Cost should no longer be a dirty word in medicine

I strolled into our noon-daily resident conference, a little late, my free burrito in hand, and noticed that “cost awareness” was the topic. The conference seemed to have the same format as our other lectures: an attending was presenting a clinical case and asking us what steps we could take to best diagnose and manage the patient. The case seemed straightforward enough—a 65-year-old healthy Caucasian gentleman with right-sided chest pain—and the attending asked us what we would do next? Low-risk, I thought to myself, and joined the room in shouting out “EKG!” But the next question was met with awkward silence. How much did that EKG cost?

Before I went to medical school, I was a teacher. In that role, I was painfully aware of the cost of each item—the glossy textbooks, the school’s utility bills, the low teacher salaries. As a resident focusing on underserved populations, I prided myself on my ability to recite the $4 Target medication list from memory. Since I knew which medications were most affordable to my patients, I figured this must translate into some knowledge about medical costs overall. After all, don’t most other jobs require you to know the prices of the products you sell?

The presenter stared directly at me. “So how much will this EKG cost?” Two months into intern year, having ordered at least one EKG per day on the inpatient service, I still had no clue what we charged for them. Doing some rough calculations in my head, estimating the approximate costs of the machine, paper, and nurse involved, I tripled my estimate—after all, things cost much more than they should—and blurted out, “A hundred bucks.” My neighbor got called on next and volunteered $500. Around the room we went, with guesses varying from $25 to $600. It was clear that I was not alone in being clueless about cost awareness, and that we could use some help.

The UCSF Cost Awareness curriculum was implemented in June 2011 by a fellow UCSF internal medicine resident, Dr. Chris Moriates, along with Dr. Krishan Soni, UCSF Chief Resident for Quality Improvement and Patient Safety; and Dr. Andrew Lai, UCSF hospitalist faculty. Through a series of interactive and innovative lectures, the curriculum challenged our assumptions about the costs of care and made us wiser clinicians.

Naysayers argue that we physicians should be blind to the costs of treatment, citing concerns that high costs could prevent us from ordering necessary tests or medications. But the purpose of this curriculum is not to teach rationing health care; it’s to teach rational health care. By learning the fundamentals of evidence-based medicine, but keeping the best interests of the patient in mind, we’ve learned how to use the most current guidelines to provide individualized yet cost-effective care. We’ve learned how to properly risk-stratify patients, consider pre-test probabilities, and yes, defer that expensive vasculitis lab test after pursuing a more logical stepwise work-up. We’ve learned how to take the patient in front of us and try to judiciously apply the most current and rigorous guidelines to the individual care of that patient, while at the same time making clinical decisions by accounting for various risks and probabilities.

We see firsthand how unnecessary testing costs our patients more than just money: anxiety from unnecessary biopsies, anemia from excessive blood draws, infections from needless procedures, and radiation from repeated CT scans. We see physicians ordering tests for fear of “missing something now” and leaving the long-term financial and physical costs for later. And we worry about how health care consumes 18% of our GDP, $750 billion of which the Institute of Medicine has categorized as health care waste.

“Cost” used to be a dirty word in medicine, but with local efforts like Dr. Moriates’ cost-awareness curriculum and national efforts like ABIM’s Choosing Wisely campaign, these issues are rightfully coming more to the forefront. Little did I know that one free burrito would lead to a new way of considering the impact of a $150 EKG in clinical care, but I’m glad it did.

Lekshmi Santhosh and Alicia Carrasco are internal medicine residents who blog at Primary Care Progress.

Comments are moderated before they are published. Please read the comment policy.

  • southerndoc1

    The important question is why does the EKG cost 10x as much at UCSF as it does at the solo doc’s office two miles away.

    • cynholt

      An EKG costs a lot more at a hospital than it does at a doctor’s office
      because a hospital has a lot more overhead costs to pay for than a
      doctor’s office does. Keep this in mind whenever you receive one of the
      thousands of meaningless e-mails for “Nurse Educator Joe” or “Care
      Coordinator Jill” with a ridiculously long title after their name, or
      whenever you see one of the hundreds of worthless administrators
      strutting down the hall like a peacock in a million-dollar suit whose
      only job is to tell you what to do. Needless to say, hospitals still
      suffer from an age-old problem of having too many chiefs and not enough
      Indians.

  • WhiteCoatRants

    The cost of an EKG is about 50 cents – which represents the paper it is printed on, the cost of the electricity to run the EKG machine, and machine depreciation. Everything else is a fixed cost for the hospital.

    While I agree that cost should be a concern in medical care, and I applaud you both for bringing this issue to the forefront, doctors are simply not going to stop ordering tests because they cost too much. The way that our system is currently structured, refusing to order a low yield test that may uncover a life-threatening problem is a sure way to be sued … and lose.

    When things go wrong, no one thanks you for saving them money. Try arguing to a jury that “the patient died, but on a positive note I was able to avoid doing the CT scan that missed his cancer” or “but look at how cost conscious I was in refusing to order that breast biopsy now that the patient has Stage 4 disease.” Once you have gone through a malpractice lawsuit, your views will change.

    And now that reimbursement is being tied to patient satisfaction, woe be to the employed doctor who doesn’t order an “unnecessary” test that a patient wants.

    There are too many other issues affecting medical care other than “practicing good medicine” right now.

    The only way that cost control will occur in this country is if insurers stop paying for the care — which is happening with greater and greater frequency.

  • Vijay

    An ECG on the BPL 108, an Indian made ECG machine and market leader in ECG machines, costs on consumables is < Rs 7 (US $ 0.12) which includes charges for delivery of the paper. gel etc.and amortization of capital investment over 2000 ECGs. But, an ECG needs to be read by person who is qualified to read them (generally a trained cardiologist in India); approx cost of the consultation with a cardiologist is Rs 300 ($ 5.45). The development of an automated interpretation algorithms has vastly improved adoption of ECG amongst the GP community; though "clinical experts" have poo pooed the lack of the accuracy; but that has filled in a big gap in the frontline care setting which no "qualified specialist" would like to visit or care to practice. This of course creates a problem in the continuum of care. The prevalence of RHD was thought to be below 0.1% but with the introduction of a visual steth called Viscope in India; they discovered that the prevalence could be 6 times higher. The question is how do we now manage this?

  • Peggy Zuckerman

    Though the writer indicates that the “real” cost of the EKG is $150, I wonder if this is the cash price, the quoted retail price, the price that is negotiated to the insurance company, from which the patient’s co-pays are calculated; none may be accurate for any one patient’s situation. And the actual cost of service provided–before the widely fluctuating mark ups–is likely not even known to the provider, especially if it is a hospital. No wonder there is such disdain for our modern medical system, and anger at the obvious inequities. And the other question a patient might have to ask is whether the price he paid for the EKG also subsidized the patient who never could or never would pay for his EKG.

  • http://www.facebook.com/profile.php?id=100000077801405 Jay B. Ham

    It took hours and hours of phone calls, emails and personal pleas to get a partial list of the cost of common tests in my hospital which I then shared with my fellow residents. The actual contracted costs vary widely and it’s nearly impossible to give a straight answer to anyone as to the real cost. The best we were able to do was give a general sense of the cost to our residents and in doing so raise their awareness of the need for rational testing.

    The amazing increase in costs that occur once hospitals administer tests boggle my mind. ECGs go from $80 to $600, stress echos go from $1200 to $3000, other scenarios are even worse. Of course the money is fungible and covers a myriad of loss leaders for the hospital like the ER, hospitalists, chaplains, not to mention admin/overhead, and defensive medicine. So the cost increase is rationalized, semi-rational and unsustainable. Negotiating muscle, not cost, drives reimbursement.

    I commonly discuss cost when considering diagnosis and goals of care with my patients. Sometimes they are mildly affronted by the reference, but rarely require placation. Usually patients give you enough cues to avoid stepping too deep into an uncomfortable situation. Many understand what I’m trying to do and appreciate it. Some react strongly to the expense and find the information helpful to unstraddle their figurative fence. Most patients are rational and appreciate using a less expensive test to achieve a similar result.

    Some colleagues occasionally deride me for trying to save the health care system “one nickel at a time”. I like that. It feels like a badge of honor.

    • southerndoc1

      I applaud your initiative in diving into this snake-pit.
      Just realize that a goodly number of the nickels you “save” go back to for-profit insurers and then straight on to their CEOs and shareholders.

  • http://www.facebook.com/Manivan Manivannan Sundaravaradachary

    cost of treatment is buzz word in India today. with most of the hospitals not knowing how much they incur, govt not knowing how much is being spent usefully, charitable hospitals not know where to control cost & increase the number of patients to be treated. We are now working with a number of health care units both for profit and not for profit for costing. You article is very timely