Economist Writers Argue That Emergency Room Care Really Isn’t Costly

One of the dangers of blogging is that it is easy to shoot from the hip, so I hope I am not guilty of responding in kind to a remarkably fact-devoid post from the Economist’s Free Exchange. This post, which argues that the savings of having a health care system that substitutes preventive care for emergency room care may not be that great, is from an unnamed author who quotes a fellow Economist writer, Jane Galt:

But even if we could get people better preventative care, it’s unclear that this would provide cost savings. (It might produce marvelous improvements in quality of life–but we’re discussing cost here.) As I understand it, diabetes management only slows the progression of the disease; it doesn’t stop it. In today’s lower interest rate environment, the cost savings from delaying expensive treatments are probably not worth calculating. But even more to the point, many of the things we can treat are cheap ways to die; a single massive myocardial infarction is probably a lot less expensive than thirty years of hypertension drugs. And people who tout asthma prevention and so forth as a way to avoid expensive emergency room visits are confusing price with cost. A trip to the doctor every two months to get your breathing checked and hear him harangue you about your inhalers consumes, if anything, more medical resources than an annual visit to the emergency room. But emergency room visits are priced to subsidize expensive trauma cases and indigent patients; your monthly checkups are not.

The flaw in the logic is that it trades off preventive care against a single trip to the emergency room. That isn’t the equation at work here.

If people who have chronic diseases get sick enough to go to the emergency room, the result often isn’t that they get patched up and sent home but that they wind up in the hospital for days or perhaps weeks. I have seen this repeatedly with HIV positive friends who have medical coverage that pays narrowly for HIV related treatments (the meds and tests related to them), but not other ailments. It’s a no-brainer that preventive care, even monthly doctor visits, are cheaper than a hospital stay.

Malcolm Gladwell also saw this same syndrome, that lack of regular medical care can lead to hospitalization, which he described in his New Yorker article, “Million Dollar Murray.” He focused on an extreme group, the chronically homeless, who are heavy, high cost users of emergency rooms:

Boston Health Care for the Homeless Program, a leading service group for the homeless in Boston, recently tracked the medical expenses of a hundred and nineteen chronically homeless people. In the course of five years, thirty-three people died and seven more were sent to nursing homes, and the group still accounted for 18,834 emergency-room visits—at a minimum cost of a thousand dollars a visit. The University of California, San Diego Medical Center followed fifteen chronically homeless inebriates and found that over eighteen months those fifteen people were treated at the hospital’s emergency room four hundred and seventeen times, and ran up bills that averaged a hundred thousand dollars each. One person—San Diego’s counterpart to Murray Barr—came to the emergency room eighty-seven times.

“If it’s a medical admission, it’s likely to be the guys with the really complex pneumonia,” James Dunford, the city of San Diego’s emergency medical director and the author of the observational study, said. “They are drunk and they aspirate and get vomit in their lungs and develop a lung abscess, and they get hypothermia on top of that, because they’re out in the rain. They end up in the intensive-care unit with these very complicated medical infections. These are the guys who typically get hit by cars and buses and trucks. They often have a neurosurgical catastrophe as well. So they are very prone to just falling down and cracking their head and getting a subdural hematoma, which, if not drained, could kill them, and it’s the guy who falls down and hits his head who ends up costing you at least fifty thousand dollars. Meanwhile, they are going through alcoholic withdrawal and have devastating liver disease that only adds to their inability to fight infections. There is no end to the issues. We do this huge drill. We run up big lab fees, and the nurses want to quit, because they see the same guys come in over and over, and all we’re doing is making them capable of walking down the block.”

Now, in case you didn’t bother pulling out your calculator, that Boston group of 119 homeless averaged nearly 32 emergency room visits per person per year ((18,894/5)/119). And the MINIMUM cost per visit was $1000. $32,000 per person would buy a hell of a lot of preventive care. Indeed, Gladwell argued that for some it would be cheaper to give them an apartment and 24/7 nursing care than have them carry on as they are now.

Now in fairness, I don’t know what level of savings the various experts are attributing to preventive care versus emerency room care. It may well turn out to be less than imagined. But to posit that there will be no savings is ridiculous.

Amusingly, the writer, who logs in from New York, clearly did not read the rather prominent New York Times series in early 2006 on diabetes, which is one of the ailments for which the claim is made that preventive care will yield no savings. The series made ghastly clear how debilitating the ailment is, and how valuable managing it could be. Paul Krugman in one of his op-eds discussed that insurance companies “will often refuse to pay $150 for a diabetic to see a podiatrist, who can help prevent foot ailments associated with the disease. Nearly all of them, though, cover amputations, which typically cost more than $30,000.”

In a bit of synchronicity, I came across this quote by Arnold King, from Two Strategies for Avoiding Truth:

The great mass of people form their political beliefs with little regard for facts or logic. However, the elites also have a strategy for avoiding truth. Elites form their political beliefs dogmatically, using their cleverness to organize facts to fit preconceived prejudices. The masses’ strategy for avoiding truth is to make a low investment in understanding; the elites’ strategy is to make a large investment in selectively choosing which facts and arguments to emphasize or ignore.

I had long accepted the Economist’s posture as being factual, informed, and above the fray. But since 2002, I have come to doubt its independence of thought. The articles on CEO compensation (see our Jan 19 and Jan 20 post) are consistent with King’s pattern, of organizing facts to suit its prejudices. And the post from Free Exchange shows its writers don’t even feel the need to be burdened by fact.

Print Friendly, PDF & Email