Sunday, January 09, 2005
The Two Crises Facing Health Care
The two crises are these: managing
medical information, and manging costs. Of course, the two
are related. Management of information will cost money,
although properly done, it can save a lot more than it costs to
implement. We cannot expect information management to solve
the cost problem, though. Although the potential savings are
considerable, they could not possibly offset the cost increases that
are projected currently.
Although estimates vary, it probably is reasonable to believe that the total cost of health care in the United States will rise to 30% of GDP within 50 years. Dr. Kenneth Rogoff writes in the latest issue of Foreign Policy:
As if the information management challenge is not already great enough, there is another complication that is emerging, as the practice of medicine becomes more sophisticated. Certain drugs can be prescribed safely only by certain physicians, those with special qualifications in the management of particular disease states. Clozapine is a good example. It is the most effective drug we have for treatment of schizophrenia. However, it causes neutropenia in about 2.5% of patients. Neutropenia can be fatal.
In order to prescribe clozapine, a physician must register with a national database. Each patient must register as well, along with the patient's pharmacy. The patient has to get a blood count done, and the results must be transmitted to the laboratory, before each prescription can be filled. This system enables us to treat persons with treatment-resistant schizophrenia safely.
Clozapine was discovered a long time ago, I think in the 1960's, but it was not approved by the FDA until the 1990's. What enabled the FDA to approve it was the development of technology for the storing of all the pertinent information (computers), as well as the timely transmission of this information (fax machines).
Clozapine is not the only example. Alosetron is a medication for the management of irritable bowel syndrome. After it was released on the market in the US, there were a few fatalities caused by bowel obstruction. It was pulled from the market, not because it is more dangerous that clozapine, but because the condition for which it is used, IBS, did not seem to warrant the risk. Patient advocacy groups complained, and it was reintroduced. When it was reintroduced, however, it was marketed in the context of a special prescribing program (1 2).
As more medications are marketed with such restrictions, and more information is needed about each medication and each patient, and as insurance issues become more prevalent, the complexity of the information management problem increased exponentially.
As mentioned previously, there will be cost savings. I haven't seen a cost analysis, but there is little doubt that these programs save money. Those interested in the topic may want to see Mark A. R. Kleiman's post about the concept of special rules for the prescribing of various medications. He focuses on the problems with drug safety that could be managed by such systems, but certainly any safety improvements would be accompanied by cost savings. Doug, posting on Lines in the Sand, has some additional thoughts on the subject. He points out the role of pharmacists in overseeing patient safety issues.
Back to the issue of health costs: the costs are going to keep going up. In fact, it seems likely that the total cost of providing health care in the country will rise so long as money is available to pay for it. I don't see any reason to think that the costs will reach a plateau, ever. What this means, is that when the economy is doing well, costs will go up. When it is doing poorly, the costs still will be there, but the means with which to pay them will not. Therefore, we can predict that periodic crises will occur with each iteration of the economic cycle.
Admittedly, I don't have any bright ideas about how to prevent these crises; in fact, if I am right, there isn't any way to prevent them. All we can do is manage them. This has several implications.
Implication #1: People are going to have to accept health care rationing. This actually is not news; health care rationing exists now, and always has. The health care system never has been large enough to deliver all the services that people need. It probably never will be. It's just that, so far, most people have managed to convince themselves that problems with access to health care are isolated problems with the system.
Implication #2: Health Care rationing will become more widespread, and will be a major issue of political contention. Today's NYT has an article about contemplated changes in Medicaid financing. this gives us a small taste of the enormity of the issue:
Implication #5: The general public will have to become more sophisticated about policy matters. Ok, that one is a long shot. But as policy questions become increasingly complex, it will be difficult for voters to understand the decisions that are being made about their lives. Bloggers will have an increasingly difficult time informing their readers about the issues. Indeed, the Internet will help to some the problem of educating the public, and informing discourse, but people are going to need more and more education just to understand the debates. Increasingly, we will see issues that are not merely either-or decisions, based upon one set of opposing principles. Rather, the issues placed before voters will be multifaceted issues that have wide implications in a variety of areas.
Dr. Rogoff concluded his article in FP by casting the health care cost issue as a manifestation of the struggle between capitalism and socialism:
(Note: The Rest of the Story/Corpus Callosum has moved. Visit the new site here.)
E-mail a link that points to this post:
Although estimates vary, it probably is reasonable to believe that the total cost of health care in the United States will rise to 30% of GDP within 50 years. Dr. Kenneth Rogoff writes in the latest issue of Foreign Policy:
As rich countries grow richer, and as healthcare technology continues to improve, people will spend ever growing shares of their income on living longer and healthier lives.The need for better information management is increasing at least as fast as the costs of healthcare. The are many reasons for this. For one, the number of medications is increasing every month. Two, the amount of information needed to prescribe these medications properly is increasing. As we learn more about how the drugs work, we understand better how they interact with each other. It is not feasible for physicians to remember all the potential interactions; computers are required for this. Also, as genomic medicine flourishes, we come to understand more about how individual patients vary in their response to medications. Managing that kind of information also is beyond the capability of the human brain. A good illustration of this is found in a recent issue of the New England Journal of Medicine:
U.S. healthcare costs have already reached 15 percent of annual national income and could exceed 30 percent by the middle of this century—and other industrialized nations are not far behind.
Life-threatening opioid intoxication developed in a patient after he was given small doses of codeine for the treatment of a cough associated with bilateral pneumonia. Codeine is bioactivated by CYP2D6 into morphine, which then undergoes further glucuronidation. CYP2D6 genotyping showed that the patient had three or more functional alleles, a finding consistent with ultrarapid metabolism of codeine. We attribute the toxicity to this genotype, in combination with inhibition of CYP3A4 activity by other medications and a transient reduction in renal function.Another factor complicating the information management problem is the issue of drug formularies. Different patients have different insurance plans, and each plan has different coverage for different medications. These formularies change at least once per year. As a result, a prescription that is appropriate for one patient may not be appropriate for the next, virtually identical, patient. Again, it is not possible for a physician to remember all these details.
As if the information management challenge is not already great enough, there is another complication that is emerging, as the practice of medicine becomes more sophisticated. Certain drugs can be prescribed safely only by certain physicians, those with special qualifications in the management of particular disease states. Clozapine is a good example. It is the most effective drug we have for treatment of schizophrenia. However, it causes neutropenia in about 2.5% of patients. Neutropenia can be fatal.
In order to prescribe clozapine, a physician must register with a national database. Each patient must register as well, along with the patient's pharmacy. The patient has to get a blood count done, and the results must be transmitted to the laboratory, before each prescription can be filled. This system enables us to treat persons with treatment-resistant schizophrenia safely.
Clozapine was discovered a long time ago, I think in the 1960's, but it was not approved by the FDA until the 1990's. What enabled the FDA to approve it was the development of technology for the storing of all the pertinent information (computers), as well as the timely transmission of this information (fax machines).
Clozapine is not the only example. Alosetron is a medication for the management of irritable bowel syndrome. After it was released on the market in the US, there were a few fatalities caused by bowel obstruction. It was pulled from the market, not because it is more dangerous that clozapine, but because the condition for which it is used, IBS, did not seem to warrant the risk. Patient advocacy groups complained, and it was reintroduced. When it was reintroduced, however, it was marketed in the context of a special prescribing program (1 2).
As more medications are marketed with such restrictions, and more information is needed about each medication and each patient, and as insurance issues become more prevalent, the complexity of the information management problem increased exponentially.
As mentioned previously, there will be cost savings. I haven't seen a cost analysis, but there is little doubt that these programs save money. Those interested in the topic may want to see Mark A. R. Kleiman's post about the concept of special rules for the prescribing of various medications. He focuses on the problems with drug safety that could be managed by such systems, but certainly any safety improvements would be accompanied by cost savings. Doug, posting on Lines in the Sand, has some additional thoughts on the subject. He points out the role of pharmacists in overseeing patient safety issues.
Back to the issue of health costs: the costs are going to keep going up. In fact, it seems likely that the total cost of providing health care in the country will rise so long as money is available to pay for it. I don't see any reason to think that the costs will reach a plateau, ever. What this means, is that when the economy is doing well, costs will go up. When it is doing poorly, the costs still will be there, but the means with which to pay them will not. Therefore, we can predict that periodic crises will occur with each iteration of the economic cycle.
Admittedly, I don't have any bright ideas about how to prevent these crises; in fact, if I am right, there isn't any way to prevent them. All we can do is manage them. This has several implications.
Implication #1: People are going to have to accept health care rationing. This actually is not news; health care rationing exists now, and always has. The health care system never has been large enough to deliver all the services that people need. It probably never will be. It's just that, so far, most people have managed to convince themselves that problems with access to health care are isolated problems with the system.
Implication #2: Health Care rationing will become more widespread, and will be a major issue of political contention. Today's NYT has an article about contemplated changes in Medicaid financing. this gives us a small taste of the enormity of the issue:
The cost of New York's Medicaid program has risen $14 billion, or about 46 percent, in the last five years, making it the most expensive in the country, state officials say.Implication #3: Innovation in health care will be stifled. As stated in the FP article:
But Medicaid cuts have long proved unpopular with state legislators - and not just with Democrats. Medicaid dollars are a major part of the operating budgets for hospitals, nursing homes and home care providers that serve middle-class communities, many of them in Republican districts.
But if all countries squeezed profits in the health sector the way Europe and Canada do, there would be much less global innovation in medical technology. Today, the whole world benefits freely from advances in health technology that are driven largely by the allure of the profitable U.S. market. If the United States joins other nations in having more socialized medicine, the current pace of technology improvements might well grind to a halt.Implication #4: Health care priorities are going to be harder to figure out. There will be a shortage of persons qualified to hold policymaking positions, as the issues become more complex. For example, when the HIV/AIDS crisis began, we were able to meet it with substantial funding increases. Some may argue that the increases are/were not large enough, but the fact is, we were able to get a major research program up and running fairly quickly. Such choices are going to be much more difficult in the future, as we face increasingly difficult choices between paying for the health care needs we have now, preparing for the needs of the future, and meeting new challenges. As if that is not bad enough, as climate change progresses, new challenges are likely to come up more frequently. Currently, how many people do we have who are knowledgeable about economics, public health, epidemiology, pharmacology, and climatology?
Implication #5: The general public will have to become more sophisticated about policy matters. Ok, that one is a long shot. But as policy questions become increasingly complex, it will be difficult for voters to understand the decisions that are being made about their lives. Bloggers will have an increasingly difficult time informing their readers about the issues. Indeed, the Internet will help to some the problem of educating the public, and informing discourse, but people are going to need more and more education just to understand the debates. Increasingly, we will see issues that are not merely either-or decisions, based upon one set of opposing principles. Rather, the issues placed before voters will be multifaceted issues that have wide implications in a variety of areas.
Dr. Rogoff concluded his article in FP by casting the health care cost issue as a manifestation of the struggle between capitalism and socialism:
Ultimately, the case for some government intervention and regulation in health care is compelling on the grounds of efficiency (because costs are out of control) and moral justice (because our societies rightly take a more egalitarian view of health than of material possessions). The issue is precisely how much redistribution of income and government intervention is warranted. With the health sector on track to make up almost a third of economic activity later this century, the next great battle between capitalism and socialism is already underway.I'm not sure that I would put it that way. I would prefer to cast it as a struggle between reality-based and faith-based factions. The reason is this: the issues regarding health care financing are just too complex for simple political maxims to be useful. With simple issues, it might suffice to rely on a saying such as "smaller government is better." But the challenge of financing health care in the next half-century are much too complex for that approach.
(Note: The Rest of the Story/Corpus Callosum has moved. Visit the new site here.)
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