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March 23, 1990
"Revive Health Care Watchdog"
San Jose Mercury News
By Timothy Taylor
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A LOT of so-called reforms of the health care system are really just quarrels over whether business or consumers or the government (meaning taxpayers) should foot the bill.

Instead of arguing over who should pay for medical care, it's time to start examining what is being purchased. A frightening amount of evidence is accumulating that a sizable share of U.S. medical care serves no therapeutic function.

One study, for example, found that Medicare patients in Boston are far more likely than those in New Haven to have hip and knee replacements, far more likely to be hospitalized for gastroenteritis, pneumonia and diabetes, and far more likely to have certain surgical procedures like removing blockages from the carotid artery. Medicare spends an average of 70 percent more for Boston patients than New Haven patients, with no discernible difference in benefit to their health.

Many medical procedures seem to be performed more often than warranted by the health of the patients. An American is four times more likely than a European with the same symptoms to have coronary bypass surgery. Studies by the National Institutes of Health and others have led to estimates that three-quarters of the 250,000 coronary bypasses performed each year lead to no gain in life expectancy compared with less extreme treatments.

In 1970, one birth in 18 was by Caesarean section. Today, it is roughly one in four. Some studies have estimated that half of them are unnecessary.

Of the 120,000 pacemakers implanted each year, half may be unnecessary.

Perhaps 20 percent of all lab tests are unnecessary.

The prevalence of examples like these has led to some eye- popping extrapolations. Joseph Califano, who was secretary of health, education and welfare in the Carter administration, estimates that at least a quarter of the $560 billion that this nation spends on medical care is wasted.

Other estimates back him up. Dr. Arnold Relman, an editor of the New England Journal of Medicine, has estimated that as much as 20 percent to 30 percent of all things done by well-meaning physicians in good hospitals are either inappropriate, ineffective or unnecessary.

Robert D. Ray, formerly governor of Iowa and now chairman of the National Leadership Commission on Health Care, cites estimates that 20 to 40 percent of all procedures performed may not be warranted.

Dorothy Rice, former director of the National Center for Health Statistics, has argued that as much as 50 percent of health resources may be spent unnecessarily.

In some sense, these figures should come as no surprise, since both patients and doctors have incentives to overuse medical care. Most patients want their doctor to do something; they are in no position to evaluate whether they truly need what is suggested; they tend to assume that a more complex and costly procedure is probably more beneficial; and private or government insurance covers the bulk of the cost.

On the other hand, doctors naturally want to help; they have developed a professional and emotional attachment to tests and procedures they believe are beneficial; they know that insurance is covering most of the costs; and they know that neglecting anything that has even a small chance of helping will put them at risk of a malpractice suit.

Back in 1978, after hearing estimates that 80 percent or 90 percent of medical procedures had never been adequately assessed, Congress created the National Center for Health Care Technologies. Its purpose was to pull together evidence on costs and benefits and appropriate use of health care technologies, while filtering out the bias of medical manufacturers and specialists. Its recommendations were binding only on Medicare, but they served as guidelines for private insurance as well.

But although the recommendations of the fledgling agency saved the government hundreds of times more than its $4 million annual budget, the center was abolished in 1981, largely due to pressure from the American Medical Association.

Dr. Seymour Perry, the director of the National Center during its brief lifetime, explained to me that today only about $50 million is spent each year on assessing medical technology. This total is spread among many different programs with slightly different goals. But no central agency exists to synthesize the findings and put them in a useful context.

The National Center for Health Care Technologies was a good idea, but far too limited in its scope. The government has an important role to play in collecting and disseminating assessments of medical procedures and technologies, a duty that it shirked through the 1980s.

America is already spending plenty for health care; the current total is 11 percent of GNP, a far greater share than any other country. If the estimates of Califano and others are even close to accurate, then identifying and finding ways to eliminate just half of the medical spending that provides no health benefit would save $70 billion a year.

That would be more than enough money to provide medical care to all of the 30 million or so Americans who have no health insurance.

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