Welcome to the June edition of the Going Below The Surface email. We’re not entirely sure what day of the week it is, but we are still keeping close tabs on the drivers of health spending in the United States. This month, we dig deeper into certain preventive health services that can drive up the delivery of low-value care. We also assess recent projections about how COVID-19 will impact our overall health spending; the findings might surprise you.

Digging Deeper

Eliminating Low-Value Care, a Multi-step Process

Preventive care can be valuable and cost-saving – except when it isn’t. In a recent article from the Journal of the American Medical Association, researchers explored the impact of primary care physicians who use low-value testing (chest radiograph, ECG or Papanicolaou test) as part of annual health exams. They found that patients who received these tests as part of their annual exams were likely to have further downstream health care services when compared with untested patients. This increase in spending came in the form of further unnecessary diagnostic tests, specialist appointments and procedures. The study suggested that low-value care has long term consequences beyond just one intervention or physician visit—wasteful spending begets more wasteful spending.

One way to tackle this challenge is to utilize a de-implementation process by which ineffective or inappropriate services are reduced or eliminated. AcademyHealth argued that de-implementation should become a routine practice in the research community and must be “understood as the inevitable result of the evolution of science.” In other words, we know that medicine and health care interventions advance and change over time; therefore, we must continuously evaluate services and methods to ensure that our health system produces the most value.

Why it Matters: Identifying low-value care is the first step in eliminating these services, a step that must be followed up with a process to reduce ineffective or inefficient care. Once we understand how interventions like unnecessary preventive care testing can impact our health system, it is incumbent that a routine process is in place to ensure wasteful spending is not compounded. As the AcademyHealth blog noted, de-implementation research should be framed as part of the ongoing process to develop a health care system that is “constantly evaluating its performance against the evolving body of knowledge about how to achieve the best possible care.”

How Much Will This Pandemic Cost? 

With so many uncertainties surrounding the coronavirus public health crisis, some might be quick to assume that the disease will only further drive up our health spending. However, recent data shows that the United States might reduce health care costs in 2020. Researchers from the University of Southern California projected the cost of the pandemic, using both low (5%) and high (60%) estimated infection and hospital rates. Their modeling concluded that the disease would only account for 0.5%-9.6% of health care spending. Furthermore, surveys from insurers found that claims spending has diminished by 30% due to canceled surgeries and routine care. The reduction in claims spending was confirmed by a recent Kaiser Family Foundation Poll that found nearly half  of those surveyed reported skipping or rescheduling medical care because of the outbreak.

Expensive hospital bills were the suspected culprit of high health spending during the pandemic, but in a separate Health Affairs blog post, hospitalization would likely be far lower than anticipated, accounting for only 1%-1.6% increase in spending per person. Additionally, the article noted that delaying procedures to the latter half of 2020 could result in a 3.3% decrease in spending. Another study from Willis Towers Watson uncovered similar findings, illustrating that postponed procedures could reduce employers’ costs between 1%-4% in 2020. At the highest level of infection rates (20% in urban areas) employers’ costs could rise by 1%-3%, which is “still far below projections from earlier analysis,” according to the report.

Why it Matters: Attempting to predict health spending during an unprecedented pandemic could be, as the Health Affairs article notes, a “foolhardy exercise.” But doing so matters, because these calculations have real-world consequences for our health system. State officials will be tasked with forecasting Medicaid spending, and private insurers will need to make predictions for premiums next year using these projections. It seems counterintuitive that a global pandemic could actually lower health spending, but as patients continue to delay or skip care, that could be a real possibilityWith so much still unknown about this virus, we must cautiously evaluate new data as it becomes available and challenge our assumptions to make sure future health care decisions are grounded in evidence.

What We’re Reading

Since we’re too far from the beach and an overseas vacation is out of the question this summer, we’re suggesting the following article as a “backyard patio” reading selection.

  • Reif J, Chan D, Jones D, et al. Effects of a Workplace Wellness Program on Employee Health, Health Beliefs and Medical Use: A Randomized Clinical Trial. May 26, 2020. JAMA Internal Medicine.
    Researchers took a deeper dive into whether a workplace wellness program delivered on the promise of improving health care outcomes for employees. The answer? Not so much. They found that while more employees enrolled in the program reported having a primary care physician and believed they were healthier, there were “no significant differences in biometrics, medical diagnoses, or medical use relative to the control group.”

Dialogues on Health Spending

There’s been no office water cooler or coffee pot to gather around in recent weeks, but health spending is being actively discussed in online forums, especially peer-reviewed journals and social media.

  • Considering Health SpendingHealth Affairs has published a plethora of articles on health spending during the last few weeks. Topics included pricing transparency, innovation and its role in reducing costs, and value-based payment reforms, among others.
  • Reexamining the Delivery of High-Value Care Through COVID-19 –This commentary in The Hill considers how we are spending our health care dollars and how we can ensure they are put toward high-value care. It was authored by John Rother, president of the National Coalition on Health Care and a GBTS Forum partner, Katy Spangler, co-director of the Smarter Health Care Coalition, and Mark Fendrick, director of the University of Michigan Center for Value-Based Insurance Design.