Atul Gawande: Excessive, Unnecessary Care Drives Up Costs

Writing in the June 1, 2009 issue of The New Yorker, Atul Gawande, reports that Medicare spent $15,000 per enrollee in McAllen, Texas in 2006, which makes McAllen the second most expensive health care market in the country.

In El Paso County, Medicare spent only $7,504 per enrollee, half of what it spent in McAllen. Both communities have essentially the same demographics, with similar per capita incomes and similar percentages of non-English speakers, illegal immigrants, and unemployment rates.

One might assume that the population of McAllen is unhealthier or that the quality of care is better. Neither appears to be true. The rates of heart disease, asthma, HIV, cancer, injury and infant mortality in McAllen are actually lower than the national average and data show that McAllen’s five largest hospitals actually perform worse than El Paso hospitals.

So what is going on in McAllen to cause such high health costs? Gawande’s answer is across the board overuse of medicine. Medicare patients in McAllen received almost 50% more specialist visits than those in El Paso and were two-thirds more likely to see ten or more specialists in a six-month period. They also received 20% more abdominal ultrasounds, 30% more bone-density studies, 60% more stress tests with echocardiography, 200% more nerve-conduction studies to diagnose carpal-tunnel syndrome, and the list goes on. The most expensive piece of medical equipment, as Gawande notes, is a doctor's pen. Physicians in high-cost markets order more of everything – office visits, testing, procedures, specialist referrals -- much of it medically questionable, some of it driven by business interests or ignorance of treatment guidelines.

The overuse of medicine is not new and is not found only in McAllen -- in fact, Los Angeles has the third highest level of per capita Medicare spending in the country. Overuse has been extensively documented throughout the country for decades. John E. Wennberg of Dartmouth University first wrote in Scientific America in 1982: “The amount and cost of hospital treatment in a community have more to do with the number of physicians there, their medical specialties, and the procedures they prefer than with the health of the residents.”

Read The Article