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BOSTON — Whenever experts get together to talk health care, the issue of ballooning costs is never far behind.

And an event in Boston hosted by STAT and The Atlantic was no exception, as experts wrestled with the multitude of challenges facing patients, clinicians, payers, and policymakers in the U.S. They shared evidence of what clearly doesn’t work to reduce the cost of care, and a few ideas of what it might make sense to try.

The first to be dismissed was the idea of making patients smarter shoppers.


The theory goes that “if you could just unleash consumers like you do in the Apple Store, they will figure out the best value,” said Amitabh Chandra, professor of social policy and director of health policy research at the Harvard Kennedy School of Government. “We’ve tried to find this result, but it’s just not there. Simply calling a patient a consumer doesn’t control spending.”

Michael Chernew, professor of health care policy and director of the Healthcare Markets and Regulation Lab at Harvard Medical School, suggested looking at the way doctors are compensated. For starters, the fee-for-service system is mind-numbingly complex, he said. And it works against finding more efficient ways to treat patients because there is no reward for choosing a less expensive drug or procedure. “Changing the way physicians are paid will give them the incentive to become more efficient,” he said.


And what about physicians?

“Clinicians — physicians, nurses, and others  — they witness the financial toxicity of our system for individual patients,” said Steven Pearson, president of the Institute for Clinical and Economic Review, who is also a physician. “They want the health care system to take care of that.”

“That” often means soaring drug prices.

Most countries have systems in place to evaluate drugs and their value, unlike the U.S. Pearson, whose nonprofit group conducts similar analyses, argues that studies of whether one drug is demonstrably better than another will push progress. “If we do a better job discriminating, it will make companies go for the home run. The business model will reward those that try to innovate.”

His organization concluded that a $475,000 drug for pediatric leukemia was worth its price. But a $75,000 drug for tardive dyskinesia, piggybacking on another rare-disease drug, was not.

“If we can align price with value, you should be able to improve access to patients,” he said.

As the political debate roils around drug prices, Chandra warned that if prices are squeezed by regulation, there will be a downstream effect that could shortchange tomorrow’s patients. “In the short run, if you want to reduce costs, we know rate-setting works. The question is, what would happen to quality, and future innovation?”

Looking at other countries can be tempting, but it may not be wise to pick and choose pieces to adopt, said Chernew.

“We have built a health care delivery infrastructure here, for better or worse, and we have to be careful … so the system doesn’t collapse,” he said.

  • Its not about docs being paid whatever its about legal and regulatory burden heaped on suppliers and providers. Input costs are so inflated just to cover the constant threat of the strong arm attorneys out their trolling the media sites encouraging frivolous law suits. On top of that you have regulators heaping on mountains of non-value added work that force the expansion of salary costs just to offset that admin burden.

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