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by Anthony S. Ragusea, PsyD, ABPP

Half of the battle to reduce health care costs


Half of the battle to reduce health care costs: How do we reduce the costs of health care? Our current path is unsustainable, we know, but what to do? Mental health care is less than 1% of the total expenditures on care insurance companies have to make. That means we have to look to physical health to cut costs. Half the battle is restraining hospitals, drug and medical device companies, and specialists who charge insanely huge amounts of money to keep profits high and have no incentive to reduce the fee because the bill gets sent to gargantuan insurance companies and not people like you and me. But the other half of the battle is having serious, sober discussions about cost effectiveness. This opinion piece is by a physician making a case for reducing costs by using cost effectiveness formulas to estimate how much value a given treatment has in terms of adding years to life or increasing quality of life, and then considering that in light of the cost of treatment. Think talking about a single payer system is difficult? Try talking about what procedures we won’t pay for! The author acknowledges as much, but disagrees that such discussions inevitably lead to “death panels” where heartless bureaucrats decide not to pay for procedures that save lives. The reality is that the vast majority of the money we spend on health care gets spent on the very young and the very old. Children born prematurely are often the ones responsible for massive health care expenses, while at the other end of the timeline the treatments used to extend life by a few days, weeks, or months is also extremely expensive. And, increasingly, elderly people in particular are making more of these “cost effectiveness” decisions already–maybe not thinking in terms of financial cost, but in terms of whether the treatments are worth whatever benefit to extending life or quality of life. People increasingly write living wills that dictate what treatments they want under what circumstances, recognizing that some treatments simply don’t seem…. worth it. In the same way, we need to acknowledge that there are many treatments that offer little benefit but are extraordinarily expensive, and are just… not worth it. Adopting an attitude of “if there’s a treatment, we’ll pay for it!” may be very popular, but it ignores reality and contributes to the bankrupting of America. This does mean that people will be denied treatments, but the intent is not to deny treatments just because they are expensive, but because they are expensive AND have little value. We can’t, morally, have a conversation like this without first tackling the bottomless greed of our current healthcare system. It makes no sense to talk about cost effectiveness models while shareholders demand higher profits that in turn dictates the absurd cost of health services particularly in hospitals. The Affordable Care Act, I believe, will not do enough to control these costs because it leaves the current private insurance system largely unchanged. But, eventually, we need to have a serious talk about what we should and shouldn’t be paying for.



by Anthony S. Ragusea, PsyD, ABPP