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Atul Gawande on American Health Care

I'm jealous of Atul Gawande's article on medicine in America. I wish I had written it. I wish I could write it. But I didn't, and I can't. You, however, should read it. It's the best article you'll see this year on American health care -- why it's so expensive, why it's so poor, what can be done.

Indeed, it's good enough that I'm not going to quote from its core point because I don't want to try to summarize the piece. I want you to read it. But I will quote from a discussion Gawande has with a couple of physicians in McAllen, Tex. He's asking them why health costs in their county are so high.

“It’s malpractice,” a family physician who had practiced here for thirty-three years said.
“McAllen is legal hell,” the cardiologist agreed. Doctors order unnecessary tests just to protect themselves, he said. Everyone thought the lawyers here were worse than elsewhere.
That explanation puzzled me. Several years ago, Texas passed a tough malpractice law that capped pain-and-suffering awards at two hundred and fifty thousand dollars. Didn’t lawsuits go down?
“Practically to zero,” the cardiologist admitted.

By Ezra Klein  |  May 27, 2009; 12:02 PM ET
Categories:  Health Economics , Health Reform  
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I just finished reading Gawande's article. It is the best article ever written about the problem of how medical care in this country is financed. To date, none of the health reform policies currently being discussed do anything to address the fundamental problem of why health care costs vary so much in different areas. I think it also points to the fact that it's easier for a medical doctor, as Gawande is, to ferret out and pinpoint the problem, as opposed to politicians who don't understand clinical medicine, treatments, and outcomes. The article clearly explains why the payer of health care, either public or private insurance, doesn't matter; it's the fundamental system of delivery that determines the efficiency and cost of medical care.

Posted by: goadri | May 27, 2009 1:00 PM | Report abuse

Ezra, thanks for linking this article. Eye opening and fascinating. It is amazing how sadly intuitive the problem is. Although it differs kind from the financial problems, environmental problems, and other crises we're facing, there is one common element: Greed, plain and simple. I think you could say that is the seminal, underlying problem in our society at this point in history. Funny how self interest is so intimately woven in to the fabric of modern capitalism. Coincidence?

Posted by: nwgates | May 27, 2009 1:12 PM | Report abuse

This article is even better than you realize. I am a diagnostic radiologist. I practice in Minnesota, which is one of the low cost areas identified in the article. Even here, there are some days when I think that about 50% of the MRI and CT scans I look at are unnecessary. (I don't order the scans, I only interpret them.) The fee for service system is designed to increase utilization, which leads to increased costs. Most of the organizations cited as good quality/low cost are large group practices where physicians are on salary and not paid by volume. In Minneapolis where I practice, many of the physicians are Mayo trained and continue to practice high quality medicine.

One question I had after reading the article is what the political process would be for decreasing utilization in cities like McAllen without punishing places like Minnesota where utilization is low and the quality of care is generally high? Most of the cost containment measures tried so far punish those practicing good medicine, while the bad actors will increase self-referral to maintain their incomes (eg 2006 Deficit Reduction Act).

Posted by: drdr2 | May 27, 2009 1:21 PM | Report abuse

Thinking more about this (and how awesome it is): "But years ago the doctors agreed among themselves to a system that paid them a similar fee whether they saw Medicare, Medicaid, or private-insurance patients, so that there would be little incentive to cherry-pick patients."

Wow. They pooled all payments from all payers together and, essentially, redistributed it to themselves in some sort of self-socialized/communized/kibbutz-y sort of pool and, thus, washed out all the hard fought differences in payments, rates, contracts and such between the payors. It's sort of DIY single payer.

Posted by: ThomasEN | May 27, 2009 1:23 PM | Report abuse

Weren't HMO's supposed to supply some of this kind of 'complete picture' medicine?

Posted by: leoklein | May 27, 2009 1:40 PM | Report abuse

An amazingly insightful article! It is clear that the Mayo-like approach works best for all - except those MDs that view medicine as a license to feed their greed. How to direct those greed-driven MDs-to-be from our medical schools into something that matches their ethics (Wall Street finance comes to mind) is the major question.

I've found that by selecting a primary care provider from the hospital clinics associated with a major medical school that I get the cooperative care and concern about quality/effectiveness that reassures me both as a patient and a citizen/taxpayer. I've never worried about profit maximizing or care minimizing at Stanford Univ. Hosp., UC/San Francisco Medical Center, or (now) Oregon Health and Sciences University.

This article should be absolutely required reading by every member of Congress and their staffs.

Posted by: JimPortlandOR | May 27, 2009 2:16 PM | Report abuse

The thing that occurs to me after reading this is that maybe Obama was on to something when he started harping on electronic medical records. It seems to me, after all, that the first step to getting doctors and specialists to work together more efficiently in dealing with patient needs is to share information. Of course, the face to face meeting is anecdotaly better (it seems from the article), but the records sharing is a start.

It also occurs to me that one feature of electronic records that might be beneficial would be embedded electronic discussion threads ('blog style' if you will) for the physicians. Get them to talk to each-other in addition to keeping patient information organized and accessible.

Could one aspect of improved medical care be... patient electronic medical record blogs?

Posted by: MrLynne | May 27, 2009 2:24 PM | Report abuse

The solution to this problem is already in place in almost every other developed country. It is adoption of a national board of practice standards to evaluate the effectiveness of various management approaches and to use the payment system to encourage practitioners to follow effective standards.

This addresses the valid concern that drdr2 raises, since it does not approach the problem with the blunt ax of across the board cuts in payment but rather with the scalpel of medical and cost effectiveness.

BTW, the system for compensation of doctors that ThomasEN notes has been in place for years -- sometimes for decades -- in multispecialty groups. Most of them divide income based on work product, not on collections, to prevent the cherry picking.

As far as the comment about HMO's -- HMO's did start out to try to introduce consideration of cost effectiveness into medical care, with a great deal of success in their early years. However, in the late 80's and the 90's competition forced them to become more and more oriented to profits and to cherry picking patients themselves, and the model fell apart. Some of the better HMO's are now successfully picking up the broken pieces and returning to the original premise.

The basic lesson of the HMO problem is that the control of abuses of health care has to be above the level of the corporate entities paying for health care, at the national government level, otherwise competition will force bad results in a typical bad practice drives out good practice model that became so familiar in the recent financial mess.

Posted by: PatS2 | May 27, 2009 2:29 PM | Report abuse

I think we all need to step back and realize that our dysfunctional health care system has multiple problems, not just one. And the two big ones are: Uninsured and Costs.

Atul Gawande's article addresses the issue of cost quite eloquently, going to the heart of why costs are spiraling out of control. Cost is definitely something that should be addressed quickly by Congress.

However, we cannot lose sight of the even bigger issue of the estimated 46 million uninsured Americans that are currently being left behind to fend for themselves. No industrialized nation would allow such a travesty, and it is shameful to know that we in fact do.

Posted by: JERiv | May 27, 2009 3:25 PM | Report abuse

I agree with JERiv, but we need to realize that health care costs and health care access are two sides of one issue. High costs contribute significantly to poor access by making insurance less available, by encouraging high deductible and high co-pay policies that cause poor access, and by making federal and state health care programs much more expensive and consequently much less inclusive.

In particular, if we do not get a grip on costs and cost increases we will price health care out of the range where we can afford it for low income and middle income Americans, regardless of who is paying for it.

That is why almost all serious health care reformers spend as much time thinking about costs as about access: in reality the issues are a unified whole, not two seperate parts of reform.

Posted by: PatS2 | May 27, 2009 4:52 PM | Report abuse

That is an astonishingly well written and interesting article. I practice healthcare law and couldn't help but notice how applicable this article is to law as well. To me, lawyers have become less professional as they chase profit. Like some of the physicians in the article, they have come to see clients as profit centers rather than people with real problems needing time, attention, and (in some cases) a team of lawyers willing to work together for the client's benefit. While I think doctors and lawyers might end up "losing out" financially by focusing on outcomes instead of revenue, both will ultimately (I think) be happier for the change if they see their patients and clients obtaining better outcomes.

Posted by: Knuckles2 | May 27, 2009 4:59 PM | Report abuse

"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."

Atul Gawande is a really good writer. He's touched upon an American disease that extends beyond health care into many industries I think. He articulates the syndrome (of greed in an ethical vacuum) perfectly for today's state of medicine and its cost crisis.

And by the way, thanks to all the commenters here. I was concerned when Ezra moved to WaPo that there would be more noise than signal in the reader responses, but these comments are as helpul and incisive as I had come to depend on at his old blog at the American Prospect.

Posted by: wapomadness | May 27, 2009 6:09 PM | Report abuse

Yes, I have to admit it's a great article, by far the best I've read on the enormous waste in medical practice in the US. BUT there are two statements in it we should think about.

"As America struggles to extend health-care coverage while curbing health-care costs, we face a decision that is more important than whether we have a public-insurance option, more important than whether we will have a single-payer system in the long run or a mixture of public and private insurance, as we do now."


"Universal coverage won’t be feasible unless we can control costs."

I simply disagree with them. I do not think Gawande has looked carefully enough at the administrative waste in health insurance in the US. I agree it's less than the medical practice waste, but I think it is enough to make good universal coverage possible. Because of high overhead of profit making insurance companies ($100 - $200 Billion a year), vast quantities of useless forms required of physicians by the companies ($200 - $300 Billion a year) and high drug prices paid to companies that spend 3 times as much on "marketing" as on R & D (around $100 Billion a year), we would save about $500 Billion a year simply by eliminating profit making companies. This would be done automatically by a single payer system like HR676, Medicare for All.

Look, it's ain't gonna be easy to get physicians to drastically change the way they practice. A single payer system will give us time to tackle this really hard problem and other hard problems like preventative care, life style changes and the really hard philosophical problems of how much extreme medicine we will give to whom especially at the end of life.

I think it is a serious error to concentrate on these huge hard problems when we can simply follow the rest of the world and greatly improve health care in our country.

Posted by: lensch | May 27, 2009 10:35 PM | Report abuse

Further thought. Suppose I'm right, that we will save $500 Billion a year simply by eliminating private insurance companies and puttting a lid on drug prices. Suppose this completely pays for a Super Medicare for All with no co-pays, deductibles, few limitations and complete drug, mental, and dental coverage. Supose then our bottom line public health statistics improve to the level of say ah-h-h-h France. Since the French pay about half per person of what we pay (and will be paying in my hypothetical), there will still be $1.2 TRILLION of waste in our system compared to France. Then we can go after that, but it's no reason not to pick the low hanging fruit of private insurance companies.

Very good is the enemy of good or something like that.

Posted by: lensch | May 27, 2009 11:11 PM | Report abuse

I don't understand the health care system, but wouldn't it be reasonable to require doctors to tell patients if they have a financial relationship with an organization they are recommending to the patient, i.e., getting a kickback? Or make it a condition of getting medicare reimbursements that a doctor's payments from other medical providers also getting medicare reimbursements be publically available on a website somewhere. Getting the details sorted out might be tricky (think of how opaque "privacy statements" are), but a little daylight would discourage some of the flagrant abuses that Gawande describes.

Posted by: adonsig | May 27, 2009 11:56 PM | Report abuse

The bit on Mayo Clinic (salaried physicians, pooled resources) undermines the latest anti-reform ad featuring a Canadian who decided to go to... Mayo Clinic. Of course, the anomalous Mayo operating model never features in the spot.

Posted by: pseudonymousinnc | May 28, 2009 12:21 AM | Report abuse

Just going to quote one line from that Gawande piece:

"No one teaches you how to think about money in medical school or residency. Yet, from the moment you start practicing, you must think about it."

That, I'd contend, arises not just from the way Americans pay for healthcare, but the way American medical schools require six-figure tuition fees.

I know doctors who work in other (universal) systems. They're well paid -- not as well paid as their American peers, of course -- but they don't have to think about money much at all. (It enters the equation at the level of general practice, but in a greatly attenuated way.) They qualify with a tuition debt load that's the equivalent of a modest car, not a modest mortgage. They do not need their own little offices along the Medical Mile, of the kind you'll see in so many US cities. They are not, to put it bluntly, on the take: specialists can combine private and public-funded work in their schedules and live a very comfortable life.

Posted by: pseudonymousinnc | May 28, 2009 12:58 AM | Report abuse

This is the best point...
"When it comes to making care better and cheaper, changing who pays the doctor will make no more difference than changing who pays the electrician. The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care."

At this point in my life, I feel capable of being accountable for my care, but long term, that may not be the best idea. I've had to refuse two major surgeries, thus far, both of which have since turned out to be unnecessary and both were not without risks. Reduce over-treatment. This is a cultural change that has to be driven by patients and doctors. Educating consumers about the dangers of medical care is good as well.

I just think about how the world would be if we had car care insurance. Most times I go to the mechanic, there is some suggested fix or tune-up that I end up turning down. If I had insurance, I don't think I'd be thinking the same way. Somehow, the burden needs to be shifted to the payer.

Posted by: staticvars | May 28, 2009 1:00 AM | Report abuse

Phenomenally well written article. Thanks to Ezra for insisting on reading it. It is worth.

Not just Congress members, but we can even start with Ezra's colleagues at WaPo in reading and understanding this article.

Really, who pays and how fees are paid are secondary issue. It is all about 'totality of accountability'.

How far current Congress bills and budgetary maneuvers are away from what this article talks about? Can Ezra educate us here? If it is too much of a deviation, what chances do we have for these proposals to move along the road map advocated in this article?

Posted by: umesh409 | May 28, 2009 2:33 AM | Report abuse

It sounds like McAllen, Texas will be the poster child for the republicans health care plan - free marketeering at its best.

Thanks Erza for the link! It was refreshing to hear someone is really digging deep to see what hidden beneath the topsoil. It sure punches a hole in Obama's position that we use the system we already have in place instead of reinventing the wheel. Too bad Obama doesn't realize the wheels being used to drive this train are squared, not round so it ain't going anywhere.

Posted by: MajorDomo1 | May 28, 2009 9:51 AM | Report abuse

And thank you pseudo for your very astute point about med school:

" 'No one teaches you how to think about money in medical school or residency. Yet, from the moment you start practicing, you must think about it.'

That, I'd contend, arises not just from the way Americans pay for healthcare, but the way American medical schools require six-figure tuition fees."

I would like to reiterate. Isn't it possible that medical schools - by saddling students with inordinately high student loan debt - teach students precisely how to value their profession and how that profession values them (i.e. financially)? For many young doctors, the *business* of medicine starts long before the M.D.

Of course, the extreme cost of that M.D. is just another depressing consequence of our "free market" health care experiment.

Posted by: cmaffucc | May 28, 2009 8:04 PM | Report abuse

Finally, an article that intelligently deals with one of the "third rails" of health care reform: physician profit, and the (natural?) human tendency in a capitalistic society to want to maximize one's income.

It also raises a larger question: who should profit from our health care system, and how much profit should they be allowed? Do we want to keep a health care system that is for-profit, and if so, how do we fairly and reasonably limit costs and profit to all players? How much profit is "reasonable," anyway?

There's lots of discussion in the blogosphere, both here and on other health reform blogs, about limiting or eliminating profits of insurers, administrators, agents and brokers, pharmaceutical companies, medical device manufacturers. . . but little or nothing about limiting physician (especially specialist) profit. The Stark and Anti-Kickback laws are designed to impose some limits, but as we all know, there are exceptions and loopholes in those laws and regulations. One of the Senate Finance Committee's policy proposals in its delivery system paper would eliminate a Stark exception that permits physicians to invest in a whole hospital (current arrangements would be grandfathered and permitted to remain in place). Eliminating the "whole hospital" exception would address one of the abuses outlined in Gawande's article, the tendency of physicians to refer "good" patients to hospitals in which they have a financial interest.

Ezra, perhaps you could write a post on this larger question, soliciting commenters' thoughts?

Posted by: Policywonk14 | May 29, 2009 9:30 AM | Report abuse

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