In Healthcare, Cost Doesn’t Mean Quality

wasted_moneyCheck out a very nice article in The New Yorker on geographic variations in utilization and spend — and how those variations are not associated with improvements in outcomes.

Policymakers have worried that [controlling costs] would require rationing, which the public would never go along with. So the idea that there’s plenty of fat in the system is proving deeply attractive. “Nearly thirty per cent of Medicare’s costs could be saved without negatively affecting health outcomes if spending in high- and medium-cost areas could be reduced to the level in low-cost areas,” Peter Orszag, the President’s budget director, has stated.

Two important takeaways:

First, if there’s no difference in outcomes associated with higher spend, it’s waste: spending more but not getting more.

Second, it’s clearly possible to practice medicine within the constraints of the U.S. system in a much leaner fashion. That is, we don’t necessarily have to import a different system to achieve far more cost-effective care.

(Note: this entry originally appeared at

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