Cost-shifting could sink healthcare system

January 1, 2008

Soaring expenditures must be contained or they will end up sinking the healthcare system, Allen S. Lichter, MD, CEO of ASCO, said during a featured appearance at the Radiological Society of North America meeting (see photograph below). Among the changes that could help attack the problem is mandatory insurance coverage for all citizens, Dr. Lichter said. He also cast doubt on the ability of one currently popular approach, consumer-driven, high-deductible healthcare plans, to solve the system's problems.

CHICAGO-Soaring expenditures must be contained or they will end up sinking the healthcare system, Allen S. Lichter, MD, CEO of ASCO, said during a featured appearance at the Radiological Society of North America meeting (see photograph below). Among the changes that could help attack the problem is mandatory insurance coverage for all citizens, Dr. Lichter said. He also cast doubt on the ability of one currently popular approach, consumer-driven, high-deductible healthcare plans, to solve the system's problems.

Dr. Lichter, a radiation oncologist by training, made his comments during the RSNA's Annual Oration in Radiation Oncology. The annual oration normally covers a clinical topic, but in a lecture studded with statistics, Dr. Lichter promoted the case for healthcare reform.

He said the growth in the cost of healthcare, now at about 17% of the gross domestic product and expected to hit 20% by the year 2017, is on an unsustainable track. Combined with other trends in medicine-the system is at risk of failure, Dr. Lichter said.

"Either something happens or the healthcare system is threatened. Without cost containment, there will be major shifts of costs to private payers and Medicare beneficiaries," Dr. Lichter said.

Back to 1965?

For Medicare beneficiaries, cost-shifting could be so dramatic that it would "impoverish the over 65 population, and we'll be right back to 1965 when we enacted Medicare so that seniors could have access to great healthcare and not have to face bankruptcy and poverty. We are about to re-enter that cycle, and that cannot be allowed to happen."

A requirement for mandatory insurance would limit cost-shifting in medical care, a pervasive problem that is boosting the costs for those covered by insurance by 9% annually, Dr. Lichter said.

Consumer-driven, high-deductible insurance plans, by contrast, would not solve that problem and would add problems of their own: Sick patients with high deductibles would quickly exceed them and end up in the healthcare system without having contributed to its maintenance, and most of them would be ill equipped to personally manage their own care.

"The smartest and largest companies in the world cannot figure out how to control healthcare costs," Dr. Lichter said. "How do we expect the average citizen to do it on their own?"

A blunt instrument

Access to care is also threatened by congressionally established tools to control spending, such as the sustainable growth rate calculation that ties increases or reductions in physician fees to past overall medical spending, he said. [See ONI October 2007, page 34.]

"This is the classic blunt instrument," Dr. Lichter said. "This will eventually make the gap between Medicare and private reimbursement so large that the system will lose balance, and access to care by Medicare patients will become a problem."

Oncology costs

At about 5% of national healthcare expenditures, oncology care represents a component, but not the major source of rising costs, Dr. Lichter commented at the meeting.

Still, costs in oncology are rising by about 15% per year, and the number of Medicare cancer patients is increasing by 1.5% to 2% per year, he said.

Outstanding results

Also, studies show that in the United States, most patients get about 50% of recommended care for major chronic diseases.

"When you look at cancer, as we have done in ASCO, somewhere between 70% and 80% of expected care is delivered to cancer patients," Dr. Lichter said. "We are producing outstanding results, but not spending a huge proportion of the nation's dollars."

But he also said, "Radiology and radiation oncology must do our part. We need to design and execute clinical trials to show which imaging modalities produce best results."