The New Health Dialogue

Greed. Kickbacks. Sex.

Not reality TV. Health care. In McAllen, Texas, at least.

We thought we knew most of the factors that contribute to health spending variation. Overutilization. Too many imaging facilities. Too many specialists. Lack of definite evidence about treatments. Practice patterns—almost habits—that doctors develop based on where they train and where they work. Screwball payment incentives that encourage lots of specialists doing lots of procedures.

All that occurs in McAllen, Texas, Dr. Atul Gawande tells us in a fascinating New Yorker piece on the "Cost Conundrum." McAllen spends more per Medicare patient than any other place in the country. In fact it spends $15,000 per Medicare enrollee—twice the national average. That's $3,000 more than the average person earns in McAllen. Yes, you read that right.

Wanting to learn more about why we spend so much more than any other country and don't have better health, Gawande headed south. "McAllen, Texas, the most expensive town in the most expensive country for health care in the world, seemed a good place to look for some answers.

He talked to lots and lots of people, including some hospital executives who were not all that happy to see him. And he got a few doctors to open up:

"Come on," the general surgeon finally said. "We all know these arguments are bullshit. There is overutilization here, pure and simple." Doctors, he said, were racking up charges with extra tests, services, and procedures.

I gave the doctors around the table a scenario. A forty-year-old woman comes in with chest pain after a fight with her husband. An EKG is normal. The chest pain goes away. She has no family history of heart disease. What did McAllen doctors do fifteen years ago?

Send her home, they said. Maybe get a stress test to confirm that there's no issue, but even that might be overkill.

And today? Today, the cardiologist said, she would get a stress test, an echocardiogram, a mobile Holter monitor, and maybe even a cardiac catheterization.

"Oh, she's definitely getting a cath," the internist said, laughing grimly.

But wait. There's more. Gawande found plenty of ethical doctors and hospitals in McAllen (even if they did prescribe 20 percent more abdominal ultrasounds, 30 percent more bone-density studies, 60 percent more stress tests with echocardiography, 200 percent more nerve-conduction studies to diagnose carpal-tunnel syndrome, and 550 percent more urine-flow studies to diagnose prostate troubles than their counterparts in El Paso, where the population has a similar health and demographic profile. Not to mention that they performed more gallbladder operations, cardiac bypasses, carotid endarterectomies, knee replacements, breast biopsies, and bladder scopes...)

But there is also, in McAllen, a culture of greed, a propensity to see patients as profit centers. Gawande says some physicians are basically oblivious of financial implications of their decisions. Some think about how to use the money to invest in better health care for their patients. And some think of their practice as a money machine. Every community has a mix, but McAllen is at one extreme. Gawande heard about doctors asking for money for referring patients to hospitals. He even heard about at least one who demanded sex from a home health care agency as the price of referral.

In a few cases, the hospital executive told me, he'd seen the behavior cross over into what seemed like outright fraud. "I've had doctors here come up to me and say, ‘You want me to admit patients to your hospital, you're going to have to pay me.' "

"How much?" I asked.

"The amounts—all of them were over a hundred thousand dollars per year," he said. The doctors were specific. The most he was asked for was five hundred thousand dollars per year.

Not everyplace in America is like this. Some health care systems—we've written about some of them before, like Geisinger and Intermountain and the Mayo Clinic—and some communities, like the high-quality, high-efficiency system in Grand Junction, Colorado, are delivering more for less. Then there's McAllen.

And McAllen reminds Gawande that the essential conundrum isn't who pays for health care. It's who benefits

As America struggles to extend health-care coverage while curbing health-care costs, we face a decision that is more important than whether we have a public-insurance option, more important than whether we will have a single-payer system in the long run or a mixture of public and private insurance, as we do now. The decision is whether we are going to reward the leaders who are trying to build a new generation of Mayos and Grand Junctions. If we don't, McAllen won't be an outlier. It will be our future.