While many of us are beginning to trim the tree and dream of sugar plums, we’re getting in the spirit of health spending, particularly CMS data and low-value care. This month, we dug deeper into the recent National Health Expenditure figures that showed a decline in the share of the economy devoted to health care spending. We also began to tackle issues related to the Choosing Wisely campaign, which aims to reduce low-value care. So sit back, grab an eggnog and enjoy … and drop us a line or tweet using #GoingBelowTheSurface, if you’re so inclined.

Digging Deeper

Asking the Tough Questions to Address Our Nation’s Health Spending Issues

Earlier this month, the Centers for Medicare and Medicaid Services published its annual National Health Expenditure data in Health Affairs. While the numbers showed that health care spending has grown by 4.6% compared with a year earlier, reaching $3.6 trillion in 2018 or $11,172 per person, they also showed that spending comprised a slightly smaller share of the economy (17.7%) than in previous years, as measured by gross domestic product. But that had more to do with the rapid economic growth the United States saw last year than good news about health spending growth, which again outstripped inflation.

To break these figures down further, overall spending growth (0.4%) was driven by faster growth in both private health insurance and Medicare, largely influenced by the reinstatement of the health insurance tax. Pharmaceutical spending increased by 2.5% – remaining at 9% of total health care dollars for the second year in a row – but the prices paid for medicines declined. Lastly, the growth in personal health care spending in 2018 – which is 84% of national health care spending – remained the same.

Why it matters: While some media and policy experts spun the lower-than-usual numbers as good news, growth of nearly 5% suggests that we need better, more collaborative approaches to limiting spending, and that we need to team up to question assumptions about where – and how – we invest our health care dollars. That’s the animating force behind the Going Below The Surface Forum, representing patient groups, providers, payers, employers and life science organizations, which is accelerating efforts to fuel these tough conversations through an informed and sustained dialogue.

When It Comes to Low-Value Care, Are We Really Choosing Wisely?

Beginning in 2012, Choosing Wisely convened national organizations representing medical specialists to identify tests or procedures commonly used in their field that may be outdated or in need of questioning. The public awareness campaign aimed to reduce low-value care through increasing discussions between patients and clinicians about the inappropriate use of medical tests and treatments.

Concerns have been raised that Choosing Wisely has not substantially reduced spending on low-value care. To investigate this issue, researchers analyzed 1,293 of the groups’ recommendations to better understand the extent to which these guidelines targeted income-generating treatments provided by each organization’s membership. The researchers found that of the more than a thousand Choosing Wisely treatment recommendations reviewed, only 98 targeted income-generating treatments by their own members.

Additionally, the study researchers looked at the prevalence of qualified statements – recommendations with wiggle room, such as suggesting an approach “when possible” – and whether qualifications were more likely in recommendations targeting income-generating or non-income-generating treatments that apply to members. Findings indicate that nearly half of all recommendations were qualified, with a similar proportion of recommendations targeting income-generating and non-income-generating treatments.

Why It Matters: These results show that societies’ recommendations often target “the other guy” or another group’s income or resources, and dismiss issues affecting their own members. Only 20% of treatment recommendations targeted income-generating treatments and, of these recommendations, most targeted other groups. But the buck needs to stop with all of us: societies must provide unqualified recommendations that target income-generating practices provided by their own membership to help better eliminate low-value care.

DON’T MISS: Mark your calendars for a Going Below The Surface webinar outlining a roadmap to evaluate low-value care on Jan. 15 at 3 pm ET. Registration information will be available on the Going Below The Surface website later this week.

What We’re Reading

Snuggle up by the fire under a cozy blanket while checking out this month’s reading picks, which all consider how to manage health care spending more effectively.

  • Enthoven A, Fuchs VR, Shortell SM. To Control Costs Expand Managed Care and Managed Competition. Nov. 7, 2019, JAMA
    While the article covers familiar ground on managed care and managed competition and how each works to control costs and improve quality, it has an interesting twist. It highlights a paradox: a majority of the public thinks that health spending should increase, yet views health care costs as a significant problem. While managing costs is an imperative, the article cautions that doing so out of crisis rather than planning is not the wisest approach. Efforts to utilize managed care and competition, while not perfect, are preferred alternatives.
  • Venkataramani AS, Underhill K, Volpp KG. Moving Toward Evidence-Based Policy: The Value of Randomization for Program and Policy Implementation. Nov. 15, 2019, JAMA
    The authors make the case for using randomized trial methods to roll out health care policies before enacting them on a broader scale. They write, “By engaging early, showing openness to understanding organizational goals, being willing to accommodate administrative realities, and finding alignment with leaders who support rigorous evaluation, researchers can do their part to embed better science into policymaking and program implementation. Doing so can increase the ability to help identify what works and what does not work and to allow the collective allocation of resources to where the biggest benefit is most likely.”
  • Bradley EH, Brewster A. Untangling The Relationship Between Social Service and Health Care Spending and Health Outcomes. Nov. 18, 2019. Health Affairs Blog
    This article adds to the debate over social services spending on the Health Affairs Blog. Investments could be cost-effective ways of improving health outcomes and still not translate into reduced spending on health care. The authors argue that “[i]f, as a country, we hope to maintain a steady level of spending on population well-being while improving health through cost-effective social services, strategies that address the financial incentives, consumer demand, and market power that underpin the U.S. health care system will be needed.”

Dialogues on Health Spending

If you’re gifted a pair of headphones this holiday season, you can plug them in to listen to some podcasts on health spending. Or use your new mobile device to scroll through the latest journal articles on health spending or register for an upcoming conference.