A report released by the Health Insurance Task Force highlighted the sharp rise in claims as a major driver of healthcare costs. But is this the real reason for the inflation in healthcare costs? Medix Group CEO Sigal Atzmon shares her insight.
The Health Ministry has already taken great steps to improve transparency with online reporting of medical procedure costs based on actual transacted fees of cases submitted by both public and private hospitals.
They now plan to go one step further. Health Minister Gan Kim Yong recently said in an interview with local media that the Ministry is seeing how it can implement some of the recommendations from the Health Insurance Task Force report, specifically the recommendation to move from simply reporting to publishing actual benchmarks for professional fees "given the urgency to manage escalation of healthcare costs".
While these fee benchmarks will help patients and insurers know how much they are expected to pay for medical treatment, they would not be binding and are only indicative numbers.
While this initiative is a positive step forward, standardising prices does not address the core reason for escalating healthcare costs: the acute problem of medical misuse and overuse.
Medical misuse and overuse
In research carried out in 2017 and published on PLOS, 2,106 US doctors were asked: “In your specialty, what percent of overall care do you think is unnecessary?”
They responded that 20.6% of overall medical care was unnecessary, including 22.0% of prescription medications, 24.9% of tests, and 11.1% of procedures.
These are alarming numbers that directly influence medical cost inflation both for the government and the insurance firms that are expected to reimburse the doctors for their medical procedures. It is also alarming for the public that see an increase in their yearly premiums as a result of this escalating cost of medical care.
In addition to the financial impact the public suffers as a result of misuse and overuse, they are not getting better medical outcomes for money spent. Quite the opposite, the detrimental effect of unnecessary medical procedures, medications and tests are well documented, from infections, complications and even something as mundane as missing days at work.
The top reasons for misuse and overuse that the doctors gave in the report ranged from fear of malpractice (84.7%), patient pressure/request (59.0%), and difficulty accessing medical records (38.2%). However, most respondents (70.8%) believed that physicians are more likely to perform unnecessary procedures when they profit from them.
Over half the respondents suggested that training residents on appropriateness criteria (55.2%) and more practice guidelines (51.5%) would go a long way to solving the acute problem of medical misuse and overuse.
Eminence Based Medicine vs Evidence Based Medicine
Clearly, healthcare administration is largely subjective, often decided upon based on the physician’s own personal education, preference and experience and the facilities available at the medical centre. Also known as eminence-based medicine, the problem with basing medical decisions on intuition and seniority in the field is that it is not defensible, repeatable or scalable.
In fact, with the speed at which medical research is developing leading to new tests, diagnosis and treatment, it is unrealistic to expect a department head at a local hospital to be able to keep abreast of all the latest developments, inevitably leading to sub-optimal medical outcomes.
The only way to guarantee that the treatment being offered is not influenced by circumstances and personal bias, and that the latest developments are being considered is to move the medical community over to a system that demands decisions be based on proven medical research and procedures, also known as Evidence Based Medicine (EBM).
The concept of EBM is about making sure that when decisions are made they are made on the basis of the most up-to-date, solid, reliable, scientific evidence. A definition from a key article published in the BMJ in 1996 is: "Evidence-based medicine is the conscientious explicit and judicious use of current best evidence in making decisions about the care of individual patients."
According to the definition, Evidence Based Medicine represents integration of clinical expertise, patient’s values and best available evidence in process of decision making related to patients health care. Medical knowledge grows every day, so that previously accepted facts rapidly become old and it seems impossible to follow such explosion of scientific information.
The benefits of following EBM for patients are clear as the latest developments will be considered, personal bias will be removed from the decision making process reducing overuse, and risk of treatment misuse will also be lowered. The benefits for the industry at large will be a standardised application of medical practice bringing predictability to a largely subjective industry.
Only standardising healthcare practices based on Evidence Based Medicine will truly contain healthcare costs, improve medical cost planning and put the patient’s medical outcome first.
Medix Global is winner of Service Provider of the Year at the 21st Asia Insurance Industry Awards.
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