Return to McAllen illustrates changes ACA has brought to health care system


Photo: Peter Dutton via Flickr
Photo: Peter Dutton via Flickr

In June 2009, Atul Gawande wrote an influential New Yorker article, about the community of McAllen, Texas, which has some of the highest per-capita Medicare costs in the nation. At the time, “The Cost Conundrum” had a significant impact on the national debate over the legislation that would become the Affordable Care Act – not so much on the health insurance coverage aspects but about wasteful spending and flawed incentives built into our payment system.

McAllen was awash in waste, fraud and abuse, with millions spent on care of little to no value to the patient. The spending could not be blamed on socio-economic factors because nearby El Paso was a very similar community, but with half the per capita Medicare costs, and same or better outcomes. Gawande wrote this about McAllen:

“Doctors were ordering more of almost everything — diagnostic testing, hospital admissions, procedures. Medicare patients in McAllen received forty per cent more surgery, almost twice as many bladder scopes and heart studies, and two to three times as many pacemakers, cardiac bypass operations, carotid endarterectomies, and coronary stents. Per-capita spending on home-health services was five times higher than in El Paso and more than half of what many American communities spent on all health care. The amount of unnecessary care appeared to be huge.”

Atul Gawande
Atul Gawande

Earlier this month, Gawande returned to McAllen in a new New Yorker piece, “Overkill: An avalanche of unnecessary medical care is harming patients physically and financially. What can we do about it?” Some answers to the “what can we do about it” question can now be found in McAllen, he concludes. The medical community’s behavior has changed, significantly, partly because his initial article shamed the doctor and hospitals into some introspection about how they practiced medicine. But change also has come because physicians in McAllen and elsewhere are operating in a new environment, with new incentives and new opportunities created by Obamacare.

One thing that struck me in this article was the context and emphasis. Six years ago Gawande was focusing on “bending the cost curve” and unnecessary spending. It’s still part of the conversation, but now we’re talking not just about spending too much but about doing too much – overtreatment, and overtesting, and how it causes harm to patients and society. That $750,000 billion of wasteful health care spending that the Institute of Medicine cited in 2010 is more than our national budget for K-12 education, Gawande notes:

“Virtually every family in the country, the research indicates, has been subject to overtesting and overtreatment in one form or another. The costs appear to take thousands of dollars out of the paychecks of every household each year. Researchers have come to refer to financial as well as physical “toxicities” of inappropriate care — including reduced spending on food, clothing, education, and shelter. Millions of people are receiving drugs that aren’t helping them, operations that aren’t going to make them better, and scans and tests that do nothing beneficial for them, and often cause harm.”

Many of the vignettes he relates may be familiar to us as health journalists: unnecessary back surgery, treatment of tiny nonaggressive “indolent” cancers that would likely never progress. And he also describes how some employers and insurers are introducing systems meant to weed out some of that no value care, and make sure the patient gets necessary and higher quality care.

This brought him back to wondering about what had or had not changed in McAllen in the five years since enactment of the ACA. In those five years, Medicare costs have flattened, and health care inflation is at a 50-year low. Working with economic data from Dartmouth health policy researchers, he learned that Medicare costs had dropped nearly $3,000 per recipient in McAllen from 2009-12, “savings on an unprecedented scale.”

Some of the changes can be attributed to the medical community’s response to Gawande’s initial McAllen article. It did spark anger and finger pointing – and some fraud prosecutions – in a community he described as having a“profit-maximizing medical culture.” But it also brought about more constructive change and physicians learned more about, for example, the cost of home care they were ordering at an unusually high rate.

In addition, new opportunities arose through the ACA. Accountable care organizations came to town bringing new incentives. More primary care. More care coordination. Better communication with patients. Less use of specialists. Emphasis on keeping patients out of the hospital, and out of the ER. Some of the doctors Gawande interviewed are seeing fewer patients, practicing better medicine, finding more professional satisfaction, doing just fine financially – but saving the health care system money and reducing unnecessary care.

Gawande doesn’t argue that the problems have been solved. He describes how he performed a thyroid cancer surgery on a patient bound and determined to have it, even after Gawande encouraged a watch-and-wait approach rather than a risky operation for her tiny, and probably harmless, cancer. It will be hard to move to a system based on quality, when we’re not very good at measuring quality. Our culture and how we understand and communicate risk also has to change.

But he’s still optimistic. “We’re finally seeing evidence that the system can change – even in the most expensive places for health care in the country.”


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