How defensive medicine has caused healthcare costs to rise

May 25, 2012
Jeffrey Segal, MD, JD, FACS
Jeffrey Segal, MD, JD, FACS

One doctor says that the large number of unnecessary diagnostic tests have caused healthcare costs to increase and offers his insight into how to fix the system.

According to a 2010 poll conducted by the Gallup organization, about $1 in every $4 spent in healthcare can be attributed to tests and procedures that are clinically unnecessary. The problem has become so overwhelming that in April, a group of nine medical specialty societies, including the American Academy of Family Physicians and the American College of Physicians, launched the Choosing Wisely initiative. Led by the American Board of Internal Medicine Foundation, the initiative asks doctors to cut back on 45 tests and procedures that provide little value to patients. (See http://www.MedicalEconomics.com/choosingwisely for more information.)

TORT SYSTEM MUST CHANGE

In most cases, physicians order up tests not because they were necessary to diagnose what was wrong, but because if they didn't and something went very wrong, they believe they would not be protected in a lawsuit.

Patients for Fair Compensation, a nonprofit organization seeking to educate policymakers about defensive medicine, estimates that unnecessary tests and procedures cost about $650 billion a year. (Full disclosure: I am a board member of this group.) That is money spent on the unnecessary MRI the doctor ordered for a worker with a nagging backache, for example, and the EKG the physician ordered on an otherwise healthy 36-year-old patient with no history of heart disease.

The $650 billion in lost revenue spent on unnecessary tests includes money coming out of the pockets of taxpayers. Medicare pays up to $125 billion a year for unnecessary tests and procedures, and Medicaid pays up to $96 billion for unneeded tests and procedures.

A brief list of what many patients can do without:

Doctors often feel compelled to order these tests or treatments because patients demand it. In today's world, patients expect quick remedies for their symptoms. When they don't get immediate relief, they push physicians to use the latest technologies to discover what's wrong. It's the American way.

As long as a doctor believes he or she could be the potential target of a frivolous lawsuit, he or she will keep ordering tests and procedures. The only substantive solution is to revamp our nation's medical tort system so physicians don't feel the need to double-check their diagnoses with expensive testing.

NEW MODEL FEATURES PANEL

States such as Florida and Georgia are considering a move to an administrative, nonadversarial model, proposed by Patients for Fair Compensation, called the Patient Compensation System. In those states, patients could take their claims to a panel similar to a workers' compensation board. Cases would be heard within months instead of years. And patients would receive quick, predictable settlements.

The system would keep doctors from being hauled into court, because they would not be held personally liable for any tort claims-legitimate or frivolous. Physicians still would pay professional liability premiums, as they do now. And there still would be a way to address doctors who should not be practicing.