Most of us are now familiar with the estimates that as much as one-third of our health care dollars are squandered on ineffective, often unnecessary, unproven and overpriced products and services. But which third?
The fat in our health-care system is not hanging out conveniently on the edges of the steak, waiting to be trimmed. It will take a scalpel, a keen eye, and a steady hand to remove at least some of that fat.
This is why we probably don’t want to leave the job to Congress. Senator Jay Rockefeller has introduced legislation that would turn the job over to the Medicare Payment Advisory Commission (MedPAC), an independent panel formed in 1997 and charged with advising Congress on Medicare spending and quality of care. Members of the panel are selected by the Comptroller General, and currently include a number of physicians, a nurse, the head of the American Association of Retired Persons, a hospital CEO, an expert who specializes in aging, a healthcare consultant who specializes in Medicare and Medicaid issues, the executive director overseeing pensions and benefits at a healthcare workers’ union, and a professor of healthcare policy.
In Washington, MedPAC is generally viewed as apolitical, though industry lobbyists tend to be distressed by any recommendations that could cut into their revenues. One man’s avoidable hospitalization is another man’s income stream.
Rockefeller would give MedPAC authority to implement its recommendations. MedPAC would decide how much Medicare should reimburse doctors and hospitals for various services, and the panel’s annual recommendation would go to Congress for a simple, fast, up-or-down vote. Legislators would not have the power to make changes. Last week, President Obama indicated his support for Rockefeller’s plan.
Setting fees for doctors and hospitals . . . Isn’t this something our elected representatives should be doing?
Consider what Congress has done in the past. In 1997, when it set out to contain Medicare spending, it decided that if Medicare’s reimbursements to physicians grow by more than a certain amount in a given year Medicare should slash all physicians’ salaries, across the board. This was a crude solution, so crude that the legislators themselves have repeatedly postponed making the proposed cuts.
Meanwhile, healthcare costs continue to spiral. Both private insurers and Medicare are paying billions for ineffective care. We are not just talking about throwing healthcare dollars to the wind: this is hazardous waste. Every time a patient is subjected to an unnecessary or ineffective treatment he or she is, by definition, exposed to risk without benefit.
But as Senator Rockefeller recently told the Washington Post, Congress just doesn’t have the skills needed to excise the waste without harming the quality of U.S. care: “We must take Congress out of its current role. It is inefficient and ineffective. We are not health-care experts, and being a deliberative body means that we cannot keep pace with the rapidly transforming health-care marketplace.”
In a recent Senate Finance Committee meeting Rockefeller was even more candid: “ . . . the best way to take politics out of all of this is to take Congress out of setting [Medicare reimbursements]. There is a group of 17 . . . completely dispassionate people,” who could do this, Rockefeller added, referring to MedPAC.
MedPAC knows where to look for spending that doesn’t benefit patients. It understands the importance of medical evidence. It knows that Medicare Advantage insurers don’t deserve the windfall bonuses they are receiving. They simply are not delivering better quality care to seniors. And it recognizes that Medicare needs to hike its payments to primary care physicians, while trimming fees for certain specialists’ services that are done too often, in large part because they are so lucrative.
Maggie Mahar is the author of Money-Driven Medicine: The Real Reason Health Care Costs So Much. A film adaptation of her book by Academy Award-winning documentary producer Alex Gibney (best known for Taxi to the Dark Side and Enron: The Smartest Guys in the Room) will premiere in New York City on Thursday, June 11th. Admission is free.
The film, which stars Drs. Don Berwick and Jim Weinstein, along with many other doctors and patients, focuses on healthcare waste.
