A study published in the American Journal of Managed Care earlier this year found that getting rid of cost-sharing for primary care actually saves money and reduces utilization. A related editorial in the same publication stated that patients shouldn't have unlimited, unrestricted access to primary care because that would lead to increased unnecessary care.
We asked two of our new physician bloggers -- Kyle Leggott, M.D., a family physician doing a fellowship in health politics and policy at the University of Colorado, and Allison Edwards, M.D., a direct primary care practice owner in Kansas City, Kan. -- their opinions on health care costs and models in this wide-ranging Q&A.
AAFP News: The journal article's conclusions favored eliminating cost-sharing for primary care, but the accompanying editorial called for limits to reduce low-value care. So, the question is: Where do you draw the line and how?
KL: The people determining what should and shouldn't be done are the patient and physician. You have to trust in our training and that we will adapt our practice to follow the evidence. We make choices about utilization every day. A patient's access to a family physician shouldn't increase costs if the patient and physician are working together to spend health care dollars appropriately.
AAFP News: So, you basically completely disagree with the editorial?
KL: Correct. It's not giving enough credit to family physicians. Increasing patient access to primary care isn't going to make family physicians suddenly order more tests. For instance, someone with a joint complaint will usually get an X-ray before an MRI. That won't change based on their ability to see me in clinic.
AAFP News: Do you usually have an idea about how much something is going to cost?
KL: I spend a lot of time and effort in clinic trying to answer that question, for instance, using my pharmacist to look at formularies for different insurance plans. I appreciate it when patients ask, "You're recommending this blood work for this problem I'm having; what is it going to cost me?" Unfortunately, most of my responses are, "I can't tell you that right now. We have to ask your insurance and go through them, and I don't know how long that's going to take." Sometimes I have patients who are so worried about costs that we delay getting treatment until they can go through their insurance and ask. Other times they roll the dice and hope it's covered.
Allison, I imagine given your type of practice, you have a good sense of what things are going to cost.
AE: Absolutely. We're discussing the concept of opening doors to primary care in an effort to create more access to high-value care, but realistically it's hard for most physicians to understand the economic impact of what they're doing. If you don't know the cost of something, it's hard to determine its value.
KL: That's a great point. If the treatment I recommend -- even if it has great medical evidence behind it -- is going to put a patient into bankruptcy or not allow them to buy groceries, it's probably not good health care.
AE: I have a patient who has end-stage liver disease, is not insured and is in and out of the hospital every few weeks just from encephalopathy and worsening ascites. Every time he gets admitted, they start him on rifaximin, which is indicated for his hepatic encephalopathy. They discharge him on that medication, which is about $1,700 a month, so he's never going to take that in the outpatient setting. Frankly, that medicine is not a high-value intervention for him because the cost is so high it would eliminate his housing and his ability to get gas and buy food. So, although it's evidence based -- and from an academic and data standpoint it's high-value care because it could reduce hospital admissions -- for this individual it's not an appropriate course of action because it's completely unaffordable.
The discussion about value-based care is incredibly nuanced because it requires that we be rigid with our definition of value, and in reality, life doesn't play out that way.
AAFP News: Where does DPC fit into the cost-sharing argument?
AE: Health insurance has evolved into a Frankenstein-like health management system. It's really not insurance anymore because we expect it to cover every element of health care. With direct primary care, we're trying to nudge the system back into a behavior that's more consistent with an insurance product, i.e., make low-cost items actually low cost and affordable so they can be accessible to the majority of people. For example, a complete blood count in my clinic is $10. Why in the world would you insure something that's $10? When you introduce middlemen and complexity into the system, the price for that goes up exponentially. So, it's no wonder you get a bill for $250 from a hospital for that same test. We need transparency to pull prices back.
KL: I don't understand why you have to uncouple insurance for high-value things like primary care. If every doctor charges the same price for a CBC, it's OK to go through insurance as long as we're all talking about same price. Where we get into trouble is when insurance companies negotiate different prices for the CBC with different hospital systems, so the final mark-up on that CBC goes to $200. But if a single entity is in charge of negotiating that price and reimbursement, they can say, "No, a CBC costs $15, your insurance does cover it and this is what the doctor's office or lab gets reimbursed for that CBC."
AE: You're talking via single-player contract like Medicare or Medicaid.
AE: The system is so opaque that nobody can do cost comparisons. Even within one hospital system, nobody can tell you how much Blue Cross is paying versus Anthem, versus UnitedHealthcare or others. There's no price transparency. All these contracts are secret. No one wants to share their secrets and are actually contractually bound to not say what other people are paying. It creates an incentive for hospitals to get the highest possible payment from all these individuals because they're not legally allowed to talk to each other.
KL: My point is that you can negotiate reasonable, consistent and transparent pricing for health care if you only have one insurer instead of hundreds. If you have one insurer, you essentially have created an entity that you assume is operating in people's best interest and that will have a better outcome on pricing. There is a subset of the population who are going to have trouble with the model of care you described. One is people who can't afford $10 CBCs. Another is people who are very sick but get managed, complex care in the outpatient setting. Someone who needs weekly CBCs is different from someone who needs a yearly screening CBC. There are also the cost- and risk-averse population who -- even if they can afford it -- are going to stay away. I'm thinking of that 50-year-old guy who doesn't go see the doctor. "I'm not going to spend my $10 for someone to tell me I'm fine." Even a small barrier like $10 is still a barrier that's going to allow someone to have severe anemia before they seek medical care.
AE: You're raising a question of do we have an ethical imperative to provide a basic level of health care for everyone in the United States.
KL: Most other countries have deemed that health care is a basic human right and that everyone should have access to it. In many countries, it's a public good, like electricity, firefighters, a police force and education. It should be accessible, affordable and high-quality.
AE: If we could change to that system tomorrow, I would do it. If it shut down my business, I would support it, but I don't believe we'll switch to any form of universal health care in my lifetime, and here's why: In the United States, the health care industry is about 18% of our GDP. Almost one in five dollars flows through the health care system. If we were to change it dramatically -- make it more efficient, lower costs -- we would dramatically disrupt one-fifth of our economy. If you're a politician, any initiative you take to disrupt one-fifth of our economy is not going to make you popular and you might lose your job. I don't think it's a palatable thing to get behind. Call me a cynic, but I don't believe any politician in office is going to do that.
So, my best bet in the reality in which we live is to move into a system where I can create price transparency, higher access, better care, a better customer-service experience, while also revolutionizing the health care system in a small way. That's my viewpoint. I can change the health care system by not blowing it up, but rather by coming in from the bottom and pushing so we can make these small changes to bring down the total price of care, to create price transparency and create a foundation for negotiating.
AAFP News: You covered why politicians don't change things. Why do patients and physicians seem afraid to change anything in a clearly broken system? Physicians don't agree among themselves when it comes to health care models.
KL: Being in the top 10% of earners, physicians have a lot to lose if reimbursement or salaries go down. Ultimately, the system works really well for some people -- people who have money, corporations, insurance companies. In addition, people are afraid of not knowing what it will look like if we try to change it. Will it be worse? Will it affect them personally?
AE: That's status quo bias. They know the current evil.
AAFP News: Now we're in a system where 40% of adults have high-deductible plans.
KL: The total cost sharing (out of pocket expenses) for employer-based insurance increased by more than 50% from 2006 to 2016. The spending on deductibles went up by 176% in that same time.
AE: And how much did wages go up in that same period?
KL: Less than 30%. Historically employer-based insurance was a benefit that your employer used to attract you to a job, and they took care of your health care. Now the cost is a 50-50 split between employers and employees.
AE: I would be happy if we just blew up the employer-based health care system. The fact that we tie our health care to our employer means that people feel stuck in jobs they don't want because of health care benefits. When you're trapped in a job, your productivity gets lower. It's actually bad for innovation and creating cool, heterogeneous communities that have a lot of small businesses because people are so tied to a health benefit that's becoming less and less of a benefit, but people feel so beholden to it.
KL: I'll add even more bad things. When you lose your job and your financial security, it's made worse because you've suddenly lost your insurance. It also leads to the high cost of care related to changing providers when somebody's insurance changes.
AAFP News: Do you have issues with patients on high-deductible plans delaying care until the end of the year because they haven't met their deductibles?
KL: If you come in once a year toward the end of the year for all your refills, that's fine. What I see as more of a problem is when a patient hasn't met their deductible and they have a new complaint or a chronic condition that's worsening and they don't feel like they can come into the office because of cost. The AAFP tried to address this at the last Family Medicine Advocacy Summit in in D.C. in May. One of the big asks was on a House bill that said insurance should have to pay for two primary care visits -- not annual or preventive visits -- on high-deductible plans. If you have high-deductible plans, you should be able to come in without out-of-pocket costs. That will help, but it's a Band-Aid on a broken system.
AE: When people receive things for free, they tend not to value them. Even though people are paying out their noses for insurance, they perceive those visits are free, so when they lose insurance or have to pay out of pocket with high-deductible plans, they are astonished by the fact that the rate for a physician's time is $100 to $200 an hour, and they don't want to pay that because they are anchoring the value of a primary care physician's time at $0.
Primary care physicians have a constant drumbeat about reimbursement rates and how they are really low. We have to churn though four patients an hour, seeing 20 to 30 patients a day, because we're not being reimbursed adequately. When you create a societal value for primary care of zero, it's hard on a subconscious level to convince people we're worth more than that to increase reimbursement rates so we can have longer visits with patients so we can prove primary care outcomes and, frankly, so we can replenish our primary care workforce. That's a bigger question about reimbursement. What's the long-term trajectory of our health care system if we don't value primary care?
AAFP News: Is the argument against Medicare for All that there would be no competition, which could actually make things worse?
KL: When a politician says, "Medicare for All," you have no idea what it means. If we're talking about universal health care coverage with government-run insurance (single payer), the first concern I hear is that government can be very bureaucratic and there's a lot of overhead. In reality, CMS' efficiency in overseeing Medicare is much better than any private employer-based insurance companies, and that's a fact. For a lot of physicians, when you say, "Medicare for All," they think that equates to everyone getting Medicare-level reimbursement, which tends to be lower than employer-based insurance. That may not actually be the case. That's hypothetical.
AE: This is like reality versus vision. It's important to be optimistic; the reality is that large organizations and large systems get complicated fast, and money, politics and power come into play to really distort beautiful visions.
I find immense value in having a relationship with a human. I went into medicine to care for people. I hate that we don't have universal coverage. I hate that people are declaring bankruptcy every day for medical bills. What I love is that by putting purchasing power into my patients' hands and allowing them to control the financial transaction, I can provide better service -- higher touch, higher quality, more involved care that actually meets their desires and needs better than I could in a system that's filled with a bunch of third parties, bureaucrats and politicians. By taking them all out of the room we get back to where we started this conversation, which is the patient and physician together are the ones who best decide what is the highest-value care.