The cruel consequences of moral hazard in health care

Our health care system devotes too many resources to prolonging life, and too few to improving its quality.

A case described by Lisa Sanders vividly illustrates what I have in mind:

A couple of years earlier she started “walking like a drunk,” [the patient] told the slender, middle-aged doctor. Her legs were weak and her feet were numb. The only feeling she had in them was a pins-and-needles sensation, as if her feet had gone to sleep and never woke up. A few months ago she started falling. She broke her ankle in a particularly bad fall; the ankle got better, but she didn’t. Now she was in a wheelchair.

Her internists referred her to a neurologist, who sent her to the hospital for an M.R.I. After the test she was so weak that the doctors were reluctant to send her home, and she was admitted to the hospital. And here she was, hoping for an answer.

After tests and more tests, one observant doctor hit upon the right diagnosis: the patient's dentures didn't fit properly. To keep the dentures in place, she had been using a tube of denture adhesive a day. But her brand contained zinc, which led to zinc poisoning, nerve damage, and a host of other medical problems.

The treatment? The patient was told to buy a different brand of denture adhesive, and sent on her way. What happened next?

It has been a year and a half since [the doctor] figured out what the problem was. While [the patient] hadn’t been able to afford new dentures, she was using a denture adhesive that didn’t contain zinc. Her blood count was back to normal and she felt better.

Why is there so much money available for high tech diagnostic services, when a few hundred (or thousand) dollars for a properly fitting set of dentures would have avoided the need for those services in the first place?

Dentures are just the tip of the iceberg. Glasses. Hearing aids. Wheelchairs. Respite care. Homemaking services. Long-term care. Each of Canada's 10 different provincial health plans, and the US's 50 different state-level Medicaid and Medicare plans have somewhat different coverage levels, so generalizations are difficult. But broadly speaking, if any coverage is available for assistive devices or long term care needs, it is limited and income tested.

How did we get stuck in this crazy situation, spending so much on care that yields so little in terms of quality of life, and so little on things like dentures that yield so much?

One explanation is institutional inertia - it's always been that way.

Another explanation is vested interests, or the lack thereof. Housekeeping services, for example, can vastly improve seniors' lives, and allow them to retain their independence and dignity. But I'm guessing that the providers of housekeeping services are often women, often new Canadians, and often have relatively low levels of education. Perhaps providers of quality-of-life type services are less likely  to be vocal, effective, or well-organized lobby groups, agitating for higher levels of government funding, than providers of the latest high tech gizmos?

A final explanation is that quality-of-life services are not provided because of moral hazard: if these services were covered by insurance, people would demand so many that the costs would be unsustainable. 

There's an episode in the Simpsons when the family visits Canada. Homer blithely crosses the street on a Don't Walk sign, saying "It doesn't matter, they have free healthcare!" When hit by a car he yells, "I'm rich!"  Patient-induced moral hazard can arise for conventional health care services, but a number of factors limit its importance.

First, specialists act as gatekeepers, deciding who does, and who doesn't, need treatment.

Second, the risk of moral hazard is reduced by the unpleasantness of much conventional health care.  No one would sign up for chemotherapy if they didn't really need it. Also, the conditions conventional health care treats - getting hit by a car, for example - are nasty enough that most people take basic preventative action to avoid needing care.

Third, it is not clear that we, as a society, want to eliminate moral hazard in conventional health care, especially end-of-life care. In a world without moral hazard, no one would receive health care unless the value they placed on living longer was greater than the cost of the treatment. I am not prepared to let Grandad say, "I won't undergo this treatment, the value to me of living another 6 months is less than the cost of the treatment". Forget it.   

Yet patient-induced moral hazard is a serious issue with services that improve the quality of life. Consider depression, for example. There are four basic treatments: drugs, talk therapy, exercise, and getting a dog. Which is most effective is debatable, which is most subject to moral hazard is not. If our public health care system paid for depressed people's gym memberships, or gave out free puppies, lots of people would be lining up claiming to be depressed. But here, in contrast to say, cancer care, gatekeeping is difficult. Depression is a serious, debilitating condition - yet no one can look inside another person's head and know how they're feeling. Doctors can't always distinguish people who genuinely need help from those who are just there for the free puppy.

No where is this a more serious issue than with long term care. I hesitate to write about the subject because, quite frankly, it scares me sh witless. But demographics plus changes in medical technology mean that Canadians, both collectively and individually, are going to have to work out how we are going to care for increasing numbers of older folks who are no longer able to live independently.

Every society has social and legal norms dictating the responsibilities of parents and children, husbands and wives. Canada has decided that medically necessary physician and hospital care is a collective responsibility, while long-term care - the assistance with day to day living that so many of us will either be needing or giving when we get old - is, at least to some extent, the responsibility of an individual or his or her family.

The status quo makes no sense morally: there is no ethical difference between the the cancer patient's need for surgery and the Alzheimer's patient's need for comfort.

Lack of support for caregivers is problematic from a practical point of view also. People can only cope with so much. If hospitals offer the only source of respite for caregiving families, those needing care will end up in hospitals. A recent US study of children with autism found that Medicaid-funded respite care - giving families a break from caregiving - reduced children's risk of hospitalization. By way of contrast, Medicaid-funded therapy had no significant impact on hospitalizations.*

Family values make for fine rhetoric. Yet around the world women and men are opting out. The world's lowest fertility rates are found in societies like Hong Kong, Singapore and South Korea that place responsibility for caregiving squarely on women's shoulders. Where subsidized child care is available, birth rates are higher (study here). 

I don't know what the ultimate answer is. But I do know that paying for a few more dentures and a few less MRIs would be a move in the right direction.

 *Disclosure: I have a nephew needing long-term care.

Comments

[Stephen Gordon]

Awesome post, Frances. Don't have much to add except that I hope lots of people read it.

[Determinant]

I put it down to inertia. "Housekeeping" is seen as a luxury, it is performed by what may be called maids. Politicians and voters do not want to pay for maids. We haven't broken the box yet. On the flip side, we have generally granted physicians far too much difference as a society and are afraid to either challenge them or seek alternative treatment delivery models.

Speaking of Long-Term Care, I attended a product sales conference held by a provider of Long-Term Care Insurance in Canada. The insurer had an underwriter from the United States as the featured speaker. The US has far more experience with this product. Long-Term Care policies generally pay out for less than five years, except in one circumstance. After that the beneficiary dies. The exception is Alzheimer's. Further, 70% of policies purchased which then have more than a two-year gap between policy purchase and claim are for Alzheimers. This statistic is increased the younger the purchaser is and Canadians tend to purchase LTC policies earlier than Americans do. When I pointed out that that meant Canadian LTC policies would likely have very high claims for Alzheimer's the underwriter looked like she had a realization.

The bottom line is that when discussing Long-Term Care and it's cost, replace LTC with Alzheimers and other dementias. That is the cost driver by a country mile.

Lastly, I can't let this slide.

Yet patient-induced moral hazard is a serious issue with services that improve the quality of life. Consider depression, for example. There are four basic treatments: drugs, talk therapy, exercise, and getting a dog. Which is most effective is debatable, which is most subject to moral hazard is not. If our public health care system paid for depressed people's gym memberships, or gave out free puppies, lots of people would be lining up claiming to be depressed. But here, in contrast to say, cancer care, gatekeeping is difficult. Depression is a serious, debilitating condition - yet no one can look inside another person's head and know how they're feeling. Doctors can't always distinguish people who genuinely need help from those who are just there for the free puppy.

Frances, that's a perfunctory and flippant analysis of the state of depression treatment and of how depression is treated in Canadian medical practice. I find it insulting and it isn't the first time you have used a mental health example in a way I find offensive. Your example of mildly depressed tax accountants being more effective due to the phenomenon of depressed people "catastrophizing" (a well known depression trait) was also offensive.

Mental health issues can be discussed in constructive ways but this is not a constructive comment. As a person who has been in the mental health system I find it offensive and out of touch with reality.

[Determinant]

I did a long post and I think it got caught in the spam filter.

[Determinant]

Thank you for fishing it out.

Lastly, because I have unusual reason to know such things, isn't zinc content an example of the need for consumer product safety regulation? The list of products that get regulated and banned in Canada get that way because something like the woman's denture story happens.

For example, jerquerity beans are banned, as are Lawn Darts with weighted and/or pointed tips. Everybody remembers lawn darts and dead toddlers, right?

It is not fashionable to say it but there is a reason and a need for consumer regulation.

[Frances Woolley]

Stephen, thanks for the feedback, and for the tweet.

Determinant, "that's a perfunctory and flippant analysis." "out of touch with reality"

If I have the facts wrong - and there are programs people can access that pay for exercise therapy, and there are some places where people can go and get free talk therapy - please, share, and name names. Especially if you have suggestions for people in major cities. There's probably dozens of people reading this who would love to know.

I've heard rumours (unsubstantiated, probably apocryphal) that things here in Ottawa are so desperate that people enrol as part-time university students just to get access to the free university counselling services.

[Determinant]

Right. First-line depression treatment is under the supervision of a family physician. Modern depression treatment consists of three parallel strategies: cognitive behaviour modification therapy, anti-depressants and exercise.

CBM Therapy is delivered by social workers who ARE paid for by OHIP. In fact they are often part of family health teams. One was part of my family health team in an average Central-Ontario town not in the GTA. Social Workers are under OHIP, psychologists are not. Don't ask me why, shangwen is a better one to ask.

Anti-depressants have the usual pharmaceutical costs (we all know the Pharmacare debate) though family doctors will happily consider generic availability in prescribing, it's requested often enough and financial pressures often feature in a depressive patients life.

Exercise can consist of as little as walking. Ottawa has some great sites for a destination walk of a half-hour length. Or if the patient is a little more fortunate, a bike ride. Schools often have basketball hoops. A gym membership is a little much and there are alternatives. Ottawa has Parliament Hill and the Alexandra Bridge with a view of the Chaudiere Falls. I made that walk for jobseeking purposes but it would be an interesting location for a half-hour walk with a purpose, with interesting sites. I can think of lots of alternatives that don't require a gym membership.

Pets are nice, many families have them but they aren't given out free. However many hospitals have animal visiting programs in their auxiliaries. Here's one: http://www.ectd.ca/ I know my hospital does have dog visits to the in-patient psychiatric ward, the place for those who are extremely ill and who have often attempted suicide.

If the family has a pet there is a true stereotype that depression patients have the most-walked dogs in the city.

If you get really bad the second-line treatment is resort to a psychiatrist and a mental-health clinic. You will get there if your anti-depressant doses exceed the practice range for a family physician. Hospitals have group Cognitive Behaviour Modification classes, which to Shangwen's delight have been shown to be as or more effective than individual CBT therapy and based on evidence-based studies (someone please restrain shangwen) are the most cost-efficient and effective form of "talking" therapy to be included with anti-depressants and exercise.

Unlike your original suggestion, mental health practitioners view cognitive behaviour therapy, anti-depressants and exercise as complementary. That trio has been shown to be the most efficient and clinically cost-effective form of therapy. Mental Health practitioners do care about costs and outcomes.

Lastly, when you get to a hospital mental health clinic they have psychometricians who are just like econometricians. They have standardized tests to go through to verify the diagnosis and clarify the exact problem. They are not psychic but measuring someone's state of mind is their specialty.

I have no idea about schizophrenia, another mental health problem with a huge image and resource problem.

IME talk therapy has a big issue problem: most people's image of a psychologist's chat doesn't square with modern reality. It's a widespread misconception.

[Nick Rowe]

Frances: "I've heard rumours (unsubstantiated, probably apocryphal) that things here in Ottawa are so desperate that people enrol as part-time university students just to get access to the free university counselling services."

I've heard that from a presumably knowledgeable and reliable source.

[Peter T]

Part of the puzzle is that policy makers are so focussed on the need to weigh costs and benefits closely that they overlook the merit of cheap programs sensibly administered. To use your example - what would it cost to make pets available for free? If a few non-depressed people got free pets, would it really matter? Fear of free-riding can be paralysing.

[Frances Woolley]

Determinant:

Thank you for your constructive suggestions.

The basic rule for medical coverage in Canada is that something is covered if it is a medically necessary service provided by a physician or in a hospital. As your comments illustrate, the same is true for various forms of talk therapy. From this link

Psychotherapy from a psychiatrist or any other medical doctor is covered by OHIP, and will thus not cost you anything. Services obtained from other health care professionals (e.g., psychologists, social workers) may also be free if they are offered in government-funded hospitals, clinics or agencies. If psychotherapists work in a private practice, their services will not be covered by OHIP, and you will be charged a fee. These fees range from about $40 to $180 per hour. However, the fee will vary depending on the therapist's experience and training and the type of therapy. (Group therapy may be less expensive.) Some therapists offer a sliding scale, which means that they can offer a reduced fee based on your income.

If a kid attempts suicide (and survives) he'll get access to the mental health services at the local hospital. If he doesn't - well, that kind of sucks, doesn't it? If you have a family physician who has an hour week free to talk to you - wonderful. Awesome. You're one of the lucky ones.

That's how gatekeeping works. Some people manage to get inside the system. Sometimes they get really terrific services. Others aren't so good at working things out, or as willing to ask for and seek help. For every person out there who is getting the OHIP-covered talk therapy, how many people do you think there are out there with untreated depression, self-medicating with alcohol or other drugs, or just walking around feeling totally pissed off at life being miserable to the people they live with?

You're seeing the parts of the system that work - and, yes, there are parts that work. My concern is with the vast, untreated mental health needs of the Canadian population.

I suspect our positions are not really that different.

[Frances Woolley]

Peter T: "they overlook the merit of cheap programs sensibly administered."

I wonder how much of that is due to what might be called desirable-moral-hazard, as described above. Would people opt to get expensive end-of-life procedures if they had to pay for them themselves? I suspect some wouldn't - and as a society we don't want that. We want Grandad to pull through for another year.

But people are willing to pay for low cost medical procedures that have clear and obvious benefits - glasses, for example - so costs are downloaded. Nick and I once wrote a paper vaguely related to that subject. Here.

[Patrick]

Is there really an over-consumption moral hazard problem with some of this as people like to imagine? I don't think people want to have poor eyesight or no teeth. Sure, if the gov't does something stupid like offer to pay for unlimited designer sunglasses, then we'd be in trouble, but I don't think anyone is saying we should do that. People will be mostly satiated with dentures that fit, or a pair glasses that fit and are the right prescription. There's not a lot of benefit in having a surplus of dentures sitting soaking on the bathroom counter.

Short of nationalizing some these quality of life services, the problem I see is that if the Gov't subsidizes denturological care, for example, to the tune of $X dollars a year. My guess is that we'll see the price of annual denturological services will suddenly be $X + some margin (probably 30% - every business I've ever dealt with seems to be in love with 30% margins). Of course $X is less than (1 + M)*X, so people will demand that the gov't increase the subsidy because poor granny is on a fixed income and those evil deturologists are gouging her. So we increase the subsidy. Again, and again. But ((1+M)^N)*X grows awfully fast.

[reason]

Frances,
" If our public health care system paid for depressed people's gym memberships, or gave out free puppies," ....
I don't quite follow these throwaway lines, the cost of buying a puppy is a small part of the cost - the biggest issue is what do single employed people (many will be) do with a puppy during the day (or during holidays). And you can get excercise anywhere, anytime - the only restriction is willpower and possibly immunity to embarassment. Gym membership isn't needed.

Another thought, is I wonder how many of the moral hazard issues could be addressed by a simple (car insurance like) excess that the patient must cover first. This is of course regressive - so you need to complement that with redistribution (but I'm for a citizen's dividend - or citizen's basic income if you must - anyway).

And wouldn't a "public option" consisting of a networked and computerised public health maintainance organisation provide a push in the right direction? If this works out cheaper and better then all medicine may end up being provided that way.

And as a final idea, wouldn't compulsory regular checkups make sense for insurance companies/single payer organisations (particularly if they have units that specialise in them). Does this really not work out financially?

I think in the case you mentioned the last two ideas may have caught the problem at source.

[reason]

Family values make for fine rhetoric.

Yes, but of course the point is that many families are disfunctional and modern industrial society regularly pulls families apart. Relying on families means that some people will have no support at all, and others will be victimised. It also causes the opposite problem to low birth rates, when surviving children are the only means of support and infant mortality rates are high. (That is why so many African societies top the birth rate lists).

[Linda]

I too am terrified at the thought of long-term care in the no longer so distant future. And with only one child, feeling guilt at the burden I will impose on her. This past weekend's feature in the Globe and Mail on genetic screening of embryos made me wonder: would pouring money into pre-viable life screening be the way to lessen the end of life burden on health care? Might we be moving towards making that tradeoff? Who would/could do the cost benefit analysis?
Nice post, by the way, and I for one do not find your comments on depression flippant.

[Frances Woolley]

reason:

"And wouldn't a "public option" consisting of a networked and computerised public health maintainance organisation provide a push in the right direction? " This is more or less what we have in Canada, except the network and computerized bit isn't working out quite as planned. And the public option is the only one available. It isn't perfect but, yes, a public option of coordinated HMOs is far more cost effective than US-style medicine.

"Another thought, is I wonder how many of the moral hazard issues could be addressed by a simple (car insurance like) excess that the patient must cover first."

For dentures or other assistive devices - yes, a deductible would cut down on the moral hazard problems.

The motivation for this post was the long term care issue, that I left for the end because it's too big and scary to talk much about.

Long term care costs tens of thousands of dollars a year. A deductible won't do much.

Absolutely on family values. Look at marriage rates in some Asian countries - women are looking at their options and saying "on the one hand - all of these care giving responsibilities - on the other hand - travel, holidays, fun..."

[Frances Woolley]

Patrick, good point.

[Frances Woolley]

Linda - the solution is to move to Costa Rica, or someplace else where homemaking services are cheap, and the weather is warm. And you and your daughter can hang out on the beach together.

[Shangwen]

First, an anecdote. A couple of weeks ago I saw Moneyball, and there is a scene in the beginning where all the scouts (who embody the "old" evaluative method based mostly on intuition) have a lively debate about several potential players based on the pop when they hit a ball, how good looking they are, how aggressive they look, their girlfriends, etc. (And of course they are later shown to be dinosaurs rendered useless by better stats.) As I was watching it, I thought, "this sounds a lot like rounds!"

There is strong moral hazard argument if value is clearly understood by all parties. If a contract says all your household contents will be replaced in case of fire, and you hate your chaise-longue but can conceal your Google searches on fire-starting, then fill your boots. But value in health care is both poorly understood and under-appreciated (as in your Grandpa example). In fact, there are many voices on valuation and cost-effectiveness. In declining order of popularity, they are:

1. All health care is essential, so pay for it (politicians, heads of unions and professional associations, vendor lobbyists, celebrities)
2. We need more MRIs/Gamma Rays/ultra-specialists/clinics/electronic records systems/cowbell (doctors, desperate patients, rich donors, journalists)
3. Big spending in "prevention" will have huge payoffs (public health types, lower-paid HC workers, journalists, social work professors)
4. Existing money could be efficiently re-allocated to better value services using rigorous statistical analysis, but there is a strong case against much prevention effort (yours truly, Frances Woolley, and other distinguished luminaries).

The fear of #4 is that it can lead to counter-intuitive findings, so it is unpredictable and neither validates ideological preferences nor supports the status quo. Some preventive action is great (hand-washing by hospital staff; exercise; home care), but much of it is unsubstantiated or even disproven (mental health care in family medicine clinics, mammograms, etc.). Mental health is a great example: we often hear that it is severely underfunded, but in fact there is a huge amount of money for it that is grossly misallocated. And of course, rationing mammograms is such a popular proposal.

[Shangwen]

@Determinant. Correct that LTC essentially = dementia. And we admit people to personal care institutions at a very late age now. Twenty years ago you could go into a personal care home and see the residents working in the garden, crossing the street to get the day's paper, and occasionally even driving. Not so now. And agreed that LTC may = apocalypse.

@ Determinant+Frances: Mental health is part starving orphan, part Zsa Zsa Gabor. No question that there is a huge level of untreated morbidity that could be alleviated with more services. But a lot of money is also spent on useless care, such as long-term psychotherapy (which is rarely indicated except for personality disorders), residential drug treatment programs, and overuse of psychiatric meds. The problem is that only a small number of services (both dollar- and volume-wise) are rationed (inpatient beds, group treatment, some psychotherapy programs), plus the non-use of reliable outcomes measures means that many people continue to consume services long past the point of cure. I did a study for one facility where people who were cured by the $4,000 mark consumed (or, if you like, were provided with) an average of $10,000 worth of treatment (data slightly altered to protect the innocent).

[reason]

Shangwen,
I'm not talking about piecemeal preventative care - but general (and computerised) checkups that ensure we have a documented patient history and catch what can be easily caught. By compulsory (I mean you get a reminder and you get penalised if you don't do it).

[Bob Smith]

I guess the other risk is that, at some point, aren't you just medicalizing life? I mean, sure, people's quality of life would be better if they had a housekeeper, or someone to cook them healthy meals, or if the government subsidized healthy food (instead of jacking up the price of eggs and dairy, but I digress), leisure activities, access to the internet (to keep one's mind active) and paid for a nice house with all the amenities (and before I'm accused of hyperbole, I've heard anti-poverty advocates make at least some of those arguments (or perhaps less extravagant versions) on precisely those "health" grounds).

Mind you, the distinction between "health care" (conventionally understood as something provided by doctors and nurses in a hospitical or clinical environment) vs. goods and services that are "healthy", but not "health care" is a somewhat arbitrary one, if both are inputs to a common end (namely health). On the other hand, perhaps the thinking is that "healthy" goods and services are ones that people are expected to be able to provide on their own (adequate food, shelter, companionship yada, yada, yada), while "health care" is something that is beyond the ken of the average joe or jill.

[Shangwen]

Reason,
If I understand correctly, you mean the widespread use of regular checkups, partially for the purpose of assessing future risk (including early detection)?

This is where social norms become a huge issue. On the empirical side, annual checkups are actually on the way out because they've been shown to have limited benefit. It is much more cost-effective to devote scarce primary care resources to the management of chronic disease; although some people complain (aka Don Drummond in Livio's last HC post) that a small number consume a disproportionately high amount of HC, that is actually a good outcome. On the social norms side, one has to ask whether or requiring attendance at annual examinations, with a penalty for non-attendance, would be accepted by most people (not to mention its feasibility and enforceability). Does the median health care consumer see himself or herself as a participant in a limited resource pool, with a moral duty to monitor their long-term access to it? Behavior does not suggest they do, either in Canada, the US, or Singapore.

Anyway, we already have mechanisms for the long-range improvement of health: education and employment. Since gains in those areas are actually a main driver of rising HC consumption (i.e. a normal good), I doubt that preventive=parsimony is going to popular with those most likely to be reached by the message. In studies looking at HC consumption by postal code, consumption of costly services is much higher in high-income neighborhoods.

[Frances Woolley]

Shangwen: great comment.

reason: my pet peeve is that people can't just logon to a computer, access their own medical records, and self-prescribe any needed tests. E.g. I should probably get my cholesterol level checked (see http://www.cdc.gov/nccdphp/dnpao/hwi/resources/preventative_screening.htm). Why can't I just prescribe that for myself, and get a print out of the results, with a set of recommendations, e.g., you're fine or you should go see a doctor to discuss lifestyle changes and/or medications. Why do I need to see a doctor to get the test, and then see a doctor again if I need to discuss the results? Perhaps this is what you have in mind?

Bob: "perhaps the thinking is that "healthy" goods and services are ones that people are expected to be able to provide on their own (adequate food, shelter, companionship yada, yada, yada), while "health care" is something that is beyond the ken of the average joe or jill"

Why is that distinction drawn where it is? Vested interests? Moral hazard? Our need for faith, for someone to turn to, which drives us to elevate medical professionals to priestly status?

[Shangwen]

@Bob: Correct, plenty of people will argue that govt HC should fund gym memberships, subsidize healthy eating, internet access, etc. Of course, there is a closely-guarded secret about the real utilization of gym memberships, the nationwide love of kale and unsweetened egg-white desserts, and productive time on the internet. If only we could find out how widespread those behaviors were....

That kind of stuff is not prevention, or even primary care. That is indulging people. Dentures repair a defect and make people more functional--that makes sense to me. More use of Botox (medically, not cosmetically) is something to be encouraged. If stents work, let's pay for them. But assuming that we all walk the path of linearity and will maximize health to the exclusion of all other goods and amenities is a fantasy. There are contexts and periods in life where health is not the most important thing.

[B.P.]

"Our health care system devotes too many resources to prolonging life, and too few to improving its quality...."

I'm interested in doing some further reading on this issue (within the context of the Canadian system). Can anyone suggest some noteworthy academic papers on this subject for further reading. Thank you.

[Shangwen]

I suggest we all just read this post by Austin Frakt:
http://theincidentaleconomist.com/wordpress/how-a-health-care-efficiency-revolution-could-make-the-next-century-even-greater-than-the-last/

[Frances Woolley]

B.P. - it's 10 years old now, but a good starting point would be the Romanow Report: http://publications.gc.ca/collections/Collection/CP32-85-2002E.pdf. The CD Howe has started a research program on health care, with the usual CD Howe spin, here's a link: http://www.cdhowe.org/policy-research/healthcare-reform. I like Evelyn Forget's work, she has an interesting piece on the September issue of Canadian Public Policy on the health impacts of a guaranteed annual income.

There's a load of academic research on the subject, too, but a lot tends to be more focussed rather than big picture.

[B.P.]

Thanks for this Frances.

[Shangwen]

BP, there isn't much on Canada, but if you sift through posts on The Incidental Economist you'll find more. The comment you referenced is a pretty broad rhetorical one. Don Taylor at that blog writes a lot about palliative care, and his comments are a good place to start too.

Also, let's bear a couple of important basics in mind:
1. Today, very few Canadians are seriously ill.
2. Even those who are not seriously ill today, are unlikely to be seriously ill tomorrow, next month, or next year.

You do not want a health care system to be providing care to everybody, unless you want to set one up in an Angolan refugee camp. That a small number of Canadians take up a lot of service is, counter-intuitively perhaps, a good thing. This is why you also don't want to mandate annual checkups (at least, as conventionally done), because you are going to flood the system with a vast number of people who are perfectly fine and stand little to gain from it.

The rhetoric of mass treatment differs politically depending on whether or not you have a hate-on for "reactive western medicine". If you want widespread use of screenings, preventive interventions, more use of alternative medicine, etc., the science is 98% against you. But widespread access to low-cost items that significantly enhance life (properly fitted dentures, glasses) is great value (I'm avoiding the obvious rent-seeking and inefficiencies that arise with subsidies, etc.).

[Rachel Goddyn]

I volunteer helping people with disabilities access health and recreation facilities in my community. Many people with disabilities need special equipment or facilities to exercise. For them is the not just a question of "willpower" as Reason suggests. Also many people who need exercise are so unhealthy that they risk further injury if they exercise unsupervised. My community provides 150 dollar per person credit to low income people so that they can use rec facilities and publishes a guide to help people find low cost and free programs.

[Frances Woolley]

Rachel - thanks for the comments.

Weather is another big issue in terms of access to exercise - whether it's summer smog or freezing rain, or +40 with the humidex or -30 with the windchill, it isn't always easy to get outside and go for a walk.

[Determinant]

If a kid attempts suicide (and survives) he'll get access to the mental health services at the local hospital. If he doesn't - well, that kind of sucks, doesn't it? If you have a family physician who has an hour week free to talk to you - wonderful. Awesome. You're one of the lucky ones.

That's how gatekeeping works. Some people manage to get inside the system. Sometimes they get really terrific services. Others aren't so good at working things out, or as willing to ask for and seek help. For every person out there who is getting the OHIP-covered talk therapy, how many people do you think there are out there with untreated depression, self-medicating with alcohol or other drugs, or just walking around feeling totally pissed off at life being miserable to the people they live with?

You're seeing the parts of the system that work - and, yes, there are parts that work. My concern is with the vast, untreated mental health needs of the Canadian population.

I suspect our positions are not really that different.

First, nobody can access the mental health system until they admit they have a problem, agree its depression (or other problem) and seek help from their family doctor. That is a voluntary decision. Depressed people often do not want to take that step and see that it's depression. Our society places a high value on self-control and will to work and admitting mental illness is not valued at all. But that is a societal issue, not an economic one. Money is not an issue.

Second, I live in a one-hospital town. There is a clear path mostly because we can't afford two paths. My doctor is part of a family health team and there is a social worker on that team. I'm generally not that lucky and don't get more than average services, nor does my town.

Child mental health is an entirely different issue as children have different psychiatric needs.

Third, most Canadian psychiatrists no longer offer "talk therapy" or psychotherapy themselves. The Globe & Mail had an excellent article on this a while back in its mental health series. They do offer group Cognitive Behaviour Modification Therapy which have been shown to be cost effective and clinically efficacious. The Mental Health profession is changing its attitude to talk-based therapies because frankly they have listened to economists and want to do something that works.

There are lots of aspects of depression that need to be addressed but which don't fit in a health resource allocation model. The patient has to do it themselves. And if you have a dog, take it for a walk!

Economically the Canada Health Act has a terrible model for health funding: it gives license to hospitals and physicians but gives short shrift to pharmaceuticals and equipment like glasses and dentures. It never should have been done that way. A a diabetic I am acutely aware of the limitations. Doctor (paid for by OHIP) prescribes insulin; I pay for the insulin. This makes sense how?

I will say that the internet has done more to educate patients and allow them to ask informed medical questions than anything else. I know more about diabetes than 90% of medical professionals. But physicians HATE to be challenged, they want the respect. Sorry, not any more, not without questions.

[Peter]

Going way back in the comments to Shangwen's list of "voices on valuation and cost-effectiveness" (Jan 17, 10:31) the problem with Number 4 (reallocation of existing resources) is not that it may produce "counter-intuitive findings, so it is unpredictable and neither validates ideological preferences nor supports the status quo." Rather the problem is it reallocates resources.
Imagine you are in a canoe that is leaking with a wooden bucket. You are bailing the canoe and keeping it afloat, but really you need to stop bailing, dismantle the bucket, and patch the canoe. Unfortunately the question remains "If we stop bailing, can we patch the canoe before it sinks?" The response of "Yes, I have read about lots of boats on other lakes where they did this." is not a very convincing argument.

Three factors oppose radical change to the status quo:
1) Risk is extremely important and exponentially so (what if the patch leaks? also known as "any risk is unacceptable");
2) The discount rate is very high (this canoe sinking is much more important than future canoes sinking, or phrased another way my parents LTC vs my own); and
3) Some activity has certain outcomes (buying more buckets will help the bailing go more quickly).

As the "product" purchased gets more and more distant from the outcome the harder it is to reallocate the resources. Most (all?) economists will point out that the single most important determinant of healthy life expectancy is disposable income. At some point the marginal benefit of lowering taxes will exceed increasing health expenditures - but who wants to put their head in the noose and say "we didn't order additional chemotherapy supplies and instead reduced income tax by 1%."

[Shangwen]

I couldn't find the meta-analysis on this topic, but here's another very significant finding that has been replicated in many studies:

http://ebmh.bmj.com/content/1/2/53.full

Home visits reduced the number of verified reports of child abuse and neglect involving the mother as perpetrator (incidence 0.29 v 0.54, p<0.001). There were no differences in the number of subsequent births, months that women received welfare, reports of behavioural impairment due to substance abuse, arrests, or convictions. A subgroup analysis of high risk women who were unmarried and from low SES households (40%) showed that home visits reduced the number of subsequent births (mean difference [MD] 0.5, p=0.02), months that women received welfare (MD 29.9, p=0.005), reports of behavioural impairment due to substance abuse (incidence 0.41 v 0.73, p=0.005), records of arrests (incidence 0.16 v 0.90, p<0.001), convictions (incidence 0.13 v 0.69, p<0.001), and verified reports of child abuse and neglect involving the mother as perpetrator (incidence 0.11 v 0.53, p<0.01).

Frances, you mentioned respite care, which is low-paid though very time consuming (you are basically replicating the familial care-givers time with a paid service, plus overhead), but brief regular visits in low-SES households are another winner in many respects, and they are way, way cheaper than respite care. Needless to say, even with unemployment and overburdened foster homes, visitation services are in short supply in public programs.

[Frances Woolley]

Peter - the solution, clearly, is duct tape ;-)

[reason]

Shangwen,
why annual? Regular doesn't mean annual.

[reason]

"my pet peeve is that people can't just logon to a computer, access their own medical records, and self-prescribe any needed tests."

Yes, fully agree. And by the way the regular checkups should be thorough and mostly carried out by para medicals who are checkup specialists. Tests don't need doctors (data gathering is not the same as diagnosis). Medical practice in general is much in need of re-engineering.

[Shangwen]

reason - I think, in terms of the dilemma and question noted in the post, that the issue is one of shifting resources out of costly, sometimes low-yield technologies that are impressive but not always helpful, into resources that are less impressive but have a greater certainty of improving the quality of life significantly. So, take the $8,000 for the full cost of one MRI, and move it into 20 pairs of properly fitting dentures. I agree there is a means to have health risk screened routinely (let's lose the loaded term "checkup"), but I don't think it would be feasible, and I'm not sure the technology and instrument reliability are really there to pick up on things and prevent upstream costs. But theoretically, yes. There are already some good internet-based screening mechanisms out there (the USVA uses one for brain injury, for example). What is interesting is that the number of such screens with strong predictive power is so small, that I think many users would find the process underwhelming, i.e., "Can't they do more with these medical miracles?", and I can see the results of such things being subject to dismissal by health care practitioners and subject to litigation. On the other hand, a controversy like that might encourage the diagnostic and public health worlds to finally acknowledge the existence of Bayesian Probability.

Peter - agreed. One of the biggest rhetorical fantasies about our system is that is centrally managed and thus subject to models of rational allocation. But 80-85% of HC spending is some type of personal income, and that to a relatively small number of people who also enjoy social prestige. Cold dead hands, etc.

[Gregory Sokoloff]

"my pet peeve is that people can't just logon to a computer, access their own medical records, and self-prescribe any needed tests."

Francis, another pet peeve may be in danger: Retail Labs Give Patients Information, But Needle Doctors. It looks like you're still out of luck with the self-prescribing bit, and accessing your medical records online.

[Determinant]

FWIW Life insurance companies frequently order routine checkups/paramedicals and blood work to be done by a qualified nurse, not a doctor. Life insurers pay directly for everything they order. They will not order a full medical from a physician unless the amount of insurance requested is extremely large, usually in the millions of dollars. The same goes for disability insurance.

Life/disability insurers are one group that pays retail rates in cash for medical services.

When I have purchased insurance I have taken the opportunity to get a free AIC average blood sugar test on my insurer's tab and saved OHIP the expense. Plus I did not want another needle in my arm.

Second, I may not have been clear that Group Cognitive Behavioural Modification classes in psychiatric clinics are not conducted by psychiatrists themselves, they are led by a trained social workers who are much, much cheaper.

[Frances Woolley]

Gregory, thanks for the link - I wonder if/when this kind of thing will make its way north (to Canada).