The Primary Problem With Our Current Health Care System: Waste

Severe_high_blood_pressure[2]By: Ken LaRive, TLB Contributor.

A few days ago I went to my primary doctor to help me clear up my annual sinus problem. As usual I received a cortisone shot, antibiotics, and his favorite sinus medicine compounded by a local pharmacy. This combination has me feeling better in a day. Otherwise I would be suffering for a month, until colder weather arrived. He fit me in between his last patient and a surgery, and though I felt very feverish and lethargic, I could not let the moment pass without asking about his take on Obama Care. I paraphrase:

“It will dynamically change the industry, and create a socialistic state that will undermine our economy. The middle class will suffer tremendously, as well as small businesses, and good health care will become a thing of the past. If it goes through, I will be one of the first physicians to go. I will be forced out. Unless I can get on with a hospital, or clinic, men in private practice will be a thing of the past.”

I said, “What is the alternative? It is my understanding that there is a lot of corruption in this industry, from insurance companies, pharmaceuticals, the health care providers.” And with this statement, his whole domineer changed. He looked at me for a moment and said, “That is not the problem, waste is the primary problem. If we could tackle waste, this industry would make a 180 degree turn.”

With plugged up ears, glassy eyes, and a low grade fever, I listened to him talk for 40 minutes. Only when his nurse came in to tell him it was time to prep did he break away. He said, “Google Price, Waterhouse, Cooper 2008, if you want to write something about this Ken. It will open your eyes, and you will see the health industry far more accurately.”

I have a great respect for my doctor. He is known to be a savvy physician who keeps up with new medical discoveries, is honest and fair, easily accessible and known to be an excellent eye, ear, nose and throat surgeon, so I looked forward to studying his suggested article.

I first found that Price, Waterhouse, Cooper (PWC), was awarded one of Fortune’s 100 best companies to work for in 2013. They are known for very in-depth research as a consulting firm, and the data they gather is considered accurate and valuable in formulating statistical analyses, and their advice as business consultants are well known around the world. They are divided into several divisions, and provide industry-focused services for public and private clients. With a global network, they provide business support both domestic and international, whatever the size business.

The following is their take on the primary problem with our current health-care system, waste:

“The price of excess: Identifying waste in healthcare spending To appropriately address waste in health spending, health industry leaders, policymakers and consumers must work together on system-wide goals and incentives. In April 2008, PwC hosted the 180° Health Forum in Washington D.C., bringing together representatives of government, regulatory bodies and the nation’s largest hospitals and health systems, health insurers, pharmaceutical and life sciences companies to seek new, collaborative approaches to solving some of the health system’s most intractable problems.

These challenges — how to focus on prevention and wellness, how to drive greater quality and value into our healthcare system and how to ensure that our health system is resilient in the face of disaster — cut across traditional boundaries and requires that we think about our health system in new ways and consider innovative solutions.

As part of its preparation for the 180° Health Forum, PricewaterhouseCoopers’ Health Research Institute (HRI) interviewed more than 20 participants, reviewed more than 35 studies about waste and inefficiency in healthcare and surveyed 1,000 consumers to understand the public’s perception of waste and inefficiency in the system. From that research came The price of excess: Identifying waste in healthcare spending.

Key Findings

Our research found that wasteful spending in the health system has been calculated at up to $1.2 trillion of the $2.2 trillion spent in the United States, more than half of all health spending. Defensive medicine, such as redundant, inappropriate or unnecessary tests and procedures, was identified as the biggest area of excess, followed by inefficient healthcare administration and the cost of care necessitated by conditions such as obesity, which can be considered preventable by lifestyle changes. PwC’s paper classified health system inefficiencies into three “wastebaskets” that are driving up costs:

• Behavioral where individual behaviors are shown to lead to health problems, and have potential opportunities for earlier, non-medical interventions. • Clinical where medical care itself is considered inappropriate, entailing overuse, misuse or under-use of particular interventions, missed opportunities for earlier interventions, and overt errors leading to quality problems for the patient, plus cost and rework. • Operational where administrative or other business processes appear to add costs without creating value.

When added together, the opportunities for eliminating wasteful spending add up to as much as $1.2 trillion. The impact of issues such as non-adherence to medical advice and prescriptions, alcohol abuse, smoking and obesity are exponential, and fall into all three baskets.”

Author’s note: I originally thought the primary problem to be corruption, from top-heavy pharmaceutical companies, Insurance Companies, all the way down to the health care provider. It would seem to me that the third part described above called Operational, would prove that point. Again, he seemed very reluctant to call it that, and took the time to help me understand this from his perspective by asking how I had originally come to that conclusion. I thought for a moment of all of the personal problems I had had over the years, but mentioned one thing I thought might prove that point. I told him I had noticed that if I didn’t have insurance coverage for a particular procedure, the price was less than if insurance had picked up the tab. “Yes!” he said, “We do that to help you belay the cost.”

But of course, without being too critical, too condensing, to decisive in our opinion of this matter, as surely corruption exists… perhaps if we could tackle the problem of waist first, corruption might dissipate too.

“If we are creating ourselves all the time, then it is never too late to begin creating the bodies we want instead of the ones we mistakenly assume we are stuck with.”

Deepak Chopra:

“Warning: Before beginning an program of physical inactivity, consult your doctor. Sedentary living is abnormal and dangerous to your health.”


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