Elliott S. Fisher, M.D., M.P.H.
Dartmouth Medical School, Hanover, NH
DR. FISHER: Thank you very much. It is indeed a treat to be here. Thanks to Jack Wennberg and Alan Gittelsohn, we’ve known for over 30 years of the remarkable disparities in spending observed across U.S. regions and communities. More recently we’ve found similar disparities when we study the populations cared for by major academic medical centers.
The differences in spending are largely due to differences in the quantity of care provided to similar patients. Compared to similar patients at Strong Memorial Hospital, patients cared for at NYU Medical Center spend twice as much time in the hospital, spend two-and-a-half times as many days in the intensive care unit, and have three times as many physician visits.
Only recently has it become clear, however, that we’re not getting much—if anything—for all the additional care. In fact, the details emerging from our research point to a “paradox of plenty.”
Our earliest studies focused on Medicare enrollees who’d had a heart attack, colon cancer, or hip fracture—and a representative sample of the elderly population. We found a consistent pattern: whether one looks at technical quality, satisfaction with care, perceived accessibility, or long-term survival, higher spending across regions or hospitals offered no benefit. Subsequent studies have confirmed that for technical quality, at least, higher spending is clearly associated with lower quality.
The key to the paradox emerges from a detailed look at the differences in practice. Higher spending—whether at the hospital or regional level—is almost entirely due to greater use of the hospital as a site of care,
more frequent physician visits, a greater propensity to refer patients to specialists, and the higher rates of imaging, diagnostic tests, and minor procedures that accompany more intensive physician contact. We term these “supply-sensitive services” because the variations in their utilization are strongly associated with factors on the “supply side,” not only the local supply of physicians, hospital beds, and imaging centers, but also the incentives under which they operate. High-spending regions have a greater per capita supply of physicians (in particular, medical specialists) and more hospital beds. The consequence for patients is an inpatient-based and specialist-oriented pattern of practice.
More recent findings underscore the paradox. We’ve found that physicians in high-spending regions perceive the quality of care to be worse than those practicing in low-spending regions. They report greater difficulty maintaining the longitudinal relationships with patients that are necessary for high-quality care, and they report greater difficulty communicating with other physicians.
This latter finding fits perfectly with the much greater apparent complexity of care in high-costs systems. Seriously ill patients cared for by the highest cost academic medical centers are more than three times as likely to have 10 or more different doctors involved in their care.
Current work on heart attack outcomes by Jon Skinner, Doug Staiger, and myself underscores the seriousness of the problem and addresses concerns that our earlier work looked only at cross-sectional differences, not growth in spending. Regions with the most specialist-oriented pattern of practice have the greatest growth in spending but the smallest gains in survival, whereas regions that were early adopters of high-quality innovations—such as beta-blockers or timely revascularization—have the least growth in spending and much greater gains in survival. So it’s not a question of how much we spend; it’s how we spend it.
I think there are three underlying causes that are worth considering— largely because we can do something about them: (1) Most medical decisions require judgment, and our scientific enterprise has provided little help. (2) In the absence of firm guidance, both physicians and patients tend to assume that more medical care means better medical care. (3) We have a payment system that provides strong incentives to provide more care, regardless of whether it’s needed or wanted. How can we then move forward?
First, we need much better science to guide clinical practice. Academic medicine—and the NIH—should begin to pay serious attention to the challenge of supply-sensitive services and the remarkable variations observed across regions and delivery systems.
Most of our scientific infrastructure is devoted to exploring the biology of disease and developing new, highly targeted interventions aimed
(usually) at a single molecule or disease mechanism. The gains have been remarkable. But the notion that all the answers to our health problems will emerge from the basic sciences is a naïve and reductionist view that serves neither the public nor our medical students very well. There are a few settings where the answers are black and white and the problem is one of execution. But most medical care is not that simple.
Remarkably little attention has been given to how to help physicians and patients make wise choices. Almost no scientific effort has been devoted to the challenge of supply-sensitive services. Among the most expensive decisions physicians make are when to see their patients again and whether to admit them to the hospital for management. The most expensive decision administrators make is whether to expand a clinical service or recruit new physicians. None of these are currently the focus of serious scientific inquiry. A wonderful question for clinical scientists to pursue would be how all health care systems could achieve the high quality and low per capita costs achieved by Strong Memorial or the Mayo Clinic. Academic medical centers and the NIH need to take the lead in exploring the health implications of the natural experiments inherent in their remarkably different practice patterns and investment. To complement the science of disease biology, we need a serious investment in the science of clinical practice.
Such an investment should help with the second problem, the lack of adequate information on health system performance. Our current performance measures aren’t up to the task. Most of our measures focus on technical quality and emphasize individual physician or hospital accountability for a specific clinical service where strong scientific evidence determines correct practice. Such measures reinforce a narrow, technically oriented view of clinical practice. They fail to account for the complexity of caring for patients with multiple chronic conditions, for whom strict adherence to clinical guidelines—as a number of authors have now pointed out—could lead to harm. Such measures will also do nothing to address the differences in practice and spending across health systems. I would suggest several areas of performance measurement that warrant serious attention: measures that promote shared accountability at the health system level; measures that allow us to judge whether a system achieves informed patient choice; and measures of the long-term costs and outcomes of care.
If the public and patients were able to choose between two care systems, one of which cost half as much as the other but achieved equal or better results, it’s a fair bet that many would choose the higher quality and less expensive system, especially if they could pocket the savings. Patients and the public largely assume that because medicine is rooted in science, the practice of medicine is currently scientific. Routine public re-
porting of comprehensive quality and cost information would rapidly dispel that myth.
Finally—and perhaps a bit quixotically—I would suggest that real progress will require reform of the payment system. Fee-for-service payment has given us the delivery system we deserve.
Fee-for-service rewards volume, ensuring that whatever resources we have remain fully occupied, regardless of whether they are needed or not. Fee-for-service rewards the growth of high-margin services. The exploding growth of cardiology, orthopedics, interventional radiology, and imaging services can be traced directly to the relatively high profit margins of such services and the needs (or wants) of physicians and hospitals to maintain their incomes.
Fee-for-service payment also rewards fragmentation. If a primary care physician has limited time and is paid little for the visit, the most efficient way to manage a difficult problem—from her perspective—will often be to refer the patient to another physician. Physicians in the highest spending U.S. regions and health care systems are almost three times as likely to refer their patients to specialists. This unnecessary—and probably harmful—complexity is directly fostered by fee-for-service payment.
The remarkable differences in spending and overall intensity observed across regions and health care systems present both a challenge and an opportunity. The opportunity lies in the potential savings that could be achieved. If all U.S. regions could adopt the conservative practice patterns of the lowest spending fifth of the country, Medicare spending—and possibly spending overall—would fall by 30 percent. The challenge, however, is substantial.
Since the publication of the Chasm report, we have focused our attention on technical quality, safety, and errors. One unintended consequence may have been to reinforce a public perception that good outcomes can be guaranteed and that the problems we face in medicine represent a few technical glitches that can easily be fixed. The public belief that more medical care means better medical care is deeply entrenched, so I’m afraid that we’ve got real work ahead of us. That’s why I believe that a good place to start would be a serious effort to address the dramatic differences in resource use we see across even our best academic medical centers and the development of meaningful performance measures. With those in place, we might have a shot at reform of the payment system.
Thank you very much.
DR. FINEBERG: Thank you very much, Elliott, for an excellent overview and a wonderful introduction to the systems-level components that may be available for improving quality.
I would like to turn now to our second speaker. He is George Isham,
the medical director and the chief health officer for HealthPartners, a large health care system in Minnesota.
George has been a leader in the field of improving quality and performance of health care from a systems point of view and was quite instrumental along the way for a number of projects here at the Institute of Medicine. He is still active, serving, for example, as a member of our board on population health and public health practice, and he was also the chair of the committee that produced the report on priority areas for national action transforming health care quality.
It is a great pleasure to welcome and introduce to you Dr. George Isham.
