Wasteful healthcare spending totaled $282M in Washington state

In a single year, more than 600,000 patients in Washington state received services that would be considered low value or wasteful, resulting in $282 million in unnecessary healthcare spending.

The report conducted by the Washington Health Alliance looked at insurance claims between July 2015 and June 2016 from 1.3 million patients who received one of 47 procedures or tests that have been deemed overused by U.S. Preventive Services Task Force and the Choosing Wisely campaign. More than 45 percent of the services examined were determined to be of low value to patients. Of the 1.3 million patients, just under 48 percent—around 600,000—received a low-value service, with 36 percent of the spending ($282 million) on the examined services going to these low-value treatments.

“Overuse in the healthcare system has become so common that we frequently don't even think to question it,” Washington Health Alliance executive director Nancy Guinto said in a statement. “However, preventing harm to patients is critical, in addition to the fact that everyone pays the price because overuse contributes to higher insurance premiums across the board.”

Eighty-nine percent of the wasteful spending identified by the report was the result of 11 low-value services:

  1. Too frequent cervical cancer screening in women
  2. Preoperative baseline laboratory studies prior to low-risk surgery
  3. Unnecessary imaging for eye disease
  4. Annual EKGs or cardiac screening in low risk, asymptomatic individuals
  5. Prescribing antibiotics for acute upper respiratory and ear infections
  6. PSA screening
  7. Population-based screening for OH-Vitamin D deficiency
  8. Imaging for uncomplicated low back pain in the first six weeks
  9. Preoperative EKG, chest x-ray and pulmonary function testing prior to low risk surgery
  10. Cardiac stress testing
  11. Imaging for uncomplicated headache

This list isn’t exclusively high-cost procedures (more than $500 or more), which the report said dispels the notion that overutilization of expensive services, like imaging, is driving wasteful healthcare spending.

The imaging procedures examined by the report, however, did show high proportions of wasteful spending. Of the 16,673 claims for imaging for low back pain, for example, the vast majority was found to be wasteful (18 percent) or likely wasteful (65 percent), which combined accounted for $4 million in spending.

The findings are similar to the waste identified in other states. The Washington Health Alliance said this should illustrate that it’s “past time to take action” on low-value services. One change they advocated is redefining the pledge to “do nor harm” to include how patients can be financially harmed if a physician orders an unnecessary procedure.

“While a goal of zero harm is desirable, it is not realistic,” the report said. “What we strive for is substantially reducing the risk of preventable harm. Reducing unnecessary overuse of healthcare services is one important way to do this. The result of the ‘more is always better’ culture present in today’s healthcare delivery seems to be: ‘first, do something.’ It is time to get back to, ‘first, do no harm.’”

The report further recommends medical societies take the lead to make reducing overuse a priority in practices. This would include reviewing more areas of overuse for appropriateness, such as ordering preoperative tests.

Some of the impetus for change will fall on payers. The report said incentives for providers to order more tests have to be removed or at least reduced and value-based contracts should include measures of overuse.

“Starting with recommendations from the Choosing Wisely campaign just makes sense—they are healthcare services known by the medical profession to be overused,” the report concluded. “These are medical tests and procedures that have been shown to provide little to no benefit in many cases and have the potential to cause physical, emotional and financial harm.”