Notes on the news:
Last week marked the 200th birthday of Charles Dickens. If there is any writer from the past who can speak to the economically troubled present, it's Dickens. While much has improved since the financially volatile and often-oppressive 19th century, Dickens would surely recognize some of his world in today's society.
Whereas his unfortunate characters scrounged for food or shelter, contemporary citizens down on their luck sometimes struggle for healthcare.
A reminder of that parallel surfaced last week. A Commonwealth Fund survey showed that the Great Recession has taken a toll on medical care. The poll of more than 2,000 adults found that households living closer to poverty were less likely to be insured. Not surprisingly, the lack of insurance—sometimes caused by job loss—made a difference in whether the respondents received basic preventive services such as blood pressure checks and colon cancer screening. (You can read the report on online at bit.ly/ySUQLb).
In addition, uninsured lower-income adults were more likely to report visiting emergency rooms for reasons other than true emergencies, according to the Commonwealth report. Those reasons included needing a prescription drug, not having a regular doctor or finding that other care sources were to expensive.
The report's authors concluded that the Patient Protection and Affordable Care Act will remedy many of these inequities. That remains to be seen. It also assumes the law will survive the Supreme Court challenge and the many state-level attempts to nibble it to death.
To grasp the magnitude of today's economic woes, please see a chart on Modern Healthcare's Feb. 8 “Of Interest” finance blog by reporter Melanie Evans (bit.ly/wHhrGM). The graphic shows the change to median U.S. household income in the first year after a recession since 1971. The figure for the latest downturn from 2010 is -2.3%, the deepest drop of the past 40 years. It's no wonder that a lot of Americans are short of cash and short on medical care.
The sick economy isn't the only reason for diminished access to care. Another is inflated treatment costs. As we have noted on this page many times, the U.S. posts the world's highest prices for most procedures and goods yet falls far behind counterparts on measures of public health.
More evidence of skewed costs came last week from University of Pittsburgh health researchers. They reported in the Feb. 9 New England Journal of Medicine that drug prices and not the amount of drugs prescribed account for regional differences in Medicare Part D spending. The Pittsburgh team examined 2008 data for 4.7 million beneficiaries, looking at three widely prescribed categories of drugs—blood-pressure medications, statins and antidepressants. Researchers found that more than 75% of the difference between high-cost and low-cost regions was due to the cost per prescription.
They concluded that greater use of lower-cost generic drugs could substantially reduce spending and out-of-pocket costs for beneficiaries.
Drugs account for about 10% of national health expenditures, according to government figures, so they shouldn't be singled out as the primary cause of soaring spending. But the phenomenon described by the Pittsburgh researchers is emblematic of a healthcare system with extraordinarily high markups.
The healthcare system in total presents a dichotomy Dickens could appreciate: high prices and overuse of services in some quarters and underuse (with all the deleterious consequences) in others. Until we straighten out that system, there will be more Hard Times.
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