Slowdown in Health Spending Could Be at Risk

lcI have a few problems with an article I read in the WSJ this morning, Slowdown in Health Spending Could Be at Risk.

I have outlined the bits of the article I don’t agree with below and shared my POV on each. But the underlying tone that the healthcare industry only raises costs without an increase in benefit really troubles me. Vilifying an industry that tackles some of the most complex and important challenges we face.


Spending on prescription drugs actually dropped 1% in 2012, to $325.8 billion, the first decline since 1957, according to the IMS Institute for Healthcare Informatics.

Its true, spending did drop on prescription drugs, do you know why?  The depressed U.S. economy is curbing the use and adherence to prescription drugs by patients. In a Consumer Reports survey of 1,226 consumers, 48% said they didn’t fill prescriptions, took less medicine than prescribed or failed to undergo a medical test advised by their doctor. This is not a “hopeful sign”, it is a really really bad sign. Decreased adherence to a prescribed drug regimen increases Dr. visits and most costly hospital and ER visits.


Another big driver of health-care costs is technology. In almost every other industry, innovation generally makes things more efficient and less costly. But in health care, it often brings higher costs with little added value.

“Little Added Value”! What about added value to the patient, an opportunity for a better standard of living.  What about faster, more sensitive diagnostic tools that help doctors identify and treat diseases. What about drugs that make diseases manageable, instead of death sentences, or ease patient suffering. What about innovative drugs that keep patients out of the ER, reduce the systems strain and overall costs.


He has a simple solution: Let Medicare pay full dollar for the least-expensive highly effective treatments, and let patients who want costlier alternatives pay the difference on their own. That would diffuse the “rationing” argument, retain individual choice and reward manufacturers for creating real innovations and lower-cost alternatives, Dr. Kellermann says.

Medicare needs to provide access to the most innovative, highly effective treatments, not the other way around. This is a long term v short term argument about the rising costs of medicare. First of all, there is already a tiered system to Part D, which I wont even get started on how well the program is working (for real, its a good program).

Cutting access and restricting formularies may initially reduce costs, but it reduces the quality of care for the patients which will lead to increased costs in other areas like doctor visits and hospital stays (redundant, I know).

Third, medical innovation needs to be rewarded instead of dampened. There needs to be a market for new technology and therapies, its business, with out that market companies will not receive the funding they need to bring innovative products and therapies to market.

And finally, I know I am straying here a little from the usual talking points and displaying some of my social political beliefs, but medical innovation needs to be available to everyone, not just the rich.  Looking at where our medical dollars are spent, it is with the dual eligible, multi-health problem’ed (I know thats not a real word) population who are not able to secure employment that could pay for medical care.

What worries me about this article, is that it was not an opinion piece. There is no doubt that the healthcare system is flawed and changes have to be made, but when we look at making changes we need to keep two things front and center.

1. Providing quality care to patients

2. Rewarding innovation.

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