The Healthcare Insurance Disconnect

Dr. Jones wants to use a specific eye drop for bacterial conjunctivitis in her 5 year-old patient. Sally is very uncomfortable; she is highly contagious and will not be allowed back in the classroom in her present condition. Her mother has already missed too many days of work this year and, oh yes, Sally is in a play that takes place in a couple of days.

Dr. Jones has specified that a fourth generation Fluoroquinolone be used because, compared to cheaper alternatives (and that's the rub) head-to-head studies demonstrate that it works better, quicker, does not sting, is easier to use, more readily reduces contagion, has a higher conjunctival concentration, and for various reasons, is less likely to induce resistance.

The insurance company balks

Why doesn't Dr. Jone's opinion about therapeutic efficacy matter? Why, in the calculus of healthcare, doesn't the opportunity cost* weigh in the insurance company's decision? For that matter why don't these issues weigh in on public policy and healthcare reform?

Clearly, there are real costs beyond visits, tests, and treatment, and I believe they should be considered in outcome studies, quality assessment, episodes of care (EOC) analysis (all care over time, regardless of setting for a diagnostic grouping) and reimbursement. In fact, this factor or consideration may be as important as acuity adjustment when we are trying to be fair and pay reasonably for healthcare.

Should practitioners be compensated when bureaucratic interference (eg, prior authorizations) increases the cost of healthcare or when the insurance company causes us extra work by only allowing coverage of bad tasting, inconvenient, or hard-to-use or even potentially dangerous drugs, such as cheaper ear drops that are potentially ototoxic?

A more competent and comprehensive view of healthcare costs should include the less easily measured issues of "quality of life" outcome measurement and management and "opportunity cost." The former is usually defined as quality-adjusted life-years (QALYs); the latter, for the purposes of this discussion, is the excess in time and money spent because the insurance company, through parsimony as opposed to quality of care concerns, interfered with reasonable and timely medical care.

*Opportunity cost is the time and money of the activity you would not have had to give up were the originally intended activity carried out.