Distinctions in healthcare

Successful reform of healthcare necessarily entails making distinctions upon which to make essential decisions. In the most basic case, that of rationing, there is a natural distinction between those who receive rationed care and those who do not. In a two-tiered system there is the distinction between the tiers; in a public/private system there is a distinction between individual depending on how their healthcare is paid.If the goal of reforming healthcare is to improve cost-effectiveness, and as mentioned in a previous post, minimize the risk of medical penury, then distinctions must be made that are more conducive to those goals. One such distinction was make in a prior post; that between ordinary and extraordinary healthcare. Another essential distinction involves the fairly obvious categorization of people by their use of healthcare resources.

Assuming for the sake of convenience that the population is divided in to deciles by their use of healthcare resources, some useful observations become readily apparent. the first is that the lowest ten percent of the population will consume far less than 10 percent of the healthcare resources, and the upper ten percent will consume far more. It is a quite reasonable assumption that the reasons for this are not arbitrary; that there are characteristics of the lowest ten percent, the next lowest ten percent, etc. that distinguish them from other deciles. Obvious factors would be things like age, over-all health, rate of obesity, smoking history, alcohol use, etc. The key point is that if the goal is to reduce medical penury and begin making healthcare more cost-effective in general, the place to focus is on the last few percent of the healthcare resource consumers. One simple, though ethically infirm and politically non-viable approach would be, for instance, to simply cut off those above a certain level of resource consumption; e.g. once one is above the 98th percentile in consuming healthcare resources, no more healthcare is available within the system. The savings from this two precent will be far in excess of two percent of healthcare expenditures, but again, this is a form of rationing that is neither morally nor politically acceptable. Nonetheless, there are some distinctions to be made among the higher-consuming population and those from lower levels of utilization that can be addressed in more a more reasonable manner. For instance, it would be expected that a significant portion of futile care and unnecessary healthcare expenditure occurs among the the top 5% of healthcare consumers.It would be expected that no-one will support continuing expenditures for futile care, except those that profit from defects in the current system. No one with a primary interest in public welfare or healthcare policy will object to eliminating futile care, regardless of how that may be defined.

Because of inherent differences between the various deciles, separated by their consumption of healthcare resources, it is not only reasonable but essential to prescribe differing policies for different groups. This of course is already done implicitly, and there is no outrage involved in doing so explicitly. It is much cheaper and more cost effective, for example, to treat relatively healthy people than it is much sicker ones. It is reasonable to scrutinize the healthcare of a person undergoing his fourth bac surgery differently than a person undergoing a procedure for the first time. This concept is simply a version of the notion that specialization is,in general, more efficient that generalization. Tailoring available healthcare resources to areas where they are expected to be utilized most effectively is a natural consequence of this fact.