The Back Story on Medicare’s Wild Spending

The narrative unfolds, bit by bit

It’s no secret Medicare spending is on a wild ride northward. The politicians—Dems and Republicans alike—tell us that every day. What has not been brought into the conversation is why. Now every reporter was taught at some point that “why” is a significant question to ask. But as my Campaign Desk colleague Greg Marx and I have been noting for some time, the “why” is missing in the current Medicare discussion. For some inexplicable reason, journos or their bosses aren’t keen on reporting much about the overuse of medical technology and the sales ingenuity of the medical marketplace.

Perhaps that’s in keeping with the prevailing narrative that all technology is super-duper and sellers have a right to sell what they want, no matter the societal cost. That’s why I was happy to see Phil Galewitz give us a clue on Kaiser Health News the other day.

Galewitz wrote a small story about a big impact problem disclosed in a new study published in the Annals of Emergency Medicine. Patients in the nation’s emergency rooms are getting CT scans at rates that are five times higher than in the mid-1990s. About fourteen percent of ER patients got a scan in 2007, compared to about three percent eleven years earlier, Galewitz reported. About twenty-five percent of all CT scans in the U.S. are done in ERs. Numbers like that should make GE (a big seller of imaging machines) happy.

Just last week, GE Healthcare sent the world a press release announcing FDA clearance of its “powerful and compact Computed Tomography (CT) system offering improvements from its predecessors in diagnostic capabilities at low dose levels and designed for sustainability and ease-of-use.” Low dose levels are surely welcome, but such new technology helps push the national tab for medical care ever higher.

Galewitz explored this issue a bit, noting that the ER docs defended the 330 percent increase in CT scan use. The American College of Emergency Physicians said the test helped reduce the number of patients admitted to the hospital. The study found that the hospitalization rate after a CT scan was twenty-six percent in 1996, but fell to twelve percent in 2007. But the effect of scan use on subsequent hospitalizations “appeared to diminish after 2003” when the rate “flattened and stabilized,” even though CT use continued to rise.

Galewitz briefly reported the reasons for increased use—doctors’ fears of malpractice suits, patients demanding the tests, more machines being around, along with the financial pressures to use them. It’s axiomatic in the high tech business that if the stuff is around— whether in an ER, or in the office of some doctor who buys the latest and greatest machine, or on an imaging center on a street corner with a sign out front advertising for patients—it gets used, and that costs money. When it gets into widespread use, someone has to pay, and in the case of Medicare it’s the government.

The day I read the Galewitz piece an e-mail advertisement came my way. “Tired of turning away MRI patients? Rent a Mobile MRI Today!” it said. Now, I am not in the business of renting MRI machines, but after reading about CT scans, I opened the message. It told medical folks who use these things that they too can afford to have a full-time MRI at their center. It listed the specs for something called the 1.5 GE HDxT Mobile MRI and the 1.5 GE LX Echospeed Mobile MRI, and advertised they could be purchased for as little as $165,000 or rented for as little as $8,800—it didn’t specify whether that was for a month or a year. Whichever it was, the message was clear: put one of these machines in your office and boost patient revenue.

Hey, guys, there’s a nexus between this kind of marketing, the high-tech effect on corporate profits and physicians’ bottom lines, the drive to shift more of the cost of care to Medicare beneficiaries as a way to solve the government’s spending problem, and the deficit. This connection has been missing from both political discourse and media speak. It’s easier for the press to quote ad nauseam the political line that Medicare cuts may be necessary to bring down the deficit than to investigate the reasons why. Perhaps the CT study will prompt more journos—and members of the public—to ask the “why” question.

Has America ever needed a media watchdog more than now? Help us by joining CJR today.

Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman. Tags: , , , , , ,