Medical Decisions by Gestalt. A Half-Trillion Dollar Bill and the Vexing Problem of Physician Practice Variation

It’s common that the same patient seeing two doctors for the same condition will walk away with conflicting recommendations.


I recently spent time with a patient who had a bad back. One doctor had recommended a conservative approach (watch it, take ibuprofen, use ice) while another recommend an MRI and possibly an epidural steroid injection.

Medicine’s an art, and these differences of opinion can be expected. But such big differences of opinion are often surprising. More interesting– these practice variations often seem to cluster in geographies.

Recently, David Cutler, Jonathan Skinner, Ariel Dora Stern, and David Wennberg conducted a study. They wanted to determine what accounted for huge regional differences in healthcare spending among Medicare patients over age 65 which (even accounting for poverty and degree of patient illness) vary dramatically depending on where patients live.

Here is a map from Dartmouth University showing one example of this variation: This one looks at the rate of inpatient back surgery, for example, and shows a 4+ fold difference in the rates of back surgery from one region of the country to another, corrected for age and gender.

Screenshot 2014-08-08 14.08.58

The authors of the study offered three potential hypotheses to explain big regional variations:

  • The first possibility is that patients in high use areas expect (and receive) more care. This is a question of patient preference more so than medical need– remember that the use was normalized for the degree of illness.
  • The second hypothesis was that doctors prescribe more care because they make more money by delivering more intensive care. This “supplier-induced demand” reflects, to some degree, the number of physicians in a geography: the more doctors around, the more care delivered.
  •  Last, there’s a hypothesis that variations in the amount of delivered care reflect intangible pressure on physicians to practice a certain way: say organizational or peer pressure to perform more procedures, for example–or deeply held feelings about the value of certain care.

The study, which used a series of vignettes to query cardiologists and primary care physicians revealed that patient demand and financial considerations were less important than **physician beliefs** about the efficacy of particular therapies.

The authors concluded that “as much as 36 percent of end-of-life Medicare expenditures, and 17 percent of overall Medicare expenditures, could be explained by physician beliefs that cannot be justified either by patient preferences or by clinical effectiveness”.

Simply, physicians practiced according to deeply-held beliefs that were are often not consistent with professional guidelines for appropriate care.

This is a stunning number: in essence, over a third of all spending at end of life is due to physician gestalt about the effectiveness of certain therapies which is often at odds with published clinical guidelines! A commentator has pegged this spending at a half-trillion dollars annually.

Figuring out variations in physician care is a tough problem. If we impose tight restrictions on physician practice and refuse to pay for care that falls outside of published guidelines, we run the risk of stifling innovation while compromising patient centeredness. An inflexible, dictatorial system isn’t what anyone wants.

On the other hand, unnecessary and unsupported medical practice is expensive and dangerous. A lot of common medical practices have been debunked in the literature: an old colleague, Dr. David Newman and his colleagues run a superb evidence-based website, called, reviewing some common treatments.

The site shows, for example, that epidural steroids for low back pain—the kind recommended to my patient with the bad back—aren’t generally supported by science. Despite this, over 1.5 million Medicare patients have received epidural steroid injections since the practice began in the 1950’s.   Still today the practice continues.

The good news: unsupported variations in clinical practice aren’t generally due to perverse financial interests among physicians. The bad news: if this study is correct, a lot of medical over-use is due to deeply-held but often inaccurate beliefs on the part of physicians that won’t be affected by new financial and management models. Belief systems, as most people understand, are notoriously hard to change.

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