Summer Journal Club, Week 6: Problems, Part 1

by Allan Joseph

Welcome to Week 6 of Project Millennial’s summer Journal Club. Previous posts can be found here. This week, we shift from studying one or two papers at a time to exploring bigger-picture questions. We begin by discussing some of the problems with the American healthcare system that nearly everyone agrees on. Because the Affordable Care Act has largely not taken effect yet, this post will mention problems that may be addressed by the ACA down the road.

When you’re talking about a healthcare system, there are three things to consider that pretty much capture everything you care about: cost, quality, and access, concepts which originally come from the Institute for Healthcare Improvement’s Triple Aim Initiative. These are very simple concepts: how much does the system cost, how good is the care it delivers, and who has the ability to get that care? Because they’re simple, they’re the lens we’ll use to look at the American system. Without further ado, some problems nearly everyone agrees are problems:

COST

Americans pay more for their healthcare than everyone else. Check out this chart, which Dr. Aaron Carroll put together. It graphs health spending as a percentage of GDP for all 31 OECD members, commonly referred to as “industrialized countries.” The United States spends far more of its economy providing healthcare to its residents, compared to every other industrialized nation in the world.

You’re never quite sure what you’re paying. There are two problems here. First, list prices for the same procedure can vary widely between hospitals. This fact has been in the news quite a bit recently, first with TIME magazine’s March cover story and then when the federal government released the prices hospitals charge Medicare for various procedures. Second, even at the same hospital, different people pay different prices for the same procedure depending on their insurance status/carrier, with the uninsured paying the most, at least on the face of it. The uninsured do often receive charity care, and hospitals often write off uncollectable payments as bad debt. Even with the large variation, prices are still higher in America than in other places.

Private health insurance premiums have been rising for some time. The Kaiser Family Foundation reports that health insurance premiums have been rising faster than inflation for at least the last 13 years, with cumulative increases in premiums of 172% and cumulative inflation of only 38%. This has coincided with a drop in the number of firms who offer health insurance, and could be discouraging firms from hiring.   

Healthcare costs are the primary driver of the projected long-term budget deficit. The Congressional Budget Office projects Medicare spending will continue to consume a larger portion of GDP each year for the next several decades; helpful graphs of the CBO’s projections can be found here. Of course, this is one of the reasons people fight so much about healthcare.

QUALITY

The American system has the best technology in the world. This is sort of cheating, since this isn’t really a problem. But as we’ll see next week, there’s a debate over exactly how good the American healthcare system is, so it’s worth noting that in America, cutting-edge technology is widely available.

Not all treatment is necessary. Some estimates say $200 billion is spent each year in America on unnecessary treatments, which can decrease quality of life in addition to driving up costs. The American healthcare system is uniquely suited to incentivize overtreatment due to a variety of factors, including the way its physicians are trained and the fee-for-service payment model, which incentivizes physicians to treat more.

Medical errors are still a problem. In 1999, the Institute of Medicine published a seminal report on medical errors, estimating that tens of thousands die each year due to preventable medical errors. While things have gotten better, there’s still lots of room for growth

ACCESS

Millions of Americans are uninsured. About 18% of the non-elderly population in America is uninsured, which translates to about 50 million Americans. Thanks to Medicare, however, the elderly have universal coverage. The uninsured are disproportionately poor, though 62% of the uninsured have at least one full-time worker in their family. This is one of the major problems the Affordable Care Act was meant to address, though even its proponents don’t think it’ll provide insurance to every last American, especially given states’ options on Medicaid. A recent estimate has about 30 million Americans uninsured in 2016, down from an estimated 56 million in 2016 before the law took place.

Uninsured Americans can get emergency care, but other care is rare. Thanks to a Ronald Reagan-era law, hospitals are required to treat and stabilize any patient who comes into their doors, regardless of insurance status, and while they can bill the patients for these services, hospitals generally don’t put a lot of resources into collecting on those bills. Uninsured and “underinsured” Americans, however, can rack up large amounts of debt for their care, whether it’s an emergency or not, and medical debt is a big reason for bankruptcy. This is why uninsured Americans generally have no source of regular healthcare, and many postpone or go without care due to its cost.

Having access to insurance isn’t the same as having access to quality care. Simply having health insurance doesn’t mean you can get healthcare — you need to be able to see a doctor, and that doctor needs to provide you with quality care. Finding a doctor isn’t necessarily easy, as trends point to a looming shortage of both primary-care and specialist physicians. In addition, this Health Affairs paper discusses why insurance is no guarantee of quality care (among many other “myths” — the paper worth a full read if you can get your hands on it).

So those are some of the problems people tend to agree on when discussing the American healthcare system, and they’re big ones — but just wait to see what next week has in store.

Next week: What are some of the facets of the American healthcare system that are problems to some people, and not to others?
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Allan Joseph is a first year medical student at the Warren Alpert Medical School of Brown University, where he is pursuing an MD/MPP. You can follow him on Twitter @allanmjoseph.

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