PrimeCuts: This Week in the Journals

March 22, 2010

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Carolyn Bevan MD

Faculty peer reviewed


 This week, as the House passed the Patient Protection and Affordable Care Act, the medical community highlighted some of its most recent achievements in medical science. The 59th Annual Scientific Session of the American College of Cardiology convened from March 14-16. The meeting delivered on its promise of presenting some of the most exciting developments in the field, including new drugs, new data on safety and efficacy, and updates in interventional technology (1). Meanwhile, the Journal of the American Medical Association (JAMA) this week dedicated its pages to developments in the world of cancer, featuring reports on new therapeutic modalities while exploring challenges in caring for patients with cancer. In all, it was a week full of promise, showcasing researchers’ dedication to finding cutting edge solutions to medical challenges.

As health reform is finally achieved, however, medical innovation is being viewed more and more in the context of the bottom line. Now more than ever, advances in medical therapeutics must not only provide benefit, they must do so at a price commensurate to their effect. This week in the journals, the focus lingered on the dollars and cents of health care.Even amongst privately insured patients, the rising cost of medical care has had a significant impact. In one of the articles in this week’s issue of JAMA, entitled Cancer’s Next Frontier: Addressing High and Increasing Costs, authors Elena B. Elken, Ph.D., and Peter B. Bach, MD, MAPP, of the Health Outcomes Research Group at Memorial Sloan-Kettering Cancer Center, explore cost issues in cancer therapeutics (2). They describe that the direct medical cost of cancer has increased over two-fold from 2003-2004, even taking inflation into account. They note that even patients with prior private insurance are paying significant sums of money out of pocket to manage their disease, with almost 25% claiming to have used most or all of their savings during treatment. The reason for this steady increase in the cost of treatment, according to the authors, is both an increase in the price of care and an increase in the quantity of care. As an example, they describe that from 1991 to 2002, both the proportion of patients receiving chemotherapy for breast cancer and the price of chemotherapy itself doubled. They note similar trends in other types of cancer. The common link appears to be new medical technology, which generates new and more expensive treatments, and expands the pool of treatment candidates by reducing toxicities and extending indications of existing therapy. The authors suggest that this problem may be ameliorated by a shift in payment models for physicians, from the current “fee for service” model to a payment model based on more standardized pay scales with heavy emphasis on evidence based guidelines. Elken and Bach acknowledge the importance of having accurate information on comparative efficacy in this situation, but they assert that cancer medicine is a field that may in fact fit such a model quite well.

An article in this week’s New England Journal of Medicine, entitled How to Think about Future Health Care Spending, builds on Elken and Bach’s concept that medical innovation is one of the significant drivers of increasing health care costs (3). In the article, author Victor R. Fuchs, Ph.D., asserts that it is “fiscally irresponsible to continue to accept innovations regardless of cost, even if they pass tests of safety and efficacy.” He suggests that a two-tiered system, consisting of public and private funding, would help to address this issue. The public system would provide basic, universal health care and would cover treatments with proven favorable cost/benefit ratios. In the private system, meanwhile, individuals would be allowed to apply their own personal cost/benefit analysis in deciding on additional expenditures. He acknowledges the importance of biomedical innovation, and the need to continue to foster discoveries that could have a significant impact on health. He also acknowledges the fact that not all new interventions have an immediately obvious benefit that would justify their expense, but these interventions may go on to develop significant benefit over time and with changes in implementation. In order to foster continued scientific innovation, he asserts that the private setting would be the ideal market for “untried, cutting-edge interventions,” as a sort of testing ground before incorporation into the public domain.

Of course, part of the cost of health care is physician reimbursement, and in this area as in all others, lawmakers are seeking ways to get more bang for their buck. Authors of a NEJM article on the practice of physician cost profiling utilized by some insurance companies find that, if current models continue to be applied, approximately 22% of physicians would be misclassified as providing high or low cost care (4). Meanwhile, an article published in the Annals of Internal Medicine explores the suggestion that pay for performance (P4P) models are at odds with the tenets of medical professionalism (5). In it, the authors analyze the effect P4P models would have on ethical themes including the application of scientific evidence, ethical interactions between physicians and patients, achieving equity, and commitment to professionalism. The authors conclude that some P4P models, if thoughtfully constructed and carefully monitored, may in fact encourage professionalism in these areas.

Some states are trying to contain health care costs by cutting Medicaid budgets. An article in the New York Times this week describes deteriorating access to care as state Medicaid reimbursements shrink, causing some physicians to balk at taking on Medicaid patients, while hospitals are shutting down services like obstetrics due to inability to cover costs with current Medicaid payouts (6). The economic downturn has resulted in record enrollment in Medicaid programs, but that same economic distress has left hard-hit states like Michigan unable to support the costs of health care for its Medicaid dependents. Some critics have voiced concern that if a national healthcare plan is to be implemented with current reimbursement schemes, physicians will not be able to keep their doors open. In a letter to congress, President Obama writes that “if Medicaid is expanded to cover more people, we should consider increasing doctor reimbursement (7).” This difficult situation highlights the challenge of balancing cost containment with providing adequate funding for necessary medical care.

Clearly, there is no simple solution for curtailing medical spending. The issue, however, is one that must be faced. In the same letter to congress, President Obama writes that “the cost of health care is a large and growing problem that, if left untended, threatens families, businesses, and the solvency of our government itself (7).” America has been at the forefront of lifesaving biomedical discovery, and while it is vital to continue to support innovation, it is impossible to do so without regard to the ever growing price tag. Meanwhile, new reimbursement models may allow law makers to apply health care dollars more efficiently, rather than making indiscriminate cuts to reimbursement rates. As physicians, we may struggle with the idea that “market forces, societal pressures, and administrative exigencies (5)” may compromise patient care, but at the same time, we must acknowledge the system in which we work, the struggles our patients face in paying for their care, and the effect our decisions have on the overall economic burden of health care. We must walk the fine line of upholding our professional standards while acknowledging the limits of our resources.

Dr. Bevan is a 1st year resident in internal medicine at NYU Medical Center.

Peer reviewed by Danise Schiliro-Chuang MD, Contributing Editor, Clinical Correlations.

1. “Rapid News Summaries.” ACC 2010. Atlanta, 2010. Web. 20 Mar 2010.

2. Elkin EB, Bach PB. Cancer’s next frontier: addressing high and increasing costs. JAMA. @010 Mar 17;303(11):1086-7. 

3. Fuchs VR. How to think about future health care spending. N Engl J Med. 2010 Mar 18;362(11):965-7. Epub 2010 Mar 10. No abstract available.

4. Adams JL, Mehrotra A, Thomas JW, McGlynn EA. Physician cost profiling – reliability and risk of misclassification. N Engl J Med. 2010 Mar 18;362(11):1014-21.

5. Qaseem A, Snow V, Gosfield A, Gregg D, Michl K, Wennberg D, Weiss KB, Schneider EC. Pay for performance through the lens of medical professionalism. Ann Intern Med. 2010 Mar 16;152(6):366-9.

6. Sack, Kevin. “As Medicaid Payments Shrink, Patients are Abandoned.” New York Times 15 March 2010, New York: A1.

7. Obama, Barack. “Letter to Congressional Leaders on Health Insurance Reform.” U.S. Capitol. Washington, D.C., 2 March 2010.