A Statistical Tour and Frame A Statistical Tour and Frame of the American Healthcare of the American Healthcare

System System

Richard G. Wendel MD, MBARichard G. Wendel MD, MBA

Greater Cincinnati Healthcare Market Greater Cincinnati Healthcare Market

31hospitals that employ over 53,000 and contributes 31hospitals that employ over 53,000 and contributes more than $14 billion to the local economy annuallymore than $14 billion to the local economy annuallyMore than 15 public health/neighborhood centers More than 15 public health/neighborhood centers serving low income patientsserving low income patients5,200 practicing physicians5,200 practicing physiciansOne medical school; 12 nursing schools; 1 pharmacy One medical school; 12 nursing schools; 1 pharmacy schoolschoolTriHealth, Mercy Health Partners, AllianceTriHealth, Mercy Health Partners, Alliance

The American healthcare system The American healthcare system offers quality healthcare to its offers quality healthcare to its

citizens. But the system has been citizens. But the system has been nagged by problems with nagged by problems with

skyrocketing costs, universal skyrocketing costs, universal access and medical mistakes.access and medical mistakes.

Americans pay roughly twice as Americans pay roughly twice as much on healthcare as other much on healthcare as other

developed nations. (about $2.2-2.4 developed nations. (about $2.2-2.4 trillion or 16.5% of GDP or $7,800 trillion or 16.5% of GDP or $7,800 per person). During this recession, per person). During this recession, aside from growing governmental aside from growing governmental programs, the healthcare services programs, the healthcare services

sector has been the only expanding sector has been the only expanding part of our economy. For a decade it part of our economy. For a decade it

has accounted for most of the job has accounted for most of the job creation.creation.

Does this high rate of Does this high rate of healthcare spending healthcare spending

produce better access to produce better access to healthcare, exemplary healthcare, exemplary

outcomes, and a healthier outcomes, and a healthier population?population?

75 for men, 80 for women

29th in the World

Is healthcare a right or a Is healthcare a right or a privilege?privilege?

Primarily due to high Primarily due to high costs, the number of costs, the number of

uninsured has continued uninsured has continued to grow (47 million, to grow (47 million,

depending upon your depending upon your criteria )criteria )

Non-Hispanic blacks make up half of the uninsured 79% of the uninsured are American citizens

30 percent earn more than the medianU.S. family income

11% of all Cincinnatians uninsured and 19% age 18-64 who were uninsured at the time of the poll

Overhead and Overhead and administrative administrative expendituresexpenditures

Physician practices receiveabout 13 percent of health-care dollars; 50 percent arespent on office overhead

Medical Malpractice may be Medical Malpractice may be considered a part of administrative considered a part of administrative expense or cost of doing business. expense or cost of doing business. The actual insurance and litigation The actual insurance and litigation costs consume only 1% of health costs consume only 1% of health

care dollars, but the attendant care dollars, but the attendant defensive medicine costs are defensive medicine costs are

estimated at 4-5 percent of the estimated at 4-5 percent of the healthcare dollar.healthcare dollar.

Marketing direct to the consumer oftenconsumes 35 percent of revenues. R&D averages 20 percent of revenues

Unnecessary ProceduresUnnecessary ProceduresMany marginal therapies make the news

The current figure for payroll deductions in the Obama plan.

A recent article in the New England Journal of Medicine showed that 70 percent of physicians favored a ‘public option.’

Variation in Medicare Spending:Some Regions Already Spend at Canadian Level

Vast differences in practice patterns

Tertiary Care

Secondary Care

Primary Care

Tertiary Care

Secondary Care

Primary Care

UK and European Health Care System

US Health Care System

Comparison of Health Care Systems

Robert Smith, MD, Milan Petrovic, MD, University of Robert Smith, MD, Milan Petrovic, MD, University of CincinnatiCincinnati

Finally, what is a Finally, what is a quality-quality-adjusted life yearadjusted life year (QALY) worth? (QALY) worth? Many consider treatments to be Many consider treatments to be cost-effective if they cost less cost-effective if they cost less than $50,000 to $75,000, but than $50,000 to $75,000, but payers routinely cover payers routinely cover treatments that cost more than treatments that cost more than $100,000 per QALY. Preventative $100,000 per QALY. Preventative care and healthy lifestyles are care and healthy lifestyles are much more cost/efficient and much more cost/efficient and effective in health outcomes effective in health outcomes than treatment.than treatment.

18 percent of lifetime 18 percent of lifetime healthcare costs are healthcare costs are consumed in the final year consumed in the final year of life. How do you address of life. How do you address the dilemma of futile care the dilemma of futile care and marginal therapies?and marginal therapies?

Many of these issuers will Many of these issuers will be further examined be further examined

during the hospital tours during the hospital tours and in the afternoon and in the afternoon

group sessions group sessions