Tag: health care system

CER: A (Slightly) Different Perspective

My colleague, Michael Cannon, makes several good points about comparative effectiveness research (CER), both in his letter to USA Today and in his excellent paper on the subject. I strongly agree with him that we should not reflexively oppose CER—much of health care spending is wasteful or unnecessary, and it makes sense, therefore, to test and develop information on the effectiveness of various treatments and technology, giving consumers tools to evaluate the value of the care they receive. There is also a case for the use of CER in taxpayer-funded programs like Medicare and Medicaid. Taxpayers should not have to subsidize health care that has not proven effective, nor can Medicare and Medicaid pay for every possible treatment regardless of cost-effectiveness.

However, I am more skeptical in general about CER than he is for several reasons.

  • First, “quality” and “value” are not unidimensional terms. In fact, such concepts are highly idiosyncratic with every individual having different ideas of what “quality” and “value” means to them, based on such things as a person’s pain tolerance, lifestyle, feeling about hospitalization, desire to return to work, and so forth. For example, a surgeon may tell you that the only way to ensure a cure for prostate cancer is a radical prostectomy. But that procedure’s side-effects can severely impact quality of life - so some people prefer a procedure with a lower survival rate, but fewer side effects. Who is better suited to determine which of those procedures represents “quality” and “value,” a government board or the person directly affected?
  • Second, comparative effectiveness research too often has a tendency to gear its results toward the “average” patient. But many patients are outliers, whose response to any particular treatment, for either good or ill, can vary significantly from the average. This matters little when the research is simply informative. However, if the research becomes the basis for more prescriptive requirements, for example prohibiting reimbursements for some types of treatment, the impact on patient outliers could be severe.
  • Third, comparative effectiveness research can create a time lag for the introduction of new technologies, drugs, and procedures. The FDA, for example, has already caused delays in introducing drugs that have resulted in unnecessary deaths. Depending on how the final program is structured, comparative effectiveness research could create another layer of bureaucracy and testing between the development of a new drug, for example, and its introduction into the health care system. One only has to look at the difficulty in expanding Medicaid drug formularies to see how this could become a problem.

The advocates of government-sponsored CER clearly intend for it to be used as a basis for rationing care, not just in government programs, but for private insurance as well.

Cannon points out that government-sponsored CER is likely to be corrupted under pressure from special interest lobbies and politicians. I couldn’t agree more. Government-sponsored CER, therefore, is liable to yield the worst of all possible worlds, not only rationing, but rationing that is based on special interest lobbying rather than science.

Health care, is of course, a finite good. Therefore, it will always be rationed in some fashion. But, it is far better if the rationing agent is the consumer himself, rather than the government or any other arbitrary agent. The private sector is already undertaking CER. To the degree that consumers, insurers, and providers make use of this information, that is a good thing. If consumers don’t like how an insurance company, for example, uses CER in determining its reimbursement policy, he or she can choose a different insurer.

Government-imposed fiat rationing allows for no such choice. Therefore, we should oppose any government involvement in CER, and any efforts by the government to use CER to restrict reimbursement, especially in private insurance plans.

Democrats Agree on Health Plan Outline: Be Afraid, Be Very Afraid

The New York Times reports that key congressional Democrats have agreed on the basic provisions for a health care reform bill.  And while many details remain to be negotiated, the broad outline provides a dog’s breakfast of bad ideas that will lead to higher taxes, fewer choices, and poorer quality care.

Among the items that are expected to be included in the final bill:

  • An Individual Mandate. Every American will be required to buy an insurance policy that meets certain government requirements.  Even individuals who are currently insured – and happy with their insurance – will have to switch to insurance that meets the government’s definition of acceptable insurance, even if that insurance is more expensive or contains benefits that they do not want or need.  Get ready for the lobbying frenzy as every special interest group in Washington, both providers and disease constituencies, demand to be included.
  • An Employer Mandate. At a time of rising unemployment, the government will raise the cost of hiring workers by requiring all employers to provide health insurance to their workers or pay a fee (tax) to subsidize government coverage.
  • A Government-Run Plan, competing with private insurance.  Because such a plan is subsidized by taxpayers, it will have an unfair advantage, allowing it to squeeze out private insurance.  In addition, because government insurance plans traditionally under-reimburse providers, such costs are shifted to private insurance plans, driving up their premiums and making them even less competitive. The actuarial firm Lewin Associates estimates that, depending on how premiums, benefits, reimbursement rates, and subsidies were structured, as many as 118.5 million would shift from private to public coverage.   That would mean a nearly 60 percent reduction in the number of Americans with private insurance.  It is unlikely that any significant private insurance market could continue to exist under such circumstances, putting us on the road to a single-payer system.
  • Massive New Subsidies. This includes not just subsidies to help low-income people buy insurance, but expansions of government programs such as Medicaid and Medicare.
  • Government Playing Doctor.   Democrats agree that one goal of their reform plan is to push for “less use of aggressive treatments that raise costs but do not result in better outcomes.”  While no mechanism has yet been spelled out, it seems likely that the plan will use government-sponsored comparative effectiveness research to impose cost-effectiveness guidelines on medical care, initially in government programs, but eventually extending such restrictions to private insurance.

Given the problems facing our health care system-high costs, uneven quality, millions of Americans without health insurance–it seems that things couldn’t get any worse.   But a bill based on these ideas, will almost certainly make things much, much worse.

Or maybe it’s all just a massive April Fool’s joke.

Deadly Canadian Care

An Illinois physician is arguing that actress Natasha Richardson might have survived her skiing accident if it had occurred in the United States rather than Canada. Explains Dr. Cory Franklin:

Canadian health care de-emphasizes widespread dissemination of technology like CT scanners and quick access to specialists like neurosurgeons. While all the facts of Richardson’s medical care haven’t been released, enough is known to pose questions with profound implications.

In the U.S. Richardson likely could have been both diagnosed locally and flown to emergency care in a nearby city.  Adds Franklin:

What would have happened at a US ski resort? It obviously depends on the location and facts, but according to a colleague who has worked at two major Colorado ski resorts, the same distance from Denver as Mt. Tremblant is from Montreal, things would likely have proceeded differently.

Assuming Richardson initially declined medical care here as well, once she did present to caregivers that she was suffering from a possible head trauma, she would’ve been immediately transported by air, weather permitting, and arrived in Denver in less than an hour.

If this weren’t possible, in both resorts she would’ve been seen within 15 minutes at a local facility with CT scanning and someone who could perform temporary drainage until transfer to a neurosurgeon was possible.

If she were conscious at 4 p.m., she’d most likely have been diagnosed and treated about that time, receiving care unavailable in the local Canadian hospital. She might’ve still died or suffered brain damage but her chances of surviving would have been much greater in the United States.

American medicine is often criticized for being too specialty-oriented, with hospitals “duplicating” too many services like CT scanners. This argument has merit, but those criticisms ignore cases where it is better to have resources and not need them than to need resources and not have them.

Obviously, Americans also die needlessly from substandard care on occasion.  But where government controls the entire health care system, politics is likely to trump consumers from beginning to end.  And that is evidently the case in Canada, where pets typically have speedier access than humans to many of the technological advances that Americans take for granted.  Policymakers must not forget the needs of patients as they rush to “reform” the U.S. health care system.

(H/t to Matthew Vadum.)

Who’s Blogging about Cato

Here’s the latest round-up of bloggers who are writing about, citing and linking to Cato research and commentary:

  • Blogging about Real ID, AxXiom for Liberty posted Jim Harper’s piece about DHS officials who skirted open meeting laws to promote the program.
  • No Land Grab, a blog covering eminent domain abuse, posted the latest Cato video on the Susette Kelo case. Jason Pye, who wrote a commentary on the case for the Georgia Public Policy Foundation, linked to it as well.
  • Sights on Pennsylvania blogged about international health care systems, citing Michael D. Tanner’s January article on health care reform and a 2008 Hill Briefing that compared various systems around the world.
  • Wes Messamore, AKA The Humble Libertarian, is compiling a list of 100 libertarian blogs/Web sites, and looking for recommendations. Last week, Wes penned his thoughts on the role of the U.S. in foreign policy, making heavy use of a recent Cato article by Benjamin Friedman and a 1998 foreign policy brief by Ivan Eland, citing military intervention overseas as a cause of terrorist activity against Americans.

If you’re blogging about Cato, contact Chris Moody at cmoody [at] cato [dot] org (subject: blogging%20about%20Cato) .

Third-World Accommodations

In the 2003 film The Barbarian Invasions, a patient’s wealthy son offers a handsome bribe to the administrator of a decrepit, chaotic, state-run hospital in Montreal that is (mis)treating his dying father.  “This is silly,” the startled administrator exclaims.  “We’re not in the Third World.”

Britain’s health-care system is perhaps slightly less state-dominated than Canada’s.  Yet today comes the following report:

The British government apologised Wednesday after a damning official report into a hospital likened by one patient’s relative to “a Third World” health centre…

Between 400 and 1,200 more people died than would have been expected in a three-year period at the National Health Service (NHS) hospital, according to an investigation by the Healthcare Commission watchdog.

Receptionists with no medical training were left to to assess patients arriving at the hospital’s accident and emergency department, the report found.

Julie Bailey, whose 86-year-old mother Bella died in the hospital in November 2007, said she and other family members slept in a chair at her bedside for eight weeks because they were so concerned about poor care.

“What we saw in those eight weeks will haunt us for the rest of our lives,” said the 47-year-old. “We saw patients drinking out of flower vases they were so thirsty.

“There were patients wandering around the hospital and patients fighting. It was continuous through the night. Patients were screaming out in pain because you just could not get pain relief.

“It was like a Third World country hospital. It was an absolute disgrace.”

The politicians quoted in the story promised, again, that, you know, they would improve things.

Wednesday Podcast: ‘The Science of Medical Marijuana’

Photo: Kelly Anne CreazzoSpeaking at a Cato forum Tuesday, Dr. Donald Abrams, director of Clinical Programs at the University of California Osher Center for Integrative Medicine, discussed the science behind medicinal marijuana, and explained why the drug should be allowed for patients who suffer from a variety of symptoms.

After the event, Abrams spoke with Caleb Brown for Wednesday’s Cato Daily Podcast, explaining the promise of marijuana as medicine:

One of the reasons I am in favor of people using the plant is because… we no longer have a health care system in the United States, we have a disease management system, and it is very expensive largely due to pharmaceuticals. If there is a plant that is a medicine that people can grow for themselves in their own backyard then I think we can really go a long way to decrease some of the costs of health care. But if we are saying that a physician is going to be able to prescribe this entity to a patient then unfortunately, or fortunately depending on how you look at it, it does need to be regulated or approved and the only way to do that is through the standard route.

More Praise for Cochrane’s ‘Health-Status Insurance’

This time, it’s coming from Reihan Salam at Forbes.com:

Choice and Security: Professor John Cochrane’s advice to President Obama

Last week, at a White House forum on reforming health care, President Obama issued a challenge to advocates of less government control of the medical marketplace.

“If there is a way of getting this done [i.e., reforming health care] where we’re driving down costs and people are getting health insurance at an affordable rate and have choice of doctor, have flexibility in terms of their plans, and we could do that entirely through the market, I’d be happy to do it that way.”

More to the point, Obama added that he’d be just as happy to pursue an approach that involved more government control as well, and that seems to be the tack he’s taking…

Congressional Republicans have criticized Obama’s approach, and they’ve been particularly hostile to the idea of a new public insurance plan. They argue that Obama’s reforms will eventually lead to a nationalized health care system. But as of yet they’ve failed to offer an alternative that meets Obama’s criteria for a successful health care reform.

Enter John Cochrane, an economist at the University of Chicago Booth School of Business. Professor Cochrane has long advocated a proposal he calls “health-status insurance,” an approach that could guarantee long-term health security while also freeing medical insurers to compete for customers. To most health care reformers, this sounds like a contradiction in terms.

Cochrane’s paper is, “Health-Status Insurance: How Markets Can Provide Health Security.”