Less Medical Care Better for Health

Good health care comes at a price. Surprisingly, better medicine comes at a lower price, says a group of influential researchers who have changed the way people are thinking about how to grapple with the skyrocketing costs of medical services while improving the quality of care.

Experts have long known that cost of medical care varies, depending on where people live. According to the Dartmouth Atlas of Health Care Project database www.dartmouthatlas.org, Medicare spent an average of $9920 for every senior in Manhattan in 2001; in Portland, Oregon, it was $4827. Other analyses have shown that quantity of care--not severity of illness or cost-of-living differences--account for the twofold spending variations across the country.

But higher spending doesn't necessarily lead to better health--and more care might even be harmful. This revelation came last year, when Elliott Fisher and his colleagues at Dartmouth Medical School published a study on what Medicare recipients were getting for their money. The researchers analyzed 5-year follow-up data on patients who had been diagnosed with one of three common, but serious, ailments: hip fracture, heart attack, or colorectal cancer. The study covered 306 geographic regions from San Francisco to Philadelphia.

Patients in locales that splurged on Medicare did not receive more high-cost surgical procedures, such as coronary artery bypass or total hip replacement. Rather, they saw their doctors more often, consulted with more specialists, received more frequent tests and minor procedures, and spent more time in the hospital and intensive care unit. Yet, seniors in the lowest-spending regions had comparable health outcomes, similar satisfaction, and 2% to 5% lower mortality rates, according to the two-part report in the Annals of Internal Medicine.

The thrifty regions also provided slightly better overall care, stressing proven preventive treatments such as encouraging seniors to get pneumonia vaccines and insisting that heart attack patients take an aspirin every day. Even at the country's best geriatric hospitals and elite academic medical centers, the extra physician visits, diagnostic tests, and time in the hospital and intensive care unit did not provide people with better quality of care or longer lives, according to a new pair of studies published in a supplement to the November/December 2004 Health Affairs by the Dartmouth team.

The differences in medical care across the country can be explained largely by too many specialty physicians and too many hospital beds in the high-spending regions, Fisher says. "If there are 60% more physicians, people will get 60% more services," he says. And if the beds are available, physicians might be more likely to admit a patient to a hospital, where it is often easier to order tests, perform minor discretionary procedures, and request consultation with a specialist. "Because almost all interventions involve some risk," writes Fisher, "unnecessary tests, treatments, and time in the hospital can be harmful."

If less expensive health care is, overall, as effective as higher-priced service, Fisher says, America's entire medical practice should be modeled after the lowest-spending hospitals, with fewer specialists and fewer beds, for example. Local government officials could require greater proof that a new wing on a hospital or a new medical building is needed. Such changes could save Medicare 30% of its total budget--$40 billion that could be used to fund a prescription drug benefit without any increase in taxes or elderly persons' premiums, he and his colleagues estimate.

The evidence from the Dartmouth studies, along with other supporting investigations, has had a profound impact on the way people think about how to reduce health care costs. Experts can now begin to discuss the specifics of how to reduce unnecessary services across the country without compromising quality of care, says Steve Lieberman, a health care consultant and policy analyst with Moran Company. "The Dartmouth researchers show we can save money without making anyone worse off and probably make people better off," he says. The next step is to figure out how.

Lieberman advocates targeting the priciest patients. "Five percent of Medicare recipients account for half the cost, and 60% account for virtually no spending," he says. The challenge is to identify the relatively few seniors with the extravagant medical bills in time to make effective changes in their treatment. Perhaps by standardizing treatment plans for certain diseases or requiring better coordination of the medications and services for people with multiple ailments, physicians will be able to avoid tests and procedures that are unnecessary--or that have not proven effective--thus providing high-quality care at a lower cost. Such a plan leaves the health care of most seniors unaffected, which could be more politically palatable than the unpopular managed care movement of the 1990s.

In the long term, the Medicare reimbursement system needs to be revamped to reward medical practitioners who provide the most effective care at the lowest cost, says economist Gail Wilensky, a senior fellow at Project Hope in Bethesda, Maryland, and former head of Medicare. "Medicare now violates this at almost every level imaginable," she says. As it stands, "the physician that gets it right the first time using the fewest services gets the least money. That's not good."

Unfortunately, not much information exists about what constitutes proven, effective clinical care for the wide range of Medicare-funded medical services, says Wilensky. Sometime in 2005, the Dartmouth Atlas will post the Medicare data specific to 4000 U.S. hospitals, offering policymakers another place to look for models of medical efficiency.

"We have plenty of money in the system to do the right thing and do it well, but we haven't figured out a way to stop doing what doesn't work," says Megan McAndrew Cooper, information officer for the Dartmouth Atlas. Americans tend to think all medicine is equally good and the only problem is getting access to enough of it, she says. But people need to think about the risks of getting too much of it.

Based in Boston, Carol Cruzan Morton no longer expects better medical care in the pricey biomedical mecca, where she lives within walking distance of some of the country's top academic medical hospitals.