How to fix the cost of American health care

How to fix the cost of American health care
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The country's health care tab came in at a whopping $3.3 trillion in 2016 — 17.9 percent of GDP. We spend $10,348 per person, per year, nearly twice the average of other modern economies. Yet despite the fortune spent, we still don't have better health outcomes, and our national political dialogue is crippled by debate over who should pay the budget-busting health care tab.

Instead of squabbling over who pays the skyrocketing bills, lawmakers should redirect the discussion to prices and ways of reducing the massive costs within the health care system.

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Here are four ways to reduce national health care costs. If just one of these fixes were implemented, it would save billions of health care dollars annually.

 

Stop practicing defensive medicine

The biggest cost savings could be realized if we eliminated the practice of defensive medicine whereby physicians order medically unnecessary tests, procedures, and medications due to fear of malpractice lawsuits. This is estimated to cost the U.S. economy $700 billion annually.

A study found that over one in four health care dollars are spent on the practice of defensive medicine, a Gallup study found. Defensive medicine doesn't make physicians practice better medicine — it simply makes them practice more expensive medicine. A whopping 96 percent of U.S. orthopedic surgeons admitted to practicing defensive medicine in 2012, creating $2 billion a year in unnecessary costs, according to research conducted by the Vanderbilt University Medical Center. 

Reduce unnecessary paperwork

The prior authorization approval process costs over $80,000 per year, per practice, according to a New York-based study. If we estimate that there are 230,187 practices in the USA then the cost is $18.4 billion dollars per year (or $18,414,960,000). According to a 2009 study, the national price tag for all this time wasted is between $23 billion to $31 billion each year.

A study following 57 U.S. physicians in family medicine, internal medicine, cardiology and orthopedics found that physicians are spending two-thirds of their time doing paperwork, including entering information into the electronic health record (EHR) system. Doctors spend almost 40 percent of their time doing paperwork, even when in the exam room with patients, according to the study. After-hours diaries completed by physicians indicate they spend one to two hours each night filing additional paperwork. The cost of the time spent filing this paperwork is massive: nearly $83,000 per physician practice.

If U.S. health care administrative overhead were more like Canada's, we could save almost $27.6 billion in annual health spending, according to a study published in Health Affairs.

Switch from disposable to reusable instruments

The U.S. is also wasting billions of health care dollars on disposable tools, even though sterilized, reusable tools work just as well and at considerable savings. It was calculated that the instrument cost per procedure of a full disposable set is between seven to 27.7 times higher than the cost of the same procedure with reusables, a study found. Given that there were 48 million surgical inpatient procedures performed in the U.S. in 2009, a simple switch to reusable tools would save an incalculable sum. 

In a study of laparoscopic procedures conducted in Greece, reusable tools paid for themselves after only nine procedures and created a total savings of €305,270 ($422,000) over the two year period of the study; whereas disposable "instruments cost nine times more than reusable ones," another study found.

Better management of surgical supplies

Forty-eight billion dollars per year could be axed if operating rooms cut down on surgical waste. Unused medical supplies eat up 13 percent of total surgical supply costs, or approximately $968 of waste per case, according to a University of California–San Francisco (UCSF) study that found $242,968 in operating room waste per month.

"The most expensive item wasted, according to the study, was the Surgifoam absorbable gelatin sponge (Ethicon US), which is used to stop bleeding. One sponge can cost close to $4,000," reports Managed Care. 

"Nearly $1,000 per procedure is being wasted" wrote Dr. Michael Lawton in the study. Extrapolated across the 48 million surgical inpatient procedures performed in the U.S. in 2009, eliminating this waste would result in savings of approximately $48 billion.

Operating room costs could also be slashed by establishing an orderly and efficient procedure for surgeons to identify the list of instruments they are likely to use in a given procedure, clarifying which tools should be opened at the outset of the surgery and removing unnecessary items.

If we agree that the goal is to provide health care to all Americans, then we need to take a closer look at why health care is so expensive and ways to make it more affordable. If we can reduce the cost of health care, then the debate about who pays the bills — whether its paid for through private insurance, government funded health care, or some other way — becomes mostly irrelevant.

Dr. Saul Weinreb, M.D. is an obstetrician-gynecologist affiliated with the Pregnancy Aid Center in College Park, Md. and Holy Cross Hospital in Silver Spring, Md. He served in Iraq as a physician in the Army Reserves and received his medical degree from University of Illinois College of Medicine.