Perverse Economic Incentives II: Ignoring Best Practices
You’ve heard this before: the more solutions you have for a single problem, the less likely it is that the true solution has been discovered. Once a real, conclusive solution is discovered it is accepted and implemented by essentially everyone who is presented with that particular problem. This process occurs unfettered in an open market or open system, and the cost of a particular solution depends on a combination of need for the solution and the economic incentives that exist to solve the problem.
Unfortunately, in healthcare in the U.S. this “rule” is not always the case.
Here’s a story about a solution that is NOT being used to the extent it should because private surgery centers are punished financially if they do the right thing. This example is truly a case of perverse economic incentives violating what we think of as a law of nature, that the discovery of a solution for a vexing problem will be adopted by all who suffer the problem if it is shown to be superior to all other solutions. Let’s look at the “Floppy Iris Syndrome” (AFIS) in cataract surgery.
The iris is the colored part of your eye, and the pupil is simply an opening in the iris, much like the shutter of a camera. The pupil is dilated prior to cataract surgery so that the cataract, a clouding of the lens that sits in back of the iris, can be reached and removed. Six or Seven years ago cataract surgeons began to be ambushed by pupils which spontaneously constricted or shrunk like a pursestring closing, or by an iris that started to billow like a parachute placed over a fan. Dubbed the “Floppy Iris Syndrome”, it turned out that it was caused by exposure to a certain class of medicines used for the seemingly unassociated problem of urinary retention in men with enlarged prostate glands; it has since been found to be caused by an increasing number of other medicines. It was a disaster. The complication rate for surgeries with AFIS was 10X or greater than those with a normal iris and pupil.
The search for the cause was important because cataract surgeons could now be forewarned that they might encounter AFIS during surgery if their patient had ever been on one of the medicine culprits. Once the cause and the extent of the problem were known the race was on to find a solution. Unfortunately, all of the intra-operative tactics we’d used in the past to handle small pupils were largely ineffective against AFIS. In fact, some of the standard ways to address a small pupil actually made the surgery MORE difficult because of the floppy, flaccid iris. Every week brought one or two new ideas to add to the dozens already on the table, proving the rule that many solutions means that no true answer has been found.
Enter Dr. Maluygen and his marvelous eponymous ring. The Maluygen Ring essentially solved the entire problem by simultaneously expanding the pupil and stabilizing the iris, and it was both vastly superior to all other solutions available and technically within the capabilities of pretty much every cataract surgeon. Bingo. QED. Kudos, heartfelt thanks, and a bit of profit to Dr. Maluygen and the company that marketed his Ring, right?
Not so fast there, Cowboy. Every week we STILL see articles on how to deal with AFIS in surgery despite the fact that not a single surgeon has stated, on or off the record, that there is anything that is as good as the Maluygen Ring. Here is where the perversity begins. It turns out that only hospital owned surgery centers can bill insurances for additional or special items used during surgery, and the $125 that the Maluygen Ring costs is extra and therefore not reimbursed. The majority of cataract surgeries in the U.S. are performed in private surgery centers, mostly owned by surgeons who operate in them. To begin with, private surgery centers are paid roughly 60% of what hospital-owned surgery centers are paid. $125 represents in most cases 50% or more of the gross profit (before interest, taxes, depreciation, etc) generated in a case.
That’s right, there is a 50% financial penalty for using the best and safest method to avoid a preventable complication.
It’s no wonder that the owners of surgery centers continue to look for an alternative solution to the problems cause by AFIS. In a misguided attempt to save money, Medicare has led the charge to pay independent surgery centers less than hospital owned centers, and along the way has stripped the independent centers of the ability to pass on the cost of items that represent the “best practices” for certain situations. Rather than use the acknowledged superior solution (the Maluygen Ring) we continue to see inferior techniques utilized despite the fact that they often prolong the surgical case and fail to completely solve the problem. All because policies are created by non-clinical personnel who are only empowered to save money.
We should be mindful of these perverse economic incentives as our American system of curing disease undergoes an historic upheaval. Do we really want doctors and others considering the economics of utilizing true, proven best practices? Do we really want non-clinicians creating policy that turns medical decisions into economic ones?
Tags: cataract, center, doctor, economics, healthcare, maluygen, medicare, reform, ring, surgery
This entry was posted on Thursday, June 13th, 2013 at 9:06 am and is filed under Health Care, Healthcare Economics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.