The Devil Is in the Dollars

Despite some cost-cutting measures in the new health care law—such as targeting fraud and requiring generic versions of biologic drugs—the cost of care is on a trajectory that could undermine the U.S. economy and bankrupt government-funded programs like Medicare.

“As a country we’re using more and more of our resources on health care as a percent of the whole. We have the largest GDP (Gross Domestic Product) in the world, and we spend a larger percentage of our GDP on health care,” says Matt Brow, vice president of government relations and public policy of U.S. Oncology [and owners of CURE]. More than 15 percent of the U.S. economy goes to pay for health care, far more than any other modern country. (Switzerland is a distant second, at 11 percent.)

The question is not 'does something have to change,' but 'how are we going to change it?

Most experts agree the situation is unsustainable, but solving the problem will involve decisions that most political leaders find unpalatable, Brow says.

According to researchers at the University of California in Santa Cruz, the United States spent more on health care per person than any other country in the world in 2000, but had a life expectancy that ranked 27th, just ahead of Cuba.

And, health care costs just keep climbing. The reasons are many, including the fact that patients are getting ever more care—more drugs, more tests, more procedures—once they become ill. One area under particular scrutiny is medical technology: studies estimate that between 20 and 50 percent of the rise in health care costs are due to technology, says Sean Tunis, MD, director of the Baltimore-based Center for Medical Technology Policy.

While many experts agree that Americans get a lot of unnecessary care, there’s no easy way to trim waste, Tunis says. “There’s no bright line between what is unnecessary utilization and what might be useful. It’s all shades of gray,” he says. One problem is that doctors and patients, most of whom have at least some kind of insurance, are largely disconnected from the bill. Thus, they don’t see the consequences of extra tests and procedures. (What’s the harm in an extra biopsy?) Tunis says it’s like ordering dinner when someone else is picking up the tab. When it’s someone else’s bill, prime rib and a $50 bottle of wine sound swell.

To make decisions that consider cost, though, patients and doctors will also need better data. That is one of the goals of the Patient-Centered Outcomes Research Institute established in the health reform law. “When you have a financial stake in the game, then you start to look at the shades of gray differently,” he says.

Technology isn’t always the bad guy. Used correctly, it can actually help control costs by making treatment more efficient. Allen Lichter, MD, CEO of the American Society of Clinical Oncology, predicts that the cost of cancer care will decline as medical science gets better at matching the right drug to the right patient. But there is no way to avoid hard choices, he says.

“The question is not ‘does something have to change,’ but ‘how are we going to change it?’” Lichter says. As a start, he says, physicians and patients will have to become comfortable talking about the cost of care, so political leaders will follow suit (See www.cancer.net/patient/all+about+cancer/managing+the+cost+of+cancer+care). “We’ve put out guidance documents for physicians and patients. We’ve tried to make sure they understand this is not a taboo subject to talk about.”

According to researchers at the University of California in Santa Cruz, the United States spent more on health care per person than any other country in the world in 2000, but had a life expectancy that ranked 27th, just ahead of Cuba.