Is the Emergency Room the Backdoor to the Healthcare System?

Let's start with some common healthcare wisdom. Basically, insurance is required to enter the healthcare system. However, the uninsured need healthcare too. Since 1986, the Emergency Medical Treatment and Active Labor Act (EMTALA) has required emergency departments to treat everyone, regardless of whether they have insurance. Anecdotally, this resulted in overcrowding of EDs (no, not that ED), with one third of ED visits being for nonurgent care. So common wisdom in healthcare says that EDs are being used as a backdoor to the healthcare system for the uninsured.

This makes perfectly rational sense However, a recent study in Health Affairs prooves this backdoor to be a myth.

Insurance, demographic, socioeconomic, and health factors are strongly related to individuals’ ED use, although some of these results run contrary to popular perceptions. For example, in 2003, the uninsured had about sixteen fewer visits on average (per 100 people) compared to Medicaid enrollees, about twenty fewer visits compared toMedicare enrollees, and roughly similar levels of use compared to privately insured people. Noncitizens had much lower levels of ED use than citizens did (about 17 fewer visits per 100 people, on average), and the difference between poor citizens and noncitizens was almost twice as large. In terms of racial/ethnic differences, blacks had higher ED use levels than whites and Hispanics did in 2003. More in line with expectations was the higher ED use by poor people (less than 100 percent of poverty) compared to other income groups, and higher ED use by people in fair/poor health and with chronic medical conditions.

So much for conventional wisdom.

The largest indicator of nonurgent ED use? Regional variation. So it seems that utilization of EDs for nonurgent care has a lot more to do with social norms and patient preferences than particular failures of the healthcare system. Another signifcant factor was the availabilty of outpatient facilites.

It cannot be doubted that the uninsured are looking to EDs for nonurgent care, which is a clear failure of the healthcare system. However, the problem of ED overcrouding needs to be corrected with an commecial expansion of outpatient facilites and, most importantly, education into the complex workings of the healthcare system.

Creating a Market for Healthcare: Information

The Boston Globe Reports:

State public health officials will decide this summer whether to publicize the patient death rates for individual physicians who perform two common heart procedures, giving Massachusetts patients unprecedented information about their doctors' performance.
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But many Massachusetts cardiac surgeons and cardiologists strongly oppose making the mortality data available to consumers, saying this approach could actually hurt care by discouraging doctors from taking high-risk patients who are more likely to die. They are pressing health officials to keep private one of the most detailed and carefully analyzed physician data sets in the country.
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Advocates of public reporting believe that it holds providers accountable for the billions of healthcare dollars spent annually and helps patients decide where to seek treatment, creating market pressure on providers to improve care. This is especially important for common procedures like cardiac surgery and angioplasty, which are often planned for months in advance, giving patients time to shop around.

Without a doubt, one of the reasons that healthcare does not work like a regular market is because of information asymmetries. Now, I'll fully admit that asymmetrical information is an essential feature of healthcare; if you knew as much about medicine as your doctor, you wouldn't need to visit him. Nonetheless, there is a dearth of information about the price and quality of healthcare. How can consumers express their preferences in a marketplace that lacks this information?

For example, a close friend of mine recently bought a Dodge Magnum. He knew about how much it would cost. Since the Magnum is a new model, he knew that he could not develop long term cost expectations. He was able to obtain this information quickly and without much effort.

Have you ever tried to find this information in healthcare? Simply put, it is near impossible to find the cash value of most procedures. With a bit of savvy (and a strong background in human biology), one may be able to research the outcomes of a certain procedure. However, it is quite rare that one can find data on the quality of a physician.

Professional medicine has consistently resisted the reporting of quality data. The nominal reason is that reporting will lead to selection biases within the data. Personally, I think that this is yet another protectionist policy.

So, I applaud Massachusetts for making this data available. Too bad this step forward merely mitigates two steps back.

Arnold Kling Gets Cold Feet Over Bioethics

In this week's The New Republic, bioethicist Ezekiel Emanuel commented on provinding experiemental treatments to cancer patients (behind a subscription wall):

Getting Virginia another experimental drug was not going to stop her breast cancer from growing and eventually killing her. I gently explained to her that investing all her energy chasing after another unproven drug was not going to help her and her family. Virginia was disappointed and refused to consider hospice, because she saw it as giving up. Holding her hand, I talked to her about spending time with her husband and daughters and making a videotape for her future grandchildren. We also discussed getting visiting nurses to come to her house. I saw her once more in my office. She was more accepting and found at least some of the activities meaningful. Because of her failing liver, less than three months later, she lapsed into a coma and died with her family present.

In "Is Bioethics an Oxymoron?," Arnold Kling comments at Cato@Liberty:

If I decide that I want to fight rather than go down graciously with a terminal illness, I will look for a doctor who is not a bioethicist. I found this article so chilling that it leaves me nearly speechless.

Where I disagree with Dr. Kling is that I think that non-treatment can be ethical, even if the patient wants "everything done." I would say most of the questions in bioethics deal with death and dying. The simple fact is everyone dies (Keynes was right about something, at least until we become post-human). Another simple fact is the vast majority of people want to live and not die.

The ethical question is: what constitutes a good death? This is probably a question that needs to be answered individually. Personally, I don’t want a long, drawn out death filled with pain and suffering. For cancer patients, there’s always another experimental treatment to generate a remote hope. Furthermore, both the patient and their family are understandably distressed, which is not conducive to rational decision making. Unfortunately, sometimes a clinical ethicist needs to come in and suggest that one’s last days may be better spent with one’s family and friends preparing for death, rather than incapacitated with toxic chemotherapy.

Anti-competition in Pharma, pt. 2

Earlier this week, the Washington Post reported:

Some at the FDA, as well as leaders in the generic drug industry, complain that "citizen petitions" -- requests for agency action that any individual, group or company can file -- are being misused by brand-name drugmakers to stave off generic competition.

The simple act of filing a petition, they say, triggers another round of time-consuming and often redundant reviews of the generics by the FDA, which can take months or years. In the process, consumers continue to pay millions of dollars more for the brand-name drugs.

I'm shocked! Are you telling me that Big Pharma is playing the system?

Here's a novel idea: change the system of drug intellectual property to one of copyright. The typical response to this is that there would be reduced incentive to produce new drugs. Perhaps, but I think that there's enough money in healthcare (15% of GDP!) that advertising rights is enough incentive. Furthermore, we can get past this silly system that allows ownership of a molecule!

How Not to Limit Medicaid Spending

Starting tomorrow, proof of citizenship is required for Medicaid benefits. The Washington Post reports:

The new provision is part of last year's Deficit Reduction Act, which President Bush signed into law in February. Despite a federal inspector general's report concluding that there was little fraud by noncitizens, supporters said the measure would ensure that Medicaid dollars go only to citizens or eligible immigrants. [Empasis mine]

You have to give the Republicans credit, it's not too often that you can combine zenophobia with an illusion of healthcare reform.

The simple fact is, this mesaure is bad for the poor. As if the health care system isn't already too difficult to navigate, many Medicaid eligable forgo care becuase they fail to navigate the Medicaid beauracacy. While the healthy need not register for Medicaid, there is a class of Medicaid eligable who need healthcare. Proof of citizenship only adds another barrier.

Anti-competition in Pharma

The Health Business Blog notes that big pharma has a number of ways of squeezing out generics:

Branded pharmaceutical companies have pioneered a number of clever techniques to repel generic competition: lawsuits that ensure delay of generic entry and threaten financial ruin for generic makers, next generation products (think Nexium) that are subtle variations of products losing protection, and authorized generics that effectively cut the market in half during the traditional period of exclusivity enjoyed by the first generic entrant.

Well, add to that list undercutting, since Merck is apparently exhibiting that classic oligopolistic behavior. The patent on the satin drug Zocor is running out, and Merck is pricing it at the lowest level possible. Meanwhile, the generic from Teva will be on the highest tier.

I wonder how a company with as few resources as Merck will be able to absorb this cost...

Coming Soon: National Patient Identification

When I first read HIPAA, I must of totally missed the identification requirements. Here's the money sentence (emphasis mine):

The Secretary shall adopt standards providing for a standard unique health identifier for each individual, employer, health plan, and health care provider for use in the health care system.

Holy crap, we're going to be assigned a number just to get healthcare. Nobody should need a number to receive healthcare.

I presume they'll use SSNs. SSNs were not supposed to be used for identification, yet they're used for tax identification, obtaining IDs (REAL ID Act) and for eligibility for other entitlement programs: HUD and Medicare/aid.

National Provider Identification

The Health Insurance Portability and Accountability Act (HIPAA) was a law passed by congress with the intention of protecting patient privacy. However, it has been routinely criticized for being overly vague and requiring more medical bureaucracy where there is already excess.

One of the lesser know provisions of HIPAA requires doctors to receive a National Provider Identifier (NPI). The NPI is administrated by Centers for Medicare and Medicaid Services (CMS), as this identifier will be required for all Medicare/aid payments. Although HIPAA is supposed to be simplified, the "simplified" version of the NPI is 36 pages.

Clearly, this is an unnecessary intrusion. There is no need for the federal government to keep tabs on doctors in such a systematic fashion. While I can see how this may reduce fraud, the responsibility for fraud reduction should lie with the states who administer the distribution of Medicare/aid funds anyway.