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Scope or Scalpel? Patients Say, Cost Matters

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Scope or Scalpel? Patients Say, Cost Matters

Sep 19, 2014

Patients routinely choose between health care procedures without knowing how much they cost. At the same time, it would be unthinkable to shop for a car without being able to do a price comparison. Dr. Eric Scaife, pediatric surgeon at Primary Children’s Hospital and associate professor at the University of Utah, took the unorthodox approach of telling patients the cost difference between two equally effective appendectomy procedures. Armed with that information, patient choice changed dramatically. Scaife explains how these results have changed his medical practice, and how cost transparency could alter the American health care system. Read more about the study, published September, 2014, in the Annals of Surgery .

Episode Transcript

Interviewer: A study finds that when it comes to choosing health care procedures, cost matters. More next on the Scope.

Announcer: Examining the latest research and telling you about the latest breakthroughs. The Science and Research Show is on The Scope.

Interviewer: I'm here with General Pediatric Surgeon, Dr. Eric Scaife. Dr. Scaife, tell me about your study.

Dr. Scaife: It occurred to me that unlike many other parts of our economy, the consumers don't really understand the cost of medicine despite the fact that it represents about a quarter of our economy. And so as a pediatric surgeon one of the most common things that we deal with is pediatric appendicitis. We take out one or two appendixes a day. And we have two different ways of taking out your appendix. One with an open technique and one with a laparoscopic technique which requires specialty instruments.

And the outcomes in children with non-perforated appendicitis turns out to be the same, but the cost is quite different. And so it presented a really unique model for us where we could have a procedure with similar outcomes, but a very big difference in terms of cost. And we thought why not allow the patients to consider the cost in terms of which operation they get.

Most of the time we actually make the decision for them. And so it would be an interesting experiment that a patient could actually behave like a consumer as they would in any other part of the market.

Appendicitis Treatment: Cutting the Costs

Interviewer: Right. And what kind of difference in cost are we talking about?

Dr. Scaife: So for our study the open operation was about $3,000 cheaper than the laparoscopic operation. And the primary difference there is that the open operation requires a scalpel and some sutures and some instruments to provide exposure whereas the laparoscopic operation requires a number of gadgets, most of which tend to be disposable.

Interviewer: Does the patient end up paying a difference in cost?

Dr. Scaife: Well, this is where medicine gets really complicated and it's hard to peel out all of these differences, but I can tell you when I spoke with Primary Children's accountants, so basically their answer is that at the end of the day these are direct cost differences in terms of materials that are charged to the patient. So theoretically they should be exposed to that difference in cost. Whether or not that actually happens or not gets a lot muddier.

Appendicitis Procedure in Children Study

Interviewer: What were the results of the study? What did the patients decide?

Dr. Scaife: We randomized patients to either be exposed to just the difference in the procedures versus other patients that saw the difference in procedures plus the And then you might actually expand it to say, "Well, what if there was a larger consumer?" For example, let's say General Motors and they could make a decision based upon different services provided at different institutions based upon cost and value perceptions. And I think that actually is happening in the marketplace. This just happens to be a relatively simple study that actually clarifies that point.

It's really interesting to me when I have discussions from sort of old college friends who are in business, this sort of study really perks their interests whereas often times you bring this study up with surgeons and they, again, want to get back to this debate about laparoscopic versus an open appendectomy. And it's almost as though we've been permanently clouded of this idea of what the real economic choices are where people in other fields who see economic choices on a daily basis get it almost instantaneously.

Announcer: Interesting, informative, and all in the name of better health. This is The Scope Health Sciences Radio.