August 18th, 2017
While it’s general knowledge that our nation spends more on health care than any nation in the world–more than $3 trillion a year–many people do not realize that at between 20% and 30% of that spending is wasted on unnecessary care, inefficiencies, fragmentation of care, failure to deliver needed care and fraud. The amount of health care waste is so large, it’s hard to wrap your mind around it. How do you begin to chip away at $600 billion to $1 trillion worth of unnecessary spending?
Here’s one place to start: have Medicare stop reimbursing providers for low-value care, health care services that provide little or no benefit–or may actually be harmful– to patients.
Over the past decade there has been an explosion of research into unnecessary care; this growing evidence base shows there are many tests and procedures that we would be better off without. Harvard health economist Dr. Aaron Schwartz and colleagues identified dozens of these “low-value services” and created a methodology for measuring the amount Medicare spends on them each year. The Medicare Payment Advisory Commission (MEDPAC) used this methodology to measure the frequency and cost of 31 low-value care services (pdf) covered by Medicare in 2013 and found that they accounted for over $7 billion in spending.
Here are just a few of the health care services we should stop paying for (and what we could save by not performing them):
Count per 100 beneficiaries, 2013
Medicare spending, 2013
Colon cancer screening for patients over age 75
Prostate cancer screening for patients age 75 or over
Balloon angioplasty or stent for stable coronary disease
Imaging for non-specific low back pain
Spinal injection for low back pain
Source: MedPac (2016), “Quality of Care in the Medicare Program,” chart 5-6. We used the “broader version of measures” as created by Schwartz et al (2015).
Routine screenings for cancer may seem like a smart idea; after all, catching certain cancers early can make survival more likely. But testing low-risk patients over 75 for colon and prostate cancer causes more harm than good. Older patients are unlikely to realize benefits from colon cancer screenings because the cancer is slow-growing; similarly, older patients with prostate cancer are more likely to die with prostate cancer than because of it. Serious complications occur in about 2.5 out of 1000 colonoscopies, and prostate cancer screening can lead to anxiety from false positives and unnecessary treatment, which can cause life-altering side effects.
In 2013, the most recent year for which data are available, Medicare spent $525 million on these two screenings for patients over 75. On average, 17.6 of these tests were performed for every 100 beneficiaries. Rates of unnecessary PSA tests have declined since 2009, from 12 to 9.2 tests per 100 beneficiaries, but the rate of unnecessary colon cancer screenings slightly increased during that time.
While implanting a stent in patients having a heart attack can save lives, evidence shows that for patients with stable heart disease, stenting does not prevent future heart attacks or reduce mortality. Having a stent implanted carries a small but clear risk of complications, such as damage to the artery, blood clots, infection, heart attack and stroke.
In 2013, Medicare spent $1.3 billion on stent implants for patients with stable coronary disease, the largest single contributor to unnecessary spending out of the 31 low-value procedures measured by MEDPAC. The incidence of the procedure has decreased since 2009 by 50%, but 3 out of every 1000 Medicare beneficiaries still received the treatment.
Low back pain is one of the most common reasons Americans seek medical treatment, but there is little doctors can do to help. Acute back pain usually improves on its own over time, and for chronic back pain, exercise and non-drug therapies are recommended over medication or invasive treatments. However, some physicians still offer treatments that do not benefit patients, and Medicare still pays for them.
Imaging for nonspecific low back pain was the most frequent low-value service listed for 2013, with 11.9 scans performed for every 100 Medicare beneficiaries for a total cost of $236 million. Medicare also paid $1.26 billion for spinal injections and $369 million for vertebroplasties in 2013. Vertebroplasties have been shown to have no long-term benefits compared to placebos, and the possible complications (such as cement leaking into tissues or veins) are no joke. Similarly, research shows no benefit for epidural steroid injections compared to a placebo, and too many of these shots can lead to spinal cord damage.
These six procedures accounted for more than $3.7 billion in waste in 2013. And if all 31 low-value services MEDPAC measured are considered, that number rises to $7 billion.
But the MEDPAC analysis is just the tip of the iceberg. There are other services Medicare pays for that are often unnecessary—such as imaging for pulmonary embolism, sinus surgery, and spinal fusion—but are hard to measure using available data. And we can’t forget about overuse of prescription drugs paid for by Medicare Part D, also not included in the MEDPAC analysis.
Changing Medicare’s reimbursement policies to reduce unnecessary services is step one toward getting rid of this mountain of waste. But redirecting financial incentives alone won’t solve the problem. We need a cultural change from all actors in health care— clinicians, hospitals, patients, industry, government, and medical schools— to realize that more is not always better, to examine the evidence diligently, and to fully understand the potential harms and benefits of the services provided. Reducing unnecessary services would not only save our health system billions, it would also save patients needless physical and emotional harm.