Washington Update:
Rethinking Health Care Costs
Ronald F. Levant
| 
Dr. Levant with former
U. S. Secretary of Health and
Human Services Donna Shalala |
I have been writing these columns for several years but still grapple with the challenge attendant upon the fact that what I am writing will appear several months later. Right now, for example, I am busily preparing for the upcoming APA annual convention and my thoughts are very much on the upcoming events, yet by the time you read this the convention will have come and gone. Hence the challenge is to write something that will not be hopelessly dated by the time it hits print.
Health Care Costs
In that light I thought I would start off with a topic that seems likely to have some “shelf-life”-- namely, how do we understand the increasing costs of health care in the USA. As you know, constraining health care costs constitutes the raison d’etre for managed care. This is based on the assumption that increases in health care costs are bad for the economy and that it is good public policy to constrain these costs. On the face of it, this seems to make sense. Overall, health care costs were on a runaway trajectory in the 1980’s and early 1990’s until managed care moderated them for a few years in the mid-1990’s, but they have started to rise again. Current projections are that within 25 years health care costs could constitute 25% of the GDP. With this picture of rapidly escalating costs, health care looks like an extremely unproductive industry. This picture is reinforced by the fact that about half of all health care costs are borne by state and federal governments, notorious for their inefficiency, and that other western countries such as Canada, England and Germany seem to get the job done for far less.
Seems logical. Makes sense. But is this view correct? Charles R. Morris (1999), in an article in the Atlantic Monthly, argues that it is not. He suggests that our discourse on this topic has confused health care costs with health care spending. Like the computer industry, actual costs have been decreasing whereas spending (utilization) has been increasing, suggesting that health care is in fact a highly productive industry. It is also a highly technological one. Furthermore, Morris argues, contrary to the widely held view that health care is the only industry in which improved technology increases costs, new health care technology actually decreases costs and expands markets. As an example, he offers gall bladder surgery, which, until a decade ago, required opening the abdomen with all of the attendant risks and long-term recovery problems, but now is accomplished by laparascopy on an outpatient basis. As a result, costs for the procedure have been significantly reduced, and more of them are being done, both because of the reduced costs and the reduced risks and complications.
Morris (1999, p. 90) asserts that: “The difficult truth is that almost all improvements in health care increase spending over time”. He points out that the successful campaign to reduce smoking has actually driven up health care costs, because fewer smokers are dying early but instead are stopping in time to “make it on the Medicare rolls in good shape and [able to] burn up health-care dollars for decades” (p. 90). So too, improved cardiac care has cut the death rate from MI’s in half resulting in an increased “pool of people who have survived heart attacks and consequently need very careful medical management” (p.90). Morris goes on to note: “The astonishing increase in the longevity and the vitality of the very old is perhaps the purest demonstration of the effectiveness of modern healthcare -- but that success, coupled with the aging of the baby boomers, promises equally astonishing increases in health care spending” (p. 90).
Another productive aspect of the health care sector is its effect on careers. Whereas healthcare in the 1950’s was a low-paid career dead end, it has now become a “career machine” (Morris, 1999, p. 94). Young minorities and recent immigrants are drawn to the healthcare field because of its technical and science base and its service aspect. Status and pay has increased as well: Whereas in the 1950’s healthcare workers earned at best two-thirds of the average wage, they now earn 109% of the average. Community colleges have, for decades, been adapting their curricula to the expanding opportunities in healthcare. Those students who make it through the two-year programs get jobs very quickly. After landing a technician-level job based on an AA degree, many go on to four-year colleges, and some go beyond this to obtain advanced professional degrees.
The major argument put forth to constrain health care spending is that it is a drain on the economy. Given that healthcare is in fact a productive industrial sector, the “drain on the economy” issue really translates into the issue of competing priorities. If we don’t spend the money on healthcare what will we spend it on? Larger homes, bigger SUVS, better electronic games, faster food, or a missile defense system? However, a discussion of choosing to divert healthcare dollars to other sectors is a mere academic exercise. For as Morris (1999, p. 96) points out “policy wonks still treasure the delusion that we as a nation will somehow decide what share of resources should be claimed by health care, when the demographic facts have already decided it for us.”
Practice Advocacy: Test Case Litigation and RxP
APA President Pat Deleon initiated monthly Board of Directors conference calls, in which one part of the Association (typically, a Directorate) briefs the Board on current activities. Recently, Russ Newman provided updates on selected Practice Directorate activities. Council Representatives Dave Filipowski and Steve Ragusea joined the call. Quoting from Steve’s report (Ragusea, 2000):
“Russ began the call by saying he would focus on two areas of Practice Directorate activity that highlight the need for us to be creative and resourceful in coming up with additional resources in order to carry on major parts of APA's practice agenda with the maximum effectiveness. These areas are: 1. the test case lawsuits against the managed care industry, and 2. the push for state laws granting prescriptive authority to appropriately trained psychologists...” “In the first area, the test case lawsuits, Russ noted that we have been on the cutting edge in terms of using litigation to shape health care policy and industry practices. And we have been able to do this by making strategic use of limited resources. To put APA's test case budget into perspective, Russ noted that in comparison to the APA budget, the American Medical Association budget for managed care test cases starts with approximately $1 million EACH YEAR from the state organizations, and then the AMA adds its own substantial resources to this majestic sum. Obviously, our budget is much smaller… Despite these limited resources, progress has been encouraging…”
“In the second area that illustrates the need for the profession to secure additional resources, Russ gave a progress report on prescriptive authority. As with the test cases, the prescriptive authority agenda is resource intensive. APA has tried to balance focusing resources on states with the greatest likelihood of passing legislation on the one hand and supporting burgeoning legislative agendas on the other. The following states have indicated that they will be introducing RxP legislation in 2001: Georgia, Louisiana, Florida, Texas, New Mexico, Connecticut, and Missouri. Illinois plans to introduce a prescriptive authority bill this fall. Alaska, Montana, and Hawaii may introduce legislation, but have not firmly committed to doing so.
Georgia, Louisiana, Florida, Texas, and New Mexico have communicated that they are variously working with their state association lobbyists, educating legislators and state officials, building relationships, raising money, and building grassroots networks.”
“As of June, California is the only state with a currently active bill. The
California bill was originally introduced to the Senate as a bill which would allow the PDP graduates, and graduates of comparable training programs to prescribe. Before being passed out of the Senate Business and Professions Committee, the "comparable training program" language was removed. The bill must still pass through the Senate Appropriations Committee and the floor of the Senate before going to the Assembly.”
We would note that the California bill has caught the attention of the media. According to an article in the Sacramento Bee (Griffith, 2000) titled “Psychologists Closer To Writing Prescriptions”: “California is poised to be the first state in the nation to allow specially trained psychologists to prescribe drugs to treat mental disorders such as depression, anxiety and schizophrenia. A bill by Grass Valley Republican Assemblyman Sam Aanestad that would do just that has passed a key Senate committee and could be brought to the floor this summer. The bill was born of concerns that people in rural areas and inner cities have a hard time finding psychiatrists to treat them with medications. Giving some psychologists prescription privileges could fill some of the void, the lawmaker argues. Psychiatrists and other mental health experts are blasting the bill, however, warning that its passage would be the first step toward allowing
any psychologist to prescribe potentially dangerous drugs without medical supervision.
have the information needed to decide whether to continue the practice or
expand it to allow all psychologists to pursue the training.”
The RxP movement received a boost recently with the long-awaited release (which had to be forced using the provisions of the Freedom of Information Act) of the 1998 evaluation of the DOD program by the American College of Neuropsychopharmacology, which notes that while the graduates were "weaker medically than psychiatrists, ... there have been no adverse effects associated with the practices of these graduates." The report concludes: "We are not clear about what functions the individuals can play in the future, but we are convinced that their present roles meet a unique, very professional need of the DOD. As such, we are in agreement that the Psychopharmacology Demonstration Project is a job well done."
Support for Small State, Provincial, and Territorial Psychological Associations
For the last two years following state associations (CA, NH, NJ, MA, PA), divisions (31, 39, 42), and caucuses (state caucus, APP) have voluntarily contributed funds to support Liaison/Observers to Council from the smallest state and territorial associations. I am proud to note that Division 42 was a leader in this effort, making a significant commitment to a multi-year effort. This support has been very helpful in to these groups, and has enabled some of them to send a Liaison/Observer to Council. After Guam's victory with prescription privileges, it is now inescapably clear just how important it is to have everyone at the table. Thankfully, we no longer have to "pass the hat" to provide support to these small associations. In February, Council passed a resolution that will provide for the support for travel of all Liaison/Observers at the same level as that provided to Council Representatives.
As always, I welcome your thoughts on this column. You can most easily contact me via email: (new address): levant@uakron.edu
References
Griffith, D. (2000). Psychologists Closer To Writing Prescriptions. Sacramento Bee
Morris, C. R. (1999). The health care economy is nothing to fear. Atlantic Monthly, 284, 86-96.
Ragusea, S. (2000). Summary of 6/21/00 Conference Call with Board of Directors. COR@LISTS.APA.ORG.
Biographical Sketch
Ronald F. Levant, Ed.D., A.B.P.P., is Recording Secretary of the American Psychological Association. He was the Chair of the APA Committee for the Advancement of Professional Practice (CAPP) from 1993-95, a member of the Board of Directors of Division 42 (1991-94), and a member of the APA Board of Directors (1995-97). He is Dean, Center for Psychological Studies, Nova Southeastern University, Fort Lauderdale, FL.
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