Back after an internet outage. Miss me? I had been reading a WSJ “consumer choice” panel discussion about what’s known as “Consumer-Directed Health Care” (CDHC), which is, predominantly, a) a waste of money; b) an opportunity to shift risk and responsibility to the sick, and c) a totally ineffective way to go about fixing our health care system. Let me explain.
A couple years ago, Congress allowed “Health Savings Accounts” (HSAs) to be created. They are insurance programs that encourage people to cut down on their health care costs by putting them in charge of their health care spending. For example, maybe your employer puts $2,000 in your HSA. You have $2,000 to then use for all your health care expenses during the year. If you get really sick, once you pay a certain amount out of pocket (your “deductible”), the insurance plan takes over and pays for the rest of your hospital bill.
Now, this makes really good economic sense at first glance. If I make you pay out of your own account to go visit the doctor, you probably won’t go unless you really need to. If I make you pay out of your own account for your prescription drugs, you’ll probably be more proactive in trying to get the generic version, or making sure you’re getting a good price on the medicine, or that there’s not a cheaper alternative out there. But look a little deeper, and you’ll pick up a couple really big (okay, HUGE) assumptions we’ve just made: that you’re currently going to the doctor when you don’t really need to, and that you’re able to tell when you do need to visit the doctor and when you don’t really need to.
Assumption one: Yes, there’s some people that visit doctors “too often.” They’re generally hypochondriacs–myself probably included. But other than that, do you honestly like to hang out at a doctor’s office? With sick people all around you? Do you go just to chat? To have a good time? To skip out of work? I honestly don’t think people do. There are definitely times when people just have a cold, and the doctor doesn’t give them any medication, just tells them to rest and drink fluids and chicken soup. Maybe those are times that a person didn’t need to see the doctor. But see, that brings us to assumption number two…
That being the assumption that you know when you need to see a doctor, and when you don’t. If you know it’s just a cold, or a sore throat, maybe you just pick up some Nyquil and stay home from work a couple days. But if you have some different symptoms, some you’ve never had before, should you go in? Or should you stay home? The HSA or CDHC model puts this choice in your hands. This model hopes to eliminate unnecessary spending, but keep necessary care. I’m personally skeptical that people know how to make the distinction–I sure didn’t before I started working in the hospital.
But let’s give CDHC supporters the benefit of the doubt, just to see where this goes. Say they go to the doctor, and the doctor tells them they have a very serious condition, and really should go to the ER right away. The doctor is very concerned. The patient is college-educated, but knows little about this specific condition. Say the patient goes to the ER, and they’d like to run a test. One test costs $1,000 but may not be good enough for a diagnosis 25% of the time, but it can damage the kidneys and exposes you to radiation. Another test costs $2,500 but will make the diagnosis 90% of the time and is invasive and has a bigger risk of bleeding and death. Which should the patient choose? Does the patient honestly understand the tests or simplified versions of the risks and benefits to make the best decision? Are we as a society going to accept a system where a person chooses to ignore a doctor’s very serious warning because of possible cost? (I guess we already do; you make this decision if you’re uninsured.)
And then there’s the problem of choice. If you’re sick, how much choice are you really going to want when seeking medical care? Maybe a hospital that’s 2% cheaper is 50 miles away. Is it worth the money you’ll save? How do you even know how much you’ll save, if you don’t even know what tests you’re going to have done? Maybe a blood test is cheaper at one hospital, but an x-ray is more expensive at another. Do you hop around between hospitals and doctors’ offices to save money? If not, then how are you saving any money in the health savings account to begin with?
I think I understand what the CDHC folks are saying. If you can give patients incentives to get cheaper health care without compromising quality or outcomes–inquire about generics, for example–I think that’s great. That makes sense to me. But anything more complicated feels like some thin ice under our feet. When you’re healthy, it’s consumer directed health care. When you’re sick, it’s patient burden health care. This all on the heels of study indicating people are more likely to forego care in one of these CDHC plans.
Oh, and I forgot to mention the biggest reason this is a waste of time and money: 70% of all our health care costs come from 10% of our patients–the very, very ill. Attacking a problem (creating more bureaucracy) will hurt more people–the 90%–than it’ll help. Oh, and did I mention 21% of our spending on health care goes to billing?