Health Care Myths Obscure The Much Tougher Decisions

August 26, 2009|By JAY HANCOCK

Health care reform lies are fairly easy to dispose of. There are no "death panels" in the legislation being considered in Washington, despite continuing insistence to the contrary from people who want to incite fear and draw attention to themselves.

More insidious are health care reform myths: seemingly logical arguments that shrink under scrutiny and distract from the real job of controlling dangerously soaring medical expenses.

Here are two of the biggest, one from conservatives and the other from liberals.

First, the conservative myth. "Why is it ... in this grand health care debate we hear not a word about one of the worst sources of waste in American medicine: the insane cost and arbitrary rewards of our malpractice system?" syndicated columnist Charles Krauthammer asked last month.

Actually we hear plenty about tort reform - fixing the laws pertaining to medical malpractice and other personal injury. Talk radio is full of it. Krauthammer wrote about it again this month. I get reader e-mails all the time asking the same question.

There's lots to talk about. Malpractice awards and "defensive medicine," in which doctors over-scan and over-treat patients to fend off lawsuits, cost tens of billions a year.

Trial lawyers bring dubious cases along with deserving ones. Juries deliver nonsensical verdicts. Every few years, malpractice insurance costs drive neurosurgeons or obstetricians to retire, move to other states or otherwise withhold badly needed care.

There is nothing about tort reform in the Democrats' health care legislation. No accident there. Trial lawyers give millions to Dems and hardly anything to Republicans.

But tort reform is not the solution to the health care crisis. The absence of tort reform is not a reason to reject what's going on in Washington.

"Tort reform as discussed in the United States would probably have very little impact," says Gerard Anderson, a professor at the Johns Hopkins Bloomberg School of Public Health. "The states that have enforced tort reform have about the same amount of litigation - and the awards are comparable - as states that don't."

A more drastic malpractice makeover would deliver substantial gains - but only once. New Zealand has a no-fault medical injury system in which lawsuits are essentially banned and experts decide how much to award victims. But even such a system, which nobody is talking about in the United States, would cut health care costs by maybe 7 percent at the most, Anderson said.

That includes costs from defensive medicine. At a time when employers and patients often see medical costs rise by double-digit percentages every year, 7 percent is a footnote.

The nonpartisan Congressional Budget Office, as usual the best source for this kind of analysis, says malpractice costs make up only 2 percent of health care spending. "The evidence available to date does not make a strong case that restricting malpractice liability would have a significant effect," the CBO says.

Even WellPoint, the insurance giant whose CEO likes to complain about malpractice lawsuits, says litigation and defensive medicine "are not considered a recent significant factor in the overall growth of health care spending."

The liberal health care myth is about prevention. If only under universal care we could monitor people before they get sick, the argument goes, think how much we could cut costs.

Expanded insurance "will cover preventive care like checkups and mammograms that save lives and money," President Barack Obama said at his July news conference.

Unfortunately, it doesn't work out that way. Society-wide, investing in prevention and early detection may cost more than the expenses saved in stopping acute or chronic illness, policy experts say. Preventive care would mean lots of new tests and scans for people who never would have gotten sick anyway.

Studies have shown that lowering the smoking rate may increase medical costs over the long term. Why? Those who would have died of lung cancer or heart disease go on to live for decades, consuming medical services and developing other expensive diseases.

"You have to look at what type of preventive service you're talking about," says Anderson. "The word 'prevention' won't save money. Prevention across the board would not save money."

The Congressional Budget Office again delivers the verdict.

"The evidence suggests that for most preventive services, expanded utilization leads to higher, not lower, medical spending overall," CBO director Douglas Elmendorf wrote this month in a letter to Congress.

That's not to say it's not worth doing. Giving people longer lives with less chronic disease might be a very good investment by society - even if it ends up costing more. A big problem with today's system is that we foot higher-than-average medical costs for lower-than-average results in wellness, longevity and other measures. More spending on prevention might at least improve the overall return.

Likewise, there are compelling reasons to enact tort reform, even if it doesn't end up financing peace, love, happiness and wellness for everybody forever.

But holding out either policy change as a solution to medical inflation only delays the day we tackle the real and much tougher problem: wasteful spending on people who are already sick.

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