If You Read Only One Thing This Week

It Should Be This

In it, Dr. Atul Gawande of The New Yorker pens possibly one of the most informative articles on healthcare this year. It’s quite lengthy, but if you’re even remotely interested in universal healthcare (either for or against)then this will probably become required reading as it addresses some of the inherent problems in the US model of healthcare delivery. Problems that must be addressed regardless of whether healthcare reform is passed later this year.

Full article is here, and is well worth your time. My quick synopsis is below the fold:

Summary

Dr. Gawande’s focus throughout the article is on McAllen, TX, which apparently is the 2nd most expensive city in America for healthcare (Miami is 1st), and the factors that led to this distinction. I can’t say this immediately surprised me however, due to the often cited loophole in our current system being that illegal immigrants and the uninsured receive “free” healthcare by frequenting the ER. This argument is quickly debunked however when the author compares McAllen to El Paso, demographically identical cities except that El Paso’s Medicare cost/enrollee is roughly half that of McAllen.

The author later asks the $1 trillion question to a local physician about whether switching to a single-payer government model would work. Here’s his response

“I don’t have a problem with it,” he said. “But it won’t make a difference.” In McAllen, government payers already predominate—not many people have jobs with private insurance.

So it seems, as Dr. Gawande’s opus describes, that one of the key problems in our current healthcare system is yet another example of a misalignment of incentives (something we've all seen play out in the financial world over the past nine months):

When you look across the spectrum from Grand Junction to McAllen—and the almost threefold difference in the costs of care—you come to realize that we are witnessing a battle for the soul of American medicine. Somewhere in the United States at this moment, a patient with chest pain, or a tumor, or a cough is seeing a doctor. And the damning question we have to ask is whether the doctor is set up to meet the needs of the patient, first and foremost, or to maximize revenue.

There is no insurance system that will make the two aims match perfectly. But having a system that does so much to misalign them has proved disastrous. As economists have often pointed out, we pay doctors for quantity, not quality. As they point out less often, we also pay them as individuals, rather than as members of a team working together for their patients. Both practices have made for serious problems.

If you’re interested in learning why patients in Grand Junction receive higher quality care at less than half the cost, or why there is an inverse relationship between cost and quality of care across the board then click here to get your learn on (as the kids like to say). Personally, as many universal healthcare advocates smarter and more informed than I am often cite the cost savings inherent in a European style system, the section of the article describing how the Mayo Clinic already manages to accomplish this is more than enough of a reason to do so.