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What's New

August 30, 2010

CAHP Research Review (.pdf)
Summaries of last week's data, research and publications related to our members:

• CHIS Projects 24% of Californians Uninsured
• Electronic Health Record Adoption in U.S. Hospitals Remains Low
• and more ...

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Financial incentives sway doctors to send patients to surgery, study says

California Watch - By: Christina Jewett
August 17, 2010

Is a doctor who stands to profit from sending you to surgery more likely to suggest that you get a procedure? The answer is a resounding yes, based on one researcher's analysis of five years worth of insurance claims in Idaho.

The study, published in the August edition of the Archives of Surgery, looked at the behavior of doctors who own all or part of a specialty hospital or ambulatory surgery center.

Researcher Jean M. Mitchell found that patients of facility-owner physicians are:

• 54 to 129 percent more likely to get carpel tunnel repair
• 33 to 100 percent more likely to get rotator cuff repair
• 27 to 78 percent more likely to arthroscopic surgery

Mitchell concedes one weakness of the study is the gap in data about whether the surgeries were beneficial to the patients. One of the categories, arthroscopic surgery of the knee, was identified in one study to yield no better benefit than medical or physical therapy. Yet it costs $5,000 per case, twice to three times the cost of lower-intensity care.

Mitchell, who is a professor at Georgetown University, concludes "that financial incentives linked to ownership of either specialty hospitals or ambulatory surgery centers influence physicians' practice patterns."

Typically, "self-referral" is illegal in health care, Mitchell notes. However, federal law makes an exception for doctors referring patients to hospitals and surgery centers.

The findings, in a way, erode the notion that doctors always do what is best for the patient. And they build on work of other researchers highlighting the way capitalism and wellness do not always align.

One recent study by a Stanford researcher found that local MRI supply tends to drive MRI usage and incidence of lower back surgeries (as opposed to, say, actual need for such services).

And a University of California Davis researcher delved a case of money and politics mixing with medicine, resulting in a windfall for one company but no discernible benefit to patients. His study examined a medical device company's role in lobbying for a mammography-screening process that increased false-positives but did little to increase cancer detection.

Medical research is amassing examples that Gordon Gecko would love. But whether they are best for patients is a matter that deserves more scrutiny and more debate.

Such debate started in earnest last week in Sacramento, when the New America Foundation hosted a crowded hearing in the Capitol about aligning incentives in medicine that ensure "effective care that takes into account the latest findings in medical science as well as the preferences of individual patients and the judgments of their healthcare providers."

For now, one antidote to medical profiteering that's being discussed in policy circles is the "accountable care organization," which is essentially an HMO that rewards doctors for keeping patients healthy rather than racking up the fee-for-service bill.

Dr. Atul Gawande, a physician who pens long, thoughtful pieces in the New Yorker, called for a movement toward health systems where the temptation to make choices for profit disappears and the incentives are in line with what's is best for patients:

"Dramatic improvements and savings will take at least a decade. But a choice must be made. Whom do we want in charge of managing the full complexity of medical care? We can turn to insurers (whether public or private), which have proved repeatedly that they can't do it. Or we can turn to the local medical communities, which have proved that they can. But we have to choose someone -- because, in much of the country, no one is in charge. And the result is the most wasteful and the least sustainable health care system in the world."

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Prescription Drug Mandates and the Cost to California

California's legislature is currently considering four bills that would increase health care costs for employers and individuals by mandating coverage that favors certain brand-name drugs and limiting the use of cheaper generics.  This fact sheet examines the impact of prescription drug mandates and provides a summary of these bills. 

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Health Care Reform Resources Kaiser Family Foundation: Health Reform Home Page             What is Medicaid?             Medicaid's Role             Temporary High-Risk Pool             Extension of Dependent Coverage to Age 26 The Commonwealth Fund: Health Reform Resources Insure The Uninsured Project: Section-by-Section Summary of Health Reform Legislation Text of Health Care and Education Reconciliation Act of 2010 Text of Patient Protection and Affordable Care Act

 

 

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