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Why not pay for what works?

By | November 11, 2009, 11:44am PST

Summary: If this was Betsy McCaughey’s intent, she is fiendishly clever. By taking science and evidence out, she has left voters with a choice between paying for political voodoo or keeping the present wasteful system alive.

In all the hullabaloo over health reform, Charles Silver and David Hyman write at The Health Care Blog, a key point of cost control has been lost.

Paying only for what works.

Silver and Hyman are law professors, not doctors. They point to a RAND Corp. study saying that “one-third or more of all procedures performed in the United States are of questionable benefit.” (The illustration is from the study.)

What happened to this simple idea?

The way to enforce it is through comparative effectiveness. Analyze data from millions of patients, develop best practices, and move physicians toward the most cost-effective solution.

This is what every other country does, regardless of how they pay for care. Formularies drive care, based on cost effectiveness. Anyone who wants to go outside what works had better have a good explanation. Often, going outside what works is simply forbidden, or patients are told to buy it with their own money.

Isn’t that how you set priorities? Why should governments or insurance companies act differently?

Unfortunately this was one of the first dominoes to fall in the debate. Reform opponents like Betsy McCaughey called this “getting between a patient and their doctor.”

This happened in conjunction with the debate over the Obama stimulus, and the subject was health IT. The purpose of the HITECH Act’s $19.2 billion in stimulus was to collect the data that would drive decisions on what to pay for.

McCaughey’s scare worked. Explicit promises were made not to use comparative effectiveness in any way to deny care, not to use evidence to decide what we should pay for.

The alternative to evidence is politics. Silver and Hyman note that millions of insurance dollars are spent annually on entirely non-medical treatments like Christian Science, but there’s more:

Lobbying from providers and supportive patients explains why many states already mandate coverage of elective services like in-vitro fertilization, massage therapy, and visits to athletic trainers. Concerns about the efficacy and cost-effectiveness of treatments are washed away by a stream of campaign contributions, and sad stories about patients who can only obtain the “necessary” services if the insurer will pay for them.

This is what is wrong with the present system. State regulation of insurance is based on politics, so your coverage includes any procedure that becomes politically powerful in your state. That’s why insurance costs are rising through the roof.

There is nothing wrong with paying for prayer but it’s not medicine, they write. There’s nothing wrong with in-vitro fertilization but it’s optional, not something everyone should have to cover.

Thus, by tossing away evidence as a way to rule-out certain coverages, you pay for a lot of stuff you don’t need.

Silver and Hyman wrote to argue against a politically-motivated individual mandate. Any mandate should be based on science, not politics, and by giving up on comparative effectiveness early in the process, it became impossible to set that standard, either through the federal government or through the states.

If this was Betsy McCaughey’s intent, she is fiendishly clever. Health care will remain a growth industry, because Americans will keep having to pay for stuff that doesn’t work, regardless of whether reform passes or fails.

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Disclosure

Dana Blankenhorn

Dana Blankenhorn has been a journalist, writer and part-time futurist for over 30 years. At the present moment I run only a personal blog in addition to my ZDNet open source blog. DanaBlankenhorn.Com has the subtitle The War Against Oil. In the past I have used it to write about political history, e-commerce, personal matters, some ideas related to open source, and The World of Always On, which is the idea of using sensors, motes and RFID to turn WiFi links into platforms for applications which live in the air. My IRA account at Schwab holds a few tech shares, most notably some Intel and Applied Materials, but there are no open source companies in it. I don’t even own any CBS stock.

Biography

Dana Blankenhorn

Dana Blankenhorn has been a business journalist since 1978, and has covered technology since 1982. He launched the Interactive Age Daily, the first daily coverage of the Internet to launch with a magazine, in September 1994.

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Yes, we have forgotten protocols
DanaBlankenhorn 12th Nov 2009
Amazing how the trolls here who were so bent on cost-saving when the subject was who pays are now so bent on dissing cost-saving now that we know how to do it.

"Getting between a doctor and their patient" indeed. What happened to no blank checks? Even if it's insurance that is paying, that insurance is paid for by a large group, against specified risks. Rates go up if doctors have carte blanche to use whatever expensive treatment they want with insurance money.

The trolls don't have an answer for anything, I'm afraid. Oh, except give doctors a license to kill and have people buy from the least-regulated state so the insurers can get out of paying. That is what the trolls call reform. It's loony.

Time to tell the trolls, as Tom Friedman said of the Iraqis in the run-up to that war, "suck on this."
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Some very interesting points
roncemer 11th Nov 2009
You made some very interesting points, and I tend to agree with most of what you're saying.

It does appear also, that docs are forced to do a lot of unnecessary procedures, tests, etc., in order to avoid malpractice lawsuits. It seems as if this would drive up costs too. Of course, you want to do early detection on things like cancer or whatever, but if there's no way a test or procedure is going to help a given condition, then why should docs be forced to do the test or procedure just to avoid a lawsuit?

Therefore, I believe the true cost of failing to include tort reform as part of healthcare reform, has been grossly underestimated. Only the direct costs of malpractice lawsuit settlements have been considered, but not the added costs of unneeded tests/procedures which docs do in order to avoid even more malpractice lawsuits.
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Lawsuits not a costly issue
pdskep 11th Nov 2009
That's a typical republican, politcal response. Studies have been done to show that's it's a very small percentage of overall costs in healthcare. Not that tort reform wouldn't help, it's just a small issue in the big picture.

Most unnecessarly procedures are generally performed by doctors padding their wallets. I know, I work in healthcare and see it everyday. It's not that they are bad people, they are just people influenced the same way the people on Wall Street and any other business are. The best way to reform healthcare is to take the money incentive out of it. Pay doctors a fair wage and don't incentivize them to do more than is needed.
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I prefer ignorance
DanaBlankenhorn 11th Nov 2009
Doctors aren't told, except in the most gross and rudimentary ways -- through journal articles -- what works and what doesn't. What they hear comes out as a mishmash, the latest study contradicting the one before.

Why not use computer science? Why not use math? Why not use the scientific approach of covering what we know works and at least make someone justify why we should pay for what doesn't -- either through insurance premiums or taxes.

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Defining "questionable benefit" and "What works"
GuidingLight Updated - 11th Nov 2009
It may be questionable, but to the person who's life litterally hangs in the balance, nothing is questionable if all else before it did not work.

Sure, math and statistics may point top the fact that some treatment or cure (let us go with for diabetes as an example) has a questionable success rate as it worked in only 2 percent of those that received it.

Would not you at least want to have the chance to try it yourself?

Remmber: Questionable benefit does not indicate no benefit.
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NT
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How we pay now
DanaBlankenhorn 11th Nov 2009
You're confusing what I wrote with politics.

Right now decisions are being made by politicians. Whether it's through a state regulatory authority or the federal government, rationing decisions are being made right now by politicians.

Why is that better than making them through data?
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Why it is better?
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
Because it's better to let the patient and his/her doctor decide, rather than limit the choice by radical socialists.
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Awww - that's way too difficult for Dana.
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
He likes to think in simple black and white terms. Like - Abortion=Good & Choice(forBaby)=Bad. Or: Obama=God & Conservative=Evil. Really, life is indeed simple that way. No thinking necessary anymore.

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Questionable benefit means you pay
DanaBlankenhorn 11th Nov 2009
Why should I pay for a treatment that has questionable benefit?

Remember, I pay in either case. It's either my tax money or my insurance premium that pays. A treatment of questionable benefit carries a cost that exceeds what you're paying.
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Not yours to decide.
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
Patient decides what treatment he/she wants.

The moment socialists like you get involved, choice get limited.
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Yup let the morons decide
tonymcs@... 11th Nov 2009
Evolution in action
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Not really
pdskep 11th Nov 2009
People want to believe that thier doctors motivations are entirely pure, but I can guarantee you that isn't necessarily true. Vast majority would never put a patients health at risk, but many would order more tests or perform more procedures to put money in their pockets. They wouldn't admit to anyone or even themselves that's what they are doing, but it's what is happeneing. Doctors are human just like everyone else. Businesses are made to make more and more money and if doctors act like businessmen that's exactly hat happens.

Here's was a really good article probably describing what you're meaning. It's a very tall order requiring lots of data. In the end there needs to be a regulatory body telling doctors what procedures they can and can't perform based on solid science.

http://www.nytimes.com/2009/11/08/magazine/08Healthcare-t.html?_r=1&em
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You are correct
DanaBlankenhorn 11th Nov 2009
Any regulation of what happens between doctor and patient must be guided by data, by facts, and not by politics.

That's what Comparative Effectiveness is about, using the data to guide proper policy, cost-effective policy that saves money. Insurance companies want to use this, and will use it in time.

The alternative is making political choices, through a political process.

Someone seems to think there's a third choice -- pay for everything. That way leads to bankruptcy, either of the public or the private system.
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Bankruptcy By Obama
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
Yeah. That stimulus package worked.
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What you state is a lie
DanaBlankenhorn 11th Nov 2009
Even if you give all doctors, nationwide, a license to kill, you don't come close to approaching the cost of unnecessary procedures identified in the RAND study.

Most estimates are that giving doctors a license to kill, as you propose, would cut just 2% of costs.

Yet it's constantly brought up by right-wing loons as the only reason they're not for reform. I call b.s. on that.
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Government run health_care is disaster
use_linux 11th Nov 2009
In case no one noticed the dollar is now ranked
48 or 49 in the world.

So go ahead and give some more money out to those
who do NOT work and will not get an education
because they complain about CEO's.

Yes, the country will go bankrupt but not from
some bogus Health_Care scheme to take over and
eliminate small business and tax those who work.

The vote is in and Congress is getting voted
out in 2010.
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You're absolutely right
Yagotta B. Kidding 11th Nov 2009
So go ahead and give some more money out to those
who do NOT work and will not get an education
because they complain about CEO's.


Americans are the laziest slackers in the world, as demonstrated by the fact that we have the least upward social mobility outside of basket cases like Burma. If Americans had an ounce of gumption they'd get off their backsides and work instead of buying goods made elsewhere on credit while demanding that they be paid a premium just because they were born here.

Look at countries that have growing economies like Denmark. Their median standard of living is far ahead of the USA, and you don't see them expecting their Government to do things for them like health care.
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You got to be kidding...
30otnix 11th Nov 2009
You do know that all heath care in Denmark is
provided by the government and paid for out of hefty taxes? Or is that sarcasm?
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Check your facts
Yagotta B. Kidding 11th Nov 2009
You do know that all heath care in Denmark is
provided by the government and paid for out of hefty taxes?


Not possible. Denmark's per-capita GDP is greater than the USA's and is growing faster. That's not possible with a high-tax welfare state.
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United States dollar is ranked 48 or 49
Use_More_OIL_NOW 11th Nov 2009
Yes, preach about how great it is to
get to 7 TRILLION with 12 zero's
7,000,000,000,000 can someone explain
why the dollar is ranked at 48 or 49
in the world???

I guess China/Russia/Europe is wanting to
get rid of it!

It is worthless so tell your messiah, that
he will get voted out in 2012 if the country
is around and not taken over by China to
repay the TRILLIONS of dollars owed to
them.

Get off your couch, get a job, get an
education quit whining about Government
paying for my food, my healthcare,
a CEO that makes millions who cares!

GET A JOB or sit at home on welfare and
cry about CEO's...
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Meaninglessness
DanaBlankenhorn 11th Nov 2009
You are not responding to what I wrote at all. You are, instead, ignoring it and attacking my politics, which favors a greater federal regulatory role in health care and health insurance.

The post was about using data to drive what we pay for. We pay for it in the current system, through insurance premiums. And those decisions are currently made on a political basis, by state regulatory agencies responding to lobbyists.

This has nothing to do with who pays. It has to do with what we pay for.

You might want to re-read what I wrote.
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Actually, he is addressing your goal.
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
He stated that he doesn't want to pay for government run healthcare. Your idea would increase the size of government run healthcare.

Re-read his post.
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Dana, do you *realize* how silly you look?
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
"Most estimates are that giving doctors a license to kill, as you propose, would cut just 2% of costs."

'Nuff said.
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RE: Why not pay for what works?
butters8686 11th Nov 2009
While your points are correct that insurance companies have been strong-armed into covering massage therapy and other non-essential "prlcedures" in some states, you tend to mis-interepret the findings of Betsy McCaughey, who has been pointing out the potential danfers to the recent health care proposals including the fact that politics will continue to have a stranglehold on the health care industry (remember who will be making the health care decisions -- and that the brother of the President's Chief-of-Staff was hand-picked to run the governing body of Government Health Care). Perhaps the biggest difference is the potential elimination of inventives to advancing medical technology. Also, while I am in favor of limiting the over-use of MRI, tort reform will save much more than the dollar amount on paper at time of litigation as a previous poster poitned out. These are points that McCaughey and others have eloquently stated, but proponents of the health care legislation as it stands have distorted her warnings.
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I call BS on that
DanaBlankenhorn 11th Nov 2009
Betsy McCaughey is not eloquent. She's an industry shill, who is costing you money.

You gloss over the fact that current decisions on what is covered and what is not covered are, in fact, political.

I did not make a political point in this story. I said we should base decisions on what to cover on evidence, not politics.

McCaughey's "warnings" represented nothing more than Luddism, and we can't have that in the science of medicine. Might as well spring for leeches as Christian Scientists praying over us -- leeches are actually effective in clinical studies.
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"I did not make a political point in this story".
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
Of course you did. This blog *is* political.

The combination unbiased / Dana is unthinkable. You are ******** left, i.e ******** socialist. That's your right, fine. Just don't say you're doing 'journalism' here.
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Interesting blackout.
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
I noticed that the combination of the two words 'hard' and 'core' get blacked out as ********. Weird.

Political correctness going in another direction? Anticipating the Fairness doctrine? We'll see.
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It boils down to coming between the doctor and the patient - again.
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
How ... liberal, how socialist.

But then again, that's how we know you Dana. At least you're consistent. Kinda sneaky though, now trying it via the 'payment' route.

Control is control.
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Only in America
tonymcs@... 11th Nov 2009
Are the words socialist and liberal used as epithets (that's bad words).

So you want decisions made by a doctor who makes money out of the processes and a patient who knows nothing.

Sounds like a winning formula! So which developed country has the worst health care system that costs huge amounts more than anyone else?

Ooops sorry, my bad for bringing in facts.

Everyone knows greed is a great substitute for caring and compassion.
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Good points...
CounterEthicsCommissioner-23034636492738337469105860790963 11th Nov 2009
nt
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Have we forgotten protocols?
Ken_z 11th Nov 2009
Lots of time and resources devoted to developing
protocols for various conditions.

My gallstone was a great example. Presented with
symptoms that a 3rd grader wanting to be a doctor could
diagnose. THe Doc (a general surgeon) took two seconds
to determine my symptom were related to a gall stone.

The protocol was pretty simple:

1. Confirm diagnosis with an ultrasound - done within 15
minutes. The stone could be seen across the room.

2. Schedule an outpatient, laparoscopic surgery on an
early open date.

3. Rx's for nausea, pain and antibiotics to keep me
comfortable while waiting a few days for surgery and to
get as much cleaned up with the antibiotics as possible.

THe surgery was a breeze - I walked out smiling (thanks
to some very nice drugs the medical profession has) and
never a problem.

That's the protocol or gallbladder stones. Tried and true.

The prostate cancer was different as the protocol seems
to mean that the patient gets informed of the various
options, handed a book that re-reviews the options that
the doctor presents and then you're allowed to decide
which option was for you.

Mine was surgery. That set a few other tasks to be
checked off in the protocol, including blood tests and a
bone scan. The bone scan looks for 'HOT SPOTS' that
indicate it is too late for surgery.

THe surgery itself followed standard protocols.

So there are two very standard approaches towards
treating two very common medical conditions. What
would the committee actually do when it comes reviewing
these two.

Now, I've aso had a heart cath and one artery was found
to be 50% blocked, Didn't get a stint, even though they
were available while I was numb and dumb. Maybe it
works here to review the percentage blockage that calls
for a stint. Might be cheaper to do one as soon as
blockage hits, say, 33% than actually go through the
procedure in another year or two before using the sting.
That is the type of area where major levels of stats can be
helpful.
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Yes, we have forgotten protocols
DanaBlankenhorn 12th Nov 2009
Amazing how the trolls here who were so bent on cost-saving when the subject was who pays are now so bent on dissing cost-saving now that we know how to do it.

"Getting between a doctor and their patient" indeed. What happened to no blank checks? Even if it's insurance that is paying, that insurance is paid for by a large group, against specified risks. Rates go up if doctors have carte blanche to use whatever expensive treatment they want with insurance money.

The trolls don't have an answer for anything, I'm afraid. Oh, except give doctors a license to kill and have people buy from the least-regulated state so the insurers can get out of paying. That is what the trolls call reform. It's loony.

Time to tell the trolls, as Tom Friedman said of the Iraqis in the run-up to that war, "suck on this."

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