Urologists Recommend IMRT for Prostate Cancer – And Double Their Income

Today’s Managing Health Care Costs Indicator is $40,000

The Wall Street Journal continues to review Medicare payment records and ask probing questions about where the money is going.  I’ve previously recommended the WSJ evaluation of some of the high-billing probably fraudulent metro New York primary care physicians

Last week, the WSJ turned its attention to intensity-modulated radiation therapy  (IMRT), which is used to treat prostate cancer.  Among the treatments for prostate cancer are watchful waiting (small cost), surgery ($16,000 by the WSJ – sounds low to me), radiation seed implant ($19,000), and IMRT ($40,000). IMRT uses a computer to do a 3-D reconstruction to limit the amount of radiation delivered to noncancerous tissue.

The WSJ posts estimates from vendor about how IMRT can boost the income of a urologist by $336,000 if s/he refers just two new cases a month.  IMRT became available in the mid-2000s, when the urologists were suffering from serious loss of income after Medicare clamped down on profiting from prostate cancer drug markups.

Self referral continues to drive health care costs higher.  I’ve blogged on this before – there are higher rates of rotator cuff surgery in the practices of surgeons  who own ambulatory surgery facilities, and orthopedists who own MRIs and CTs refer to their machines with apparently excessive frequency.   Here’s a link to an older review of the literature on self referral.      

I don’t think many urologists who give IMRT believe that they are overutilizing this procedure.   However, the potential to double income is highly likely to have a subconscious effect.   We need to get away from paying for each unit of service, and dangling almost irresistible incentives in front of those who we expect to make decisions in the best interests of their patients.

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Medical Bills Lead to Refinancing Woes

Today’s Managing Health Care Costs Equation is $11+$11=$14,000

There have been many reports of medical bills contributing to personal bankruptcies in the United States.   In 2007 researchers suggested that medical problems were associated with 62% of personal bankruptcies (and almost four in five of those who had medical cost-associated bankruptcy had health insurance).   

The Wall Street Journal reported this week that small unresolved health care bills were taking a bite out of credit scores from some unaware consumers – leaving them unable to get inexpensive refinancing.    Consumers could pay decades of higher interest because they were turned over to collection agencies for tiny bills.   One Texas resident reported that refinancing would carry $14,000 in fees since she had two $11 physician charges which had been turned over to a collection agency.

Thanks to John Donahue for this suggestion.

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Health Care is Robbing Our Children’s Education

Today’s Managing Health Care Costs Indicator is $1 Billion

All countries eventually spend 100% of their GDP – and why not spend more on health care, which offers us benefits we really value?

Well –because health care costs ‘crowd out’ other important services, including societal functions that lay the groundwork for our future economic prosperity.  I'm thinking again about education. 

This month, Massachusetts schools are singled out in The Atlantic Monthly  as being far better than those of other states, although far inferior to the schools in many foreign countries. 

This week, however, The Boston Foundation  released a report detailing how health care costs across the state are putting our children’s education at risk.

Health care costs have risen on average 13.6% per year from 2000-2007, while general cost of living has only risen 3.4%.   Health care costs went up a staggering $1 billion from 2000-2007 for Massachusetts school districts – gobbling up every cent of increased state aid during that time, and devouring an extra $300 million in addition that required cuts elsewhere in the budget.   High health care costs for state workers have also hobbled the state’s ability to provide full funding for poorer school districts. The report notes that “from 2000-2007, increased spending on health care consumed 2/3 of the entire increase in state spending”

This data complements a report from Peter Orszag in September which showed that as states spent more on health care, they underfunded public colleges and universities.

Here is how Massachusetts school systems are coping with the 144%  increase in the cost of health care from 2000-2007.

-        Purchases of textbooks  ↓ 57%

-        Teacher training ↓ 23%

-        Overall non-inflation adjusted budget excluding health care ↓ 2%

Click to enlarge 

During this time, school budgets would have had to increase by 26% just to keep up with inflation. The report also noted that school districts in poorer communities have fared most poorly, while wealthy districts were in a better position to address rising health care costs by increasing tax rates. 

If we want to have world class schools for our kids, we have to control the costs of health care.

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