Cleaveland: Health care on a budget

Cleaveland: Health care on a budget

February 7th, 2013 by By Clif Cleaveland in Life Entertainment

Dr. Clif Cleaveland

Dr. Clif Cleaveland

My last column summarized the case of a man whose fainting episode resulted in overnight hospital charges exceeding $40,000. The itemized statement from his hospitalization identified imaging and lab tests as the major expense.

A patient with health insurance that includes a large deductible or co-payment can owe thousands of dollars after emergency or in-patient care. The challenge for our health care system is to find ways to control costs without sacrificing quality, safety and effectiveness. Because an estimated 30 percent of U.S. health care costs are wasted, substantial savings should be attainable.

There are several approaches to this problem. None are easy. Each requires cooperation between patients and their families and providers.

• Education on costs. Many physicians and other providers are unaware of the cost to the patient of medical tests including bloodwork and imaging studies. This is especially true in training centers in which high-tech diagnostic facilities abound and extensive testing is the norm. From medical training forward, costs and appropriate use of services must be emphasized. With each new technology, cost must be factored into the question of clinical usefulness. Costs must be highlighted in every clinical setting. Patients will benefit from awareness of costs and potential side-effects of diagnostic tests.

• Clinical guidelines. Many recommended pathways for diagnosis exist. The problem is their voluntary nature. More rigorous adherence to guidelines for employing MRIs and other high-priced imaging procedures would lessen inappropriate use. Acute-care providers worry about litigation if a condition is not diagnosed in a timely manner. If providers adhere to established guidelines when evaluating a patient, they should be absolved from blame if some unanticipated abnormality is subsequently detected. Ideally, guidelines would encourage more attention to obtaining a careful history and performing a physical exam before ordering diagnostic studies.

• Bundled payments. Under this scenario, one fixed and comprehensive charge would be applied to all diagnostic evaluations in a certain category. For example, a single payment would be made for the evaluation and treatment of a patient who had fainted. Bundled payments would make treatment facilities more cost conscious. Excessive and inappropriate testing would impact their bottom line.

• Coordinated care. Established health systems make clinical consultation by telephone available continuously. A consultant can direct patients to the most appropriate site for evaluation. Not every symptom requires an emergency room visit. Integrated systems may offer urgent care centers as alternatives to hospital-based emergency departments. All care providers for the system depend upon a common budget so cost awareness is promoted throughout.

• Capitated care. Under this scenario, patients pay a flat fee for comprehensive care during the year. If providers in a capitated plan are careful in planning clinical evaluations, the plan will be solvent. Careless ordering of expensive tests will bankrupt the plan. In capitated plans physicians and other providers are often salaried instead of being paid on a fee-for-service basis. Salaried reimbursement may be supplemented by bonuses based upon patient satisfaction and adherence to clinical guidelines.

If costs are overly emphasized in any health plan, physicians might become so concerned with the patient's billfold, they neglect to obtain a needed study. There is a fine balance that requires clinical judgment on the part of care providers.

Our present system does not work. Change must be driven by providers who adopt successful models of care that have functioned well for years. Mayo Health Systems, Kaiser Permanente, Intermountain Health System (Utah and Idaho) and Geisinger Health System (Pennsylvania) offer blueprints for sound care that does not break the bank.

Contact Clif Cleaveland at