Hospital bill1Atul Gawande’s new New Yorker article, “Overkill: America’s Epidemic of Unnecessary Care,”  brilliantly lays out why and how we are getting so much overtesting, overdiagnosis, and overtreatment — testing that is inappropriate, not helpful, and often harmful; diagnosis of problems and abnormalities that are real but actually won’t hurt us; treatment that misses the mark, is unnecessary, and takes the place of real, needed treatment that is usually less expensive.

High point of the piece: If you’ve been following along with a scorecard, you’ll remember from five years ago Gawande’s skewering of McAllen, Texas, which had the highest per capita costs in the nation despite having a relatively poor population. Among other things, the article earned him the hatred of most of McAllen’s physicians. For this article, he revisited McAllen and discovered that it has completely reformed, its citizens getting better care, wasteful practices way down, overall costs down significantly — and most of the doctors doing fine. Why? A few federal prosecutions, some admirable learned restraint on the part of McAllen physicians, but mostly new patterns of practice, especially at the primary level, primed and encouraged by new payment modes like those encouraged by the Accountable Care Act. These payment systems (such as Accountable Care Organizations) pay doctors for costs saved by spending more time and attention on patients who need it the most. If we needed another real-world demonstration of my first two laws of behavioral economics (“1. People do what you pay them to do. 2. People do exactly what you pay them to do.”) — here it is.

Takeaway: The article as a whole illustrates my key point: Economics matter. Today’s piecework fee for service healthcare system actively pays for expensive, wasteful, dangerous medicine and discourages, even penalizes, smart and thoughtful medicine. We now have the tools and resources now to change that.