The headline is not a typo: you really can’t afford low-quality health care. The costs—not only in dollars spent, but also in lost time and productivity for employees on your company’s health plan as well as lessened patient health and well-being—are simply too high.
According to PricewaterhouseCoopers (PwC), American health care costs are steadily rising, accounting for an ever-larger percentage of the gross domestic product and the average annual income. Patients and payers alike are spending more on health care than at any point in our country’s history.
(Related: Medical Errors Are Leading Killer After Heart Disease and Cancer, Study Finds)
But all of that spending isn’t buying us better quality care. According to a report from the Commonwealth Fund, our health care system ranks last in quality among 11 industrialized nations.
With PwC projecting that costs will continue to rise at a rate of more than 6% per year, roughly three times the current rate of inflation, it’s only fair to ask where all of the money is going.
PwC’s analysis of historical data from the Bureau of Labor Statistics shows that recent increases in employer health benefit costs owe to increases in price, not utilization. Moreover, they report, “roughly half of employer health costs are from hospital inpatient and outpatient spending.”
Taken together, those figures might seem to suggest that belt-tightening managed care plans should look to cut costs by shopping for the lowest prices on the services they use the most.
That is exactly the wrong approach.
That’s because studies have found no correlation between cost and quality of care. Health care is not a commodity and providers are not interchangeable parts.
If you always look for the lowest price, you might get some high-quality care, but you’ll also get some low-quality care. And if you pay for low-quality care—no matter how much you spend—there will almost certainly be another bill to come.
Trying to cut health care costs on the front end is therefore counterproductive.
The best way to control costs is to insist on high-quality care. Even if that means paying a bit more upfront, quality is always worth the investment because it results in significant downstream savings of money, time, productivity, health, and well-being.
How? In many cases, the difference is diagnostics. A misdiagnosis can result in wasted and potentially dangerous treatment even as the original condition worsens.
And diagnostic errors are much more common than we think. A 2017 study from The Spine Journal found error rates of over 43%. A 2017 Mayo Clinic study found that as many as 88% of patients who seek a second opinion receive a new or refined diagnosis, concluding that referrals for second opinions from advanced subspecialists can have a life-changing impact.