Paying For Medical Care Which Is Not Cost Effective

Yesterday I discussed the question of whether preventive care will reduce or increase health care costs. Tobacco cessation was one example which had been given in which the life style change could wind up costing more if this leads to people living longer and consuming health care services for a longer number of years. I also noted that this might not be the case as it costs more to care for people with chronic diseases, even if they don’t live as long, due to higher annual expenses when they are alive.

In general I think that the right preventive programs will save money, but only in the long run. This is also not the key issue as preventive care is still beneficial if it leads to a healthier population without saving money. I have thought of a perfect example of a case where preventive care clearly costs more money is still worthwhile.

People with congestive heart failure are at an increased risk of serious ventricular arrhythmias which can cause sudden death. Because of this, implantable defibrillators are placed in many heart failure patients. This costs a fair amount of money for the procedure. This also increases health care expenses because it leads to people with congestive heart failure living longer, which requires more money to treat them.

In some cases failure to provide preventive care can lead to greater expenses, such as if an inadequately treated diabetic requires dialysis or bypass surgery. In this case, failure to insert the implantable pacemaker will lead to sudden death in a certain number of heart failure patients.

If a heart failure patient dies of sudden death from a ventricular arrhythmia there are no medical expenses for treatment and there is one less person with heart failure requiring medical care. In this case an analysis based purely upon cost would show that implantable defibrillators are not cost effective, but this is still something we would want a health care system to pay for.

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  1. 1
    gary says:

    The main point should be that government bureaucrats will be the ones deciding what health care treatment is cost effective and which lives are worth saving.  We all agree that pacemakers should be put in, but we are on the verge of giving that decision to a bureaucrat (or panel of bureaucrats) with no guarantee that we will ever be allowed to dicuss it personally with them.

    Absurd.  We might as well let the IRS or the DMV decide if we get the implant/surgery/medication.

  2. 2
    Ron Chusid says:

    That is untrue. Health reform plans do not put these decisions in the hands of bureaucrats. If anything health reform can increase the ability of people to receive what is recommended by their physician by weakening the ability of insurance companies to deny treatment based upon cost considerations.

    The biggest obstacle towards people not receiving needed medical care is lack of coverage.

  3. 3
    Eclectic Radical says:

    As others have said, many of these decisions are already in the hands of bureaucrats… insurance industry bureaucrats. Most people interested in health reform, on the both the right and the left, are interested in seeing that third-party control of medical decisions lessened rather than increased. The problem is that the current pet illusion of reformers on both sides is the phantom idea of ‘lowering costs’, by which they mean making health care cheaper for health care providers so to lower consumer prices. This is the very process that leads to rationing in the insurance industry, and government reform based on the same model won’t change the problem.

    The only way to address the issue is to admit that research, technology, and professionalism mean that health care costs are not likely to ever lower in the way many are obsessed with managing. The real issue that needs to be addressed is consumer cost, and this can be managed in a variety of ways. Improved cost sharing is the most obvious, as more people paying into the system means lower individual ‘piece rates’ for care. This is the real debate, and it is being quietly sidetracked by faux reformers right now.

  4. 5
    Ron Chusid says:

    Many conservatives hold a very strange view of health care, seeing the choice as one of government control versus a totally free system. People either have plans where, if there is any outside interference, it is either from insurance company bureaucrats in private plans or by government bureaucrats for those in government plans.

    In general insurance company bureaucrats are far more likely than Medicare to interfere with physician decisions as insurance companies often will deny procedures based upon cost considerations. Another difference is that government allows appeal processes based upon whether something is necessary. An appeal of an insurance company denial is basically an internal matter and generally they can set their own rules as to what they will deny.

    Several years ago Blue Cross was the Medicare intermediary where I practice and for some reason the medical director of Blue Cross decided that a standard test was “experimental” and would not pay for it. They audited me and both Blue Cross and Medicare asked for the money back for that test and in the process found another bogus reason to take money back. I could appeal the Medicare audit to an administrative law judge, and I got all the money back. There wasn’t anything I could do about Blue Cross. (A few years later they gave in and admitted it was not experimental and have been paying for it).

    Fortunately this in a sense is “off topic.” I’ve never seen a plan (government or private) deny the medical necessity of implantable pacemakers for CHF. (Perhaps before saying this I should check with the cardiologists as they deal with far more cases of this than I do.)

  5. 6
    Eclectic Radical says:

    No, but chemotherapy and radiation treatments have been denied as ‘experimental’ by some carriers, long after they ceased to be any such thing, because of carefully crafted company rules defining the word ‘experimental.’ Diabetes drugs that have met all tests and moved out of the experimental phase have fallen into this same ‘experimental’ category with some carriers.

  6. 7
    Ron Chusid says:

    It really is ridiculous when conservatives try to frame the choice as government run health care with severe restrictions on choice versus free market health care with no restrictions.

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