MEDICAL COSTS: DENIALS AND PARADOXES
Christopher Ebbe, Ph.D., ABPP 4-11
ABSTRACT: Most people acknowledge the need to slow down the rate of increase of medical costs in the U.S., but most are also in denial about the various consequences and costs of doing so. The options and denials are described. A change in the public’s desire for maximum services is the only thing that will control medical costs.
KEY WORDS: healthcare costs, medical costs, fear of death, health insurance
Since healthcare costs have been increasing for a number of years at a rate significantly greater than general inflation, there is considerable concern about containing medical costs or slowing down their rate of increase. Some people are also concerned about this because of the huge costs of Medicare and Medicaid as a percentage of the Federal budget. Part of the cost increases are due to personnel costs and part to new procedures and new medicines, but these increases could not take place without the demand by the public for more services and medicines and its willingness to attempt to pay increasingly large amounts for that care. (It is unclear whether plan administration costs have risen proportionally as well, although we can presume that healthcare businesses are being sure to take care of themselves.)
The only solutions for containing medical costs are—
(1) controlling salaries and other staff costs
(2) controlling the development and spread of new procedures and
medicines
(3) reducing the number of patient-initiated visits and services
(4) controlling the use of medical procedures and medicines in
general
(5) reducing the overall availability of medical services
(1) Medical jobs are considered to be well-paying in general. It is unclear whether a shortage of medical personnel would develop if that pay were lower or were held constant for several years. It seems unlikely that there would be a shortage, since at the current pay level these jobs are coveted, and this pay level would still be attractive for several years, but more importantly, in our society we do not have effective mechanisms for controlling pay in the private sector, and the public sector then says that it must “compete” with the private sector for personnel and must pay similarly. In general the public does not support cutting medical personnel costs, because the public wants to believe that its medical personnel are good at what they do, and being paid well is one presumed indicator of doing well.
A paradoxical effect of lower costs could be obtained by training more doctors. If we doubled the number of doctors (and they still provided the same total number of services), they would have to charge less per doctor. The public might benefit somewhat from this, but the public really doesn’t want to hear that doctors aren’t being paid well, because, as above, they presume that one indicator of good performance is being paid well.
(2) Since most new procedures (lab, imaging, surgery, etc.) add to the number of procedures available to doctors rather than replacing or simplifying other procedures, having new procedures may be additionally helpful to some patients, but it also adds to the total of medical costs, since new procedures usually mean new equipment, and having new equipment on hand, storing it, and training personnel to use it adds to total costs. The public dislike of disease and fear of death, together with some ability to pay more if necessary, are enough to support increasing medical costs and to encourage the development of more and more procedures.
Everyone is familiar with “big pharma” and how drug companies develop medicines to appeal to consumer desires (Viagra, allergy medications, etc.), rather than focusing all of their capacities on finding more effective and cost-effective medicines for serious conditions. The public loves its medicines and wants to believe that there are simple, easy solutions to their problems, so unless payments for unnecessary medicines is significantly restricted, this cost will continue to rise.
(3) As a society we want to visit the doctor whenever we feel like it, and we have trained the public through advertising of medical services and medicines to feel that they deserve a pain-free life that is not restricted by diseases or symptoms. This implies that citizens will make lots of doctor visits, many of which will not result in actual help (except for psychological and placebo help), since only a percentage of medical interventions are effective for a given patient with a given complaint (perhaps 30 to 50 percent?), and having a pain-free life unrestricted by symptoms or diseases is not realistic anyway. Therefore, our public will press for more and more services and medicines, believing that “science” will eventually solve every problem. The only mechanism that attempts to control this is having patients pay for every visit an increasingly greater amount that is not covered by their insurance (co-payments), but this has not been used seriously enough to impact the overall number of visits. The HMO solution of making people go through various screening hoops in order to divert those who will not actually be helped and those who can be treated by non-M.D. personnel has proven so unpopular that it no longer seems credible as an overall solution. If a treatment is available or possible, then everyone wants access to it.
The latest Republican proposal for controlling costs (April 2011) urges us to have a freer insurance market, with more choices of plans for consumers, and to change Medicare so that many Medicare beneficiaries buy private policies (with government assistance) instead of having Medicare pay their doctor bills. The argument is, as it always has been from promoters of business through free markets, that some consumers will buy less expensive policies and that this will bring down total outlays. The fallacy in this view is that no one wants fewer services, and people only buy less expensive policies if they are short on money and if they seriously hope that all of their medical needs will be covered by the less expensive policy. Do we really imagine that a family would decide that they only wanted certain services and not others, even if the need for those other services might arise in the coming year? They are gambling that they won’t need those other services. One can argue that young people could buy less expensive policies because they have fewer medical needs, but this goes clearly against the principle of insurance in general, which is that you must have many people paying in who get fewer benefits, so that others who need them get the benefits that they have not fully paid for.
Everyone wants medical help with everything that goes wrong, but the only way that total costs will go down is if a sizable proportion of consumers get fewer services. When people have a medical need that is not covered by their less expensive policy, they will “fight” with the insurance company to cover what they need, or they will involve a local newspaper in publicizing how awful it is that their insurance company won’t cover what they need (regardless of what their insurance contract says). This inevitable desire to get help with every medical need, over time, will act to increase state mandates for every policy sold in that state to cover more and more services.
Promoters of the free market seem to believe that people make rational decisions about healthcare and honor their insurance contracts as written, but in fact people are not rational about healthcare and will always fight to get what they need medically. A free market approach will result in more business for healthcare companies, but it will not stem the tide of hopes and expectations.
Another non-rational aspect of healthcare in relation to free-market ideas is that there is no competition on price based on quality of services. Companies may offer policies that vary in price based on what is covered, but they cannot offer policies that differ in the quality of the services covered. The service providers have no reason to offer different prices based on different levels of quality of services, since they are supposedly dedicated to providing only the best services possible. We don’t have any hospitals offering lower priced services because they cut corners, use cheaper equipment, or use only newly graduated doctors who cost less. No one would go to them. If insurance companies forced their policy holders to go to such providers, they would lose their policy holders, who would migrate as soon as possible to companies that used higher quality providers. Therefore, the only competition is on amount of coverage, and psychologically, that can only go up, unless our society shifts some key attitudes.
We are beginning to see ratings of hospitals and doctors based supposedly on quality of care, but this will ultimately drive prices up, since more people will demand services from the higher quality providers, and those providers will charge more. (It’s the American way.) If lower quality providers are driven out of business, it will reduce supply and again result in higher prices. Reimbursing hospitals based on quality of care may raise the quality of services of a few lower quality hospitals, but assuming that hospitals will all strive harder to get better quality ratings, it will do nothing to control or reduce overall hospital payments.
Another way to reduce patient-initiated visits might be to get people to be healthier and therefore not need as many visits, through eating a healthier diet, exercising more, etc. This raises the question of what could induce more people to do these things, since they involve exercising a greater amount of forethought, self-control, and pain tolerance than people typically use currently. Exhorting people to do better clearly has its limits, and the type of information provided to the public would need to be changed. Scare tactics usually involve lying (“tobacco smoke kills” is so much of an overstatement that it falls in the category of a lie as stated), and it is not clear that more accurate information about the actual degree of added risk of smoking, excess weight, etc. would have much of an impact, since human beings are so poor at psychologically assessing risk in relation to a future that may or may not materialize and tend to ignore information that has negative implications for them or the accuracy of which they question. The unstated “peer pressure” of having a majority of people around them doing those healthier things would be stronger than any individually-oriented approach and would certainly be stronger than guilt, so the question is how to get to that societal tipping point where a majority are exercising more and eating a healthier diet. More comprehensive and truthful education, in the schools and for the adult public might be helpful and should be tried--for example, illustrating visually the progressive effects at various ages of overweight, high blood pressure, and various types of diets.
(4) As noted just above, restricting procedures to those who really need them and to those who are likely to benefit (which is not everyone) could control costs, but it is very unpopular with the public, so we do not have the will to proceed in this direction. Very few physicians tell their patients when what the patient wants or what is being done for them is not likely to help, and those who do are viewed as pessimistic and obstructionistic. There is a movement to develop guidelines (rules?) for a stepwise approach to every disorder (what the doctor should try first, second, third, etc.), based on symptoms and patient characteristics, but it will no doubt come into conflict with the public’s wish to be treated as often and as much as possible with the treatments the patient requests.
(5) This wish to be treated as often and as much as possible obstructs any efforts to restrict costs by controlling the total of available services. This is a primary argument given against a national health system, as in Canada or Britain, since many in this country believe that people in need of treatment in those countries must wait inordinate amounts of time to receive it. This is not nearly as true as people in the U.S. believe, but it is nonetheless a convincing argument for fearful patients. The outcry against realistic discussions with seriously ill patients and their families about whether to engage in further treatments when the patient is close to death indicates again that our public wants unlimited medical care with no restrictions.
Most citizens want emergency care to be rendered to everyone, regardless of insurance coverage or ability to pay and regardless of the cause of the need for emergency care (e.g., engaging in very risky behavior, knowing that one could be injured), which indicates that people want medical care to be provided in a forgiving and proactive manner, even if people other than the patient have to pay.
Total medical costs could be reduced slightly if we acted in a more risk-averse manner—i.e., if we avoided dangerous situations where we might incur injury or illness, such as skydiving, rock climbing, painting with a broken ladder, or physical exhaustion, but our aggressive, adventurous culture identifies taking risks with our bodies as a relatively good thing, so we are unlikely to stop doing it.
It is certainly understandable that all of us would like to have pain eliminated when it is interfering with our functioning and our joy in living, but our consumer society has trained us all to believe that this “should” happen if we and our doctors will only try hard enough and find the right medicine or other treatment. This is not at all true, but our childhood belief in and worship of “the doctor” makes us hold onto it desperately. Families of patients who are near death are reluctant to stop medical care because we have been trained to believe in medical miracles and because families wish to avoid the potential guilt and conflicts that might arise from making such decisions (not to do “everything possible” for loved ones).
Our situation with respect to medical costs is easily understandable. (1) Americans want every service possible to reduce pain, eliminate symptoms, and keep us alive as long as possible, regardless of cost. (2) Our system of health insurance and employer-supported health plans and the tendency of patients and their families not to even ask what something will cost when they bring the patient to the doctor or hospital mean that patients and their families do not weigh the costs of procedures against their ability to pay or against the likelihood of benefit. (3) American businesses are doing exactly what we expect them to do—make as much money as possible giving us things that we want and are willing to pay for. Unless one or another of these factors changes or is subject to new controls, medical costs will continue to rise, probably faster than inflation, because we are currently willing to pay more and more to have our medical services and medicines.
From time immemorial, human beings have instinctively done all that they could to eliminate pain and prolong life, and this is a natural consequence of our genetics and neurobiology. Medical and economic progress, however, have now put us in the situation where we can (and must) choose how much medical care to receive. We are now in the situation of being able to do so much medically that to do “everything that we can do” can easily bankrupt most people in a few days, often for very little gain, and it predictably is driving up total medical costs. In the case of those old enough or ill enough to be near death, “everything that we can do” usually simply dulls pain with narcotics and prolongs life by a few weeks or a few months. We have no tradition of moral guidance to help us to decide what is the “best thing to do” in this circumstance, so to avoid such decisions (and to avoid the guilt that could accompany actually making a decision), too many families tell the doctor to do “everything that can be done.” Doctors, who are in medicine to do everything possible to save lives, rarely counsel patients or families to stop treatments and let nature take its course.
The bulk of the American public is in denial about key factors regarding medical care and medical costs.
- They choose to ignore the fact that much treatment is ineffective or pointless. They refuse to believe the fact that in many circumstances and for many conditions, nothing can be done medically that has a reasonable expectation of helping.
- They deny that living with some pain and minor physical difficulties is an expectable and tolerable part of human life.
- They deny the reality of the expectable consequences of overeating, overweight, poor diet, and lack of exercise.
- They run from the idea that death, at the right time, can be the best course of action.
- They deny that their unnecessary doctor visits are adding to the runaway costs of medical care, wishing that others would restrict their visits instead of doing so themselves.
- They deny, until faced with the bill, that they might suffer severely financially by getting all possible care.
- They deny that the only way for medical costs to be contained is for them to get less medical care (or at least to keep the level of care as it is now), and they refuse to accept limits placed on that care by government or healthcare companies.
Doctors are also in denial regarding their contributions to healthcare costs by trying everything that might help a patient, even if the chances of it helping are quite small. They are also for the most part in denial about death, by trying everything they can to avoid it for patients and by avoiding discussing it with patients.
Other approaches to containing medical costs are suggested, such as eliminating “fraud and abuse,” letting private business compete more by eliminating public programs such as Medicare, and charging patients more for each service, but “fraud and abuse” is a very small part of medical costs, healthcare businesses are consolidating instead of competing, and patients, because of their belief in scientific medical miracles, are currently nowhere near the co-pay level that would effectively limit services. Some claim that “efficiencies” can be found in the overall healthcare system that will lower overall costs, but no such efficiencies in treatment services have been found (indeed, having more treatments and medicines is increasing overall costs), and administrative efficiencies are only likely to be found in more consolidation of companies, which lowers competition and increases prices.
What would it be like to live with less medical care or to freeze development so that there are no new procedures and medicines? We would then have available only the procedures and medicines currently available, but how bad would that be? A few illnesses would continue to be untreatable (just as now). The same numbers of people would die from cancer. No cure for autism would be found. People near death from old age or from life-threatening illnesses would be kept alive a few months less. We would have to adjust to those realities, and we would adjust, regardless of whether we liked it, because that is what human beings do. So why does this seem repugnant (even un-American) to us?—because we believe that science can do anything, and we hope that if we only live long enough, the cures for every illness we might encounter will be found before we have those illnesses!
The problem of adjusting to less treatment or a slower rate of development of new treatments is a psychological one, a problem of hopes and expectations. No bureaucratic or technical solution is possible, because no bureaucratic solution can insulate elected officials from it and allow them to continue to be elected and no technical solution will ever conquer death.
There are several educational things that could shift our societal denial regarding medical treatments, death, and costs of care. (1) Third-party payers could require that doctors give patients accurate information in writing before administering a treatment about the likelihood of benefit, the probable extent of benefit, and the expected cost. Patients respond somewhat uniquely to treatments, of course, but they could be informed about how most people react and benefit. Only by knowing the cost beforehand (which is almost unheard of) can patients and families make informed choices. (2) Since a significant percentage of medical costs relate to end-of-life care, educate the public, through articles in newspapers, hospital promotional journals, and pamphlets in every waiting room, about what end-of-life care really is like—its costs and benefits (or lack thereof) and the average extension of life that it achieves. The psychological benefits of hospice care should be underlined. (3) Any of us who are willing (reporters, editorialists, philosophers, pastors, teachers) could address the peculiar and unrealistic attitude of Americans toward possibilities, life, death, and risk. We want to believe that anyone can succeed (and succeed big) in life and that this will involve risks. We also assume that while others may be hurt by their risk-taking, this will not happen to us. Similarly, we believe science can do anything and that medical treatment can cure anything (until for some reason we give up hope in a particular instance). We view death as an embarrassing defeat, rather than as a natural part of the life cycle. The culture would lose some of its optimism if these attitudes changed, but it could take the pressure off of everyone to succeed and to make everything work out, and it would make choice about medical treatments really possible.
It seems clear that there are no feasible market-based or government-based solutions to containing healthcare costs, because demand (or desire) would have to decline, which could only happen over a number of years (or decades) with a change in attitudes, including attitudes about health-producing behaviors, tolerating minor pain and minor disorders (cold, flu) as an expectable aspect of human existence not requiring medical intervention, and accepting death when continuing to live is too onerous or too painful.
An interesting thought-experiment is to consider having all citizens (or their elected representatives) vote annually on the total medical budget for the country for the coming year. Information would be provided about what services would be provided or not provided for various total cost levels. Then availability of services would be set to correspond to this approved amount. Those who wished to afford more services than that could pay cash (no installment plans) or buy an insurance policy for the coming year to cover more services. Those who could not or did not wish to purchase more coverage would live with the voted-on amount of services. I suspect that many people would be willing to live with the voted-on level of services, because that level of services would be legitimized by the government (through the vote) and because they would feel that they were doing just as well as lots of other people (which makes it more OK).
Another interesting (but untenable) solution would be to have everyone purchase whatever medical insurance they want and can pay for, and then to restrict their care to the services and medicines covered by that policy. Unanticipated and uncovered illnesses would not be treated no matter how hard the patient begged from his sick bed. Only cash payment in advance could extend that person’s care for that year beyond the purchased policy. This is, of course, Draconian, but it would control costs to some extent as well as highlighting for patients the costs and risks of medical care.
It should be noted that this essay does not necessarily advocate for any specific remedy to the medical costs issue. It simply points out that any solutions that do not change the hopes and expectations of the populace are a waste of time and will surely fail. Other solutions are being discussed and attempted in order to “prove” to taxpayers and insurance purchasers that something is being done, but they will fail. It is foreign to our culture to reduce hope and reduce expectations, but that is what will have to happen. And it will happen, when circumstances require it, but right now there are no forces acting in that direction for us. The problem of medical costs is us! “We have met the enemy, and he is us!”
blog\postings\medicalcosts
