Among the many reasons cited for the necessity of a health care overhaul, the most notable is the high cost of medical care in the United States.  According to the Centers for Medicare & Medicaid Services, the percentage of US GDP spent on health care has hovered around 16% since 2003.  This contrasts with countries like France, Germany and Switzerland, where health care eats up only 11-12% of GDP¹.  

You Get What You Pay For:  But while the US spends more, Americans also get better medical care for diseases such as cancer and heart disease than do people in other countries.  For example, survival rates for a host of cancers in the US significantly exceed those across western Europe.  Cancer care infrastructure and access to diagnostic and therapeutic equipment – all of which cost money – are key reasons for improved survival rates in the US².  

For heart disease, the chances of dying after hospital admission for a heart attack in the US are half of what they are in Britain – 12% vs. 25% ^3,4.  Around-the-clock access to cardiologists, and state-of-the-art catheterization laboratories, mean that more patients in the US who have a heart attack can live to tell about it.  In medicine as in many other things, you get what you pay for. 

Heart catheterization labs and advanced cancer treatments drive up costs in the US as compared to western Europe.  Though expensive, most Americans would be loathe to give up access to these lifesaving treatments for the sake of, say, imitating German health expenditures as a fraction of GDP.  Nonetheless, health care costs overall are a burden on many sectors of the economy.  How can we cut health care spending without reducing quality of care, and without reducing options for patients and doctors who want access to lifesaving procedures? 

Ideas for Cutting Costs:

 1.  Attack the Obesity Problem.  We should be treating obesity like we’ve treated smoking.  In the 1960’s, the US went to war against tobacco smoking.  A vigorous campaign of advertising, health warnings, public service announcements, and other measures, dramatically shifted the national attitude regarding tobacco.  From 1960 to 2000, the rate of smoking in the US dropped from 42% of adults to 22%, largely due to this intense and prolonged campaign of public education⁵.  If a public education campaign could convince people to give up an addictive substance like tobacco, then a similar campaign can convince people to change their lifestyles and lose weight.  

According to the National Health & Nutrition Examination Survey (NHANES), roughly 14% of US adults were obese until 1980, when the obesity rate began increasing rapidly.  Currently at 33%, the obesity rate in the US is the highest in the world.  Since medical spending due to obesity accounts for at least 10% of the total US health care bill, cutting obesity back to 1980 levels would cut spending by at least 5%, probably more⁶.  Hence, a national education campaign to fight obesity, while costing very little, would rein in medical costs significantly. 

2.  More Primary Care Doctors: Primary care doctors improve care while decreasing costs, but they’re disappearing from the American medical scene.  Extensive evidence suggests that if you have a primary care physician (PCP), you will benefit from improved coordination of care and fewer hospitalizations.  PCP’s are also very cost-efficient:  increasing the number of general practitioners in a state by only 1 per 10,000 population reduces Medicare spending by 9%⁷. 

But though the growing and aging US population needs an increasing number of PCP’s, the number of doctors entering primary care has been falling for two decades.  Doctors are fleeing primary care in droves, citing increasing workloads and decreasing pay⁸.  An average primary care doctor with 2,500 patients must spend 10.6 hours per day to deliver all of the recommended care for chronic conditions, plus 7.4 hours per day to provide preventive care.   Therefore, in the US today, an average primary care doctor must work 18 hours per day to deliver a proper standard of care to an average cohort of patients.  No wonder they’re quitting. 

To address the PCP shortage, re-imbursement structures should be modified so that we pay PCP’s for their hard work – this can be done in cost-neutral fashion, by shifting re-imbursement from specialists to PCP’s.  In addition, primary care residencies need to expand the number of doctors who can train in internal medicine and family practice.  These two interventions will increase the numbers of PCP’s, cut expenditures, and improve overall health, while costing very little. 

3.  Medical Tort Reform: Rampant defensive medicine is the single most important way that our medical tort system drives up health care costs.  Fear of medical malpractice causes doctors and hospitals to practice “defensive medicine”, wherein unnecessary tests and procedures are performed because of fear of lawsuits.  In Massachusetts, a study published in the Journal of the American Medical Association found that roughly 30% of CT scans and MRI scans are ordered for “defensive” reasons.  Even 10-20% of hospital admissions in Massachusetts are “defensive” – a huge drain on precious medical resources.  

A study by the Pacific Research Institute in 2007 found that malpractice insurance, settlements and defensive medicine cost roughly $130 billion, or 6% of the total health care bill in the US.  Tort reform that establishes clear guidelines for acceptable medicine, and protects doctors from unnecessary lawsuits while ensuring that patients receive outstanding care, will decrease medical expenditures substantially. 

Aggregate Savings:

All told, these three interventions alone could decrease US medical expenditures by 15%.  This translates, in current dollars, to over $300 billion annually.  These savings would be realized for a truly minimal investment, and with no decrement in the quality of care.  Indeed, increasing PCPs and decreasing defensive medicine would likely improve overall health care.  

Obviously, there will be a spirited debate about how to spend these savings - give them back to consumers, or plow them back into making health insurance more affordable for the uninsured.  But though the proper use of such savings is a matter of debate, there are nonetheless clear and uncontroversial ways to save money in the system, without reducing access to care, or quality of care. 

If we want to rein in health care costs, inaugurating an enormous new federal health care program will not be the answer.  Even without the health care overhaul, the federal budget deficit for 2009 hit a record $1.4 trillion, which is roughly 10% of GDP.  CBO estimates that the Senate Finance Committee health care bill will cost $0.83 trillion over 10 years, and the strategy for paying for this program is far from clear, though much of it will come from cuts to Medicare. Instead of expanding the role of government in health care, if we want to control costs we should be focusing on the problems in our system of drive up expenditures, and we should be tackling those problems head on.  

References:

1. Kaiser Family Foundation
2. Lancet Oncology 2007, No. 8; 784–796
3. New England Journal of Medicine 2007; 356: 1099-1109
4. BMC Cardiovascular Disorders 2004; 4:14
5. New England Journal of Medicine 2006; 355: 9
6. Health Affairs 2009; 28: w822-w831
7. Health Affairs 2004; 23: w184-w197
8. New England Journal of Medicine 2006; 355: 861-864

Dr. Laura Niklason is a physician and professor of Anesthesia and Biomedical Engineering at Yale University.