Health Care In The States

Why Are Health Costs So High? The Robot Knows

By Sarah Varney

March 19th, 2012, 5:30 PM

Americans have always loved the next big thing: the newest iPhone, the freshest hi-def television, and the latest and greatest … medical technology. But that quick embrace of new innovations has come at a cost: It’s driving up the prices hospitals charge insurance companies who in turn raise premiums for the rest of us.

One of the best examples can be found in the operating room at the University of California San Francisco Mt. Zion Medical Center, which looks like a video arcade plunked down in a NASA Control Center.

Dr. Kirsten Greene, a urologist, shows off a much-loved member of her surgical team, the Da Vinci S-I four arm robot.

The console where the surgeon controls the robot is some 10 feet away from the operating table. “I know this looks like old, 1980s video game console but it’s actually fairly high tech,” she says.

During surgery, black goggles give Greene a 3-D view inside her patient. She controls the robot’s camera and four arms using little joysticks and foot pedals.

Unlike manufacturing plants that often replace humans with robots, in the operating room, robots have become an extra set of hands – really expensive hands. Surgical robots can cost up to two million dollars plus pricey maintenance fees.

A Da Vinci surgical robot (photo by Nick Dawson via Flickr)

Dr. Greene says the robot is worth it because “it’s minimally invasive. It’s less blood loss. It’s faster recovery.”

But after researchers studied thousands of robotic surgeries, it turns out that, but for a few exceptions, surgery outcomes aren’t any better and patient’s recovery time actually aren’t any shorter.

Still, that hasn’t been enough to stop hospitals from engaging in a really expensive game of keeping up with the Joneses. In the San Francisco Bay Area alone there are at least 20 of these robots. At about $2 million a pop, that’s $40 million.

But insurers typically won’t  pay more for a robotic surgery, or for the newest kind of MRI or CAT scan. So instead hospitals recoup their costs by charging insurance companies more for everything. And that contributes to $20 aspirin pills and the world’s highest health insurance costs.

But Greene says there’s no choice: “I think everyone just assumes you have it, because why wouldn’t you? It’s like having blood or beds or light in your OR now. You have to have a robot.”

7 Responses to “Why Are Health Costs So High? The Robot Knows”

  1. Petunia McIntyre says:

    If you want to point fingers at why health care costs in the US are so high start with the for-profit insurance companies.

  2. Peter Brown says:

    Robotic surgery has to be a very small part of the reason for very high costs. It may be symptomatic but even that is less than clear. What is clear is we use the acute care system to deal with health issues which can only be truly improved by life style changes, we have yet to embrace preventive measures as a key to reduction in health problems (although the ACA includes a real step in this direction) and we use a fee for service payment system which encourages healthcare workers and administrators to use all the care that can be provided.

  3. John Spek says:

    Controlling health care cost is simple

    Each one of these steps is proven to cut costs, proven in the real world.
    Each one of these is an existing standard of care in a country with better health outcomes and lower costs

    But no one has the stones to do it

    Here is how the real world does it

    Premium based on BMI + age + lifestyle, measured by BP, static heart rates and stress tests
    healthy, at weight people pay less, fat lazy smoking and drinking people pay more
    We need to get this nation’s BMI and fitness levels to the # 2 most expensive nation to cut costs

    Cut service levels to the same level as the next lowest costing nation per the WHO reports
    Each extra hospital, each extra Dr office, each extra MRI machine, each extra scanner has an ROI factor that is raising costs to have it, raising national costs.
    We have luxury service levels for medical care in the U S
    Sell the extra equipment, and the supplies from the closed service centers and doctors offices to African nations so they can upgrade

    Cut quality of care back to that same # 2 country’s levels – no more ER visits for paper cuts and ingrown toenails, treat much at home with no Dr visits
    Co-pay for Dr visits and hospital visits for all

    Elder care is not longer a warehousing function that can be bought. Kids take care of aging parents.

    Eliminate the semi and private room. Most nations, like England have wards where numerous patients are collectively cared for.

    Cut staffing levels to the number 2 costing nation. Reduce the extra doctors and extra nurses by sending them back to their home countries to improve global care.

    Eliminate the multiple drug outlets – the drug store in every store model adds shipping and tractability costs, adds liability insurance and added costs for all of the trained workers. Cut back to the # 2 nation’s levels
    Adopt the Canadian and VA based model – approved drugs are stocked in bulk service centers – there are local supply locations similar to the model used for state run liquor stores
    Approved drugs are those which have been on the market for 5 years and are used by the 95% – if it’s new, if it’s special – it’s not stocked, just like the VA does it

    Catastrophic coverage levels mandatory by state law – if you do not have proof of coverage, the state takes 15% of gross income to fund a state plan (just like Germany folks)
    You want more than that in coverage – go buy it

    Mental health coverage – gone, just like it’s not available in Canada

    Doctor’s visit is 5 min tops, just like Singapore – if you want longer, it is 100% out of pocket as a luxury

    Measure health care results and outcomes in the same manner as third world nations. So babies underweight, or that die in 48 hours are not counted. Death by violence no longer counts in mortality statistics, etc.

    That is real world health care folks – now who has the stones?

  4. Eric says:

    I think this article sums it up quite succinctly, albeit only one example that Hospitals(facility care) are what drive healthcare costs in the U.S. It is a model that has become longer sustainable. I don’t think anyone can argue against this(except perhaps the Insurance and Pharmaceutical industries and their respective lobbies). What needs to happen is a shift of responsibility for healthcare to consumers along with some kind of State/Federal sponsored educational initiatives to encourage people to adopt healthier lifestyles. We all need to be more responsible for ourselves and become more self educated about the lifestyle choices we make. Over the long term, this will help create a more sustainable healthcare model that is less dependent on Hospital and facility care. The problem is that it won’t happen overnight and no one in Government seems to have the political or fiscal will to make something like this happen. And before anyone bashes me for being socialist, consider that if you have freedom of choice to pursue an unhealthy lifestyle at the expense of others do you consider yourself a responsible individual or perhaps selfish? As citizens of a free society we all have a personal responsibility to behave in a manner that contributes to that same free society.

  5. Unneeded, expensive, and redundant are three words that describe the spending spree hospitals have been on in recent years. The author writes regarding the uber-expensive robot in question”…but for a few exceptions, surgery outcomes aren’t any better and patient’s recovery time actually aren’t any shorter.”

    When the inevitable deep cuts in Medicare and Medicaid reimbursement come, the hospitals that wasted the most money on surgery gimmicks will suffer deeply. Many successors to today’s hospital executives will ask, “What were they thinking?”

  6. roger lowen says:

    The fact that “Kaiser Health News” was instrumental in preparing this report may explain the negative slant concerning robotic surgery. Kaiser has been reluctant to employ the daVinci system and has been dragged kicking and screaming into finally purchasing a few of them. Given the well-known fact that robotic surgery has many advantages for surgeons and patients alike, this is a loss for Kaiser members. These advantages include less pain, shorter hospital stays, quicker recovery times, far less blood loss and decreased need for tranfusions, a lower infection rate, more comfort for surgeons who sit at consoles instead of hunching over patients, and elimination of hand tremors of surgeons through use of the robot. Kaiser may be very short sighted in denying its members these advantages.

  7. Peggy Girshman says:

    To Roger Lowen:
    We’d like to correct your misimpression that Kaiser Health News is part of Kaiser Permanente. In fact, we are not affiliated with KP in any way. We are a nonprofit news service and an editorially-independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization.
    If you’d like to read more about us, please go here:
    Peggy Girshman
    Executive Editor
    Kaiser Health News