During his recent State of the Union speech, I was delighted to see President Obama acknowledge the unsupportable rising costs of health care in this country but sadly, his proposals would barely make a dent.
The U.S. currently spends about $2.7 trillion per year on health care and along with this cost, U.S. employers experience another $300 billion annually in lost productivity due to illness and poor employee health — and each year, health care costs are rising by almost $300 billion.
Clearly, if we are to make progress we must talk about changes that save hundreds of billions, not tens of billions, of dollars per year and unfortunately, President Obama’s proposed changes don’t even come close.
President’s proposal are too little, too late
According to the The Washington Post:
- Changing the way Medicare pays for prescriptions – will lead to an estimated savings of 156 billion over a decade, or $16 billion annually.
- Raising premiums in a means-tested way for seniors – will lead to an estimated savings of $30 billion over a decade, or $3 billion annually.
- Changes that lead to health care pay for performance — will lead to an estimated $6 billion annually in savings, at best. This scenario is the most promising, but given the pilot state of these efforts, the savings are unlikely to be dramatic for the next few years and we can expect vicious counter-lobbying from the usual suspects, since this change will, ultimately, require true change in how medicine is practiced here.
If you do the math, this represents, at most, $25 billion per year in savings against a system whose cost is over 100 times that amount— and growing ten-fold each year.
Clearly, this is too little too late. To really lower the skyrocketing cost of health care in this country, two fundamental changes are required:
We need to address the root of the problem.
We, as a nation, have triple the obesity rates we did just 25 years ago — and six or more times the rate of morbid obesity. The U.S. is experiencing massively more Diabetes Type II and it is likely that it will rise even more over the next two decades, as the Baby Boomer generation continues to age.
We have already met the problem and it is us; we must get healthier, and frankly, we need to eat less. Of the $2.7 trillion per year mentioned above, it’s at least a third, and, arguably half, of the diseases are directly linked to a lack of exercise and low fruit and vegetable intake.
A crusade to get back to the average weights of just 25 years ago is the sort of crusade we need in order to have a solid fiscal house and a healthy population. It’s estimated that health costs, on average, for treating an obese person will be $8,315 a year in 2018, versus $5,855 for an adult at a healthy weight — that’s a difference of $2,460.
Even at today’s rate of obesity (2018 is looking worse), this represents 100 million Americans or $246 billion just in basic costs. For the seriously obese and the more developed illnesses over time from Diabetes Type II like kidney failure, blindness, foot problems and from the similar issues from cardiovascular disease and from those 30 percent or more of cancers in which lifestyle plays a role, however, the costs per patient are far higher.
The real savings are likely to exceed a trillion dollars per year if we can get the U.S. population to a healthy weight and off cigarettes. Even if we only changed the lifestyles of 20 percent of Americans, that would equate to hundreds of billions a year and vastly exceed the savings from Obama’s plan.
This is the shift we need and must have.
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Explore the Role of Incentives in Performance Management
Rewards for keeping Americans healthy
Secondly, we need to reward and pay the health care community for keeping Americans healthy, not treating them when they’re sick. Right now, 99.9 percent of health care costs go to “sick care,” not health care, and most of the costs don’t even go to “primary care doctors.” The U.S. currently has about 350,000 primary care physicians, the ones tasked with preventative care, but we pay them about $62 billion a year out of the $2.7 trillion, or less than 3 percent of what we spend.
Of course, most of the work being done by these primary care physicians in the current pay-for-procedure model isn’t about prevention, but rather, for treatment. In other words, 97 percent of our health care costs are going to devices, hospitals, insurers, specialists, and pharmaceutical companies, not the doctors who could help with prevention, and most of the remaining 3 percent isn’t going to prevention.
A great deal of time is going to treat diseases in which obesity, poor nutrition, lack of exercise, smoking or combinations thereof are root causes and the medical community has a term for the condition that this lifestyle creates, they call it the “metabolic syndrome.”
Turning sick care into healthy health care
Metabolic Syndrome is a well-known precursor to both diabetes and heart disease, and the percentage of Americans experiencing it has been steadily increasing year by year and in fact, accounted for over 70 million Americans almost a decade ago.
The current model is equivalent to dealing with traffic accidents by spending 97 percent of money on body shop work and some small fraction of the remaining 3 percent on preventing drunk driving and dangerous driving.
It’s well past time to tinker with costs that dwarf all other national costs combined, and develop a wellness program that prevents hundreds of thousands of needless deaths each year. It is time to turn our sick sick care system into a healthy health care system, and make the true heroes of medicine not the cardiologists who treat you when you are already ill, but the physicians who keep you healthy well into old age instead.
When these are the doctors who are the heroes, then we will know we have turned back the tide.