A Comparison of healthcare in the US and the UK - Similar problems but differing solutions.
I am a General Practioner in the UK and spent some time in the US during March and April of 2002 on sabbatical looking at problems with healthcare provision and solutions that have been put in place or are proposed.
Throughout the developed world costs of healthcare have spiralled. This is due to a combination of increasing unit costs, new therapies and increasing demand from patients both for greater volume of healthcare and for ever higher quality.
In the UK since 1948 healthcare has been largely provided through the NHS - see (1). The initial overriding principle of the NHS was that it should be entirely funded out of general taxation and free at the point of use and thus equitably available to the entire population. An aspiration which seems hopelessly naive now was that the improved level of healthcare that would result would make the nation healthier and so reduce the demand for treatment. Unfortunately this has not materialsed. Also there has been some modification of the underlying commitment to no charge at the point of use. Dental treatment now attracts some nominal charges at the point of provision (in the US these are styled co-payments) and prescriptions and eye tests attract a flat rate fee. There are various exemptions dependant on age, diagnosis and financial circumstances and in women pregnancy.
The NHS has been in existence so long that most practising healthcare workers have no experience of a different system unless they have either worked abroad or had occasion to use a foreign healthcare system, as indeed I have myself in the past. Also, they may come across patients from time to time who have been treated abroad. There is still a strong belief in the general principles of the NHS among British healthcare workers though perhaps it is somewhat less strongly felt among the medical staff. However, there has been a very negative reaction to the NHS in the media in recent years, focusing on long waiting times for surgery, patients kept for long periods on trolleys in Accident and Emergency (E R) before admission, discrepancies in the availability of certain drugs region to region and long waits to see the G P amongst other problems. The NHS has been a political battleground and as in real war truth is often the first casualty. All of this, combined with the perception amongst many workers that for reasons of funding, staff shortages, inadequate facilities, high workload and central policy they cannot deliver the care that they want to deliver and which they feel that their patients need and which they are only prevented from delivering by factors that they feel that they cannot directly control has led to a feeling of disillisionment.
In the US too I detect a general feeling of disillusionment. Funding of healthcare in the US is much more fragmented than in the UK. Medicare, which is Federally funded, provides healthcare for the population aged 65 and over but does not pay for drugs even though the elderly population is taking an average of 7 items per individual. Medicaid provides basic healthcare for the indigent and is State funded and will fund medication. The rest of the population is covered by either insurance or one of the managed care plans except that many are not actually insured at all, relying on Emergency Room treatment for their care because they know that it won't be denied to them but of necessity this can only be reactive care however in specific areas, as for example in Tallahassee, Florida the local medical community may have set up a scheme to care for these individuals.
Much healthcare cover in the US is funded through work. After the Second World War employers needed to find ways to get employees to join them and funded healthcare was introduced as an inducement. Some type of healthcare provision is now pretty standard as part of most workers employment package. However, because of increased costs this rarely amounts to full insurance cover so in one way or another the cover is restricted - hence the advent of managed care, which has as it's primary function cost containment though its advocates would certainly claim that it rationalises care as well and reduces inappropriate usage of facilities and expertise which is very likely to occur when patients directly refer themselves to specialists as can occur when patients have unregulated direct access.
Millman (2) predicts a 44% increase in US healthcare costs from 2001 - 2006 whereas from the most recent of the UK Department of Health's own figures (3) for the two years 1997-1998 and 1998-1999 annual expenditure was rising at a rate of 5.5%-5.7% giving a five year rate of increase in the region of 30% though because of a perceived shortfall in health expenditure in the UK relative to most advanced economies (4) a process of catch-up is proposed by the present UK Government and so the likely increase is probably going to be higher than that over the forthcoming five year period. The consequence of such cost pressure in the two healthcare systems is likely to be somewhat different. In the UK at present there is a political consensus that basic rate income tax should not increase and a general assumption that general taxation will remain the main source of funding. As a consequence either funding increases are not going to be met in full or other spending programmes will have to suffer or more likely both although some ways of increasing the tax take without touching the basic rate of tax are likely to be found thus easing the dilemma somewhat. In the US where the pressure on cost is even greater and where government funding, except at the margins, is not even on the political map there are only two sources of possible funding - the employer and the patient (or the patient's spouse or parent). I will be discussing the history of managed care in the US later but I think it would be fair to say that it has not fulfilled its initial promise. As a consequence there has been some relaxation in the restrictions imposed by Health Management Organisations (HMO's) in their original conception as what would in effect be a private health service (or a series of private health services). Though they do provide services directly most allow patients to go to independant primary care physicians with whom they have a contract and also a degree of self referral to certain specialists such as dermatologists, obstetricians/gynaecologists and psychiatrists provided that only designated specialists are used. However, restriction of access to doctors is probably the most unpopular aspect of HMO provision in a society which values choice highly. Other schemes have a greater degree of flexibility - e.g. Preferred Provider schemes which allow the patient a greater say in how their health care is delivered provided that they stay within an approved network of healthcare providers and Point of Service Schemes which allow the patient to chose whether to go with an approved provider at one level of cover or to go outside at the cost of a higher contribution. In 1997 there were 66.8 million Americans enrolled in HMO's. However, there is a crisis in the making because most employers are not in a position to continue upping their contribution in line with the projected cost increases. Some larger employers are able to take some additional control by setting up a self-insured scheme whereby the various aspects of a health plan are purchased separately and the insurance company's role is simply to act as the payer. Other solutions that are being mooted include the employer paying the money that would go to fund a health plan directly to the patient and let them decide what to do with it or paying into a savings scheme from which the patient can withdraw funds to pay for health care with a safety net policy to pay for the cost of dealing with a health catastrophe. Almost all patients are going to have to get used to paying more both proportionately and in real terms and this is likely to be both on a regular basis and at the time of any health intervention.
To ask some fundamental questions:
Is it inevitable that costs have to rise inexorably?
Clearly general inflation has an effect on health costs. Healthcare workers have to live in the world and pay bills. Other employers of professional labour may be able to fund increases in remuneration which induce healthcare workers to leave or not to go into health in the first place. In the US there is a problem recruiting nurses and in the UK it's doctors as well. Consequently the wage bill cannot avoid increasing year on year, unless you progressively make do with fewer staff. What is more other organisations that are associated with healthcare such as drug companies and other suppliers also have to recruit and retain staff in a competitive market place. However in both the US and the UK the inflation of health costs has been and remains well ahead of general inflation and this is so ingrained in the system that it's seldom questioned now - within healthcare at least. Of course innovation is responsible in part for this. New treatments have to be more expensive than old don't they and we have to have new treatments don't we? It seems almost a heresy to even ask the question. Of course many diseases exist for which current treatment is unsatisfactory either because it doesn't work or because the side-effects are unpleasant and there is an almost universal aspiration to improve the outlook in the group of diseases that come under the general label "Cancer". So this striving for innovation and improvement has an impact on the cost of delivering established care - in 2000 the US pharmaceutical industry was anticipating spending 26 billion dollars on R&D and this clearly has to come, at least in part, from current expenditure on drugs (essentially the branded rather than the generic drugs). Now whilst some of this expenditure on R&D is commendable and meets the general aspiration for health improvement a significant amount does not and is simply about trivial innovation simply to improve or preserve market share - developing "me-too" drugs or reformulating existing drugs simply to extend the patent and this adds little to the therapeutic canon that is available to doctors. Other much needed research to develop treatments that will be unlikely to yield a commercial return because the diseases are either rare or don't afflict the reasonably affluent either doesn't get done or is left to public institutions such as universities. Once having developed a new therapy there is a commercial imperative to seeing it utilised. In the US the direct marketing of drugs is designed to create a demand even if there is no actual need - this is banned in the UK though drug companies have circumvented the ban on occasions by use of the news media. Perhaps also the UK public is a little more cynical about novelty and innovation. The UK system, from the prescribing figures I've seen does work better in encouraging the use of generic prescribing, in limiting the use of antibiotics and anxiolytics and in limiting the prescribing of new drugs that add little to quality of care or are simply inappropriate as first line therapy in common everyday illnesses. The annual rate of increase in cost is significantly less than in the US but is still substantially ahead of general inflation.
Is "Managed Care" always a threat to clinicians and "Clinical Freedom"?
My understanding of the term "managed care" is that it refers to an external influence on the doctor/patient relationship to ensure an outcome that might otherwise fail to occur. This outcome might relate to cost or quality or both. Of course it begs the questions 1) why can't the patient and doctor be trusted to come to an appropriate conclusion about the correct course of action by themselves and 2) where is the body managing the care coming from and from where do they derive the right to interfere?
To answer the second part first. The interest naturally arises when a third party is funding the care and/or when a fourth party is competing for funding. This arises whether the funding is from insurance funds (especially if the premiums are derived from a source other than the patient) or from public money. The motivation behind such interference can't fail to attract some suspicion that it is entirely about saving cost and any pretence that it is about quality is mere window-dressing. However there are influences on whoever is managing the care to ensure that it is good quality. If the payer is Government then the result of ineffective treatment of blood pressure, for example, may be a stroke and that could have massive cost implications elsewhere in the budget. If the payer is an employer via an insurance plan then a sick employee is an unproductive employee and a discontented employee may well move on elsewhere. However, it is not always easy to demonstrate a clear relation between what a consensus view of clinicians may feel is a quality intervention and a cost saving.
Why can't the clinician and the patient be trusted? Firstly, both left to themselves are not motivated to take any recognisance of cost. The clinician is ethically and professionally bound to put the interests of the current patient being dealt with before all others. An experiment in the UK whereby GP's were actually given a budget to pay for the care of their patients had at its heart this essential dilemma - that money spent on the present patient was in some ways compromising the interests of all the other patients that the doctor was responsible for and some doctors felt that this represented too much of a conflict of interest and stayed out of the scheme, whilst others felt that they could at least balance interests more competently than someone who was not a primary care clinician. The patient, on the other hand usually wants the best for him/herself and is not usually going to be too bothered by cost if s/he is not actually seeing money which could be spent on other things change hands. The other factor is poor quality information. This may be due to plain ignorance, misinformation or even downright disinformation. Both the patient and the doctor may be basing their preference for care on an inadequate knowledge base. The patient is particularly susceptible to information that is partly or totally incorrect from such sources as advertising, the internet, newscasts etc. or they may misunderstand the relevance of a new development to them - e.g. a new antibiotic or anti-inflammatory, though good and appropriate in its place, may be perceived as offering a general advance when it does not. The clinician is clearly in a much stronger position because of his/her training and experience but especially in primary care where, unless the doctor or nurse has a special interest it is a tremendous challenge to be up to the minute and in possession of all the current evidence on every matter that is presented but in secondary care there is a somewhat different risk of being narrow and biased. In both systems there is a desire not to fall out with the patient especially if the issue is not seen as central to the doctor/patient relationship but perhaps NHS clinicians are a little less concerned since both in primary and secondary care there is no shortage of patients! In most cases the management decisions made are in no way incompetent or dangerous but perhaps too often the decisions left to the clinician and patient may be sub-optimal - in the UK system, in which I have direct experience this is usually because something is treated which could be left alone (asymptomatic bacturiuria in a catheter specimen given antibiotics for example), treated by an expensive drug when a cheaper one would be as good or better (from my discussions and reading of confidential material this would seem to be even more of a problem in the US than the UK because of the direct marketing of drugs to the public), treated by a less effective drug (perhaps because reliable comparative data does not exist, is published obscurely, has been overlooked by the clinician or because the less effective drug is heavily marketed) or perhaps a totally different approach is one of which the clinician has no experience because it is new or against which the patient may be biased (an example would be the slow adoption of H.Pylori eradication therapy in some quarters). I hesitate to be critical here because it is virtually impossible to make optimal decisions at all times in any field and this is especially true in medicine because of the rapid development of the field which is often very difficult for a generalist to evaluate and especially perplexing for the layman in the face of powerful commercial promotion and media coverage which is often biased in favour of the latest development and sometimes is just plain ill-informed. These sub-optimal decisions are rarely critical in the individual case (where they might be, as in cancer chemotherapy then restricting decision making to a limited group of doctors who make it their business to be on top of best current evidence at all times has proven to be literally life-saving) however, multiplied many times across a health system sub-optimal decision-making leads at best to the squandering of resources and at worst poorer outcomes with higher complication rates for say hypertension and diabetes than current best practice can achieve. Consequently the pooling of skills and the production of guidance on how to proceed in specific circumstances based on the analysis of the best evidence available would seem to be an obvious solution and should be an aid to good practice rather than a threat if it is done in such a way that clinicians and patients are able to see it as such and not as an intrusion and a block to what needs to be done.
Is there more than one model for managed care?
There are several stakeholders in the managed care process: the patient, the clinician, the clinician's peers, the provider institution, the agency that distributes the funding (be it government or insurance company), the source of the money (taxpayer, employer or the patient again) plus additional rather less directly involved agencies such as the professional bodies and the law. The nature of the process will be of a different character depending on which stakeholder is taking the lead role and who else they involve. It's my contention as a primary care physician that guidelines, protocols, care pathways or however you describe them and the audit or review process that ensures that they are adhered to have to be seen to involve the clinicians peers at every stage with quality as the primary driver or the clinician is going to be deeply suspicious about motivation and feel, perhaps with due cause, that s/he is being forced to act against the patient's and his/her best interests for the prime purpose of simply saving money. The patient too has to trust the process. In the US, from talking to consumers I get the impression that they feel that managed care is about stopping them getting any care that is likely to be expensive whilst they are aware of increasing co-pays and that the insurers are raking in more and more money from whoever is paying the premiums. In the UK where perhaps less formalised managed care arrangements are gradually being put in place the concern of patients and the media is still with waiting times primarily, both for treatment and to see the doctor and I don't feel that generally patients are aware of a process that might be described as managed care except in very specific instances - for example the NICE guidance on the treatment of multiple sclerosis with beta-interferon (6) when the patient group involved felt very strongly that they were being denied access to treatment that they felt was effective. NICE (stands for the National Institute for Clinical Excellence) is a relatively new body that examines new interventions in the UK and also reviews old ones too - a full list of its current reports is at (7). In many ways it would be a lot easier to sell the process to UK patients because it could be portrayed as being a measure primarily to ensure equity of access and also that everyone's tax money is being well spent.
The History of Managed Care.
Paul Ellwood is credited with originating the concept of managed care. He writes (8) of his concept of a competitive health care system which consists of a number of health provider organisations competing mainly on quality and this is well explored in an interview with him (9) from 1997. Clearly the way things have actually developed differ considerably from his vision which is very much a free market solution not just to containing cost but also very much to raising quality. In the interview he claims that whereas he envisaged that each organisation would consist of clinicians with a proven track record on quality who would all work to provide a guaranteed quality product which the purchaser would therefore want to select even if it wasn't the cheapest available (and there would be more than one such organisation so offering a genuine choice) the reality is that each HMO signs up a wide range of providers and in fact the same providers thus negating choice on all but grounds of cost. This he blames for the preoccupation of managed care schemes with cost and the poor reputation that they have acquired with professionals and patients alike.
Conclusions.
We have the paradox in both the UK and the US that although healthcare in both countries is achieving health outcomes superior in many respects to what has ever been even dreamt of in previous times nevertheless the reputation of both countries systems is at an all time low. In the UK we hear of people dying on trolleys in Accident and Emergency, of waiting lists, of dead children's organs being taken and stored without parental consent and of long waits to see G.P.'s and in the US people are increasingly concerned about cost and access to the care that they feel that they need. Of course in both countries the access to information, of variable quality and relevance in some cases, is at an unprecedented level both through more conventional media sources and also through the internet. Most people in our two countries have grown up expecting to live a full life span so that not to do so is to be cheated in some way. Past advances are now just part of the scenery and totally taken for granted. People are also conditioned to the quick fix that doesn't require a lot of input from them. They are busy at work and leisure and don't always have time and inclination to do all that they can to make the best of their health. They don't want either for perhaps even relatively minor symptoms to interfere with their day to day activities and there is often an expectation that medicine should have a role when in reality self-care is the appropriate course - I suspect that this is more of a problem in the UK where patients seem often to fail to make a connection between their use of health care facilities and the expenditure of resources. I think that this may well be much less of a problem in the US where there is more awareness that health care costs real money. However in both systems there is a crunch coming and the maintenance of what we have now is in some sense being held hostage by the demand for innovation and progress which is partly responsible for the increasing share of national wealth going into health care. The UK has lagged behind in its level of health expenditure, not just behind the US but most of Western Europe as well and this has resulted in the relatively poor performance that the NHS has demonstrated in comparison those systems in recent years in respect of certain indicators at least - see (4). The present Government has decided to increase the level of relative expenditure to the "European Average" but this seems to me to have been an arbitrary decision taken primarily for political reasons and without there necessarily being a proper national debate about what is a proper and affordable level of expenditure. Whilst it is probably incontestable that as a nation the UK could fund health care at a higher level than at present without any major deleterious consequences on the rest of the economy, because others are already doing it successfully, nevertheless is it always money well spent? There presumably is an upper level of spending which is sustainable and perhaps we need to reach a national consensus as to what that is before it is reached. From current trends it would seem that no matter what that level is it will be reached - be it 18%, 20% or 25%. The higher the level the longer it will take to get there but it seems to me that unless the health economy starts to behave differently then the possibility of health inflation coming into line with general inflation seems unlikely. In the US of course there isn't a mechanism for Government to set public policy on a level of health expenditure because, with the exception of Medicare and Medicaid this is out of its hands though decisions on such things as levels of tax relief given for health insurance and patent privileges given to drug companies will have an effect on cost. In other respects these issues are market driven in the US and are ultimately going to be determined by what the employers and the patients will pay for and unfortunately this market on cost has dominated the market on quality that Ellwood invisaged. Sooner or later, it seems to me employers and individuals will have to make real choices in the US as to what level of health care they really can afford and to a much greater degree than at present though even now the elderly, in particular, are making choices about drugs because of the cost to them that drugs represent. I have not alluded to private health care in the UK because it is relatively insignificant in overall volume and few people use it to provide all of their healthcare needs - very few have a private GP for example. The main function of private health care in the UK is to circumvent NHS waiting lists and perhaps in some cases also to have access to in-patient facilities that are more comfortable than an NHS six bedded ward. Most Private in-patient care is provided in separate facilities that are not really set up for high risk or complex surgery which the NHS usually copes with well. It basically there for comfort and convenience but like the US however, it is often provided through an employer. However, if the situation arises that the NHS has to start limiting access to health care that many might regard as basic then it is extremely likely that those that can afford it or whose employers are prepared to provide it may well resort to private health care to fill the gap. Thus in both countries systems, because of increasing costs we could well see an increasing divergence between what the well off and those highly valued by their employers can access in terms of health care and the rest. It is after all what we see in other areas of life and accept: holidays, cars, wine, restaurants etc. but in the UK especially, but in the US too in many quarters, it has always been an aspiration to make the best available to all - perhaps in the long run we delude ourselves this is possible unless we redefine what we mean by health care and find that much useful intervention that really makes a difference to people's enjoyment of a long and healthy life need not cost the earth.
(1)BBC News On-line - Health Background Briefings - Your NHS. http://news.bbc.co.uk/1/low/health/background_briefings/your_nhs/86100.stm
(2) Millman's Health Cost Index Report.
(3) Health and Personal Services Statistics - UK Department of Health. http://www.doh.gov.uk/HPSSS/INDEX.HTM#sectione
(4) Compendium of Health Statistics - Office of Health Economics.
(5) Definition of Managed Care at: www.encyclopaedia.com - http://www.encyclopedia.com/html/m1/manag.asp
(6)http://www.nice.org.uk/page.aspx?o=27588 - NICE guidance on the treatment of multiple sclerosis with beta-interferon and gratiramer.
(7)http://www.nice.org.uk/nice-web/Cat.asp?c=153 Full list of NICE guidance on various topics issued to date.
(8)The Likely impact of a competitive health care system, 1980 (a.e.) t.p. (Paul Ellwood)