The untenable position of physicians as cost control agents

In October in JAMA, Tilburt, et al published the results from a survey of physicians regarding their perceptions of their role(s) in the control of costs in health care (JAMA. link). Nearly everyone surveyed recognized that out of control costs were a big problem and needed to be addressed. What was reported from this study was what was viewed as surprising results showing that most physicians did not view themselves as having the primary role as controller of costs, and that other parties should take on larger roles.

Physicians also hold nuanced views about their perceived responsibility for health care costs. Most (78%) agree that they “should be solely devoted to [their] individual patients’ best interests, even if that is expensive,” whereas 85% disagree that they “should sometimes deny beneficial but  costly services to certain patients because resources should go to other patients that need them more..........Yet 85%also agree that “trying to contain costs is the responsibility of every physician,” and 89%agree that “doctors need to take a more prominent role in limiting use of unnecessary tests.” This apparent inconsistency may reflect inherent tensions in professional roles to serve patients individually and society as a whole. Previous smaller studies have suggested that US physicians endorse the ideal of prudent stewardship but are reluctant to withhold available but costly services that could benefit individual patients.....Physicians clearly struggle with these tensions and how they can act individually and collectively to provide optimal, sustainable quality care. They also recognize themselves as just one component of a multifaceted system of stakeholders responsible for addressing increasing costs. Indeed, they ascribe a higher degree of responsibility for controlling costs to external forces such as health systems, insurance companies, and even patients and trial lawyers than they do to themselves.

Then who should be primarily responsible?

Maybe this is the wrong question. Perhaps the better question is that how are other industries grappling with this? Is the automotive industry going through a crisis because we are spending too much on cars and dealers are being singled out because they are not concerned sufficiently with cost control? Is the mobile phone industry concerned about the explosion of users of mobile phones and cellular service? Do we try to hold accountants or lawyers accountable for the overall cost of financial or legal services?  I don't think so.

There are major differences with these other industries since for the most part the costs of these services are falling in real dollar terms and the quality of the goods involved are improving, even without requiring the parties involved in the manufacturing and distribution to agonize over driving costs and prices down. Why is this not happening with health care? This very important difference revolves around what I refer to as health care exceptionalism.

We have been indoctrinated in the tenants of health care exceptionalism, in that health care is different. This is based upon delusional thinking centered around the idea that decisions regarding health care should not be influenced by scarcity. Within the broader economy, markets control the allocation of scarce resources and scarce resources (which are all resources to some degree or another) tend to end up in the hands of those who make best use of them.

The beauty of market based allocations is that no single party must be charged with management of scarce resources, setting prices for all, or driving affordability. It is a shared responsibility and although Adam Smith's invisible hand has been repeatedly trashed as an allocation tool, no better alternative has been shown to actually work as well. Within health care, market mechanisms have gone AWOL. Prices are artificial. Actual costs are opaque. Supply has been regulated to death and regulatory agents initially deployed to protect the public now protect the guilds which choke supply.  The cost of losing the market mechanisms and succumbing to regulatory chokeholds is that prices lose their ability to send scarcity signals and efficient allocation of scarce resources does not happen.

These articles in JAMA highlight what happens when these market mechanisms are lost. Because we view health care a somehow fundamentally (and inherently indefinably) different from other human wants and needs, so distinct that we could not possibly entrust allocation of resources to something as vague as the 'market". we declare that we must use some other mechanism. Who or what is supposed to step up to fill these holes is left undefined? There is no way that physicians can do this job and it places them in a position which is thoroughly untenable, creating financial and ethical quandaries which we are not at all prepared to deal with. The grand experiment of planned economies of the 20th century demonstrated unambiguously that experts cannot replace markets as allocators of scarce resources.  To place physicians front an center is the role of resource allocators in health care will undoubtedly fail. The results of this survey do not demonstrate lack of leadership but in fact demonstrates real wisdom in that physicians recognize that they are no experts in resource allocation. What we do as physicians really provides us with none of the tools or expertise to control costs. It is not our job.

Health Care Exchange Hidden Surprises

Leigh Page published an article on the American Health Care Exchanges in the British Medical Journal this week. It is behind the pay wall but for those who have access to read the full content, it is well worth doing. The stories described are startling. For example:

Physicians who don’t want to participate, however, are finding it’s not so easy to do. Last year, David Aizuss, an ophthalmologist in Encino, California, was sent an exchange contract from Blue Shield of California, with the payment rates left blank, to be filled in by the plan later. “They were basically asking me to sign a blank check,” Aizuss recalls, and he refused to do so. But later he found his name on the plan’s provider list, contacted Blue Shield and had it removed. He found out the insurer planned to pay him 70% of his usual rate.

 Ok, the idea that insurers try to extract lower payment rates from practices is not new news. But there is more...

In many cases, the physician’s affirmative assent is not required. Under the contract, the plan only needs to send physicians a notice, and they will be included in the new network unless they opt out in writing within a certain period, typically 30 to 60 days. Practices may never see these notices. Depending on the terms of the contract, they may be faxed, e-mailed or simply posted on the plan’s website. A notice may be just one of countless communications from dozens of different plans, covering a variety of issues. “Half of the time they are not even read,” said Sam Unterricht, president of the Medical Society of the State of New York. “Who has the time to read all this stuff?” He added that practices should make a special effort to keep track of these communications. In other cases, through an “all products” clause in the contract, plans do not even have to inform physicians that they are putting them into a new network, said Sidney Welch, an attorney specializing in physician contracts at Kilpatrick Townsend and Stockton in Atlanta. All product clauses are banned in states like Texas and Connecticut but not in New York, where a survey of physicians by the Medical Society of State of New York (MSSNY)
found that 16.5% of them had been forced to join exchange plans through such clauses.2

OK, now this is getting serious. You cannot even discern whether you are part of the network or specific plans. What other surprises are lurking? More...much, much more.
 

Curran added he was concerned about some aspects of the new arrangement. For example, if enrollees stop paying their premium, federal regulations require a “grace period” in which they can still get care. The insurer has to continue paying claims for the first 30 days, but the physician must continue providing care for 60 days after that, with no assurance of being paid. In the MGMA survey, 59% of practices cited the grace period as a reason for not joining exchange plans.

I guess there is always the option to opt out and not participate in the Exchanges. Maybe, maybe not...

Unterricht thinks that once physicians know they are in exchange networks and have to grapple with the problems, there will be a mass exodus from them. “The network that existed last April [when New York plans vouched for network adequacy] will not

 

be in place come January or next April,” he said. Opting out, however, could be challenging, according to Welch, the contract attorney. The contract may stipulate that the physician must stay in the network for a certain period of time. Physicians who can’t get out might refuse to see exchange patients, but under the terms of many contracts, the physician would be barred from seeing new patients in all the other networks the insurer operates, Welch said.

What I find most interesting is that this is published in the British Medical Journal, not JAMA or the NEJM.  

 

 

 

Healthcare.gov on Dec 2, 2013

The claims today are that the website is vastly improved. It is hard to take issue with this claim since it is not to hard to improve upon the October 1 baseline.

When I treat patients I will ask them if they have had a response to treatment. If they say yes, I ask them to use one of a set of global response descriptors ranging from minimal, partial, near complete, or complete to describe their response.  If I were to use the patient global assessment tools for characterizing the "response" to website "treatment", I would have admit, yes there was some improvement but I could not begin to claim that the response was complete or near complete. It perhaps would be a stretch to call the response partial and given all the caveats regarding continued bugs and glitches, I would have to settle upon a minimal response. Any way you look at this the efforts are not nearly adequate to meet the public needs.

No one has made any claims whatsoever about the back end of this. However, that part which involves insurers and doctors getting paid is not so important. As long as they can get this to be operational by 2025, we should be just fine.