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February 07, 2013 // By John Shea // Comments

Ezekiel Emanuel Confronts Health Care Costs – and Doesn’t Like What He Sees

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Just describing the huge challenge of reforming the health care system of the United States demands drama and superlatives, so Ezekiel J. Emanuel, MD, PhD, was ready. He was the presenter at a recent Grand Rounds sponsored by the department of Psychiatry at the Perelman School of Medicine, called “Health Care Reform and the Future of American Medicine.” Emanuel began by citing a figure: $2.80 trillion. That, he told the large audience, was how much was spent on health care in the United States in 2012. He encouraged the audience to consider that figure. “Trillions are, like, out of this world!” By itself, that total makes U.S. health care “the fifth-largest economy in the world,” surpassed by only by the economies of four entire nations. In 2010, Emanuel continued, the United States spent $8,362 per capita. Considering that the country has more than 300 million people, that, Emanuel asserted, “is a huge amount of money.” In comparison, during an equivalent period, the total cost of Social Security was $730 billion and defense spending $660 billion.

An oncologist by training, Emanuel is the Diane v.S. Levy and Robert M. Levy University Professor and chair of the department of Medical Ethics and Health Policy. His CV includes stays at the National Institutes of Health, where he was founding chair of the department of bioethics, and the White House, where he helped frame the Affordable Care Act. After earning a doctorate in political philosophy, in other words, he has had plenty of real-world experience in the political trenches. As he noted later during the question-and-answer segment, his support for training doctors to talk to their patients about end-of-life care “got me called Doctor Death” by some opponents of the ACA.

One of the surprising characteristics of health care, Emanuel said in framing his discussion, is that it does not perform the way other essentials like food do; instead “it behaves like a luxury good” – like diamonds or Maseratis. From year to year, the nation adds another $100 billion more to the total. Where does all the money go? He showed a list of possibilities, including insurance companies, “nasty drug companies,” defensive medicine, and demanding patients. As it turns out, Emanuel continued, defensive medicine accounts for less than 1 percent of the budget (“almost no effect”); insurance companies and drug companies account for about 10 percent each. Two sizable portions are hospitals (31-33 percent) and doctors (20-22 percent). But the main driver, Emanuel emphasized, is technology.

The implications are very serious. Rising health costs jeopardize other aspects of the commonweal, such as coverage and access to health care. Higher costs mean families may decide coverage is too expensive. State budgets are strained, leading to higher Medicaid costs and higher premiums for state employees. Ultimately, Emanuel argued, the high costs accelerate the shrinking of the middle class (during a time, he noted, when corporate profits increased 200 percent). The cost of health care “affects our world standing . . . undermines our ability to do things.”

After painting such a grim picture, Emanuel offered some possible solutions. Regarding the Affordable Care Act, he said, “The really important part of the bill” is how we change the delivery of care to our patients. Half of the population (the young, on the whole) consumes very little of the total – about 3 percent; whereas 10 percent uses nearly two-thirds of it. “The key to saving money,” Emanuel stated, “is prevention”: keeping the population healthier and keeping people out of the health care system as much as possible. Can we do it? he asked rhetorically. Emanuel did not hesitate: Yes.

Emanuel cited the “Three I’s”: information based on comparative effectiveness research, infrastructure, and incentives. These, he argued, will help re-engineer care for higher quality and lower costs.

As an example of success, Emanuel pointed to a local organization, Main Line Oncology Hematology Associates. The practice has modified electric medical records; doctors have prompts to complete their notes; adherence is tracked and deviations require customization. There are fewer low-level employees and more qualified nurses, who are used to treat common symptoms. In addition, “nurse navigators” provide concierge care, gathering all pertinent clinical data, coordinating with other doctors (complete with “hand-off” agreements to maintain care), and doing telephone triage. According to Main Line Oncology’s data, 77 percent of symptoms were managed at home, and there was a 51 percent decline in hospitalization.

Emanuel’s second example of a better way to run health care was CareMore, whose headquarters is in California. CareMore, which treats older patients, has mobile medical units; has 24/7 accessibility, which reduces having to send patients to emergency rooms; and makes use of proactive monitoring of its patients and “advanced predictive modeling.” Of particular note, Emanuel said, is the organization’s focus on patients’ psychiatric issues. They are routinely screened even before they go for treatment, because, as Emanuel noted, psychiatric problems exacerbate other health problems. CareMore’s reported data are also impressive: a hospitalization rate 24 percent below average; hospital stays 38 percent shorter; and readmissions 25 percent less.

“I’m an optimist when it comes to health care reform,” said Emanuel. He conceded that it will be “bumpy,” because of the necessary transitions. But, he concluded, “By 2020, the American health care system will be better than it is today.”


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