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Breaking the Bank vs. the Backs of Americans

February 28, 2011

February 14 brought the much-anticipated release of President Obama’s FY 2012 budget proposal, which wisely invests in research, discovery, and health care in many respects. However, the budget plan misses the mark by completely eliminating payments that support pediatric training programs at children’s hospitals.

This comes at a time when the federal government and many others have noted severe shortages in pediatric subspecialties. Without support for residency training positions, we cannot increase the supply of physicians in the United States. As John Iglehart noted in a recent Health Affairs article, “even though medical school enrollments are rising, paradoxically the number of graduate medical education (GME) positions supported by Medicare has been frozen since 1997.” Another thoughtful piece appearing on puts it better than I could have: “In the next 10-15 years, the United States will have many more patients, a greater percentage of whom will need more medical care. Without more new physicians entering the workforce than there are older physicians retiring, there will be fewer doctors to care for all those patients.”

In D.C., bookies are taking bets on whether the government will shut down on March 4 when the continuing resolution expires. The House voted after an unusually long debate to pass their party-line spending bill, slashing funding for other important workforce programs and returning National Institutes of Health (NIH) funding to its FY 2008 level. Op-eds appeared around the country pointing out that these cuts—the largest in NIH history—are shortsighted and will have a dire impact on the progress of research for treatments of diseases like cancer and on the fiscal health of local economies.

What the Senate, and the president, will do with the House budget remains to be seen, though no one wants a repeat of 1995. While I’ll have trouble explaining to my kids why the National Zoo is closed, I’d hate to be a politician explaining why benefit checks haven’t arrived in the mailboxes of seniors and veterans.

Graduate Medical Education Remains a Hot Topic

While Medicare’s support for GME escaped the president’s budget scalpel, many individuals and groups continue to see these payments as leverage for reforming the health care system. Although a valid point, this approach addresses only the 25,000 doctors who finish training every year, not the other 750,000 who are already practicing and who might not be quite ready for that “new” system.

Nonetheless, I appreciated the recent New England Journal of Medicine perspective article from Glenn Hackbarth and fellow Cornell classmate Cristina Boccuti that stressed the need for training in areas already required by the ACGME for any residency to be accredited and obtain public funding. Many teaching hospitals far exceed those requirements and are pushing the envelope further every year. For instance, teaching hospitals are far more likely to encourage the use of diverse health care teams and to have well-developed HIT systems compared to other settings. And there is growing evidence that resident physicians are actively helping to drive quality improvement in our health care system.

As Hackbarth and Boccuti noted, “teaching hospitals also serve as linchpins of their local health care systems and contribute to stunning advances in medical science” and that, from a traditional perspective, the “GME system is an extraordinary success.” While the authors may not agree with that “traditional perspective,“ it’s clear that training programs have responded to societal values and needs, and that they will continue to adapt as those needs change.

When More Is, Well, More

Why do some geographic areas of the country spend so much more money on health care? Because the patients are sicker. At least that’s what the latest research from the Center for Studying Health System Change (HSC) demonstrates. In fact, the paper by HSC Senior Researcher James D. Reschovsky, Ph.D., and colleagues suggests that current cost-reduction policies may have little effect on what’s spent on seriously ill or injured patients—particularly Medicare beneficiaries with highly complicated conditions. One suggestion for lowering costs has been to reduce the number of doctors and hospital beds in communities to help decrease “supply-induced demand.” It turns out that this theory—that geographic variation in health care spending is driven by the supply of providers—“can’t be supported when one comprehensively controls for health status,” according to Reschovsky and colleagues.

This research comes, alas, too late for the health care reform debate when some areas of the country touted their high-efficiency, low-cost approach to care. But it brings to light several critical findings from researchers in California showing that “extra spending” for several common conditions “was almost always associated with better outcomes.” As author and surgeon Pauline Chen has pointed out, “the notion that aggressive care leads to worse outcomes has been easy to buy into because it seems to offer an easy remedy for spiraling costs while playing into our worst fears about overzealous health care providers.”

The truth that sometimes aggressive care is necessary comes as no surprise for clinicians and patients in teaching hospitals. In many cases, caring for trauma, cancer, or other patients requires Herculean efforts in the clinics and operating rooms. Both patients and policymakers will need to have a more serious—and data-driven—discussion about what constitutes “waste” versus critical care that actually saves lives in order for the nation to accomplish the noble goal of reducing costs while making sure America still has the best doctors and hospitals in the world.

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About the Author

Atul Grover, MD, PhD AAMC Executive Vice President

Atul Grover, MD, PhD
AAMC Executive Vice President

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For More Information

Peters Willson
Sr. Specialist, Policy and Constituency Issues
Telephone: 202-862-6029