Had I done my homework, I would have known that the answer was "yes" -- or more precisely, that Obama's brain on healthcare, Peter Orzag, not only read read Gawande, but went to town blogging on Gawande's conclusions and in particular on Gawande's spotlight on McAllen TX, the low income town with one of the highest per capita Medicare tabs in the country. On May 28, Orzag noted that Gawande's tale of two healthcare markets richly illustrated his own theme that some markets pay dramatically more for healthcare than counterparts, with no apparent benefits. Then, on June 4, he delved deeper into McAllen's high costs, comparing them with his own favorite poster child for low costs/good outcomes, Grand Junction, CO:
For example, at the end-of-life, nearly half of all McAllen Medicare patients see 10 or more physicians, significantly more than the national rate of 30 percent (and in Grand Junction, Colorado, it is just 11% – more than four times less than the rate in McAllen). Also, McAllen’s Medicare patients have 50 percent more cardiac surgery procedures as the national average (about 24 per 1000, versus about 16 per 1000), four times the ambulance spending during end-of-life, and eight times the home health care costs. Medicare spending per enrollee in the last two years of life also varies greatly among McAllen and other peer hospitals.This week, Orzag was at it again, converting Gawande's core contrast into a policy mantra:
Obama is singing from the same choir book. As in his June 2 address to senators, so in his June 2 letter to Senators Kennedy and Baucus, he highlighted the Mayo Clinic, replicating Gawande's thesis in the process:It’s certainly true that medical innovation is essential to improving treatment – and thus health outcomes – for us all. And it’s also true that we need to encourage doctors and researchers to explore and experiment in ways that lead to medical advances that save lives and improve their quality. But, today, the American health care system doesn’t always reward the best medical innovations – and one need look no further than McAllen, Texas to see that this is so.Despite having a demographic profile similar to El Paso, Texas, and despite having had similar Medicare expenditures as El Paso as recently as 1992, McAllen’s spending grew about five times faster in the years since than in either El Paso or the United States as a whole. In return, McAllen got more medicine (more tests, more surgeries, more time in waiting rooms), but it didn’t get better health – McAllen scores lower than El Paso (and the U.S. average) in measures of health care quality. McAllen "innovated," and certain doctors and hospitals were financially rewarded, but I think we can all agree that this isn’t the kind of innovation we desire.To get the most from innovation, we need to align incentives toward quality rather than intensity. The Mayo Clinic, synonymous the world over with cutting-edge medicine, has among the country’s lowest Medicare costs per beneficiary. Smaller medical markets, too, have managed to achieve such results: Grand Junction, Colorado is one of the lowest-cost and highest-quality places in the country to be treated. We need to reform the health care system so that it rewards the right kind of innovation – the Mayos, not the McAllens. And the Administration’s proposals aim to do precisely that through bundling of payments, incentives to reduce hospital readmission rates, and (as discussed below) a process through which MedPAC’s recommendations would enjoy fast-track protections in Congress (my emphasis).
We should ask why places like the Mayo Clinic in Minnesota, the Cleveland Clinic in Ohio, and other institutions can offer the highest quality care at costs well below the national norm. We need to learn from their success and replicate those best practices across the country (my emphasis).Compare Gawande:
Most Americans would be delighted to have the quality of care found in places like Rochester, Minnesota, or Seattle, Washington, or Durham, North Carolina—all of which have world-class hospitals and costs that fall below the national average. If we brought the cost curve in the expensive places down to their level, Medicare’s problems (indeed, almost all the federal government’s budget problems for the next fifty years) would be solved. The difficulty is how to go about it. Physicians in places like McAllen behave differently from others. The $2.4-trillion question is why. Unless we figure it out, health reform will fail.Among other cost-cutting measures, Obama also called for "'accountable care organizations'" to improve the quality of care for Medicare patients - apparently a bid to create the kind of outcomes-focused peer group Gawande highlighted in the Mayo Clinic.
Not to mix up cause and effect: Orzag has seized on Gawande's field research because it so precisely illustrates his own pet theses. But still it's remarkable to see that high quality piece of research and writing working its way so swiftly into the political process.
Did Obama read Atul Gawande part 3
Orzag hones in on doctors' incentives