Merrill Goozner thinks so:
Using $1 million to give 50 seniors artificial hips may help those 50 people get around better, but that's less effective than using the money to administer 200,000 seniors flu shots, which would probably save more than that number of lives.
In countries on fixed budgets like Canada and Great Britain, medical payment authorities are forced to make such comparisons and ration care accordingly. The result is that their physicians are more likely to deliver care that most people really need while skimping on expensive and marginally effective treatments. Yes, people wait on line for those latter treatments, but they can take comfort in the fact that it is the price for ensuring that their fellow citizens get needed care on a timely basis.
The way [medical cost-benefit analysis] is used in the U.S., on the other hand, incentivizes providers to increase the use of marginally effective services whose prices have been inflated to the arbitrary payment threshold. Meanwhile, less costly but highly effective treatments get ignored. In practical terms, we get a lot more orthopedic surgeons making a half million bucks a year replacing a couple of hips a day, while there's a shortage of primary care docs willing to make the rounds of nursing homes immunizing seniors.
All true. Our health system incentivizes "high intensity," rather than "high value," medicine. There's no money in prescribing and relying on low cost drugs and treatments, but enormous amounts of money in performing complex surgeries and offering cutting edge pharmaceuticals. That doesn't mean, of course, that no tylenols are ever offered, or that everyone who complains of the sniffles is rushed in for an angioplasty. Rather, the incentives of a system that pay doctors (and hospitals) based on how much treatment they offer create an at-the-margin push for expensive interventions. When it's a tough call between providing treatment and doing nothing, all the forces are aligned to encourage the costly intervention.
Moreover, because of the way insurance is set up, there's no incentive to redirect some money from paying for expensive claims to pursuing broad public health initiatives. It's not even particularly possible to do so within such a fractured system. We're utterly focused on providing care at the point of trauma or illness -- there's nearly nothing pushing for heavy investments in preventive care, despite the evidence showing that such efforts are far more cost effective.
