Health care issues: Overutilization of care

The Associated Press

THE ISSUE: Health care costs in the United States are far higher than in other countries without better outcomes, and most experts agree that's partly because of the excessive and often unnecessary use of expensive tests, surgeries and procedures. Will health overhaul legislation address this?

THE POLITICS: Ezekiel Emanuel, an oncologist, White House adviser and brother of White House Chief of Staff Rahm Emanuel, has written that there's a "perfect storm of overutilization" of health care in the United States that's the greatest contributor to high medical costs. Factors include a fee-for-service Medicare system that financially rewards volume over quality; pharmaceutical companies and others marketing directly to consumers, who then ask doctors for the newest treatments; and employer-provided health insurance plans that can shield patients from much of the cost of the care they consume. President Barack Obama has said repeatedly that rising health costs must be checked, but any attempt to rein in care faces resistance. Some policy experts believe one of the best solutions would be to tax employer-provided health benefits which workers now receive tax free; this would provide an incentive for employers and employees to limit benefit packages. But Obama criticized Republican Sen. John McCain for that proposal during the presidential campaign, and many congressional Democrats are opposed, partly because of opposition from labor unions.

WHAT IT MEANS: Lawmakers say they are aware of the problem of overutilization and are trying to address it through a variety of proposals. Among them are pilot projects for "accountable care organizations" that would pay doctors and hospitals for holding down costs and delivering results; grants to improve health system efficiency; increased payments to primary care doctors to increase coordination of care; and support for research into the relative effectiveness of medical treatments. But many experts don't believe the measures do enough. The Congressional Budget Office said in July that Democrats' proposals did not contain the fundamental changes necessary to significantly reduce federal health spending.

— Erica Werner

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September 25, 2009 09:45 AM EDT

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