WASHINGTON — Improved technology lowers overall costs in most industries but not in health care.
So Joint Economic Committee Chairman Bob Bennett, R-Utah, held a hearing this past week to find out why — and identified reasons that range from better technology causing more people to seek more treatment, to problems with insurance, regulation and laws that keep up costs that technology would normally drive down.
"For example, some have expressed concern that advanced imaging technologies may be overused, in part, because of poor incentives in the payment formulas used by Medicare and other insurers," Bennett said.
He cited another example of an advance that would seem to bring savings but resulted in increased overall costs instead.
Bennett said his wife several years ago tore cartilage in her knee and required major surgery and a painful three-day hospital stay to fix it. More recently she had a similar injury to her other knee but had it repaired through cheaper, relatively pain-free arthroscopic surgery that required only an hour in an outpatient clinic.
"When it's easier to do, more patients decide it is worth having. Those with milder injuries may be likely to undergo arthroscopic surgery, but they would never consider going to the hospital for a miserable week's stay," so overall costs go up, said Mark B. McClellan, commissioner of the Food and Drug Administration.
Similarly, he said some new advances against such diseases that could not be treated before, such as some types of cancer, allow people to live longer and better — but may be more expensive over time because of new groups receiving treatment.
Harvard medical professor Peter Neumann said that shows that while costs may be up with advanced technology, so are the benefits.
"It is important to address not just how much medical technology contributes to health costs but whether the investments in medical technology are worth the health benefits produced," Neumann said.
Meanwhile, Bennett said the health-care industry is not utilizing some advances that could bring better efficiency and savings — often because of legal and regulatory roadblocks.
For example, he said to imagine passing out on a sidewalk in a strange city. Imagine having a card in the wallet with your entire medical history on a microchip, allowing doctors to make a quicker and better diagnosis.
"Technology could allow that now," Bennett said — and might lower costs by avoiding duplicative tests and by providing quicker care. But he said privacy laws and hurdles such as different health-care groups using different coding for medical histories likely would not allow it for years.
Also, Neumann said hospitals and doctors are often afraid to share information about what may have gone wrong with treatment — and aid in review that might improve treatment and technology — for fear of aiding lawsuits against them. He said shielding use of such data against them could bring better advancements.
"We need to find the right balance," Bennett said. "We need to judge the cost-effectiveness of new technologies, so that we properly fund this critical work, without overpaying and without adding additional upward pressure on health-care spending.
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