Author + information
- W. Douglas Weaver, MD, FACC, ACC President⁎
- ↵⁎Address correspondence to:
W. Douglas Weaver, MD, FACC, American College of Cardiology, 2400 N Street NW, Washington, DC 20037
“I Hear the Train a'Comin …
It's rollin round the bend … .”
—Johnny Cash (1)
For specialty physicians, the recent financial meltdown is likely to be a train that affects us greatly, because it will increase the call for cutbacks in federal spending for Medicare and Medicaid and the demand for more value for dollars spent. As we prepare for the changes that must occur with health care and health care payment reform, we should anticipate some knowns and unknowns. I use the word “must” because the annual increase in health care spending has been consistently 2.5% greater than that of the rest of the economy.
Currently, the government spends $90 billion more for Medicare than what it collects in taxes. Economists estimate that in 10 years we will have accumulated $900 billion more in entitlement debt than we have funded. This would mean that we are on track for almost 50% of our future tax dollars to go to health care. This rate of deficit spending is not sustainable, and even measured against the recent bailout of the economy, it is an awesome sum of money. So, the first given is that the government is going to spend less for health care—or at a minimum, the rate of health care spending will be brought in line with the rest of the economy.
Second, more and more reports surface suggesting that as much as one-third of the services provided are either unnecessary or even harmful. A recent report to Congress, America's Health Rankings (2), showed huge variations in the cost of primary care both in geographically diverse areas and within the same areas, and all had no added benefit. A second report that is planned will look at specialists, including cardiologists. The most recent Dartmouth Atlas Health Study findings on geographic variability suggest that those areas in the highest quintile of spending may even result in worse, not better, outcomes for patients (3).
Reducing Spending: Short- and Long-Term Options
What are the options that might be considered to reduce spending? Some are short-term, and others will take longer to implement. It would seem likely that individuals will have to pay more. We may see higher deductibles before Medicare funding comes in, higher premiums and copays for services, or even an extension of entitlement age for Medicare enrollment.
What could it mean for hospitals and providers? We might see lower reimbursement per encounter or, in the short term, a reduction in reimbursement for services that have not been proven to meaningfully improve either outcomes or quality of life. A tactic that is gaining momentum is the evaluation of new technologies and therapeutics prior to making them eligible for reimbursement. These studies of comparative effectiveness would probably raise the bar substantially for the introduction of new technology. Other countries already use this approach. We can expect that the medical industrial complex will fight this and will argue that medical innovations help drive the economy, and they do have a loud lobbying voice. However, without some attenuation of the introduction of new diagnostics and therapeutics, which have unproven value or are of minor benefit to patients, the cuts for providers could even be greater.
A second short-term means to incentivize more efficient care and better continuity would be to bundle the associated care of an individual. We might see payments for the inpatient care of a problem, similar to the diagnosis-related group approach already used for surgical procedures. Another approach might include payment assignment for a group of patients. Essentially, this would be capitation, which presents the problems of building virtual physician groups with accountability and large enough groups of patients to balance out the variability in risk—not easy tasks.
Why Target Physicians?
It seems that in most of the cost-reduction strategies, physician reimbursement is in the middle of the “target,” and one has to ask why. Most likely, it is because of the way we currently practice medicine. Ample data show that physicians are responsible for 70% to 75% of health care costs. The increases in imaging costs alone—and the fact that imaging has accounted for increases in income reimbursements of 24% to 36%, yet has not demonstrated an equivalent improvement in patient outcomes—has made us a target. We also know that care by specialists is more expensive than care by primary care providers. It is difficult to argue that we have provided more value with the increase in expense because the objective measures of our population's health show that we lag behind many countries whose cost increases have been substantially lower than ours.
I believe that many of these changes are coming because specialists, such as cardiologists, radiologists, and others, frequently use the expensive procedures that account for such a large portion of the increased health care costs. If quick savings are needed, it seems logical that it will happen in those populations that account for the majority of health care spending—cardiovascular disease, cancer, respiratory disease, diabetes, and mental illness. There are inefficiencies throughout, but these seem to be the likely initial targets.
The College's efforts these past few years have focused on building tools that help us all deliver more value, or in the contemporary jargon, increase efficiency. These tools include the Clinical Guidelines, Appropriate Use Criteria, and the National Cardiovascular Data Registry, including our new outpatient registries. The registries provide feedback on performance that can be benchmarked to others. The College is betting that in the near future, physician reimbursement will likely be aligned more with quality performance measures and less with quantity and complexity. There is a second reason for developing these measurement tools. It is the right thing to do because it helps us find ways to better ensure that our evidence-based medicines are more consistently applied.
So, are you talking about the upcoming changes with your peers? Are you discussing the current shortcomings of our health care system and suggesting solutions to your legislators? In my mind, either you can become engaged on these issues and help to shape their outcomes, or you will be left behind and be enraged about the changes. Do not assume that someone else is going to do it. Contact your Chapter Governor and get involved.
None of us wants to see health care expenses encroach on the dollars needed for children's basic education needs or for care of the elderly and disabled. We also do not want to see innovation stifled, hurting the creation of new jobs.
Change is inevitable. It is time for us to tighten our belts, do a better job at reducing marginal or inappropriate care, and join the College's quality measurement efforts.
But that train keeps a rollin', on down to San Antone … (1).
- American College of Cardiology Foundation
- ↵Cash J. Folsom Prison Blues [based on “Crescent City Blues,” written by Gordon Jenkins]. CD. Phillips S, producer. Memphis, TN: Sun Records, 1955.
- United Health Foundation, Partnership for Prevention and American Public Health Association
- Wennberg J.E.,
- Fisher E.S.,
- Goodman D.C.,
- et al.