C-sections galore!

NPR ran a story on the air today describing the increased rates of Caesarean section births in developing nations. It is relatively well-known that C-sections have increased in popularity in developed countries like the US due to their convenience (working moms can schedule the C-section and plan maternity leave more easily, avoid the pain associated with a vaginal birth, retain bladder control by preserving the pelvic floor, rates of inducing births have increased which can cause the need for a C-section birth, etc.) Now we're starting to see this trend in developing countries as well-- but this is causing something of a problem.

Now that more women are opting into C-sections they're taking up more space in operating rooms that were once used only for women who truly needed them for medical reasons. The concern that arises now is whether wealthier women who can afford to pay for an elective C-section are taking operating room space away from women (poor or wealthy) who really need it.

Obviously this also starts raising questions about cost-effectiveness.... why are we paying for unnecessary medical procedures? I wouldn't say that a C-section is unnecessary if a women just prefers it (she should be able to obtain it if she's willing to pay for it and understands the risks involved...not that she's bearing the full cost of the procedure at all due to insurance--but that's a different conversation altogether), but I would say that it's unnecessary if the woman has been unnecessarily pushed into a C-section either due to convenience or revenue considerations coming from the hospital. C-sections are revenue makers. They generate twice as much revenue as a vaginal delivery.

It seems that we're getting a little heavy-handed with the C-Section ordering pen, but are we really considering the Economic implications? With such a great deal of geographic variation in C-section births, it's hard to make the argument that C-sections are needed at the high rates seen in some hospital systems. These C-sections are coming at a much greater cost than the vaginal deliveries, and also are more risky, and result in more readmissions--and in some cases lock women into delivering via C-section for subsequent children. All of these factors add up to much larger expenses in the end. It may be time to re-examine what determines the need for a C-section, and what does not, so that we can avoid unnecessary surgical procedures.

Also of interest

Information Problems

Asymmetric information is a topic discussed in introductory Economics courses that describes a situation where one party has more information than another. For example, if you are selling your car to a passerby on the street, you have more information about the car than the passerby does. You know that you took your car to your trusty mechanic every 4,000 miles for an oil change, and that whenever anything seemed remotely wrong with your car you got it checked out immediately. Perhaps you’re charging $ 8,000 for you 8 year old car. The passerby is thinking “that’s a pretty steep price for this car… it looks good, but how do I know if something isn’t wrong with it… there MUST be a reason (s)he’s getting rid of it”.

Alas—we have an information asymmetry.

There is no way the buyer can be certain of the quality of the car until they purchase it and drive it around for a few months. The seller can attempt to tell the buyer what a good car it is, but how can the buyer be sure they aren’t just getting scammed?

This story is applicable to the heath care industry as well. Let’s say you go to the doctor with a persistent sore throat and the doctor diagnoses you with some condition--something you can't even pronounce with confidence. “Oh no” you think to yourself, “that sounds serious". The doctor goes on to prescribe you an antibiotic and perhaps some other medicines that will make you more comfortable. The doctor is giving you directions on how to take your medications and what the side effects are, etc. You’re starting to feel a little out of the loop and you’re getting blown away by all of the foreign terminology and directions. At the end of the appointment the doctor asks “do you have any questions”? You think to yourself quietly for a moment… you’re not even sure you could come up with an educated question if you had to. Despite feeling overwhelmed you respond, “no”.

You’ve just been a victim of asymmetric information (and if this situation has never happened to you, surely you’ve taken your car to the shop before and have agreed to all sorts of repairs you weren’t really quite sure about). Doctors go through an intense amount of education—both in the books and in practice. We can’t expect for them to convey all of that knowledge to us when we visit their offices, but we really ought to be better consumers. You wouldn’t buy a new dishwasher without doing at least a little bit of research (at least you’ll compare Home Depot and Lowe’s). However, when you go to the doctor, often times you go in with very limited knowledge about prescription drugs or treatments your doctor may prescribe. If your doctor tells you that you need a test that will cost you (or your insurance company) $4000 at the hospital that you usually go to, are you going to call the other local hospitals to see if you can get the same test for less money? Maybe you think that the test will cost the same everywhere—surely these things have to be standardized—right?

Wrong. The variation in cost between hospitals can be astronomical. We’ll wait for another blog post before we discuss this in full—so for right now you’ll just have to believe me when I say that procedures don’t always cost the same at every hospital.

So, what is the problem here? The problem is simple—you don’t understand that product(s) you’re consuming, and you’re likely paying too much. The bigger problem is that, if you have health insurance, you (and your doctor) probably don’t care too much since you won’t be picking up the bill yourself. This results in overtreatment at increased costs. What’s worse is that, if you’re taking unnecessary medications (perhaps you get prescribed an antibiotic for a common cold) you may actually end up hurting yourself in the long run. I hypothesize, that if we were better, more informed, consumers of medicines we would save money, but more importantly we could be healthier. Every day people are harmed by drug interactions that could have been avoided. Doctors are people too—so they will make mistakes. The informed consumer can safeguard themselves from medical mistakes by asking questions and attempting to learn more about the medications and treatments their doctors prescribe.

What can you do? Next time you’re at the doctor try and think of questions to ask—even if they’re simple. Your doctor has a lot of knowledge—you just need to finagle it out of them.

Here are some questions to ask that I found on about.com:

1. What is the name of my medication?
2. What does my medication do?
3. How/ when should I take my medication?
4. How long should I take my medication for? (this is important—sometimes doctors are not inclined to remove you from medications, even when you may no longer need them)
5. What should I do if I feel better and I don’t want to finish my medication?
6. Does this medicine contain anything I’m allergic to—or will it react with any of my other medications and/or supplements or vitamins?
7. What food, drinks, or activities should I avoid when I take this medicine?
8. What are the side effects? Are they common?
9. Is there a generic version of this medicine?
10. Is it safe to use this medicine if I am pregnant or breastfeeding?
11. How soon will this medicine start working?
12. Will any tests be necessary while I’m taking this medication?
13. Most importantly (arguably): What risks are associated with this medicine and do they outweigh the benefits?

A good talk on Health Economics in the United States

Here is a link to the former CBO Director, Peter Orszag's blog. This post links to an interesting talk on the problems with Health Care costs in the U.S. as well as the slides from the talk. Currently Orszag is the Director for the Office of Management and Budget. He is the youngest member of the Obama cabinet.

This lecture describes some of the health care challenges the U.S. will face in terms of costs. Orszag discusses how medicare and medicaid costs are projected to grow rapidly in the future, and how costs vary geographically.. Run time is a little over 30 minutes.