Atul Gawande, MD, Dives into Patient Cost Data

June 23, 2014
Laura Joszt

The healthcare industry is just beginning to see the advantages of putting together clinical minds and financial minds, said Atul Gawande, MD, at HFMA ANI's keynote address.

The healthcare industry is just beginning to see the advantages of putting together clinical minds and financial minds, according to Atul Gawande, MD.

Gawande, associate director of the Center for Surgery and Public Health at Brigham and Women’s Hospital in Boston and an associate professor of surgery at the Harvard Medical School, headlined a keynote address at the Healthcare Financial Management Association’s National Institute in Las Vegas.

“As fierce as the feelings are over the Affordable Care Act, I think we’ve actually reached the point that the debate about whether to provide people’s healthcare needs … is over,” Gawande said. “We’re still fighting about how that coverage should be provided, but we’re not fighting about whether that coverage should be provided.”

Throughout his speech, Gawande highlighted the importance of digging into the data to improve patient care and lower overall costs. One of the problems with American healthcare, he said, is that the delivery system for patients’ healthcare needs is broken. In order to fix it, providers and executives need to understand the root of the problem.

“Understanding the sickest people in our population is how we fix our healthcare system,” Gawande said. “They account for the vast bulk of healthcare costs.”

Although most of the people in the room already knew the statistic that the top 5% of sickest patients account for half of healthcare spending, he thought people have miscalculated what those numbers mean. While physicians see the 5%, the financial people fixate on the 50% of the costs. And these 2 groups are not talking.

“We are just beginning to see what happens when you put you and I, and other people like me together,” he told the audience. “And it’s pretty stunning.”

Some of the examples he provided highlighted the importance of digging in to the data of patients costs to uncover the best way to fix the problem.

In one example, he discussed a company that did what most are doing in the face of rising healthcare costs: increased copays. While the move drove down hospital visits and procedures sought and a host of other aspects of healthcare, what it didn’t do was what the company most wanted: it didn’t drive down costs.

Diving into the data, they found the most expensive patient and realized that in the wake of increased copays, he stopped taking his medications, which led to a heart attack. The patient had, according to Gawande, “his $100,000 moment,” which turned into a “half a million dollar moment” when he suffered complications.

“Your job is the same as mine,” he told the audience of financial minds. “And that’s to reduce the harm and suffering. That’s how we fix healthcare.”