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Macro Economics
Nine Patients, 2,700 ER Visits, Three Million Dollars

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By AlanK
April 2, 2009

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Just nine people accounted for nearly 2,700 of the emergency room visits in the Austin area during the past six years at a cost of $3 million.

I don't know what the answer is but some of these problems must be addressed if we are to tackle our skyrocketing medical costs. Examples like the above will require lots of imaginative out of the box programs that will utilize services that themselves will threaten runaway costs if left unchecked.

- A small number of patients routinely uses the majority of services either due to ignorance or, more commonly, multiple, complex co-morbidities. How do these patients get guided to more appropriate facilities, take responsibility for their own health when their problems are self induces and get the right kinds of treatment that does not waste services?

- Electronic medical record systems will help. But EMR's will not come remotely close to solving runaway costs. They will reduce some expenses due to inappropriately prescribed drugs, easier and instant access to records and duplication of testing due to unavailable records but, in the scheme of things, those are significant but not huge problems.

- Reducing the costs of administration will mostly provide a savings drop of perhaps 20% if every possible penny is squeezed out of the system. The expenses due to more complex care will continue to rise. The irony is that as doctors can save more patients, they live longer and experience diseases they never lived long enough to see before.

- Rationing care is politically explosive (we are already rationing care based on income) but it is the only way that costs will be brought under control. The challenge is where one draws the line. 90 year olds with metastatic liver cancer need lots of morphine. A 2 year old with the same might be treated much differently. Today it often depends on what the family wants. Dead patients don't sue. But their living families do all the time. Doctors respond accordingly.

- The costs of liability insurance continue to grow. The indirect costs of tests and treatment that are performed to forestall lawsuits (defensive medicine that often offers little benefit) are probably as large or larger that the direct costs. Nobody gets sued for getting an MRI even if it is often not needed. But what if there were criterion for various conditions where the doctor knew that if they followed established protocols for that condition then a lawsuit could not move forward? How does one establish these criterion in a field that is always changing without stunting the growth of that field?

- How much is a doctor worth? What is any procedure worth? How does one fairly compute the value of any medical service? How do you continue to attract the best and the brightest when salaries are dropping?

- How do we prevent the law of unintended consequences from ruining medical care e.g. if you pay doctors based on their "success" in treating patients they will rate patient's diseases as worse than they really are (upcoding) and turn away the sickest so their own ratings don't get hurt (sorry sweetheart, there's nothing more that can be done). When you pay doctors based on the condition instead of the treatment the treatment may change and not necessarily for the better (here dear, take these Ibuprofen for you arthritic hip, you don't really need that hip implant or you're really not a good candidate for a hip implant).

These questions and more will need answers if we are ever to solve the problem of out of control medical expenses. Just some thoughts stimulated by the article on wasteful spending in Texas.