Why health care costs are ballooning

Have you ever wondered to what degree health care is driven by a profit motive?

A doctor advises you to undergo a procedure. Is that advice motivated solely by concern for your health and welfare? Or, does the generous financial compensation peculiar to procedures bias your doctor’s decision?

The billboard on the highway advertises a hospital heart program. Is it meant to raise awareness of lifesaving services? Or, is it the same as an ad for a casino or hotel chain, a marketing tool for generating business?

At one time or another, we’ve probably all shared a suspicion that healthcare is occasionally motivated by money: over-priced prescription drugs, hospitals charging higher prices to the uninsured, the three-minute doctor’s visit for $200.

Direct-to-consumer drug advertising has brought aggressive drug sales tactics front and center to the public’s attention. “Ask your doctor about . . .” is the mantra of countless 30-second spots appearing several times an hour on national television. Direct-to-consumer drug advertising has provided the American public with a $4.5 billion reminder that there’s money to be made in the world of prescription drugs (U.S. Government Accountability Office). And there’s certainly a load of money to be made. A 2003 Harvard and Massachusetts Institute of Technology study showed that, of every dollar spent on consumer drug advertising, $4.20 was recovered through increased sales (Impact of Direct-to-Consumer Advertising on Prescription Drug Spending; Henry J Kaiser Family Foundation). A $53,000 ad run three times during the Oprah Winfrey Show is money well invested for a drug manufacturer.

The knotty issue of medical errors has recently captured attention. Unintentional medical errors—-nurses administering the wrong medication, doctor misdiagnoses or amputating the wrong leg, unrecognized medication interactions—-are an estimated $29 billion headache. Former Secretary of Health and Human Services, Tommy Thompson, reported that up to 98,000 lives are lost every year as a result of errors in healthcare delivery.

No doubt, these are all enormous problems that plague our healthcare system.

But I am going to make the case for a much larger problem. The magnitude of this problem dwarfs that of medical errors. It’s not an issue of neglect, nor is it committed in error. It is built on intentionally committed acts, systematically conducted on a massive scale, and sustained by the participation of many. It is a plague of unprecedented proportions on the health care system. It requires the willing participation of parties at multiple levels, from lone medical practitioners, to hospitals, to multi-billion dollar medical device and drug manufacturers, even to institutions like the FDA and American Heart Association.

The problem is the bizarre situation that has evolved in health care for the heart. I specify health care for the heart, not heart disease, because actual disease is not always part of the equation. Astonishingly, much of the inflated cost of heart care is based on the feared specter of heart disease, the implied threat of heart disease, the possibility, sometimes vanishingly remote, of heart disease based on some harbinger of risk. Sometimes the disease itself is nowhere in sight.

The system thrives on a culture of fear, an open ticket to over-testing and profligate spending. Ads cleverly admonish you to “Do it for your family”. Nuclear stress testing alone generates $18 billion of costs. Yet this test is normal in 80% of people tested. Worse, the 20% of “abnormal” stress test results are not always indicative of genuine disease, they are “false positive,” and are a big part of the reason that 30% of heart catheterizations fail to show disease. “My arteries checked out okay!” relieved patients will declare?-but there may have been no reason to have pursued a costly test like catheterization in the first place. But the system makes far better sense when you understand that nuclear stress tests and heart catheterizations are the bread and butter of cardiologists and hospitals, and the ticket to more financially rewarding procedures.

This approach evolved in the 1960s, when coronary heart disease itself was impossibly difficult to diagnose until a catastrophe like heart attack declared itself. But in the 21st century, coronary heart disease is easily, inexpensively, and safely detectable, decades before heart attack risk looms over your life. Yet murky, risk-based tests like stress tests and cholesterol testing continue to dominate the practice of “heart disease detection” in real-life practice.

Make no mistake: This problem is huge. The cardiovascular health care system has mushroomed into a gargantuan profit-generating mechanism, far larger than is required to deliver essential heart care. In 2003, over $431.8 billion was spent in the U.S. on cardiovascular health care, $151.6 of this on coronary disease alone (American Heart Association, Heart Disease and Stroke Statistics—2007 Update). The U.S. Department of Health and Human Services projects that total health care spending will double to $3.6 trillion by 2014, consuming 18.7 percent of the nation's economy, much of the increase due to expanding cardiovascular costs.

Most tragically, the system has grown through the exploitation of trust. The faith we have in doctors, hospitals, and the institutions and people associated with healthcare has been subverted into the service of profit. Many practitioners and institutions have chosen to operate under the guise of doing good but instead capitalize on the public’s willingness to accept as fact the need for a major heart procedure and all its associated costly trappings.

Copyright 2008 William Davis, MD

Comments (7) -

  • JPB

    3/28/2008 8:30:00 PM |

    I have spent a lot of time wondering why everything in medical care is so expensive.  I have not been given any answers despite asking a lot of questions - I really would love to see some of those bottom lines! (BTW, I'm not holding my breath.)

    One thing that really bugs me is how offended and/or defensive doctors get when you ask "why" or otherwise challenge them.  How are we (the clients) to rein in costs if we don't ask "why?"

  • Anonymous

    3/28/2008 11:42:00 PM |

    Received a sad e-mail this morning from a long time friend.  We used to work with each other 10 years ago or so and over the years have kept in touch, talking on the phone a few times a year.  I've been sending him copies your Heart Scan Blog for awhile and do that because I remembered his fit, athletic, father-in-law passed away suddenly from a heart attack while taking his daily hike into the Tennessee mountains.  Ever since then doing what he can to have a healthy heart has been important to him.  

    The sad part is I found out this morning that my friend has only been skimming your articles.  He wrote to me this morning:

    "I have a heart story of my own to tell you.  I might even call you up because it's a really good story.  The hint is that in the last 2 months I have had an echocardiogram, worn a Holter Monitor for 24 hours, and had a nuclear stress test (no blockages seen)."

    I wrote him back an honest e-mail, saying congratulations on the good test results, but if he was only looking to see if he had plaque present, he had been scammed. I then sent him a few of your recent articles about this topic.  And moments ago, I send him todays blog, joking that it had been tailor made for him.  

    My friend is good friends with a decently well known DC Congressman.  I half jokingly told him that maybe this is something Washington should have hearings on.  They have hearings over everything else, why not this?  I can't think of what Washington could actually do about the problem other than hearings would draw attention to the problem. (dreaming away)  

    I'll give him a call this weekend to say hi and give him sound heart care advice.

  • Anonymous

    3/29/2008 2:04:00 PM |

    Actually, the Hill is not a bad place to start.  Find out the committees that are appropriate and research from there. I believe Senator Kohl in Wisconsin is the head of one of them concerning aging.  Of course, they're going to do what's politically correct, and that might be a dilemna, but there are some that might take an interest if they can use it to their advantage.  ie:  ultimately lowering Medicare costs.  Maybe find one that's had a heart attack or two.  Depending who ultimately is the new President could play into it.  ie:  Democrats and universal health care plan.

  • Rich

    3/30/2008 2:10:00 AM |

    Dr. Davis:

    We need you to become Surgeon General of the United States! (I'm sure you wouldn't want the job, but we still need you.)
    How about Director of NIH?
    How about health policy advisor to the next President?


    PS - Our insurance and taxes are paying for the Krispy Kreme eaters and it's crushing our economy!

  • Stephan

    3/31/2008 8:06:00 PM |

    I think the problem is technology is increasing at a rapid rate.  We have more and more sophisticated ways of dealing with more and more minor problems, but they're also incredibly expensive.  

    We have the attitude in the US of "Get the best treatment, no matter what the cost", but the cost is becoming so absurd it's hurting everyone.  

    We're going to have to make some tough decisions in the near future.  We just can't afford to give cutting-edge medicine to every person forever.  Either people have to take preventative health measures so they don't get ill in the first place, or they have to accept that the public may not want to foot their bill.

    On another note, our per capita healthcare cost is huge in this country, even though our health outcomes are unimpressive.

  • David Miller

    7/25/2008 2:47:00 PM |

    Thank goodness though that we at least have access to the best medical care in the world.  You hear about other countries having better management systems, but at least I trust the care here.  Thanks.

  • David

    12/16/2010 1:51:17 PM |

    Definately everything has become a money minting scheme and we do not now what and who to trust.
    But i would like to suggest people to browse through Findrxonline, as it helped me get good amount of prescribed medicines at a reasonable rate. You will get to know reliable vendors and retailers who will provide you with medicines at a low price and you do not have to worry as your health will be kept guided from time to time.