George Bush promised to kill two birds with one stone when he introduced his “consumer driven” healthcare plan. According to Bush, the market based plan would contain spiralling health costs and make insurance more affordable for the 48 million uninsured US citizens.
Figure 1.
Maggie Mahar
HarperCollins, $27.95, pp 451 ISBN 0 06 076533 X Also available as an ebook, $19.95 www.harpercollins.com/
Rating: ★★★⋆
Under the scheme, consumers buy high-deductible plans—insurance plans that cost less each month, but they must pay a higher portion of the bill if they use medical services. The money saved by lower monthly payments is set aside in a tax free “health savings account” held by the consumer, who can use the savings to pay for medical care. Since out-of-pocket payments with high-deductible plans can run up to $5100 (£2696; €3978) for an individual and $10 200 for a family, consumers will have considerable money at stake, or “skin in the game,” as conservatives like to put it. And having skin in the game, according to enthusiasts like Regina E Herzlinger, chair of Harvard Business School, will drive healthcare costs down and quality up, because consumers will comparison shop to get the highest quality care for the best price—much as they do for other consumer goods and services, such as automobiles.
At least, that's how the conservative theory goes. Maggie Mahar, a critic of the Bush plan and author of Money-Driven Medicine: The Real Reason Health Care Costs So Much, offers a cogent and well researched critique of the idea that high healthcare costs in the United States can be corrected by free market forces. When it comes to health care, reliance on a Hobbesian “all against all” marketplace generates vast amounts of waste and delivers second-rate medical care, according to Mahar. Instead of cooperating to deliver needed care, drug and device manufacturers, insurers, hospitals, and doctors compete—and they compete in ways that duplicate efforts, keep advances hidden in order to protect trade secrets, favour “bleeding edge” technologies even before they are proven safe and effective, and put short term profits ahead of long term patient outcomes.
According to Mahar, market forces are not only responsible for driving up costs in the US healthcare system, but those same forces also threaten the public health by fuelling both undertreatment and overtreatment. For the uninsured, undertreatment is not only a health problem, but it can increase costs as patients seek medical attention only after they are sufficiently sick to seek care in an emergency department. Faced with paying high out-of-pocket costs, even insured patients under the Bush plan are likely to be undertreated. Mahar cites studies that show that patients are just as likely to forego necessary or preventive health services as they are to skip unnecessary or excessive interventions when forced to make a choice. Overtreatment, encouraged by freewheeling marketing campaigns, adds costs and exposes patients to increased health risks. Mahar neatly demonstrates this latter point by reviewing carefully constructed studies of geographic variations in Medicare spending.
“Supply-driven demand” also contributes to high prices. New technologies and interventions offered to patients who are desperate for cures are adopted despite new or added costs—and without definitive proof of benefit.
Patient choice is simply no match for technology and industry advertising. Mahar describes the absurdity of asking patients to “play doctor” by second-guessing their own doctor. Can someone in the midst of a health crisis decide whether admission to an intensive care unit is justified? Can a patient determine whether two similar but differently priced drugs are comparable in value? Mahar uses the scandal over rofecoxib (Vioxx, Merck) as a case in point. When doctors at the Veterans Administration (VA) and Kaiser Permanente decided that rofecoxib provided no real advantage over similar and cheaper drugs for most patients, both sharply limited their use of the drug, which was later estimated to have caused between 39 000 and 60 000 heart attack deaths. However, doctors outside of these organisations who were “educated” by an army of industry drug reps, prescribed rofecoxib promiscuously to patients who were bombarded with direct-to-consumer advertising and believed they were getting a stronger and safer medicine.
Figure 2.
Patient choice is no match for industry advertising
Credit: GREG SUVINO/AP
Curiously, Mahar pays scant attention to another cause of high healthcare costs; universities and their researchers—wedded as they are to industry—perform an enormous amount of unnecessary and duplicative research. Similarly, the federal government's “partnership” with industry receives little mention from Mahar (although she does examine the Medicare prescription drug benefit plan).
Mahar acknowledges that she does not offer solutions. None the less, she repeatedly suggests that physician directed health care would be superior to corporate health care. She comments favourably on the era before the “power in the healthcare system... shifted from the physician to the corporation” and she asserts that physicians, as “professionals,” will put their patients' interests before their own.
Certainly many doctors do the best that they can by their patients. But Mahar's starryeyed faith in physicians fails, in the end, to provide the sort of systematic and sober analysis necessary to answer the question, “What is to be done?” Her view of doctors goes from idealised to laughable when she makes the claim that doctors heroically “struck at the very heart of the capitalist system” in 1934 by adopting a code of ethics making it “'unprofessional' for a physician to permit `direct profit' to be made from his labour.” Here, Mahar is referring to entrepreneurs who would make a profit from physician services—thereby taking a slice of physician profits. What she fails to acknowledge is that physicians were protecting their turf and their incomes. In fact, as she acknowledges, the American Medical Association vigorously defended direct fee-for-service reimbursement for doctors and opposed socialised health care and medical cooperatives with salaried physicians and prepaid insurance.
Mahar makes an important contribution to the literature on health systems with this book—especially in the area of debunking the idea that the US has “the best medical care in the world” and in describing how insurers, hospitals, and drug manufacturers contribute to high healthcare costs. However, her suggestion that physician control, rather than corporate control, can avoid these problems diverts readers from real solutions for the structural market forces that appear to drive so much waste, unnecessary cost, and even dangerous interventions in medicine.