Response to Time cover story Bitter Pill: Why Medical bills Are Killing Us

February 27, 2013

Mark L. Friedman, MD, FACEP, FACP

Steven Brill's Time magazine article, Bitter Pill: Why Medical Bills Are Killing Us, is on target in many respects. He explains in graphic detail how outrageous pricing and egregious profits threaten to destroy the healthcare system in the U.S.

Unfortunately, the reasons that medical care is so expensive are more complicated than even Brill has imagined. The answer, which I explore in my book Healthcare: The User's Manual, is complex and multi ­factorial.

The cost of care has escalated at double- ­digit annual rates for much of the past two decades, easily outpacing the underlying rate of inflation. How can this continue when everyone, from the president on down, has focused intensely on containing the cost of medical care?

To understand this phenomenon we must first acknowledge that very few people directly pay the full cost of medical care. Most of us have some form of insurance ­ ­ and no medical care is too good (or too expensive) ­ ­as long as someone else will pay for it.

Government programs of any type are bureaucratic, inefficient, expensive (relative to value delivered) and highly politicized. Medicare, Medicaid, and now Obamacare, are no exception.

To add insult to injury, we are currently on the cusp of several of the largest technological breakthroughs in the history of medicine since the advent of the germ theory of disease, vaccination, and the discovery of antibiotics. The central element of these breakthroughs is, to a large degree, the computerization of technology, which has accelerated the rate of change in many medically related areas.

COMPUTING

Computers themselves, while they promise huge efficiencies and improvement in the delivery of care, at least initially add to the cost. Hospitals and doctors struggle to afford buying the hardware and software systems required to practice modern medicine (and now mandated by government). These systems in turn all require training, maintenance, and replacement (as they rapidly become obsolete).

IMAGING

In the realm of medical imaging (formerly known as radiology), computers have enabled the complex 3D assembly of what were previously two-dimensional images. These pictures are as good as, or better than, those in anatomy textbooks and permit the accurate noninvasive diagnosis of conditions we only guessed at in the past.

GENOMICS

The ultimate decoding of the human genome was accomplished in a matter of months, rather than the predicted time frame of years, again due to the power of computers able to rapidly and simultaneously perform complex and tedious calculations. The next steps, which we are already beginning to see, are the ability first to identify genetically triggered diseases prospectively and then to treat, cure, and ultimately prevent them.

IMPLANTS AND TRANSPLANTS

Advances in medical devices and our understanding of the immune system and how to suppress it have ushered in a new era of surgical replacement. New knees, hips, arteries, kidneys, hearts and lungs, are available for replacement once they wear out. Indeed, any part of the human body except (for the moment) the brain and nervous system is replaceable.

PHARMACEUTICALS

Pharmaceuticals are another force enabling cures and therapies previously impossible, but in the process adding to our costs.

The good news with all these new technologies is that we are increasingly able to help people with previously incurable and untreatable problems. The bad news, from a cost ­-of- ­care perspective, is that we now must pay for therapies for all these people who previously suffered with their disabilities, or quietly (and inexpensively) simply died.

While one can make an economic case that the gain in years of life increases productivity, this all costs money.

Finally, there are two additional factors that contribute significantly to the cost of healthcare.

DEMOGRAPHICS

As a result of all these medical advances, average life expectancy has steadily increased over the past two decades, despite the ravages of HIV/AIDS and our newest epidemic, obesity. This has naturally resulted in an increasing number of older people, many of whom tend to use an increasing amount of ever more available medical services.

MALPRACTICE

The official IOM (Institute of Medicine) statistic is that litigation contributes from 3 percent to 5 percent of the cost of healthcare in the U.S. In my opinion, this is a gross underestimate based solely on the direct costs of malpractice insurance alone. We physicians collectively and routinely over ­diagnose, over ­treat, and over ­admit (to the hospital) our patients in order to protect ourselves from lawsuits.

I am not alone in believing this contributes to as much as 25 percent of the cost of care. If true, this is a $600+ billion cancer on our society. Doctors understand this. Attorneys accept it as a "cost of doing business." The public is largely ignorant of it. Our political leaders must be either delusional or trial attorneys.

SMOKING: the good news

Since 1965, when the prevalence of smoking in the U.S. was 42.4 percent, it has been reduced by more than half (to 19.3 percent in 2010). So if the lifetime cost to society for the average smoker is $163,000, we are saving about $128 billion a year. This is not enough to wipe out the national debt, or decrease the overall cost of healthcare, but it helps. Not to mention all the people alive today because they quit, or never smoked. So if you still smoke, quit now. We need the money.

PREVENTION

We also need to learn the lesson that prevention pays, both personally and economically.

Originally published Feb 27, 2013 4:52:30 PM.