$6.7 billion of medical spend wasted in one year says study

By Colin Ricketts - 05 Oct 2011 8:22:0 GMT
$6.7 billion of medical spend wasted in one year says study

A staggering $6.7 billion of US medical spending in just one year is wasted on tests that aren't needed and expensive branded drugs according to new research. A team from Mount Sinai School of Medicine performed the analysis, published in Archives of Internal Medicine, which they believe should inform the ongoing and heated debate on paying for health care in America.

The main culprit for the overspend - accounting for 86% of the total - is the prescribing of branded statins for high cholesterol says the team from Mount Sinai School of Medicine, which was led by Minal Kale MD. To reach their startling conclusion, Kale's team looked at the May 2011 study published in the same journal which rated overused treatments in three areas of medicine: family medicine, paediatrics and internal medicine. Comparing this data with studies of the same time period - 2009 - from two other sources came up with the $6.7 billion wastage figure, with $5.8 billion of that going on statins which could have been provided more cheaply by paying for non-branded versions.

Dr Kale said: "Our analysis shows astronomical costs associated with prescribing of brand name statins when effective, generic alternatives were available. Efforts to encourage prescribing of generics clearly have not gone far enough."

Antibiotics and unnecessary testing procedures were also significant contributors to the overspend the study says. "Significant efforts to reduce this spending are required in order to stem these exorbitant activities," Dr Kale said. And, Kale believes his research has erred on the side of caution in estimating these costs while admitting it is limited by the single study available.

While dwarfed by the statins overspend, the costs of unnecessary tests are still striking. Kale and his team reckon that $32 million was wasted on unneeded blood tests; bone density scans on younger women racked up $527 million in wasted cash; tests on back pain patients wasted $175 million; children's sore throats were responsible for $116 million worth of unnecessary.

The needless yearly repetition of echocardiograms were also wasteful says Kale along with unnecessary urine and pap tests and prescriptions for children's cough medicine.

And, according to Kale, these costs quickly mount up. He said: "We found considerable variability in the frequency of inappropriate care, however our data show that even activities with small individual costs can contribute substantially to overall healthcare costs.

In light of the current healthcare reform debate, we need more research examining how overuse contributes to healthcare spending. Research might focus on the potential role of reimbursement, defensive medicine practices, or lack of adherence to guidelines."

Top Image Credit: Health care and medical expenses in the United States © PhotoShopAustralia

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