The ultimate fix to the American healthcare system

One of the priorities of the new Obama administration is to reform the healthcare system in the United States. Statistics show that while the US spends the most per patient, the quality of that care is less than in those countries that spend less than we do. An article in the New Yorker magazine discusses what can be done to fix our broken system and the answer might surprise many people on both sides of the issue.

Atul Gawande, a doctor, writes in his article “The Cost Conundrum” about McAllen, Texas. Based on data from several sources it is one of the most expensive health-care markets in the country.

In 2006, Medicare spent fifteen thousand dollars per enrollee here, almost twice the national average. The income per capita is twelve thousand dollars. In other words, Medicare spends three thousand dollars more per person here than the average person earns.

“The Cost Conundrum”

Gawande took a look at why McAllen was so expensive and if that spending resulted in better patient outcomes.

And yet there’s no evidence that the treatments and technologies available at McAllen are better than those found elsewhere in the country. The annual reports that hospitals file with Medicare show that those in McAllen and El Paso offer comparable technologies—neonatal intensive-care units, advanced cardiac services, PET scans, and so on. Public statistics show no difference in the supply of doctors. Hidalgo County actually has fewer specialists than the national average.

Nor does the care given in McAllen stand out for its quality. Medicare ranks hospitals on twenty-five metrics of care. On all but two of these, McAllen’s five largest hospitals performed worse, on average, than El Paso’s. McAllen costs Medicare seven thousand dollars more per person each year than does the average city in America. But not, so far as one can tell, because it’s delivering better health care.

Gawande then visited the Mayo Clinic in Minnesota, which has the lowest cost but has the best quality:

The core tenet of the Mayo Clinic is “The needs of the patient come first”—not the convenience of the doctors, not their revenues. The doctors and nurses, and even the janitors, sat in meetings almost weekly, working on ideas to make the service and the care better, not to get more money out of patients. I asked Cortese how the Mayo Clinic made this possible.

“It’s not easy,” he said. But decades ago Mayo recognized that the first thing it needed to do was eliminate the financial barriers. It pooled all the money the doctors and the hospital system received and began paying everyone a salary, so that the doctors’ goal in patient care couldn’t be increasing their income. Mayo promoted leaders who focused first on what was best for patients, and then on how to make this financially possible.

So basically the answer to fix our system isn’t single payer or private insurance making decisions on care. The answer is to remove the profit motive from medicine all together. The whole system would pool the money coming in to pay for treatment and those who do the treatments would be paid a salary. What treatment would be used would be decided within a group, sharing data of what works and what doesn’t and so on with the mantra “The needs of the patient come first”. There would be an emphasis on preventive care.

As the article reports many doctors and medical providers see patients as a revenue stream to be squeezed as much as their insurance allows. On the other hand the insurance companies try to squeeze as much profit out of premiums paid by nickel and diming the decisions the doctors make. Neither approach addresses the problem of high cost and low quality results. The patient loses in the end.

Of course Gawande leaves one question unanswered. Who will be in charge of this new healthcare system?

Dramatic improvements and savings will take at least a decade. But a choice must be made. Whom do we want in charge of managing the full complexity of medical care? We can turn to insurers (whether public or private), which have proved repeatedly that they can’t do it. Or we can turn to the local medical communities, which have proved that they can. But we have to choose someone—because, in much of the country, no one is in charge. And the result is the most wasteful and the least sustainable health-care system in the world.

I found a lot of interesting points in the article to consider. Does Gawande’s “fix” look good? I think it does but like the last quote I think we need to decide who will be in charge.

I think the Federal government is a good choice just because it is able to marshal the resources to write and setup regulations that would be needed even though those regulations would be written by people who actually treat patients. They have been managing Medicare for years so they could do health insurance for the rest of us. The money would pool together would be safe from all but the worse economic storms.