Med Trends Continue

Beware of the news; usually the main thing one learns is that long term trends continue.

  • Case 1: US medical spending, now >16% of GDP, continues to double as a fraction of GDP every three decades. Politicians worry and agonize, but refuse to actually cut. Specifically, a recent article said Congress keeps postponing ’97 rules it set to limit rising Medicare fees, and rising fees plus a huge increase in number of doc visits led to a 51% increase in Medicare payments to docs from ’00 to ’08. The low chance of remedial action is shown by the article title: “Doctors say Medicare cuts force painful decision about elderly patients.” (more)
  • Case 2: Docs kill huge numbers of people via preventable errors, and there is little support for forcing hospitals to publish error stats, much less for strong financial incentives to punish errors. Docs say such stats would be “misinterpreted.” Specifically, a recent study found that in at least 0.4% of hospital stays, a medical mistake “caused or contributed to a patient’s death.” This rate has not changed since a 1999 report estimating up to 98,000 US annual med mistake deaths “led to a national movement to reduce errors.” Multiplied by the 40 million US hospital discharges reported for 2008, this makes for 173,000 annual deaths. For who else besides docs would we not do the obvious easy thing to greatly reduce such a huge cause of death? (more; HT Tyler.)

Some article quotes:  On med spending:

A long-postponed rate-setting method that is on track to slash Medicare’s payment rates to doctors by 23 percent Dec. 1. Known as the Sustainable Growth Rate and adopted by Congress in 1997, it was intended to keep Medicare spending on doctors in line with the economy’s overall growth rate. But after the SGR formula led to a 4.8 percent cut in doctors’ pay rates in 2002, Congress has chosen to put off the ever steeper cuts called for by the formula ever since. …

The growing cost of running a medical practice … rose 18 percent from 2000 to 2008. During the same period, Medicare’s physician fees rose 5 percent. … From 2000 to 2008, the volume of services per Medicare patient rose 42 percent, … [which] helps explain why Medicare’s total payments to doctors per patient rose 51 percent from 2000 to 2008. A review of physicians’ incomes suggests that specialists … reaped most of the benefit. On average, primary-care doctors make about $190,000 a year, kidney specialists $300,000, and radiologists close to $500,000,

On death by med error:

The study, conducted from 2002 to 2007 in 10 North Carolina hospitals, found that harm to patients was common and that the number of incidents did not decrease over time. The most common problems were complications from procedures or drugs and hospital-acquired infections “It is unlikely that other regions of the country have fared better.” …

It is one of the most rigorous efforts to collect data about patient safety since a landmark report in 1999 found that medical mistakes caused as many as 98,000 deaths and more than one million injuries a year in the United States. That report, by the Institute of Medicine, an independent group that advises the government on health matters, led to a national movement to reduce errors and make hospital stays less hazardous to patients’ health. … About 18 percent of patients were harmed by medical care, some more than once, and 63.1 percent of the injuries were judged to be preventable. … 42.7 percent of them required extra time in the hospital for treatment of problems like an infected surgical incision. In 2.9 percent of the cases, patients suffered a permanent injury. … 8 percent of the problems were life-threatening, … and 2.4 percent of them caused or contributed to a patient’s death. …

The study was limited by its list of “triggers.” If a hospital had performed a completely unnecessary operation, but had done it well, the study would not have uncovered it. … “Process changes, like a new computer system or the use of a checklist, may help a bit,” he said, “but if they are not embedded in a system in which the providers are engaged in safety efforts, … progress may be painfully slow.” … “What we know works in a general sense is a competitive open market where consumers can compare providers and services. … Right now you ought to be able to know the infection rate of every hospital in your community.”

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  • Matthew Fuller

    Could you give me a sense of the other medical experts who disagree with your statistics or methods? Names, websites?

    I want to present your medical skepticism to a skeptics/free thinking group at UTD but do not want the embarrassment of relying on my fav. expert.


    • Be careful,
      I’ve recently noticed Prof. Hanson unapologetically use misleading statistics, in his “Bah complex regulations” thread. Check the comment section.

      • You noted that Hanson used ellipses around that statistic, so were you claiming that excised portions of the op-ed undercut the message? It seemed to me that the portions he left out were less relevant spouts of populism. In his own post Hanson disagreed with the claim that growth was being killed in the U.S, he thought it was persisting in spite of it. It was Morris Panner who was highlighting that one ranking as if it were representative of the overall relative difficulty of doing business. All Hanson’s point really requires is that there are areas in which we have overly complex regulations which hinder innovation, and that nobody has done anything about it by invoking huge gains to future descendants.

      • Did you go to the link with my post and play around with it?
        It doesn’t take much to see how misleading it was to include that statistic in either the initial op-ed, or for Prof. Hanson to burn calories to preserve it in his post on OB.

        It’s a warning sign to me about how much trust to put in his more esoteric writings, and in posts I haven’t bothered to poke into beneath the surface.

      • Okay, I just went to it, I clicked the U.S link and for that taxation category it reported the same rank of 62. I don’t think the statistic by itself is misleading, the question is what use is it put to. The op-ed author made over-reaching claims about the harm done to growth, Hanson made more modest ones which I think only require that significant detectable complexity-induced inefficiencies exist.

      • I give up on you on this topic. I’ve got to downgrade you a bit too, TGGP.

      • Looking back at those comments again, you expressed surprise that nobody else was shocked. I would suggest that you are not a very good communicator, which is something a number of other people have told you.

        One thing I had overlooked was that you said if the range is restricted to large countries the U.S is not so bad. If the reason is that large countries have subregions with their own particular tax rules, I could then see how complex taxation is a practically unavoidable result of largeness. If the reason instead is along the lines of Mancur Olson’s logic that long-lived stable polities give rise to distributional coalitions small enough to coordinate but influential enough to exploit the larger polity (and that large countries give rise to more groups and greater spoils for rent-seeking) we are back to the story of avoidable loss.

      • Aron

        “I give up on you on this topic. I’ve got to downgrade you a bit too, TGGP.”

        That’s a high status signal that fails for obvious reasons.

      • Matthew Fuller

        Okay, opinion noted thanks.

      • Aron,
        Ignore the status signals and look at the actual numbers and Prof. Hanson (and I can add to that now TGGP’s) framing. I think it’s reasonable to lower trust of a source in the face of obvious bad faith public epistemological behavior. It’s so cartoonishly bad even a relative statistical innumerate like me was able to pick up on it, which is why I found the lack of a chorus of sneers surprising.

  • nazgulnarsil

    solution is simple. break the doctors union known as the AMA.

  • Unnamed

    The first example isn’t “news.” As discussed in the article and elsewhere, the 1997 law was a mistake and Congress stopped following it years ago. The law tied Medicare doctor payments to economic growth in a way that ended up requiring drastic cuts, relative to the rest of the health care sector. The Congress that passed the law did not realize that it would require drastic cuts and did not want drastic cuts – they thought that the law would only be a modest restraint on doctor payments since they assumed that the 1990s boom would continue forever. Congress realized its mistake in 2002 and stopped following the 1997 law, but because of budget gimmickry the law has stayed on the books. Repealing the law outright would look like a big increase to future deficits, given how the accounting gets done, so Congress just keeps passing temporary exceptions so that the 1997 law stays on the books but never actually gets followed.

    The fact that Congress is still not following the law that it gave up on in 2002 is not news at all. The fact that it still has not repealed the law outright and ended the budget gimmickry is minor news which is not all that closely related to medical spending. If Congress ever failed to pass a temporary exception and reverted back to the 1997 law, that would cause a sudden, enormous decrease in Medicare doctor payments, and that would be news. But it doesn’t look likely.

  • Abelard Lindsey

    Make all compounds over the counter. This will cut office visits by 3/4’s and will probably cut the amount of GDP going into health care by half.

  • Is it possible that mistakes can be blameless?

    Maybe the o.4% hasn’t changed despite initiating new safety programs because that’s approximately the level of errors that occur from errors that can’t be helped (ie. procedural complications, misjudgement of a situation with no established protocol, etc.)

    Just a thought.

  • Have there been studies on error rates in other countries?

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