The new medical-industrial complex

The most important health-care development of the day is the recent, relatively unheralded rise of a huge new industry that supplies health-care services for profit. Proprietary hospitals and nursing homes, diagnostic laboratories, home-care and emergency-room services, hemodialysis, and a wide variety of other services produced a gross income to this industry last year of about $35 billion to +40 billion. This new "medical-industrial complex" may be more efficient than its nonprofit competition, but it creates the problems of overuse and fragmentation of services, overemphasis on technology, and "cream-skimming," and it may also exercise undue influence on national health policy. In this medical market, physicians must act as discerning purchasing agents for their patients and therefore should have no conflicting financial interests. Closer attention from the public and the profession, and careful study, are necessary to ensure that the "medical-industrial complex" puts the interest of the public before those of its stockholders.

Cost and effectiveness of clinical investigation: the state of the art

Clinical investigation by means of special technical tests has increased in clinical practice during recent years. Pressures causing this increase are said to include: rapid technological change making many more tests available, clinical uncertainty, peer pressure, greater patient awareness, and concern for diagnostic completeness. Cost factors do not appear to have influenced test-ordering behaviour to any large extent, and those ordering investigations are frequently ignorant of the cost of the test which they are ordering, both to the patient and the community. The relation of clinical investigational activity to quality of outcome of patient care remains largely unestablished. Studies of the possible modification of test-ordering behaviour through educational and institutional policy pressures are reviewed. A rational approach to investigating the effectiveness of techniques designed to encourage the more economic and effective use of investigations is presented in brief on the basis of this review of previously published work.

Processing control and cost in bacteriology

Controlled processing was applied to lower respiratory, wound, and cervicovaginal exudates, and urine. The extent of processing was determined by assessment of quality in direct smears and/or by limits placed on complete identification and antimicrobial susceptibility testing of isolates in mixed cultures. Some specimens were not cultured; others were cultured, but certain isolates were identified by colonial morphologic features only. The time in minutes for performing 22 processing operations was determined. The average number of operations performed with processing control was established along with the total cost per minute of labor expended. A 19% reduction was observed in the time expended with controlled processing relative to projected time expended without processing controls. Urine specimens yielded the greatest saving. Processing control speeds recollection of poor-quality specimens, provides reporting of results of examination of all Gram-stained direct smears, minimizes reporting of information potentially misleading to physicians, and may reduce other health-care costs through improved patient care.

The platelet estimate: is it being ignored?

A study was undertaken to determine whether the platelet estimate included in the routine CBC is being utilized as a guide to ordering quantitative platelet counts. Requisition slips and results were reviewed for a one-month period. The data showed that platelet estimates were not being used properly. In fact, much of the time the platelet count was being ordered with the CBC. The smear estimate and quantitative count agreed in 96% of specimens. The platelet count is a costly procedure and should be reserved for those occasions when the platelet estimate is abnormal.

Industrial relations: conflict and communication

Organisational roles and systems are a reflection of professional group norms, says Tony Johnson of the West Midlands RHA personnel division. He suggests that professionals need to be encouraged to be aware of how their expectations affect their particular service, and thus the patient.

Laboratory tests in chronic urticaria

One hundred twenty-five patients with chronic urticaria were evaluated with 11 commonly recommended laboratory and radiologic procedures. Abnormal studies were obtained in 26 (20.8%) of these patients, but the majority of these abnormalities were evident from the initial history and physical examination. These results indicate that, with the possible exception of sinus roentgenograms, these laboratory studies are not likely to be helpful in the evaluation of chronic urticaria unless there are suggestive findings in the history and physical examination. The yield and equivalent charge of diagnosis for each procedure used was also analyzed.

Cost containment in emergency medicine

High-cost laboratory tests, roentgenograms, medications, and supplies were the focus of a voluntary cost-containment effort initiated in a community hospital emergency department. The department microcomputer determined that 100 of 1,560 possible chargeable items were responsible for 90.9% of the total cost to patients. Emphasis on cost containment in general and specific emphasis on the 100 high-cost items resulted in a 10.2% reduction in laboratory and radiology charges and a 3.3% total savings to patients.

[The value of laboratory tests (author's transl)]

The diagnostic significance of various laboratory tests was studied at a Medical University Clinic and a regional hospital. Requests for such tests were graded on admission according to the criteria: (a) necessary for differential diagnostic decision; (b) part of routine admission programme. Results were assessed according to the criteria: (a) clinical "proof"; (b) of value in differential diagnosis; (c) pointing to another diagnosis; (d) unhelpful. Analysis of the results provided an interesting agreement: all doctors graded seven to ten tests as necessary. Those with the highest information content were the classical tests--erythrocyte sedimentation rate, serum-electrophoresis and blood sugar levels. 45.6% of those graded as necessary proved informative; 7.2% of routinely ordered tests provided pointers to another diagnosis. This percentage is the contribution of laboratory tests beyond what doctors consider as necessary for diagnosis. This additional value of laboratory tests is relatively high so that a reasonably extensive programme of laboratory tests on admission appears justified, especially if one adds the time factor to cost-effectiveness.

Problems in laboratories of developing countries: the Korean experience

The problems of managing clinical biochemical laboratories are varied. They range from deficiencies in communication and fragmentation of services to misconceptions of the use of automation. The common symptoms of inadequate management are outlined and solutions proposed against the background of the Korean experience.

Medical technology -- a different view of the contentious debate over costs

There is a growing conviction that medical technologies are major contributors to escalating costs, and regulating them is generally viewed as the least contentious way to control expenses in the 1980's. Five forms of technology control are being discussed or developed. All aim to reduce costs by controlling big, expensive technologies in the class of computed tomographic (CT) scanning. We present evidence that technologies such as the CT scanner account for far less of the growth in medical expenditures than do the collective expenses of thousands of small tests and procedures. Furthermore, we suggest that each strategy for controlling large technology involves substantial practical and conceptual problems that would severely limit its effectiveness. We thus suggest a shift away from attempts to harness the big technologies, and toward incentives to encourage the more discerning use of all technologies. To this end, we propose changes in physician reimbursement and education and expanded insurance incentives to encourage physicians and hospitals to be more selective in the use of technology.