If government officials were legally permitted to assess cost before determining which procedures Medicare would cover which they are currently prohibited from doing the cost of unnecessary and expensive treatments would fall on patients, Skinner said.
An insurance system that ruled out unnecessary, expensive procedures would force drug companies to reduce prices and pressure doctors to limit the number of non-essential tests and procedures they ordered, according to Skinner. The prices that Medicare pays for procedures are currently determined by a panel of doctors "who represent other doctors," which leads to the advocacy of expensive surgeries for which doctors are highly compensated, Skinner said.
"The difference between the U.S. versus a lot of other countries is that the U.S. pays for stuff even in the absence of any evidence that it helps," he said. "Medicare basically writes a check."
Patients might prefer the cash advantages associated with limiting the number of medical treatments they receive, Skinner said. Such savings could add up to the cost of a used Ferrari over an individual's lifetime, according to Skinner.
The cost of certain procedures or advances in technology can be plotted against quality-adjusted life years which measure both the quality and time added to a human life by a procedure gained by the treatment, so that the treatments can be quantitatively compared according to their cost-effectiveness, Skinner said. The problem, however, is that the monetary worth of time or quality added to life by each additional procedure is difficult to quantify, he said.
The dividing line between cost-effective care and inefficient care is "fairly arbitrary," according to Skinner. Experts tend to identify $100,000 as the maximumly efficient cost for one year of increased quality-adjusted life, he said.
If a particular hospital consistently uses resources ineffectively compared to another medical center, co-payments should cost less for patients who choose the more efficient hospital in order to incentivize hospital cost-effectiveness, Skinner said.
Audience members expressed concern throughout the seminar that some patients particularly those in low-income or rural areas might not have access to more efficient hospitals and would thus be penalized under such a system.
If unchecked, the skyrocketing cost of health care will cause marginal tax rates for the highest income levels that are expected to exceed 60 percent by 2050, Skinner warned, citing figures compiled by the Congressional Budget Office.
The government may cut health care costs to avoid exorbitant tax hikes, but how the two politically-unpopular moves may intersect is unpredictable, Skinner said.
"It's kind of like old movies of Godzilla versus Mothra we're not sure which monster is going to win this one," he said.
Skinner contrasted the United States health care system with those of European countries, in which health care costs have grown much less rapidly compared to the growth of their gross domestic products.
The United States is the "outlier" in global health care spending, Skinner said.
Audience member Kimberly Perez, the program manager for DHMC's family HIV program, voiced concern that health care might still be poorly distributed under Skinner's suggested initiatives if enough attention is not paid to equalizing care across socioeconomic strata.
"It seems to me the debate is focusing on trying to control costs and have better care, and not saying and more equity,'" she said. "If you don't make that explicit all along, equity is going to get dropped again, and that to me is the primary problem with the U.S. health care market."
Skinner responded that regardless of reform efforts, wealthy citizens will likely still pay more than poor patients in order to receive extra procedures.
"My goal is to make sure that when high-income people get stuff, they pay through the nose," he said.
Patients consistently demand and doctors consistently prescribe drugs, tests and procedures that are proven to be ineffective, if not detrimental, to health, according to Skinner. Skinner showed audience members a color-coded map of the United States that indicated the percentage of men over 80 who received screening for prostate cancer, which is medically discouraged for that age group. In some regions, the percentage of patients undergoing this procedure reached over 37 percent, he said.
"Evidence doesn't sway behavior," Skinner said.
To assess medical effectiveness, consistent measurement procedures like those used by employers to choose insurance coverage for employees must be developed, Skinner said.
Skinner's presentation was an installment in the Dartmouth Medical School pathology department's bimonthly Research and Review Seminar Series, which brings speakers such as medical historians and music therapists to assist with the continuing education required for physicians' re-licensing, according to Edward Gutmann, director of the series.
