In a recent New England Journal of Medicine article, Drs. Pater Orszag and Philip Ellis talk about the problems with our health care system that no candidate for the Presidency of the United States is truly addressing. It is nice to talk about universal healthcare but we can’t do it on the backs of our children and destroy our economy. They propose two simple (if that is possible) measures to begin to reign in our medical costs.
First off, there is little strong research on treatment comparisons between expensive and cheaper therapies. One example I always use is how insurers are willing to cover the expense of the drug Nexium® which can run hundreds of dollars a month over Prilosec® which is over-the-counter and runs under $50 a month. Why? For two reasons one is that the pharmaceutical industry is more about profits and less about improving the health of people. The second issue the authors bring up is that there is no incentive to cut costs.
At my last few lectures, I noted that insurance companies have no reason to cut costs as long as payments, in the form of your health insurance premiums are greater than costs. The incentive is actually to perform more expensive procedures because the higher the cost, the higher the premiums charged and the more money there is to enrich the stockholders and meet Wall Street’s expectations. If their profit margin is to make 18% for each dollar they spend because they will only charge you more in premiums, what procedure would you think they would want to pay for, one for $1,000 or $100? Yup, the more expensive one.
While I am not a big fan of government intervention, it is imperative it happens here before economic disaster occurs. The idea that industry and the free market will benefit society and that trickle down economics benefits the greatest number in our society are two ideas who need burial. Trickle down is what George Bush Sr. once called “voodoo economics”. Free market is a nice idea, but the bottom line is that excessive greed does not benefit the greatest number of people when it comes to medical care.
Incentives to cut costs, independently measure efficacy in treatment protocols, not just those limited to pharmaceutical models needs to be put in place. We don’t need another male libido drug, we need better treatment for staph, tuberculosis and other deadly diseases that may not be financially enriching for the pharmaceutical industry.
We need more preventive health care, more dietary interventions to stem the tide of obesity and we need to stop the rampant polluting of our environment by greedy, profit above all businesses. We do these things and bite the bullet and we will save our future. Will we? I seriously doubt it unless we elect a leader with enough personality to have the populace back the reforms necessary.