Friday, April 13, 2012

Considering Cost When Choosing Care

Recently, I was having a conversation about the insanely high cost of health care with a friend. I believe it is unacceptable that we cannot easily look up how much a service will cost before we get it. I would never go to the grocery store, throw a bunch of items in my cart for which the price was not marked, hand over my credit card to the cashier, and agree to pay whatever grocery invoice they send me in three months.

My friend's reaction was, "No one should make medical decisions based on cost."

As a person who has made medical decisions based on cost, I have to disagree.

In an ideal world, every person could afford to undergo any necessary preventive care or medical treatment. Also, in an ideal world, the cost we are billed for care at a given facility would accurately reflect the cost and quality of the procedure or service itself. Furthermore, in this medical utopia, there would be no duplicate tests, no medically unnecessary procedures, etc. And I believe this is the world we should work towards. In my mind, everyone deserves quality, affordable health care. Period.

Unfortunately, we are currently far from this reality.

Let's start with the part about everyone being able to afford medical care. In our current society, at least half of us could not afford a major medical emergency. Many people are just scraping by paycheck to paycheck. In a 2011 research study, as reported on MSN Money, 28% of Americans said they definitely could not come up with $2,000 for an emergency given one month's time, and 22% said they probably could not. That adds up to half of all Americans who would likely be unable to pay a $2,000 medical bill (which is less than the cost of one day in most hospital beds.)

Additionally, in the current medical environment, the same services can cost thousands of dollars more at one facility compared to another, with no difference in medical outcome. And how can you make this cost comparison ahead of time? For many services, you can't. Or maybe you could, but with extreme difficulty and only if you knew how to ask each facility for the information through the proper channels. If you wanted to look up the cost of a heart procedure and the success rate of the surgeons at a dozen facilities in your area, it is likely that you would not know where to begin looking.

And if you were able to locate the information somehow, I guarantee it would leave your jaw hanging, both the sheer amount billed at all of the facilities, and the drastic differences between what is billed at each, unrelated to medical outcomes or actual costs of the procedure.

To solve this issue, my friend would likely say that the government should foot the bill for everyone. And if you believe the government can do this efficiently, let's examine the idea of what that would cost. According to a USA Today article, the average family health insurance policy cost $13,375 in 2009. Let's make a conservative assumption (given that medical inflation is much higher than regular inflation) and assume that increased 5% each year until 2012. That would bring us to $15,483 per household in 2012. Since insurance premiums are directly tied to medical costs, plus the cost of administering the program, if the government were to foot that bill, we can assume it would be at least $15,483 per household. (Side note: I am basing this one-to-one comparison of the potential government's cost with current costs on the evidence of how much it costs the government to administer Medicare Part A versus what it costs private insurance to administer Medicare Part B (the private equivalent of Part A). For the same amount of premium, private insurance carriers cover more services and have profit left over. With the same amount of money, the government can only cover the minimum required by law.) Since "the government's money" is just code for "our taxes,"  we can then assume the average household tax would also have to increase by that same amount to pay for all of the care. Of course, my friend argues that the wealthy should foot more of the bill than the poor, under a progressive tax system. I told her that's just fine, because her individual income at the ripe old age of 24 is about the same as the average household income in this country. So I put her with the elites, and she can take slightly more than her share. (According to the Wall Street Journal, median household income in 2010 was $49,445.)

I am not here to argue whether or not the government should pay the cost or whether individuals should. My only purpose with the above is to point out that medical care is very expensive. $15,000 a year is a lot to most people, whether it is paid through direct premiums or taxes. We consume a lot of care, and most people have no idea that's how much it costs, in total, to pay for the care of the average individual.

Let's examine some other aspects of the cost issue. Our "pay for play" system encourages providers to perform the maximum number of medical procedures in order to be reimbursed, not necessarily those which will provide the best outcomes for the least expense (also known as efficiency). I do believe 99.9% of doctors are genuinely caring and are making sound medical decisions. However, when there are multiple equally good options available, there is no incentive for a doctor or hospital to work for your financial benefit, except from the goodness of their hearts.

I will give you a real-life example from a friend of mine, which occurred within the last year. Let's call my friend Joe. Joe's ten-year-old son injured his arm, and Joe took his son to the pediatrician. The pediatrician told him that Joe needed to get an x-ray and pointed him to the hospital across the street. Now, being the savvy medical consumer he is, Joe asked if there were any other facilities in the area that perform x-rays, such as a freestanding radiology center, but the pediatrician did not know of any. (Hospitals usually charge significantly more for radiology procedures than free-standing facilities, even though they use the exact same equipment, because hospitals have a lot higher overhead costs compared to a smaller facility.) Since the pediatrician said there were no other nearby facilities, seeing no other option, Joe went to the hospital for his son to get an x-ray. After the x-ray, the physicians at the hospital informed him that they were not specialized enough to read the particular x-ray, as the potential fracture was very small and they could not tell for certain if it was broken. They sent Joe and his son to a free-standing orthopedic center to consult another doctor. At the orthopedic center, the doctor told him it would take a long time to get the x-rays from the hospital, but they could just run new ones on site. Since his son was in pain, Joe consented. He ended up having to pay for three different physicians and two of the exact same x-ray procedures, one at a hospital rate, when there was an orthopedist with his own x-ray machine right down the street! It is not that the pediatrician was misdirecting Joe to the hospital in an attempt to intentionally increase the cost of this incident, but even the doctor was taken aback by someone asking about less expensive x-ray options and was unfamiliar with any.

Interestingly enough, a few months later, Joe's son had a similar incident with his leg, and they were able to go directly to the orthopedic center. The end result of the care was the same, except it involved significantly less hassle at probably a third of the cost.

One example from my personal life occurred when my husband accidentally cut his arm very deeply. His hand slipped with a knife while chopping tomatoes. One look at the cut told me he would need a couple of stitches, but the bleeding was more or less under control when he held gauze firmly against the opening. I thought of the possibility of going to the emergency room, but I knew that would cost us a couple thousand dollars in this part of the country for something that neither of us considered a true "emergency." Instead, we went to an urgent care center nearby, where a doctor in the office was able to sew it up quickly. Admittedly, it wasn't cheap, but definitely less than the ER. Yet most of my friends and family would never know how much they could save with a little knowledge about the costs of various types of facilities. In this case, I did not even need to know the exact rate we would be charged to have at least a vague idea that the urgent care center was a better bet on cost, probably a much shorter wait for a non-life-threatening injury (plus it would help keep the ER clear for people who really need it), and was perfectly capable of handling the issue.

Another example involves a time when I was not so savvy and later regretted it. When I moved to California, I went to a new gynecologist for the first time. She asked me if I wanted my pap smear to include testing for a whole slew of sexually transmitted infections. Since I have insurance, I figured most of the cost would be covered, and I consented. A few months later, my portion of the lab bill came in the mail, and it was over $400! Yes, my insurance helped, but what was left for me was still a pretty large number. Thankfully, I had been putting money into a Health Savings Account and was able to pay. But had I been one of the 50% of Americans who could not come up with $2,000 for an emergency, I have a feeling $400 would have been quite a hit.

And in retrospect, faced with the $400 balance, I strongly regretted getting the tests. I am married, with no past history of abnormal tests. I am my husband's only partner. The likelihood of me actually having one of those infections was virtually nil, yet I paid $400 to confirm that. I felt as silly as if I had paid to have an x-ray to confirm my arm is not broken, when I have not had any falls and I have no pain. Yikes! I definitely would have taken the cost into consideration when making that decision, had I known what it would be.

If someone else were in my situation, I would now recommend not to get the tests. If the person had lesions or bumps or itching or any other symptom of a particular STI, then that would be a totally different story, and I would tell them to get tested. In that case, I would definitely agree with my friend that it would be a tragedy to have to choose otherwise due to finances. But when someone is as low risk as I am, there is no reason to throw money down the drain - yet I did not even have enough information to make that choice.

Not only that, but had I really needed those tests, there are still ways I could have gotten them for less. In particular, I could have asked my physician to redirect the interpretation work to a freestanding lab, such as Quest, rather than letting the affiliated hospital process them. As mentioned above, an educated consumer should be aware that most things cost more at a hospital.

As a follow-up to that, the latest revised clinical guidelines for pap smears say that a woman over the age of 21 with one partner only needs to be tested once every three years for cervical cancer. I am married, I have never had an abnormal pap, and no one in my family has ever had cervical cancer, to my knowledge. So I do not want to pay for this service every year, when that frequency is outside of clinical recommendations. Not only is it costly; it's also unpleasant. Yet when I told my gynecologist's office that I just wanted a visual exam and my vitals tested in lieu of a pap smear at my upcoming annual exam, the administrative personnel had to go ask around the office "if they can do that." Of the first several people she asked, no one seemed to know, until finally a nurse said it was fine. This is at an office that specializes in women's health! Apparently, no one has ever asked not to have a pap smear every year. Even if my insurance covered the exam in full, nothing is really free. That would be a cost that gets spread across the insurance premiums of all my coworkers the following year (including my own premium.) Now if my doctor had advised me otherwise or thought I was higher risk, I would have taken her educated recommendation over my own. But just a little bit of knowledge about the clinical guidelines from mainstream media (and a push from that $400 bill the previous year) opened up my eyes to ask about what is necessary, and it turns out she agreed that this service is not. Yet had I not taken initiative to ask, the default would have been to provide the testing.

If I was shocked and upset with that $400 invoice my first year, I can only imagine how I would feel if I was in a more sticky place financially. For many people, receiving an unplanned $400 bill in the mail would be devastating. No one should ever be put in that position, where the cost of care is a surprise to them and puts them in a place of hardship. I do understand the argument that it is morally wrong to deny care to someone due to socioeconomic status. I do believe everyone deserves high quality care as a basic human right. I believe that someone facing an illness should get the care they need, regardless of their ability to pay. And I hope to spend much of my life working towards those changes in our society and our health systems. But based on the reality of the current system, which does not do this whole coverage thing perfectly, I also think people should know ahead of time what sort of bill they can be expecting.

Whereas my friend would say that "no one should make a medical decision based on cost," I would revise her statement to the following:

No one should be denied medically necessary care based on their ability to pay. But also, every consumer should be aware of lower cost options that would offer equivalent care, such as generic versions of drugs, or freestanding radiology, laboratory, and ambulatory surgery centers, when they are available. And every person should be informed of the price of their medical care before they consent to incur the costs. No more surprises.


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3 comments:

  1. This is super interesting for me to read as a soon to be nurse. I can tell you that a majority of nurses are acutely aware of procedure costs (especially where I am, here in Eastern NC translate that, super low socioeconomic status population) and we do our best to use the cheapest option available to confirm diagnoses/treat patients we encounter. We are taught to advocate for our patients in every way possible, and that includes their financial capabilities.

    That said, I agree, the cost of healthcare is very expensive, but there are SO many available options for affordable primary healthcare (emergency care is another ballgame all together). I can think of three free clinics in a 20 mile radius, off the top of my head, who offer free STD testing, yearly physical exams, infant and pediatric immunizations, income based sick visit copays, and affordable payment plan networking with specialists... I think the main issue is getting the word out so people avoid the $1000 ER visit and instead go to a $10 co-pay clinic when they have the flu.

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    1. Great point. I agree that a lot of the issue is education. If we know where the services are, we can use them. But a lot of people just have no idea where to look.

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    2. Great post! As a soon-to-be-physician, I have been confronting these issues on a daily basis and must say, you are spot on about a lot of what goes on behind our very broken healthcare paradigm. The system is sick, and as a result the people within it are sick as well.

      From my perspective, there are some other major contributing factors that are worth mentioning. For one, the increasingly fragmented clinical climate due to super-subspecializing of physicians has created a highly disjointed system which not only disrespects the patient by reducing him or her to a single organ or body part, but also contributes to diffusion of responsibility when it comes to educating patients and clinicians about any services outside of a particular specialty's realm. The root of this problem lies in the fact that primary care has become increasingly unattractive to medical school graduates as it is difficult to financially sustain such a practice while working reasonable hours, achieving adequate reimbursement from health insurance companies for what is often the best possible care, and seeing reasonable patient loads.

      Secondly, those primary care providers whose job it is to draw their patients' experiences into a comprehensive whole--including everything ranging from patient education to staying up-to-date on guidelines and regulations--are failing to do so often because they are so frequently overworked, in a rush, and not given sufficient time with their patients per appointment, or breaks to pursue Continuing Medical Education (CME, which is a crucial part of staying sharp as a practicing physician).

      The list goes on an on. Thank you for raising awareness about such a crucial topic. I think that ultimately, the answer lies in major reform on the part of our healthcare system and bodies that govern medical education and training programs; but until such monumental change occurs, you're absolutely right--it's definitely up to the patient to arm her/himself with as much education as possible.

      Cheers,
      Carrie Schepker

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