Supplies and Devices Are Biggest Cause of Hospital Cost Increase

There just might be a link between rising healthcare costs and hospital marketing of their procedures (some elective) which require expensive devices (as da Vinci) (I’m thinking).

And this marketing might be tied in with over diagnosing and fear of malpractice suits, perhaps…

From a recent email update received from AHRQ (US Agency for Healthcare Research and Quality

Medical supplies and devices represented nearly one-fourth (24.2 percent) of rising hospital costs between 2001 and 2006, according to a new AHRQ-funded study.    Among all types of hospital stays, the cost percentage impact for supplies and devices was nearly three times that of operating room services.  While rising inpatient costs are typically associated with imaging services such as computed tomography scans and magnetic resonance imaging, those services only contributed a 3.3 percent increase in the cost of an average hospital stay, the study found.   Because rising hospitals costs are an ongoing concern, payers and policymakers may want to explore the specific factors driving those costs and the factors associated with them, according to the study authors.  The study, “What Hospital Inpatient Services Contributed the Most to the 2001 to 2006 Growth in the Cost per Case?,” was published online in Health Services Research on September 4. Select to access the abstract on PubMed.®

[Principal Findings of this study – “Supplies and devices were leading contributors (24.2 percent) to the increase in mean cost per discharge across all discharges. Intensive care unit and room and board (semiprivate) charges also substantially contributed (17.6 percent and 11.3 percent, respectively). Imaging and other advanced technological services were not major contributors (4.9 percent).”]

Related articles

• Rising cost of inpatient care linked to medical devices and supplies (medicalxpress.com)
• Health care spending: Study shows high imaging costs for defensive purposes (jflahiff.wordpress.com)
• 9-part series on over-diagnosis (short reads from a health care journalist) (jflahiff.wordpress.com)
• Where do our wasted health dollars go to?(KevinMD.com)

  Excerpt:

  • Failure of care coordination ($25 to $45 billion wasted). I see examples of this all the time. Docs and hospitals don’t talk to each other, and patients don’t bring records—so tests get repeated, or (even worse), medicines are added on top of other (unknown) medicines, creating costly havoc. The patients suffer. Why does this happen? Docs (like me!) get paid to see patients, not to read charts and chase down forms. In fact, HIPAA “privacy” laws have made care coordination even more time-consuming and frustrating for everyone.
  • Failure of care delivery ($102 to $154 billion). I’m not really sure exactly what that means. I imagine they mean waste created by not treating medical conditions early, when they’re less expensive to address.
  • Overtreatment ($158 to $226 billion). In part, this is defensive medicine—docs do whatever they think they need to do to they don’t get sued. Show up in the ER with a headache? You get a $1600 CAT scan! Those tests not only cost money themselves, but they lead to more tests and procedures and costs that really aren’t making anyone healthier. (Except the medical-malpractice industry. They’re doing real well.) Overtreatment also includes steps taken by lazy doctors who find it quicker—and better for business—to just order the tests and treatments the patients expect, rather than doing what’s medically appropriate.
  • Unnecessary administrative complexity ($107 and $389 billion). We love filling out forms, and we love hiring staff to wait on hold for administrative pygmies at the insurance agency to approve Grandma’s catheters. Yup, that’s why we went to med school.
  • Noncompetitive pricing ($84 and $178 billion). “Noncompetitive”, I think, must be a euphemism for “batshit crazy”. Ever see a doctor or hospital’s price sheet? They’re locked up, guarded by poisonous lizards deep in an underground bunker. Prices have to be super-inflated so the insurance companies can negotiate them down to what they’ve already decided they’ll pay (when they get around to it, which is after they’ve paid for the VP’s executive jets and haircuts.) People who don’t have insurance, of course, get hosed.
  • Fraud and abuse ($82 to $272 billion). With this much money sloshing around, scumbag frausters (including some with MD degrees) crawl out and starting grabbing what they can. For every jerk the government finds and prosecutes, there’s a handful of other cockroaches to take their place. Though there’s certainly insurance fraud in the private market, there is far more abuse designed to extract money from government health programs. Insurance companies do what they can to guard against fraud, which could hurt their profits or drive them out of business. Government agencies just don’t seem as driven to control costs. I guess they figure we can always borrow more money from our grandchildren.
• Choosing Wisely – Conversation starters for office visits on choosing health care (jflahiff.wordpress.com)

  Choosing Wisely – a Web site that aims to “aims to promote conversations between physicians and patients by helping patients choose care that is:

  Supported by evidence
  Not duplicative of other tests or procedures already received
  Free from harm
  Truly necessary

• Electronic Medical Records Reduce Negative Outcomes and Related Costs After Patient Safety Events Occur (ahrq.gov)

• [Reblog] Use of patient decision aids may lead to “sharply lower hip/knee surgery rates & costs”
  

• Electronic Medical Records Reduce Negative Outcomes and Related Costs After Patient Safety Events Occur (ahrq.gov)