Costs of Care and Shared Decision Making: The Value of Knowing

I have a patient. He is in his late 50's. He has a very sophisticated knowledge of medicine and science, though he is neither a healthcare provider nor a scientist. He is generally healthy. He has hypertension, but no other significant risk factors for coronary artery disease (CAD). Over the past few months, he has been having fairly classic symptoms for stable angina (chest pain) only at a very high workload. He is a pretty avid exerciser, but he is clearly bothered by these symptoms. He only gets the symptoms with very vigorous exercise, but he is worried about what it might mean and why he has it now and never had it before.

A little over a month ago, we did a stress echo. He exercised for over 13 minutes and really could have gone longer. The ECG portion of the stress was negative. The echo showed what was a very small area of the apex where the images were not great and there could have been a small small area of hypokinesis.

Overall, here is a guy with an ASCVD risk of about 7%. He has what seems like stable angina at only a very high workload and a very low-risk stress test (maybe normal). At the time, I told him that I would favor just treating him medically and that we could follow his symptoms and pursue more later if needed. Here's the rub. He does not like taking medicines and was hesitant to take a statin. I told him that I would take a statin if I were him because I suspected he had angina and as such, there would be significant benefit of statins in preventing future cardiovascular events. He asked what we could do to confirm. I told him that the gold standard would be to do a cardiac cath, but that I did not recommend. He was not interested. I went over his stress echo with one of our best clinicians and he recommended we do a stress nuclear perfusion scan. I thought this sounded like a decent idea. It would not rule out coronary disease, but at least we would get an idea if the symptoms he had only at very high levels of exertion were actually angina, and this would help guide our recommendations on statins.

The patient agreed, and I ordered the test. In the meantime, he contacted my assistant and asked her a very reasonable question: "What will this test cost me?"

He had been dealing with a lot of medical bills of late stemming from some issues with his kids, so he was understandably very worried about taking on more bills. The patient has a plan through Covered California and it pays 60% of costs with an annual max out of pocket of about $9000. He had spent about $3400 so he would still have to cover 40% of the cost of the test. Amazingly, my superbly talented assistant spent many hours over a month and found out that the test would cost $4800. She also spoke to his insurance company and the radiology billing department and eventually concluded that his out of pocket cost would be $1921.46 for this test.

So yesterday,  after learning this information, we spoke for an hour. We agreed that it was not worth $1921.46 to do the nuclear stress test. Again, we would be doing this really only as a way to convince ourselves that he did not need a statin. I laid out my view on the whole thing as follows: All things being equal, I would recommend he take a statin. He is in the range where taking one would be supported by current guidelines anyway, and he has a good story for angina suggesting he has clinical (though mild) CAD.

However, he was still not satisfied. He wanted to know if there was a way to tell him that he did not need a statin. At that point, I suggested that we could do a coronary calcium scan (CAC) and that if the score were 0 or close, we could probably feel comfortable that this is not angina and that he would not benefit from a statin. Here, I knew that insurance did not cover CAC and I also knew from other patients that the cost was about $300.

We discussed it for a while and he agreed this seemed like a reasonable and cheaper option and we both agreed it might even provide us with more information (assuming the CAC was low). So we will do it and I will update with results when they are back.

I thought this case was interesting for many reasons (hence my decision to share it). The medical part is good, but to me, the most interesting aspect is the economics of it. This was the most comprehensive discussion of economic information I had ever had with a patient. We both learned a lot from it. But most importantly, this case highlights how much better and more informed decisions can be made when we know the cost of a medical intervention before it is purchased. I commend my assistant, and I commend the person in radiology she worked with to make this information available to my patient. I especially commend my patient for asking for it and then for using the information to educate me and to push me on my thinking. In the end, he did not need a $5000 nuclear stress test. As the result of his inquiry, he saved himself $2000 and he nudged me to make what at least now seems like a better choice for him and for less money for him and the system.

But I think this case is even more interesting when you think about what would happen in the "normal" situation where three things are likely to have been different:

  1. Most insurance plans cover much more than 60% of costs so most patients are not highly motivated to think about cost when making healthcare decisions.
  2. Most (many) doctors own or have significant financial incentive to perform tests such as the one I ordered (I have none). 
  3. Most of the time, the cost of a test or intervention is not available to the provider or the patient.

So you can quickly see how the "normal" situation results in:

  1. A patient where cost is not a factor
  2. A doctor who presumably wants the best for her/his patients
  3. A doctor/hospital where the incentive is to spend (either directly or indirectly)
We are not there yet, but we are getting to a point where patients now think the cost - and much more importantly the value - of the healthcare they are buying. This forces doctors to do the same and I argue it can improve care while saving money. It all points to my personal holy grail of healthcare economics which is a system where the incentives of patients, providers (and hospitals) and payers are all aligned and result in the best care for the least money. 

In a previous life, my lab focused on thrombosis, and the dogma there was that you can't get improved efficacy (fewer thrombotic events) without worse safety (more bleeding). This law has not yet been broken. It made me think about whether there is similar law of healthcare economics. Can you get better healthcare for less money, and can you accomplish this by aligning the financial incentives of doctors, patients, and payers? For now, we don't know the answer, but I know that having the information of what a test or intervention costs before doing should be the rule and not the exception. That we have not had such information before is almost unfathomable...


  1. Patients frequently have to consider costs of treatment--talk to any person on Medicare that happens to fall into the "donut hole". People in that situation are forced to either delay treatment or forego it altogether due to costs. One of my husband's co-workers who recently died had to forego the type of chemo that might've given her a better chance simply because she could not afford it.

    It would be nice to know physicians are now considering the costs to patients. I know my doctor is of the "Oh, well. Let's just order this/these test(s)" never considering what it's going to cost *me* directly or indirectly (through increased insurance costs) since it doesn't come out of his pocket.

  2. Thanks for the great comment. I will say that we providers are not trained to have these kinds of discussions or to consider cost much, if at all. But financial security and comfort are fundamental to patient health. Patients are probably going to have to take the lead here, at least in the beginning, much as my patient did.

  3. A great, and helpfully honest, reflection on an interesting clinical challenge. Judgement vs algorithms...
    EBM is based on the critical triad: the best evidence; the patient's preferences; the doctor's wisdom. This is an excellent worked example!
    It also illustrates nicely the relatively recent newcomer on the block - better value medicine.

    Two comments:

    i) It is not obvious whether you made explicit to the patient what the magnitude of benefit and harm would be with and without the statin (ie objectively quantifying the effects). As Gigerenzer points out (in 'Risk Savvy'), we doctors often don't do that very effectively!

    ii) You haven't commented on the possibility of an 'incidentaloma' turning up on the CT scan. This potential for further worry (& expense) might colour the patient's judgement about where the balance lay.

    Nevertheless, a salutary worked example - thank you!

  4. Thanks Kit. Great points. We had a long talk about the relative risks and benefits of statins. I should have mentioned. I did not mention risk of incidentaloma. I would love to know how often one is found on these targeted scans. I will look into it. Great question. Thanks again!

  5. This was a thoughtful blog post as far as it goes, but it leaves out some extremely critical factors. One of which is the fact that diagnostic test pricing is often fabricated from hot air decorated with MBAs.

    There is very little correlation between the cost of a test or procedure and what it actually should costs to perform that procedure. If there were a simple percentage markup on costs of supplies and labor or if there were such a thing as 'list price' for a procedure, we could have more intelligent discussions about cost/benefit ratios. We know medical industry pricing is often extortionate because diagnostic procedure costs vary widely from location to location and provider to provider, and this undesirable situation has persisted far too long partly because it is so hard for the average person to detect. As you blogged above, " superbly talented assistant spent many hours over a month and found out that the test would cost $4800." It is criminal that a trained medical assistant should have to spend hours to determine the cost of a procedure, yet that is how it must be done. I know because I have tried. It should not be this hard to shop for procedures.

    So diagnostic test prices are often highly imaginative in pricing, if not downright unethical. What's wrong with this? What's wrong is that it has moral and ethical implications. The current situation taken to its logical conclusion in a non-socialist system such as the U.S results in diagnostic testing facilities effectively practicing medicine by simply pricing some tests out of reason and instead charge outrageous fees for simple tests which are simply inferior. This seems to be exactly what happened in the above blog post example. If the prices had been different your patient might have chosen differently (at least that is the implication of the blog post) and therefore if the pricing of those tests was artificially inflated for him (for example no insurance, wrong insurance, etc) he could end up getting worse care than someone else, effectively having his medical care chosen not by best medical evidence but by best accounting practices. This is perhaps why we have poorer lifetime outcomes in the US than in other developed countries where less time and effort is lost dealing with artificial factors.

    Medicine should be practiced by the best evidence and fairly and rationally priced tests. Clinical decisions should not have to be made based on artificially inflated funny money prices.

    Anyone who thinks health care diagnostic testing is logical simply has not been a patient in the U.S.

    Price transparency is part of the answer (to empower consumers to choose more easily and to promote provider competition). The other part of the answer is closer regulation to both level the playing field for competitors and reduce price gouging (as was done in the auto and home insurance industry with good effect).


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