Alliance Between the Generations for Responsible Medicare Savings

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There’s no way to address long term financial health in the U.S. without including Medicare savings in the mix.  But political action has been stymied by fear among politicians that we over 65ers will rebel against any and every proposal to contain Medicare costs.

The politicians’ fears aren’t unfounded. With out-of-pocket health care costs rising even for well-insured Medicare recipients, it’s not irrational for over 65ers to see proposals for cost containment as stealth proposals for us to pay even more for our care than we do at present or to suffer from loss of important components of medical care. But this “lose/lose” perspective on our part overlooks emerging findings about the amount of “waste” in U.S. health care and the harms we over 65ers experience from overtreatment. As Berwick and Hackbarth argued in a 2012 JAMA article, discussed in this Health Affairs article, the lowest estimate of health care waste is 20 percent! In other words, there’s substantial opportunity for Medicare savings without (a) increasing out-of-pocket cost for Medicare beneficiaries, (b) reducing quality of care, or (c) further impoverishing future generations.

In order to focus attention on reducing waste and overtreatment, over 65ers who understand the potential for this “win/win” form of Medicare cost containment need to speak out. Political dialogue has been so dominated by “death panel” and “don’t let the government get hold of my Medicare” fears that we won’t get anywhere with regard reducing waste and overtreatment without a voice from the over 65 population on behalf of clinically informed, ethically justifiable Medicare reform.

I’ve recently joined with a group of young physicians and nurses who embrace the economic and ethical imperative for health professionals to help contain health care costs in a responsible manner. Costs of Care, a 501c3 nonprofit started by medical students and residents is a leading voice in this effort. Its three goals are exactly on target for what the U.S. health system needs:

ADVOCATE: creating a culture where caregivers are responsible for the cost and value of their decisions, take action to avoid waste, and help build the will for change

EDUCATE: giving caregivers the knowledge and skills they need to make cost-conscious, high-value decisions with their patients

SUPPORT: helping caregivers to deflate medical bills by using information technology and decision-support tools to put cost and quality information at their fingertips at the critical moment when medical decisions are made

We launched Over 65 to create a vehicle through which over 65ers could contribute to public deliberation about meeting the health and economic needs of the over 65 population in ways that consider intergenerational equity and the future well-being of our society. It’s heartening to see young physicians and nurses dedicating themselves to this same effort. Collaboration between over 65ers and thoughtful young activists could play a significant role in health system reform. We at Over 65 and my young colleagues at Costs of Care would love to hear your ideas on where savings could take place. Our plan is to publish relevant posts on both sites. I invite Over 65 readers who would like to participate in this collaboration to let me know via email.

James Sabin, M.D., 74, is an organizer of Over 65 and a clinical professor of psychiatry at Harvard Medical School. This post also appears on the Costs of Care blog.

7 Responses to “Alliance Between the Generations for Responsible Medicare Savings”

  1. Leslie Kernisan, MD

    hi Jim,

    Terrific to see that this group of younger clinicians is interested in this critical issue, and glad to hear of this collaboration.

    I’m quite struck by the use of the term “caregiver” in the goals statement. Reflexively I’d assumed that caregivers are either family/friends, or paid in-home aides. But I think in the goals statement, they are referring to clinicians or other healthcare providers, right?

    best, leslie

    • James Sabin

      Dear Leslie, Alastair, and Kathryn

      1. Leslie – the Costs of Care folks are indeed using the term “caregiver” to refer to clinicians in their statement of goals. I agree that the term is typically used to refer to family & friends. As a clinician I personally like the implication of being “brought into the family.”

      2. Alastair – Norman Daniels and I wrote – with admiration – about the New Zealand health system in our book “Setting Limits Fairly.” The U.S. health “system” – as a system – is pathetic. The 20% figure is a minimum estimate for “waste.” New Zealand has the advantage of being relatively small and an island. In my view, these two factors have contributed to a much stronger commitment to the common good than we have in the U.S. Perhaps you have some “stories” you’d like to tell on the Over 65 blog!

      3. Kathryn – I agree that Brill’s article is a tremendously valuable contribution. I’ve given it to my students.

      Best

      Jim

      • alastair macdonald

        Dear Jim

        Thanks very much for your reply. I do indeed have many stories about the New Zealand health system. I am a regular reader of the Over 65 blog and really appreciate the opportunity to occasionally contribute some thoughts.

        Kind regrds

        Alastair Macdonald

  2. Alastair Macdonald

    Thanks for the opportunity to comment.

    I have worked in the first publicly funded health service in the world (New Zealand in 1938)for almost 40 years as a renal physician.

    It has always staggered me at the different spending per capita p.a. between the US and New Zealand. In 2007 dollars the US spent $7290.00 per annum and we spent $2454.00 p.a.

    I am aware of wastage and defensive medicine being an issue for us in New Zealand, I am therefore amazed that the estimate of wastage in the US health care system is only 20%.

    Parenthetically, I should indicate that when we examine the performance of the NZ health service as compared to the US in the Commonwealth Health Fund study of 2010, we perform significantly better.

    My comments are not intended to convey any smugness on my part, rather they are intended to re-affirm how much further health care reform is required in the US.

  3. Kathryn Clark

    I strongly recommend Brill’s in depth analysis of “why medical bills are killing us” found in recent Time magazine. Any discussion of reduction of costs without this information is
    incomplete.

  4. eileen beal

    Late-coming to this discussion, but I’ve been to New Zealand…traveled all over the N. Island talking with Boomers, Gen Xers, Millinials, etc.

    One thing that really struck me is the tremendous racial, ethnic and cultural homogenity and social cohesion there…and that kind of got left out of the discussion on why thigs are “so good” there.

    Not dissing what was said…at all…just want that homogenity and social cohesion to be part of the discussion.

    BTW…I’m a health/geri writer.

    • Alastair Macdonald

      Dear Eileen

      I am glad that you have visited to New Zealand and that you found a signficant degree of social cohesion. Having lived and worked in the US I think that there is less emphasis on rights and a greater degree of collective thinking in New Zealand. We were the first country in the world to have votes for women (1893) and declared ourselves nuclear free in 1987. I am biased of course to the extent that I think NZ is the best country in the world.

      However, a couple of points about the degree of ethnic homegeniety. In the 2006 census the results indicated the following ethnic breakdown

      European/caucasian = 67%
      Maori = 14.7%
      Pacific = 7.0 %
      Asian = 10.0 %

      We had a census a few weeks ago but the results are not out yet. However it is likely that the percentage of those identifying as European is likely to have decreased because of factors such as immigration and age structure and births; particularly within the Pacific and Maori population.

      I hope that you have another trip planned to the “Land of the long white cloud”

      Kind regards

      Alastair Macdonald