America's health system is bloated — too much medicine does not mean better health

America's health system is bloated — too much medicine does not mean better health
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The joint announcement by Amazon, Berkshire Hathaway, and JP Morgan to provide high quality, low cost healthcare for almost one million combined employees is a welcomed addition to the health-care arena.

As an internist in private practice for over thirty years, this is an opportunity to correct the inadequacies in a system that is currently overpriced and underperforming.

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This is not the first attempt by an employer to offer healthcare. Kaiser Permanente, was the most successful employer-initiated health care system started by Henry Kaiser in 1945. However, times have changed and today’s medical care is more complex.

 

Having patient care directed by large employers rather than government, insurance companies, or large providers, is a source of hope and change.

In their initial announcement, these three industrial giants promise to use “technological solutions” to provide simplified, high quality, transparent health care and to allow patients ready access to health records.

Since these companies are all led by bright innovators, they will probably ultimately arrive at the same conclusion: that technology alone will not lead to high quality, low cost care.

Providing patients easy access to medical records or allowing for more transparent medical costs may be convenient, but those changes will not be transformative.

These corporative giants will have the power to bargain with pharmaceutical companies to decrease their drug expenses.

Costs savings for medications can be significant, perhaps 10-20 percent, but since drug expenses are about 10 percent of the total health-care dollar, overall savings will be no more than 2 percent percent, according to my estimates. Instead, the changes that these companies must initiate are large and potentially controversial.

Amazon, Berkshire, and JP Morgan — like Kaiser Permanente did before — will need to develop a primary care based medical system and attempt to limit unnecessary visits to inflated specialists and emergency rooms that increase costs and compromise quality.

Their medical system will need to acquire optimal therapy protocols and cost-effective strategies to control expensive tests and treatments that are not worth performing.

They will be required to own (or have contracts in place with hospitals) to control the short unnecessary hospital admissions that have become so commonplace.

They must compensate their specialists in a method other than fee-for-service to discourage costly, excessive, and dangerous procedures. Physicians will need to be shielded from fear of malpractice in hope of limiting the wasted expense of defensive medicine.

Educational material and programs must be available for all people to encourage healthy life habits and to discourage patients from requesting unneeded testing and procedures.

The mechanisms necessary to oversee this health-care system should be made less expensive and more efficient than existing programs.

These changes are significant, but given the successes of these monumental companies and the people who lead them, the hope and opportunity for transformation seems to have arrived. 

Currently, our health care system is grossly overpriced, consuming 18 percent of our GNP and rising annually. This is more per capita than any other country in the world and over twice as much per person as Great Britain.

ObamaCare, which primarily dealt with insurance payments, rather than medical care, slowed the yearly increase in health care costs from about 8 percent annually down to 5-6 percent, which was twice as much as the overall inflation rate.

The 2017 statistics are not yet available. The entrance of these successful business giants raises the possibility of getting control of our overpriced healthcare system. Since unaffordable and unavailable are two sides to the same healthcare coin, decreasing costs may provide adequate health coverage to more people.

Dr. Dennis Gottfried is a physician in private practice in Connecticut for over 30 years, and the author of “Too Much Medicine: A Doctor’s Prescription for Better and More Affordable Healthcare.”