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The Quality Imperative A Commentary on the U.S. Healthcare System

Austin B. Frakt, PhD, Aaron E. Carroll, MD, MS

Introduction

The U.S. healthcare system is ailing, despite thepassage of the Patient Protection and AffordableCare Act (ACA) in 2010. Although it was a mon- mental advance, the ACA was not comprehensive ealthcare reform, as it focused principally on expanding ccess to health insurance. The ACA largely, although not ntirely, avoided swiftly and directly addressing two ther problems that plague the healthcare system: high nd rapidly increasing spending and poor population utcomes. Considering politics and market dynamics, neither oses issues that are simple to solve. The $2.6 trillion U.S. ealthcare economy involves many powerful interest roups and major political constituencies. As the 2009– 010 health reform debate demonstrated, making major hanges to healthcare delivery and fınancing poses fun- amental challenges to the U.S. legislative system. Yet, echnically, reducing growth in healthcare spending eems paradoxically trivial: Adopt a model from any in- ustrialized nation that has achieved lower healthcare pending growth (Figure 1). A more-diffıcult challenge is to increase broadly the uality of the U.S. healthcare system, as measured by opulation-level outcomes. In fact, a substantial problem s that it is diffıcult to improve quality in ways that can be easured easily. However, in some areas, quality im- rovements can be achieved relatively easily. Adhering to est practices and heeding the lessons of certain clinical rials simultaneously could improve quality and reduce aste and costs. Thus, in many respects, we already know ome ways to improve healthcare quality; it is imperative hat we apply the available tools to do so.

From the Department of Veterans Affairs (Frakt), VA Boston Healthcare System, and the Department of Psychiatry, Boston University School of Medicine, Boston, Massachusetts, and Center for Health Policy and Profes- sionalism Research (Carroll), Indiana University School of Medicine, Indi- anapolis, Indiana

Address correspondence to: Austin B. Frakt, PhD, Boston University School of Medicine, 150 S. Huntington Ave., Boston MA 02130. E-mail: frakt@bu.edu.

s 0749-3797/$36.00 http://dx.doi.org/10.1016/j.amepre.2012.09.010

S22 Am J Prev Med 2013;44(1S1):S22–S26 Published by El

The Cost and Quality Context Domestic trends and international comparisons make clear the fact that U.S. healthcare spending is high and growing rapidly. Notwithstanding decades of concern about healthcare spending; the passage of numerous incremental reforms to public health programs (nota- bly to Medicare and Medicaid); and various private- sector innovations in health insurance and its provi- sion, healthcare spending has grown from 9% of the U.S. economy in 19801 to 18% today.2 Over that pe- riod, growth in spending has outpaced that of other wealthy nations, as well as overall inflation, economic growth, and the wages of workers (Figure 1). Per- person healthcare spending in the U.S. was about $7500 in 2008, an extreme outlier relative to other Or- ganisation for Economic Co-operation and Development (OECD) nations, even accounting for the greater wealth the U.S. enjoys.1 Federal spending on health programs now accounts for 23% of the federal budget and is ex- pected to grow to 34% by 2035.3 By all accounts, this growth is unsustainable. High healthcare spending in the U.S. might be

viewed as acceptable, or at least grudgingly tolerated, if it resulted in consistently high-quality and broadly enjoyed health outcomes. But it does not. Numerous studies, examining dozens of measures of population health, have concluded that the U.S. lags far behind its peer nations in many measures of healthcare quality.4

Figure 2 summarizes how the U.S. compares to several other OECD nations on various dimensions of health- care quality: To adequately meet the needs of a diverse population, and to receive good value in return for expenditures, the U.S. must improve the quality of health care delivered.

Cost-Savings the U.S. Can Implement Now Ofcourse,we,asacountry,alwayshaveachoiceandarefree tospendaslargeaproportionoftheU.S.economyonhealth care as desired. However, doing so implies some unpleasant consequences: potential massive increases in taxation; huge increases in debt; dramatically lower spending on other goodsandservices(suchaseducationanddefense);orsome combination thereof. In a 2010 Health Affairs article,6 Jo-

ephNewhouse,facedwiththesechoices,explainedwhythe

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trajectory of total U.S. healthcare spending must be bent downward. Key to his argument, however, was the observa- tion that it is not enough to simply address healthcare spending in federal programs, notably Medicare. The healthcare spending problem must be solved nationally, for both public and private payers. The real question, therefore, is not whether to spend

less on health care (relative to the economy or projections of current trend) but how. Either less can be spent on everything, or spending cuts can be targeted. The for- mer approach risks reducing spending on necessary, effıcient, and life-extending or life-enhancing care. The latter approach offers an opportunity to reduce waste and improve quality as spending is controlled. Increasing quality and reducing waste, as spending is tamed, sounds hard, and it is. But the U.S. already knows where to begin and has an idea of how to do it. Well-designed studies have shown that, often, treat-

Figure 1. Healthcare spending as a percentage of GDP in Note: Source: OECD health data, 201029

GDP, gross domestic product; OECD, Organisation for Economic Co-operation

ments are offered, and paid for, that do not improve

anuary 2013

outcomes. Let’s consider just a few. About three quarters of a million new vertebralfracturesoccurin the U.S. each year, and people aged �50 years have a nearly 25% chance to have at least one such fracture over their life- times.7 Most such frac- turesheal,butasubstantial number cause chronic pain. Although surgery for these fractures has been controversial, the number of vertebroplasties paid for by Medicare nearly dou- bled from 2001 to 2005. A 2009 study showed that vertebroplasty for verte- bralfractureswasnobetter than sham (fake) surgery in reducing pain.7 In spite of this study, Medicare still pays for 100,000 such pro- cedures each year, at a cost of $1 billion annually.8

In addition, studies show that more than 5% of people in the U.S. aged �30 years and more than 10% of those aged �65 years have frequent knee pain from osteoarthritis.9

In 2009, more than 00,000 of them underwent arthroscopic surgery, at a ost of $3 billion.10 Yet a 2002 study showed that ar- hroscopic surgery for knee pain was no better than sham urgery.9

An enormous list could be amassed of treatments that have been proven to be ineffective, let alone cost ineffective. These could include routinely using estro- gen in menopause for chronic disease prevention,11

suppressing arrhythmias post–myocardial infarc- tion,12 doing internal carotid artery bypasses,13 using �-blockers as fırst-line therapy to prevent stroke,14

giving estrogen to men with coronary artery disease,15

giving high-dose glucose infusions in the critical care unit,16 using �-blockers perioperatively,17 and nappropriately using implantable cardioverter- efıbrillators.18 Recently, the Choosing Wisely campaign,

in partnership with medical provider organizations,

OECD countries

evelopment

31

identifıed fıve tests or procedures that are of questionable

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value, in each of nine medical specialties (www. abimfoundation.org/ Initiatives/Choosing- Wisely.aspx). The exact amount

spent on these proce- dures every year is not known, yet it is known that they are all still com- mon, expensive, and do not improve outcomes at the population level. They provide a ready, if politically challenging, means to reduce spend- ing without decreasing quality. In fact, eliminat- ing them would increase quality because doing so would avoid needless health care, which itself carries risk. The key is to reform institutions and payment systems within the broader healthcare system that would provide incentives to eliminate them. This is not a simple task; knowing what to do is not the same thing as getting everyone to agree to do it.

The Way Forward Of course it is not enough to describe areas in which spending can be reduced without decreasing quality. A description also must be provided of how to motivate actors within the system—patients and providers—to change their behavior. Two fundamentally different views about how to do this have been offered recently. One approach is to place the burden on patients by in-

creasing cost-sharing. Advocates of this approach, among them current congressional Republicans, point to the RAND Health Insurance Experiment as support. Results of thisprojectdoshowthatindividualswithhigherdeductibles and copayments incurred lower healthcare spending. However, that project and subsequent work have shown that individuals are ill-equipped to differentiate between necessary and unnecessary care. When patients cut back on utilization, they did so indiscriminately. About half the for- gone care would have been good for their health.19,20 The other approach, more associated with congressio-

nal Democrats and President Obama, is to focus on treat- ment modalities that are more effective than others and empower experts to reduce program spending on those treatments that prove less valuable. The American Recov-

Figure 2. The quality of he Note: Among the seven countries, 1 AUS, Australia; CAN, Canada; GER, Co-operation and Development; UK,

ery and Reinvestment Act of 2009 allocated $1.1 billion m

for comparative-effectiveness research, studies that compare the clinical effectiveness of treatments.21 The ACA further supports research of this type by estab- lishing the nonprofıt Patient-Centered Outcomes Re- search Institute.22 The fırst step in reducing wasteful ealth spending is to identify it, which is exactly what omparative-effectiveness research does. The second step is to create institutional structures that sethisinformationtodelivercarethatcanbejustifıedon he basis of strong evidence of effectiveness. In some ases, such structures would expand care to improve uality (e.g., fınancing without copayment for clinical ervices vetted by the U.S. Preventive Services Task orce). In other words, not all comparatively effective or ost-effective quality improvements would necessarily be ost-saving; they should nonetheless be pursued if they re effective. As noted, individuals are not always able to distinguish etween helpful and unhelpful health care. However, they eed not do so. Empowering physicians to make such eterminations is one of the implicit goals of the ACA. he law establishes the rules governing new accountable are organizations (ACOs), integrated systems of provid- rs responsible for the care of a population of patients and t risk for the associated costs, with bonuses and penalties ied to measured quality. ACOs can theoretically play a ositive role in increasing quality, including through

systems of selected OECD nations gnates the highest rank and 7 the lowest; excerpted from Davis 2010.5

any; NETH, Netherlands; NZ, New Zealand; OECD, Organisation for Economic d Kingdom

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easures that reduce wasteful spending.

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Frakt and Carroll / Am J Prev Med 2013;44(1S1):S22–S26 S25

Organizations with ACO-like structure known for high-quality and effıcient care already exist, including Kaiser Permanente, Group Health Cooperative of Puget Sound, Geisinger Health System, and the Veterans Health Administration.23,24 ACO-like concepts are being ursued also by Blue Cross/Blue Shield of Massachu- etts.25 Although ACOs are no panacea, and may them- selves raise other issues, they are a reasonable start toward encouraging the provision of higher-quality care.26

Lastly, the ACA attempts to reduce one of the high barriers to development of a more rational, effıcient Medicare program: politics.27 The act establishes the In- dependent Payment Advisory Board (IPAB), which will have the authority to make Medicare spending recom- mendations that must be considered, without amend- ment by Congress, under expedited procedures.28 In brief, Congress faces a collective action problem that the IPAB would help to address. The IPAB is severely re- stricted by law, in terms of the range of its purview (e.g., until 2020 it cannot suggest changes to hospital payment rates). Nonetheless, it is the type of body that could, one day, streamline Medicare’s ability to implement more- effıcient payment structures, ones that provide greater incentives for reducing provision of care that has been proven by research to be less effective than other approaches.

Conclusion The U.S. healthcare system has deeply entrenched prob- lems relating to access, cost, and quality. These issues have continued for decades, despite many attempts to resolve them. If past experience is any guide, caution should be taken in suggesting that the U.S. is now on the right path to solving them. Even if there are clear technical policy solutions to the problems, it is clear that politics remains a chief barrier. From the authors’ perspective, there is no question that

if politics and informational barriers due to proprietor- ship were no obstacle, the system could be optimized for cost and quality. In some sense, this type of optimization is what the ACA is attempting to do through a politically feasible, gradual path that seeks to minimize the political backlash that has doomed other attempts at serious re- form. Within the context of the structures and bodies established by the ACA, there are positive steps that could be taken to reduce waste, improve outcomes, and de- crease future spending. In the U.S. today, there are medical procedures known

to do little to improve health outcomes and a lot to in- crease costs. The U.S. should begin, right now, to con- strain insurance coverage for such treatments. But this is

just the beginning; comparative-effectiveness research

January 2013

will identify more examples. ACOs can provide incen- tives to put that research into practice. The IPAB could be empowered to add larger incentives toward providing high-quality, effıcient health care. Beyond these steps, inclusion of cost-effectiveness re-

search in reforms could be considered. It is true that this approach would open the door to the type of decision making seen in other national healthcare systems, such as the National Health Service in Britain. But with scarce public resources, does it make sense to cover treatments with high costs that deliver relatively few quality-adjusted life-years? To supercharge the healthcare-system regime in this

way will require not just an unprecedented act of political will, but unprecedented new data systems and data ac- cess. Much about the U.S. healthcare system and its per- formance is unknown, as it is locked up in proprietary databases or inscrutable paper records. Moving medical practice into the 21st century by promoting electronic medical records systems is another goal of the ACA. The next logical step is to tie all these goals together:

harness the data to inform comparative-effectiveness re- search, use that research in the practice of accountable medicine, and develop payment-system incentives to drive the chain of innovation in quality and effıciency. Changes such as these may sound like an impossible dream or a Draconian nightmare. Yet, if the U.S. is going to develop the health system those in the U.S. want, the one many Americans mistakenly think is already in place, such incremental, quality-focused, evidence-based re- form is not a choice. It is an imperative.

Publication of this article was supported by the West Health Initiative. The authors thank Harold Pollack for his comments on an

earlier draft of this paper. The views expressed by the authors do not necessarily reflect those of the Department of Veterans Affairs, Boston University, or Indiana University School of Medicine. No fınancial disclosures were reported by the authors of this

paper.

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