Transcript Relief for Severe Asthma, at a High Price

Relief for Severe Asthma, at a
High Price
ANAHAD O'CONNOR
September 3, 2012
New York Times
http://well.blogs.nytimes.com/2012/09/03/relief-for-severe-asthma-at-a-high-price/?ref=health
Struggle against asthma
• For two decades, Patricia DiGiusto struggled
with severe asthma. Powerful medications and
frequent use of her inhaler could not prevent
repeated trips to the emergency room.
• Two years ago, Ms. DiGiusto’s doctor told her
about a new procedure called bronchial
thermoplasty, the first non-drug therapy
approved by the Food and Drug Administration
for patients with severe asthma.
Treating asthma
• Avoiding allergens and using inhaled
medications are enough to keep asthma under
control in most patients. But for the minority with
severe persistent asthma, medication and
lifestyle changes are not enough. Frequent
hospital trips are almost inevitable, and powerful
steroids like prednisone — which can cause
thinning bones, cataracts, depression and other
debilitating side effects — become a necessity.
• Nationwide, asthma treatment costs exceed $10
billion a year, and over half of that is spent on
severe asthmatics, who make up only 10
percent of the asthma population.
Does the new treatment work?
• Researchers at Washington University
School of Medicine found that compared
with a control group, bronchial
thermoplasty patients saw:
– asthma attacks drop by a third
– emergency room visits fall by 84 percent, and
– the number of days they lost from work and
school drop by 66 percent.
Insurers’ responses
• Still, even patients with severe asthma often are denied
insurance coverage for the procedure. A spokeswoman
for America’s Health Insurance Plans, the industry trade
group, said insurers are awaiting the results of an
additional five-year clinical trial, required by the F.D.A.
when it approved bronchial thermoplasty. That trial will
not be completed until at least 2018.
• Until then, she said, many insurers are denying coverage
on the grounds the procedure is experimental. “The
issue here for health plans is the long-term safety and
efficacy have yet to be established,” she said.
Is it worth it?
• But three five-year studies have already been completed.
Many asthma specialists believe that insurers are taking a
shortsighted approach. The one-time cost of $20,000, they
say, is dwarfed by the tens of thousands of dollars in hospital
bills and medication costs that a severe asthmatic can easily
accumulate in a single year.
• One such patient, Alberto Gaulion, 68, a retired importer in
Miami, estimated that for much of the last decade, his insurer,
Blue Cross Blue Shield, spent about $50,000 a year on his
medical care.
• “Every two or three weeks I had to go to the hospital,” he said,
“and I was taking everything that was on the market. I was on
a cocktail of drugs.”
• Blue Cross would not cover the procedure for him, so Mr.
Gaulion paid out of pocket when he had it in 2010. Since then,
he has had no hospital visits and no asthma attacks, and
takes only one medication instead of five.
Economics – 1 – Moral Hazard
• If you insure
people, they may
buy more than they
need.
• This leads to a
“welfare economic”
loss.
Price
Demand –
no insurance
Demand –
insurance
P0
Welfare
Loss
C0
Q0
Q1
Quantity
Economics – 2 – Income Transfer
• Attributed to John
Nyman
• Person would not
have bought care
w/o insurance.
• Insurance transfers
income to patient.
Price
Demand – no ins
Increased
Cons Surp.
Demand –ins
P0
Loss
C0
Q0
Q1
Quantity