Comments on: HEALTH SPENDING: CBO On A Mission

By: annecarroll

annecarroll — Mon, 21 Apr 2008 21:14:30 +0000

Peter Orszag needs to go further; for example, if he is really sincere about evidence-based medicine and the value of comparative effectiveness research of new technologies (including drugs), and if he is truly impressed and outraged by the findings of the Dartmouth Atlas project, then he needs to point to the logical conclusion that public funding in several places needs to be beefed up:

1) NIH should resume its role as an independent researcher and take it out of the hands of industry and industry-funded FDA;
2) AHRQ, which is currently trying to establish evidence-based practice guidelines based on consensus and doing meta-analyses of the published research (which we know is influenced by industry funding), is sorely understaffed and under-resourced and can only be reactive, rather than proactive;
3) The Public Health Service and CDC are continuing to have funding taken away in favor of Homeland Security’s wasteful and ineffective programs, thus short-circuiting their ability to do their own independent research;
4) spreading the experience and successes of the Veterans Health Administration in controlling costs, improving service delivery quality and patient safety, and ranking highest in patient satisfaction of any US healthcare system.

In addition, perhaps Orszag’s analyses and reports can stem the tide of privatization of Medicare (12%-13% higher costs for the same care and no better health outcomes) and John McCain’s idea to privatize the VHA.

By: Low Cost Life Insurance In The Us

Low Cost Life Insurance In The Us — Fri, 01 Feb 2008 13:59:50 +0000

Heavy drinking can increase life insurance costs.

Britons are drinking too much, shout the headlines. Out of those who live in Great Britain, two thirds say they drink to excess at least once a week and almost a quarter hurt themselves while they are intoxicated. This is according to a report by the D…

By: Thomas Barber

Thomas Barber — Mon, 03 Dec 2007 23:08:18 +0000

The CBO is on the right track. Within Kaiser Permanente we have seen a dramatic rise in the number of patients getting joint replacement surgery. Total joint replacement is one of the top areas of spending for Medicare and will be for decades to come. The increase of 10-12% a year in number of total joints being done was thought initially to be due to the aging of our population – untrue on further scrutiny. Our examination of our total joint population shows that more patients in every age range are getting more total joints done. Each patient’s philosophy has changed – everyone wants to be as active as they can be as they age and these procedures are becoming more and more common at an earlier age. The penetrance – ie the percent of a given population that has experienced a total joint replacement- is rising dramatically in every decade of life. This is due to an emphasis on more active life styles, direct to consumer advertising, more “minimally invasive” techniques, and a perception of safer surgery. It doesn’t help that prosthetic vendor profits are expanding rapidly on unproven technology such as the gender specific knees. The cost of the implants go up every year due to “improvements” when the most durable total hip prosthesis in the Swedish Total Hip Registry is a 20 year old design.

Why don’t we have a national prosthetic or implant registry? I think we are scared of the results and uncomfortable saying that those improvements that cause a rapid rise in prosthetic costs are actually not really worth it. Medicare could save millions by having just a total joint registry, to say nothing about the patient morbidity saved, and much more if all implantable devices were included.

Slowing the rate of increase in costs will demand a rational policy around technology development – one that encompasses changes in new product reviews by the FDA (demanding efficacy not just safety), changes in monitoring of already released techology (an implant registry), and strict conflict of interest policies for physicians involved in implanting devices.

In every other industry the cost of new technology drops significantly over time. Not true for medical devices – the costs just keep going up and up. This points to a structural problem. Lets have the courage to take it on.

By: Health Care BS » Blog Archive » CBO Crisis Mongering

Health Care BS » Blog Archive » CBO Crisis Mongering — Sat, 17 Nov 2007 12:56:33 +0000

[...] So, how did the folks at the CBO produce such dire projections? They arbitrarily decided to include the 1975 to 1990 excess cost growth figures in their average. In other words, their projections assume a growth rate that far exceeds actual experience for the last decade and a half. This statistical skullduggery is what allowed the CBO to produce a much bleaker spending projection than did the Medicare Trustees. The latter group projects a trajectory for excess cost growth that is much more in line with what has actually been happening since 1990. Naturally, the usual suspects are claiming that the CBO report confirms the need for drastic reform (i.e. more government meddling in the health care market). More proof that Disraeli was right. [...]

By: Brad Kirkman-Liff

Brad Kirkman-Liff — Tue, 13 Nov 2007 22:20:51 +0000

It may be “excess cost growth” to Congressional Budget Office (CBO) director Peter Orszag, but it is “revenue and profit growth” to entrepreneurs, medical device manufacturers, biopharmaceutical researchers, physician group practices, commercial laboratories and hospital networks, as Uwe Reinhardt observed decades ago.

The implementation of limits on access to services based on comparative effectiveness evidence is complex. European health systems have addressed these issues for the past 30 years, while the US health system has engaged on a technological spending spree fuelded in part by unconstrained prices.

Americans do not want their choices limited. Regardless of the future form of health insurance (be it based on tax credits or vouchers for the individual purchase of insurance, purchase through regional “Connectors”, or some employer-based system still alive on life support) people will be allowed to purchase ineffective care privately. Will supplemental insurance be available to pay for such purchase ineffective care? If so, will it enjoy any tax-advantages? Those are the difficult question to be answered.

The cost of technology can rapidly decline, and anyone who has performed cost-effectiveness analysis knows that a 50% reduction in the cost of a technology can change the outcomes. Some models of pharmaceutical pricing look at quality-adjusted life years gained by oncology drugs to determine their price. Should comparative effectiveness be added to the FDA’s remit? Probably not – but whose then?

Managed care effectively slowed spending growth in the 1990s. It will not return – under that name. Frank Luntz described “managed care” as an example of one of the worst phrases for a policy initiative – and he is right. No one wants their care managed, just as no physiician want her decisions concerning patients monitored and second-guessed by clerks. Collaboration and sharing of knowledge to promote effectiveness is what may reduce costs, combined with effectiveness research.