health policy experts will continue to embrace tepid and ultimately ineffective solutions that may sound good in theory but will fall short in practice. 

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Observations on Managing Health Care Costs

I've been finishing up lectures for the final classes in a health care management program over the last week- and so I'm behind on blogging.  I'll do some catching up this coming week.


In the meantime, I've posted the final slides from the Fall course, Managing Health Care Costs, at Harvard School of Public Health.  Here are my eighteen observations - the slides contain substantially more detail.

Observation One: Sick people are expensive to care for!

Observation Two: The problem in the US is cost per unit, NOT utilization

Observation Three: We are too sedentary, too fat, and smoke less than we used to, but still too much.

Observation Four: We don’t like to make tradeoffs!

Observation Five: There is HUGE Variation

Observation Six: Fee for service is toxic (but everything else is difficult)

Observation Seven : There is a cultural clash between those seeking to preserve the “art” of medicine, and those looking to create more reliability and cost effectiveness through industrial redesign

Observation Eight: We pay a heavy economic and noneconomic price in our effort to banish uncertainty

Observation Nine: We often promote competition that does not generate new value for patients, and reject competition that could create such new value.

Observation Ten: We “medicalize” many conditions, driving up cost

Observation Eleven: Many see a primary care shortage

Observation Twelve: We are reluctant to regulate prices (and when we do, we often do it poorly by design)

Observation Thirteen: Providers must consolidate to allow for more integrated payment; however, provider consolidation increases the cost per unit

Observation Fourteen: We often mistakenly think that we can measure the cost of health care by medical claims alone

Observation Fifteen: You can’t ‘reform’ an industry representing 17% of the GDP without angering many, and without unintended consequences

Observation Sixteen: Americans will pay for a larger portion of their health care out of pocket over the coming years, and this is likely to lower utilization

Observation Seventeen: Physicians are more likely to prescribe treatment associated with high margins for their practices

Observation Eighteen: There are no magic bullets


1/14/12 Addendum:  Here's the OECD list of out of pocket payments.  Remember that the total cost of health care is so much higher in the US than elsewhere that a lower percent of health care spending still means a higher portion of personal income.  Thanks to Vegncook for comments.

Click on image to enlarge. Source 

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