• Explicit v. implicit rationing

    The publication of the American College of Physicians ethics manual has garnered lots of comment. Aaron has weighed in with two posts and the comments show that people have very strong feelings about the role of physicians in using cost and effectiveness information to make clinical decisions. On balance, I come down thinking that it would be unethical to completely ignore cost and effectiveness information. At the same time, I don’t want a robot providing my care who was just following guidelines, and there are areas of great uncertainty in any event. Though as Aaron and others have noted, ACP probably needs to work on their language.

    Seeking to push the discussion forward, you could define rationing in a variety of ways, but the way it tends to be used culturally in the U.S. is anything other than a patient get whatever s/he might want, desire, need (these are different, but I am leaving that aside for the moment) is rationing. Under this definition, it is not a question of whether there is rationing, but how? Larry Churchill has two great, short books* that are worth reading if you want to go deeper into this discussion; Paul Kelleher has also pulled together some great resources. Bill Gardner also has a great post.

    David Mechanic has an essay in Health Affairs in 1997 that provides a useful way to think about rationing: implicit v. explicit. I think that one of these rationing approaches likely scares people more than does the other, and the reasons individuals view them differently are idiosyncratic. Under Mechanic’s formulation the two choices given the inevitability of rationing are:

    Explicit rationing refers to decisions made by an administrative authority as to the amounts and types of resources to be made available, eligible populations, and specific rules for allocation. Significant amounts of explicit rationing occur in public and private plans regarding levels of available technology, location of facilities and programs, expenditure levels…

    Implicit rationing, in contrast, refers to discretionary decisions made by managers, professionals, and other health personnel functioning within a fixed budgetary allowance.

    When I did a post doctoral fellowship at the University of Manchester (U.K.) in the mid-1990s, I spent a fair amount of time talking to my GP, not as a my physician, but trying to better understand how primary care worked there. He seemed to embrace the role of implicit rationer as not only inevitable, but as good because he viewed himself as uniquely qualified to assist patients in making decisions, many of whom he had known for many years. He felt that this meant that could bring some insight into the likelihood of success, cost, and preferences of the patient as revealed over many years, all while realizing there was someone else in the waiting room who also needed care, and many others that he would never meet.

    His straightforward acknowledgment of this reality and his ease in discussing it was very foreign and even scary to me, but as Mechanic notes:

    Medicine is both a scientific activity and a cultural form. Most of the ways in which we ration care are invisible, obscured by cultural assumptions, political understandings, and economic realities.

    What was jarring to me, was old hat to him. As has been said by us on this blog in many cases, the hardest part about rationing is not technical, but cultural. We don’t need to, nor could we copy how other nation’s ration; we have to figure out what works for us. The hardest part for us Americans seems to be even starting the conversation, and acknowledging that it is a question of how, not if.


    Larry R. Churchill. Rationing health care in America: perceptions and principles of justice. 1987; University of Notre Dame Press.

    Larry R. Churchill. Self-interest and universal health care: why well-insured Americans should support coverage for everyone. 1994; Harvard University Press.


    • At approx 43’35” notice the word she uses.

      This is a great talk btw. Digs deep and her observations about staff in high vs low intensity ICUs hit home–completely on message with this topic.

      I post it so folks can see that this word was in the lexicon before ACP release. Having said that, I understand the dust up–not so much on intent, but interpretation.


    • Implicit rationing may put a patient’s best interests in tension with the financial interests of the physician. Explicit rationing may place the best interests of the patient in tension with the financial interests of the insurer. However, without good cost-effectiveness research, we make most of these decisions based just upon cost, not effectiveness. We really need the cost effectiveness research to help us with these decisions.

      That said, I couldnt agree more that the it is our cultural/political limitations which keep us from resolving our health care cost issues. If we continue to believe that there are no limits to what care we should receive and that no limits should be placed upon payments, we end up with those awful charts Austin puts up showing health care taking up 50% of the economy.


      • @steve
        good points….the incentives are key. Salaried practice would seem to limit direct incentive to over or under provide, but of course financial viability of the entity paying the salary still enters in. In explicit rationing realm, I think there is some stuff for some conditions that likely are harmful and expensive, certainly when taking QOL into account, but I am not really sure of the magnitude. If we were serious about explicit, one approach would be to take one condition a year and drill down and identify some things that might typically not be paid for, some that would be done via reference pricing only (paying same amount as proven therapy), some that always would be covered, etc. Do CHF in Medicare one year. Next year do Lung cancer, etc. We could muddle it through if we agreed to actually try it.

    • The pharmaceutical industry has taken advantage of our inability to factor cost effectiveness into patient care. They price drugs highest for diseases that are most serious and life-threatening–our most desperate patients. In the past 20 years we’ve gone from several hundred dollars a month for a cutting edge cancer drug to tens of thousands of dollars/month. The new drugs now, as before, are innovative but only, with few exceptions, marginally effective.

      We now measure efficacy by delay in progression and accept a two to three month delay often with little or no survival benefit as a major advance. Spending $100,000 on such a drug is unsustainable.

      How to factor this into a rationale decision making when drug companies have the congress on their payroll is a challenge.

    • I think the more useful distinction is between overt and covert rationing. It may sound like semantics, but even explicit rationing may not be overt in the sense that even though the rationing mechanisms aren’t hidden, there’s no statutory requirement to disclose the specific ways in which they affect an individual patient’s care to that particular patient.

      Even though I think that disclosing such conflicts of interest is the minimal ethical requirement for imposing them on patients, I have a hard time imagining doctors who support such measures making such disclosures to patients.

      The irony here is that as soon patients start paying out of their own pockets, the ethical and interpersonal dynamics change completely, and instead of being an immensely uncomfortable conversation where you tell them that you’ve been conscripted to impose personal sacrifices upon them for the greater good – you are simply helping them make their own determinations of the costs and the benefits.

      The irony is that once their own money is in play on average they’ll impose more parsimonious restrictions on their own care than a physician acting on behalf of a third party would have dared to impose on them, and the physician will be more likley to find himself asking them to consider more expensive options than they’ve opted for when the benefits are significant enough.

      • @JayB
        the overt v. covert distinction is an interesting point. But, the out of pocket question likely won’t change things that much, at least not for the very sick. If I had a cata plan with a $15,000 deductible, once I blew through that if it was true catastrophic I would face 0 marginal price for more care. So, there is some effect of OOP, but the biggest costs are with the sickest folks, so I don’t think it will do as much to overall spending as you think. My main point is that even if we move to cata care with more OOP costs generally, we will still have to talk about implicit v. explicit rationing I think (or covert v. overt).

      • “The irony is that once their own money is in play on average they’ll impose more parsimonious restrictions on their own care than a physician acting on behalf of a third party would have dared to impose on them”

        I would just flesh out what Don said above. Remember that 50% of people account for 3% of our health care spending. IOW, most people do not spend that much. Most spending is done by the acutely ill, think cancer and heart disease, or the chronically ill. When you need that CABG, you are going to blow through any kind of deductible. Issues like geographical location become much more important. Same with the costly chronic illnesses. We also know that when deductibles become large, people often drop the most cost effective care.

        There may be a place for these market mechanisms to help decrease costs, but I dont think we know how to use them yet.


        • @steve
          important to note though, that the avg amount spent per capita for the bottom 80% (that’s the total amount of our HC spend), is less than Don’s 15K illustrative cata/OOP plan. Its only a minority (top 20%) that would blow through that ceiling of fifteen grand. Effect would still be significant. Granted, I cant envision a world where all citizens have a HDHP of that magnitude, but nonetheless, where you set that bar matters.


          ps–you know the KFF graph all too well, did not html