Is that surgery really necessary? Ensuring the Medical Necessity of Care

July 31, 2014

World Bank

  • Medical overuse has become an epidemic worldwide. It is estimated to cost $250-300 billion annually in the U.S alone.
  • Overuse is evident in India too. Hospitalization rates in private voluntary health insurance are two to three times the national average.
  • Policy, regulatory and insurance based solutions, including the creation of a strong primary care system, are required to stem this trend.

Prescribing unnecessary medical tests, procedures, hospitalizations and surgeries has become an epidemic worldwide. The rates of caesarian sections, for instance, vary widely. While globally the C section rate in public hospitals is 10 percent, it reaches an alarming 98 percent in Brazil’s private hospitals, and 40 percent in private hospitals worldwide.

Similarly, the treatment for cardiovascular disease shows unwarranted variations. Studies conducted across 23 countries found that the use of angiography in Europe, for example, showed a 13-fold range of variation. In the US alone, unnecessary medical care costs $250-300 billion annually by conservative estimates. Another growing danger is the worldwide overuse of antibiotics that is causing a surge in hard-to-treat bugs.

‘Medical overuse’, as it is known, is emerging as a serious issue in India too, especially as more people can afford to pay for medical interventions due to increasing access to insurance cover.

For instance, individuals in India with private voluntary health insurance are two to three times more likely to be hospitalized than the national average. Many of these interventions deliver only marginal benefits and can actually harm the patients, leading to unnecessary suffering, especially among the frail and elderly.

Soon, many more people will be able to afford healthcare as the government ramps up medical coverage for poor households. Therefore India urgently needs to learn from the experience of other countries and build in checks against this hazard, especially as it allocates a growing share of scarce public resources for medical insurance.  

“This is a critical time for India since the country is in the midst of building a healthcare system which will set conditions for decades to follow,” said Somil Nagpal, senior health specialist with the World Bank in India.

To draw attention to this crucial issue, the World Bank devoted one session at its eighth forum for knowledge exchange between India’s major public health insurers for finding ways to ensure the medical necessity of care.

“Our goal must be to do much for the patient, and as little as possible to the patient,” said Dr Vikas Saini, setting the stage for the discussions with a quote from his mentor, the nobel laureate Dr. Bernard Lown. Dr. Saini is a faculty member at the Harvard Medical School and president of the Lown Institute, a Massachusetts based group that works to increase access to healthcare and limit unnecessary treatments.

This was the first time in India that such a broad range of stakeholders – including senior policymakers, health insurers, industry leaders and academicians from across the country had come together for this purpose.

What has led to overuse?

High levels of unwarranted medical interventions have led to a groundswell of international activity to identify and reduce this hazard. Many factors that drive this trend have been identified globally. These include: the culture of ‘more medical intervention is better’; the slavish use of medical technology even when it is not necessary; defensive medicine  or ‘playing it safe’ by prescribing additional tests or treatment; failure to counsel the patients adequately about the risks and benefits of treatment and the other options available; aggressive marketing of services by hospitals, pharmaceutical firms and the medical device industry; incentives inherent in the way providers are paid for their services; and the growing demand by patients for medical interventions.

There is also a growing recognition of the unnecessary costs this imposes on the economy. For instance, it often leads to overinvestment in tertiary care and expensive medical technologies, at the expense of investments in the primary healthcare system, a more cost-effective means of care and prevention. In addition, it causes neglect of the social factors contributing to ill health, like access to safe drinking water and sanitation.

" ‘Medical overuse’, as it is known, is emerging as a serious issue in India too, especially as more people can afford to pay for medical interventions due to increasing access to insurance cover. "

Possible solutions

At the conference, the high-level panel of experts proposed possible solutions: create a strong primary care system that promotes preventive healthcare and reduces unnecessary referrals to specialists; increase public awareness about the dangers of overuse so that patients understand that ‘more’ treatment is not always ‘better’ treatment; and place greater emphasis on professional ethics during medical education.  

For insurers, there needs to be greater attention to prior authorization, although it is critical to also ensure that patients are not denied required medical care. A change in payment systems would ensure that providers are not incentivized for more interventions. A review of utilization patterns and public reporting of variations in practice and outcomes will help create transparency.

For regulators, surveillance for insurance fraud, and the systematic assessment of costs and effectiveness before introducing coverage for new drugs or technology, also called Health Technology Assessment (HTA), was suggested.

The policy options suggested included implementation of clinical guidelines to promote consistency, and a change in the way doctors and health care providers are remunerated so that they neither over-prescribe tests and procedures nor under-prescribe them.

Moreover, India needs to leverage available data and invest in HTA to help preempt unnecessary care, and optimize the utilization of resources.

A concerted effort against medical overuse, involving all stakeholders in the sector, which is already happening elsewhere in the world, is equally relevant in India. The discussions in the World Bank’s forum were a catalytic effort towards this cause, and the enthusiastic support of the country’s health sector luminaries augurs well for this becoming a sustained movement.   

The World Bank’s forum for knowledge exchange between India’s major public health insurers – the Government Sponsored Health Insurance Schemes (GSHIS) - is part of a series conceptualized by the World Bank’s India health team in collaboration with the World Bank Institute. The event was co-organized with the Ministry of Health and Family Welfare.