Cost: A Side Effect of Care

Physicians often underestimate the costs of care thereby imposing a potentially catastrophic side effect on patients.

Courtesy Drs. Laura Medford-Davis and Elizabeth Arrington (All Rights Reserved)

Health care costs consume an increasing proportion of the GDP while individual Americans face an increasing financial burden from medical bills. Two recent articles address the role physicians play in the costs of care; a third looks at the impact of the Affordable Care Act (ACA).

Estimated out-of-pocket costs on top of insurance premiums are quoted at $55,250 per year for breast cancer, $4,000 for diabetes, and $40,000 for a heart attack. These figures explain why 30%-37% of insured Americans report struggling to pay medical bills in the past year.

Medical school and residency training encourage over-testing, which drive up patient charges and health care costs. Physicians during training are encouraged to be as thorough as possible, to test for rare diseases, and to perform tests due to intellectual interest despite being unlikely to immediately help the patient. Since most physicians continue to practice the same way after training, over-testing pervades both academic and community settings.

Physicians, under the principles of informed consent, often discuss potential complications of the drugs and procedures they prescribe for patients. However, physicians often do not discuss the more common complication of massive bills for out-of-pocket expenses. Adding to the problem, hospitals often hide true patient charges from their own physicians, which leaves providers unable to advise patients on cost.

Although the ACA attempted to make health care more affordable to patients by capping premium payments, without a cap on the patient’s point-of-service payments, insurance companies will shift available options toward high-deductible health plans (HDHPs) to maintain profitability. Preexisting conditions, while no longer an acceptable reason to deny insurance coverage, still determine the number of times a patient needs to go to the doctor or buy medications, and consequently the number of copays patients will owe.

When faced with high deductibles, – both essential services as well as elective services. Minimal research has been done on how these plans impact low-income populations or ultimately health quality outcomes, but what we do know suggests that low-income patients will be especially hard-hit.

Commentary

Health care costs impact the long-term viability of our health care system and the quality provided in the short term. When patients skip essential services due to cost, they risk complications that are more costly to treat.

Patients with “Cadillac” private insurance plans rarely consider low-cost alternatives; some even insist on receiving high-cost tests such as MRIs because they have “good insurance” and know they will not receive a hefty bill.

Our existing payment models reinforce the tendency to over-test and this goes unchecked when patients are sheltered from the costs. Meanwhile underinsured and uninsured patients who skip essential care to avoid costs may inadvertently wind up with catastrophic complications of delayed treatment.

Even when providers want to prescribe their patients the most affordable of several effective options, health care organizations closely guard knowledge of costs and patient charges as trade secrets. As a result, providers are often just as shocked as patients when seeing a bill for their own services.

In an unpublished survey of emergency medicine providers, health care providers providers (medical students, physicians, and mid-level providers) who estimated patient charges were only 8%-53% correct. Most often, providers underestimated charges. For example, 55% of providers underestimated the charge for one test by a factor of 100, and 23% by a factor of 10, with only 22% correct or overestimating.  Both patients and providers have a responsibility to educate themselves and to include costs of care among the factors they consider when deciding the most appropriate treatment plan.

Korenstein, D, et al. JAMA. 2013; 310 (16): 1671-2.

Wharam, JF, et al. NEJM. 2013; 369 (16): 1481-4

Ubel, PA, et al. NEJM. 2013; 369 (16): 1484-6.

by 

Laura Medford-Davis, MD