January 12th, 2009
McKinsey blames technology for our health care woes
Imaging technology represents much of the “waste” identified by McKinsey Global Institute economists in a new breakdown of the U.S. health care problem.
Outpatient care accounts for 41% of total care and 67% of total “waste,” and its growth is out-of-control, according to the report.
CT scans, knee replacements, and other expensive treatments are routinely approved without effective controls. Robert Samuelsen of Newsweek calls this a political problem.
But there is another way of looking at it. Add these expenses to our prescription drug epidemic and you see American health consumers subsidizing American dominance of the healthcare technology industries.
That is the flip side of this problem. American companies still dominate the market in medical imaging, in pharmaceuticals, and in operating room technology because their home market consumes, almost without question, every advance they make.
To make money in Europe or Asia their competitors are limited to serving high-income patients.
Access to the mass market requires jumping through government approvals where there are immense political pressures to just say no, and hard bargaining if approval is granted.
I have participated in this just like everyone else. For my knee pain I got an x-ray, without wait or question. For my back pain I got a CT scan, ordered by a chiropractor. And the insurance company paid.
It’s very likely I would have had a long wait for these procedures in Europe, and very possible they would have been denied. In both cases I recovered on my own. Rest cured the knee. Weights cured the back.
The promise of HMOs was that such expenses could be reduced, that having a gatekeeper stall or deny high-tech care could save money. It did, for a time. Then HMO care became subject to the same inflationary pressures as every other form of care.
These are the kinds of answers the push toward an integrated system of EHRs is designed to find. But, as with decision support on medical decision making, it may turn out the data was there all along.
The problem is, as Samuelson notes, “What others call ‘health costs’ are their incomes — wages, salaries, profits.” Saving Peter means ending subsidies to Paul.
Samuelson’s own proposals for ending the subsidies — taxing benefits, charging more for Medicare, imposing a tax to cover government health costs — are only half the answer.
The other half is having someone just say no to unnecessary high-tech care.
Dana Blankenhorn has been a business journalist since 1978, and has covered technology since 1982. He launched the Interactive Age Daily, the first daily coverage of the Internet to launch with a magazine, in September 1994. See his full profile and disclosure of his industry affiliations.
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| 01/12/09
