Starting With Curious

My father (who was a cost accountant for a big pharmaceutical firm), used to say “If you think medicine is expensive, consider the alternative.”  Although we didn’t use the term “value” much in the context of health care back then, I think he was trying to get at that concept.  The real question isn’t the cost, it’s what are you getting for it.

Our awareness of the importance of the cost part of the value equation has outpaced our ability to measure the cost.  Oh, we’re getting quite good at determining the cost from the perspective of the provider and the payer.  We talk about fixed vs. variable costs, and direct vs. indirect costs.  While health care costing is complex, there are some very sophisticated systems for measuring those components.  When someone wants to know why a hospital charges $8 for an aspirin that can be purchased at Walgreen’s for $0.03 (as an aside, notice how keyboards no longer have the ₵ symbol?), we can explain that the price includes not only the direct cost of the materials, but also the indirect costs for handling, storage, documentation, administration, etc., much of which is mandated by regulations.  People may still feel the price is ridiculous, but at least it’s understandable.

This works if we’re trying to calculate the value of health care services to the individual who is paying.  It doesn’t work when we determine the value of health care to society.  A basic tenet of health economics is that any cost-effectiveness (i.e., value) analysis must specify the perspective of the analysis.  Much of what we do, especially at the more expensive academic health centers, benefits society as a whole.  But in addition, much of what we do also has costs to society that go beyond what typical cost accounting measures.  There are a host of what economists term “externalities” – essentially, unaccounted for costs.

Charles Bitmann illustrates this concept in a New York Times article called “The True Cost of a Cheeseburger.”  The price of a burger includes direct costs (e.g., ingredients, labor for preparing and serving) and indirect costs (e.g., rent and utilities for the restaurant, advertising), and of course a profit for the vendor.  Among the externalities, however, are things like the maintenance of the highway system used to transport the ingredients, and the cost of caring for illnesses that may be the result of consuming too many burgers.  Because these costs are not incurred by the restaurant owner, they aren’t included in the price.  But someone has to bear those costs.  Most often, they are spread out across society at large.  In the context of a for-profit business, ignoring externalities inflates the profit by passing on the costs to someone else.  Bitmann’s calculation is that the true cost of a cheeseburger would be 15-50% higher if these costs were accounted for.

In the context of health care, there are other implications.  First, in the debate over the cost of medical care to society, things may be even worse than we believe.  Instead of 17% of GDP being spent on health care, it would be substantially higher.  Second, our mission is not to make a profit.  It is to heal people or keep them well, to improve the health of society.  Some of the externalities we ignore may have the opposite effect.  While undoubtedly there are many such externalities applicable to health care, I want to consider two.

The first is the cost of our environmental impact.  Hospitals are among the most energy intense buildings around.  Our carbon footprint is enormous.  There are highly variable estimates of the cost of controlling carbon emissions and dealing with the related climate changes, but they run into the many trillions.  In the current state, those doing the emitting do not bear any of those costs.  (This could, of course, change if there were a carbon fee or tax, but that’s unlikely in the US any time soon.)  At the Milwaukee Regional Medical Center, our heat and cooling come from a coal-fired thermal plant.  This will eventually be converted to natural gas, which has about half the carbon emissions, but they are still substantial.  Since there is no cost to the hospital for those emissions, there is no financial incentive to do something to eliminate them (e.g., geothermal).  But should we be looking more broadly at the cost to society, from an economic perspective?  Or the health impact, from a moral perspective?  Some health systems, notably Gundersen Lutheran in La Crosse, WI, have done so in a big way.

The second externality is lost productivity to patients and families due to unnecessary waiting.  I have never seen anything about this in print.  But the amount of time people spend waiting in our facilities is simply extraordinary.  Societal-perspective economic analyses typically include an estimate of the monetary value of lost time.  Imagine what the cost of an ER visit would look like if it included not only the usual direct and indirect costs, but also the 120 minutes of lost work for the parents?

Research, education, public health, preventive care: these are an important part of the quality part of the value equation.  Payers, policy makers, and individuals need to be reminded that when they think about what health care costs, this is part of what they are getting in return.  We, in turn, need to be mindful that we actually cost even more than we know.  As my father might have said, “If you think medicine is expensive, it’s worse than you thought.”

A few months ago in the emergency department, I saw a child who had been getting only half as many puffs of their asthma controller medication as prescribed.  The mother, hoping to make the $185 inhaler last longer, figured some medicine was better than none.  For many people, living on the financial edge, life is a series of trade-offs – medicine vs food vs clothing vs transportation – that most of us are completely unfamiliar with.

Health insurance is supposed to minimize the need to include medical care as part of that zero-sum equation.  The Affordable Care Act, by expanding coverage, should therefore increase access to care.  But one of the changes that has accompanied the ACA is a huge increase in cost-sharing, not just for people covered by policies acquired through the ACA, but for everyone.  Over 20% of all health plans now are high deductible plans, and they are growing far faster than any other type of coverage.  We are now starting to see some of the effects of this shift of financial responsibility for health costs away from insurers and toward patients.  Back in the 1970s, the RAND Health Insurance Experiment randomized people to high vs. low deductible plans.  Their main findings were that those who had to pay higher out-of-pocket costs used less medical services, both necessary and unnecessary, and that overall there was no demonstrable difference in health outcomes.  Many have since latched onto this as evidence that cost sharing can decrease spending without harming health.  But dig into the details and you’d see that among those people with lower incomes and poorer health to start with, there were adverse effects of greater cost sharing (specifically, higher mortality among those with hypertension).

In the July issue of JAMA Pediatrics, researchers from Boston report on the effect of cost sharing on children with asthma.  Similar to the RAND study, forgoing needed care (including medications and emergency department visits) was more common among those families with higher cost sharing who were also below 250% of the federal poverty level.  Moreover, such families reported worse asthma control.  They also were more likely to have to borrow money (33.3%) or defer other necessities (17.6%) than families who either had less cost sharing in their health insurance, or higher family income.

At present, children covered under Medicaid have very little cost sharing.  Indeed, in the JAMA Pediatrics study, children covered by Medicaid fared reasonably well.  However, those families who have employer-provided insurance, or those obtaining coverage via the public exchanges, may well fall into that combination of modest income and high cost sharing that leads to forgoing needed care for their children.  We as health care providers need to be aware of the kinds of Sophie’s choices they are faced with.  How can we support them?  We can ask them if they are having trouble making ends meet, if they are having to trade off food for medication.  We can be sensitive to the cost of the care we provide, and consider less expensive alternatives when appropriate.  And we can be non-judgmental when we find out they missed a clinic visit, or didn’t refill a prescription.  Instead, we can be curious.

July 1 is the traditional start of the medical academic year.  The hallways are bustling with eager, young (and getting younger each year) physicians with seemingly limitless enthusiasm.  Yet by the end of the year, surveys show that at least half of them will have some signs of burnout.  This is not unique to health care. A 2013 Gallup study found that just 30% of American workers are engaged at work.  This is remarkably consistent across sectors of the economy (health care is actually at the higher end, with 34% of physicians and 33% of nurses engaged), and is a figure that compares favorably with the global average of 13%.

The usual leading suspect is lack of work-life balance.  But that is only a part of the picture. Research shows that there are four core needs that, if met, contribute to a feeling of satisfaction and engagement (or burnout, when these needs are not met):

• Physical – opportunities to regularly refresh and renew at work (e.g., taking breaks) and away from work
• (work-life balance)
• Emotional – feeling valued and appreciated for one’s contributions
• Mental – ability to focus in an absorbed way on the most important tasks, and determining when, where, and how to get the work done
• Spiritual – doing what you do best and enjoy most, and feeling connected to a higher purpose at work

A survey of over 12,000 workers (95% of them “white collar”) showed that of these, it was the ability to focus and to think creatively that was most often felt to be missing.  A sense of meaning or significance to one’s work, and doing what is most enjoyed, were also lacking.  I suspect that part of why health care professionals are somewhat more engaged than others is the strong sense of mission we have and share with the organization as a whole.  We all want to feel that what we do is important, enjoyable, and appreciated.  I am very fortunate that, for most of my career, I have been in jobs that are exactly that.

Satisfaction is more a function of the organization than of the industry.  A common thread among those organizations with a highly engaged and satisfied workforce is certain characteristics of leaders: personal energy level, showing appreciation, and leading by example when it comes to creating focus and renewal.

Hoping to cast a positive shadow of leadership, I am getting ready to renew myself physically and mentally on a family vacation.  No email, no work reading, and no blog next week.