JAMA Forum: Poor Technology Management a Key Driver of US Health Care Spending

Great blog post by Dr. Austin Frakt on why not effectively managing medical technology is a major reason why healthcare costs in the US are increasing at a rapid pace. Technology creates an arms race among hospitals. If hospital X has the newest surgical robot, hospital Y has to get one too to remain competitive, even if these hospitals are 10 miles apart. A May NPR article talked about Washington D.C.’s local governement approving 2 photon beam treatment centers even though there is one in Baltimore, 40 miles away. These facilities are spending $180m on a treatment that may produce marginally better results than other treatments. In my opinion, we have gone past the point where every dollar spent provides a dollar of benefits. We are now getting less than a dollar of benefits for every dollar we spend. Society has equated the best healthcare with the most expensive. In Leonard Weber’s book, Business Ethics in Healthcare: Beyond Compliance, he states, “the reality of limited resources requires that healthcare providers shift from thinking that they should always try to use the best to thinking that they should try to use the least expensive that works well” (pp 26-27). This thinking is one way to bend the healthcare cost curve.


The fact that US health care spending growth has slowed in recent years is good news for Americans. But it’s like watching a slow-motion train wreck develop a bit more slowly. It’s still a train wreck.

The health care sector is consuming our nation’s wealth at a rate that is faster than we generate it. Before the recession and economic downturn, in 2007 we spent 16% of the gross domestic product on health care. Today the figure is 17.5%. Ever higher health spending is squeezing out needed infrastructure investment and contributing toward wage stagnation. Despite the slowdown, our battle with health care spending is not over.

Moreover, many proposals to wage a more effective battle miss a key point: a sustained and substantial reduction in health care spending growth must focus not just on deductible levels and integration of care. It must focus on technology.

In many other sectors…

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