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Money talks: Discussing costs of treatment

Paying for care can be a sensitive doctor-patient discussion. Here is some advice for dealing with those uncomfortable situations.

By Jonathan G. Bethely — Posted Oct. 16, 2006

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When internist G. Caleb Alexander, MD, an assistant professor at the University of Chicago, was finishing his residency in a Pennsylvania hospital, he found it surprising how infrequently physicians had meaningful discussions with patients about the cost of the clinical decisions being made on their behalf.

Dr. Alexander said he shrugged off the initial observation because most patients in the inpatient setting were too sick to contemplate the cost of their medical treatment. But he began to wonder what happens in the outpatient setting as patients and physicians discuss a treatment course.

"Patient communication [about money] is important, yet it's often neglected," Dr. Alexander said. "It's not so surprising in the inpatient setting because patients are so sick, and there's less willingness to tolerate cost-quality tradeoffs because the stakes are higher."

But the stakes, financially speaking, are going up in the outpatient setting as well. As more patients enter their doctors' offices carrying high-deductible health plans, often with attached health savings accounts, there is a growing shift in the mind-set. As they are assuming more out-of-pocket expenses on their own, patients are asking more from their physicians about the cost of their own health care, and whether a lower-cost procedure might be a better idea. That can be jarring for a physician duty-bound to provide the best course of care, with cost often a secondary concern.

"This issue is a critically important one and there is a woeful lack of attention being given to it," said Nileen Verbeten, vice president of the California Medical Assn. Center for Economic Services. "The profession as a whole is not trained to think about that."

Lingering questions about communication between patients and physicians led Dr. Alexander to plot a course of action that studied how physicians talk to patients about the cost of medical treatment.

His study, published in the August 2004 Journal of Internal Medicine, found that most physicians felt they didn't have enough time to include money conversations with patients in the exam room and that doctors felt uncomfortable with the topic, broaching it only when necessary. Patients also tended to be uncomfortable talking about money and believed that bringing it up might compromise the quality of their care.

What to do?

Robert Sade, MD, chair of the American Medical Association's Council on Ethical and Judicial Affairs, said there aren't many guidelines for physicians when it comes to talking money with patients.

Instead, Dr. Sade, a professor of surgery at the Medical University of South Carolina, said the AMA's Code of Ethics indirectly prompts physicians to provide information to help guide patients in their medical decisions.

"The physician's responsibility is to discuss the situation and make sure [patients] understand the medical value of alternative treatments and relate those outcomes to the cost, and, with the patient, decide what the bigger picture holds," Dr. Sade said.

Some large practices have turned to financial counselors, a tactic commonly found in hospitals. But Dr. Alexander said financial counselors are usually hired to steer patients toward government and social programs and are not knowledgeable about the patient's specific medical options.

Experts say there's no one way to go about discussing money inside or outside the exam room. Whatever the venue, experts agree that serious conversations about cost as it relates to medical treatment options should take place under the physician's guidance.

Physicians agree talking finances with patients is a subject that needs more attention but often disagree about how to go about conducting those conversations. Dr. Sade said conversations about money need to be directed to the patient's specific needs.

"Cost definitely belongs in the conversation at one point or another," Dr. Sade said. "I think that kind of decision needs to be individualized."

For instance, Gary Cordingley, MD, a neurologist in Athens, Ohio, said he brings up the cost issue when he first sits down with a new patient. Dr. Cordingley acknowledges the awkwardness of bringing up money in the exam room, but said if the physician can put the patient at ease by showing concern for his or her financial situation before charting a course of treatment, the barriers are usually broken.

"You engage the patient in a partnership. If you don't ask the questions, how are you going to get answers?" Dr. Cordingley said. "The patient has the right to expect not only a list of options, but there should also be a recommendation."

The initial conversation usually begins like this: "I need to have some guidance about how important the money factor is for you so that we can set ourselves up for success."

Dr. Cordingley also considers the patient's current health status when charting a plan of action. For instance, if a specific test might cause financial strain, he might be able to defer it in favor of close monitoring. If that's not a sound option, negotiating payment options with the hospital before ordering the test can ease the patient's financial stress.

He also communicates with patients in familiar terms, "option A has a 50% success rate, versus option B, which has a 90% rate."

"I can't change the price of the procedure, but I can certainly communicate the level of perceived need and what the person's options are, depending on what's important to them," Dr. Cordingley said.

Internist Robert Berenson, MD, a senior fellow at the Urban Institute, a Washington-D.C.-based think tank, is growing increasingly concerned about money conversations between physicians and patients. He urges physicians to do their homework before factoring money into their medical recommendations.

Dr. Berenson said physicians should be tough on patients who refuse medical treatment because they can't afford it. If something goes wrong after a physician altered a course of treatment because of cost, he said, physicians open themselves up to a new category of lawsuits.

"As difficult as it is right now, it's going to be much more difficult as far as whether to follow the advice or not," Dr. Berenson said. "This is an area where the physician should really get defensive about what happens if you don't get [a medical procedure] done."

Confronting the issue

A good time to bring up the money issue is at the point of service. For instance, because nearly 65% of most office visits end with a physician writing a prescription, Dr. Alexander said this is a good time to ask if the patient is having difficulty affording the medication. Bringing up the issue while action is taking place lets the patient know you're considering not only their physical well-being, but their financial well-being too.

Physicians also need to be clear about what they charge, says William Andereck, MD, an internist in solo practice in San Francisco. Dr. Andereck said in some cases he provides patients with an itemized summary of the charges.

"We don't have a neon sign, but we're open about the fact that this is what it costs," he said. "I tell patients, 'I work for you and not your insurance company.' That line usually draws a smile."

Hoangmai Pham, MD, a senior researcher at the Center for Studying Health System Change, said primary care physicians are more likely to think about cost when it comes to decisions about prescribing drugs (75%), admitting a patient to the hospital (50%) or ordering diagnostic tests (40%) according a community study of more than 6,600 physicians nationwide in 2004 and 2005.

Dr. Pham, an internist, said it's critical for physicians to consider the cost of medical treatment in all levels of health care because studies show physicians' decisions affect 90% of how every health care dollar is spent. It's also critical for others, such as health plans and hospitals, to be clear with physicians about charges so doctors can communicate that information to their patients.

"The big items are things like diagnostic tests and hospital admissions, and most doctors are thinking about this," Dr. Pham said. "Whoever wants physicians to make cost-conscious decisions needs to give them the data. Then they need to empower consumers to have these conversations with their physicians."

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ADDITIONAL INFORMATION

Outside the comfort zone

[download pdf]

It's not easy for physicians and patients to discuss money. In a survey on the subject by C. Caleb Alexander, MD, assistant professor at the University of Chicago, 133 internists and 484 patients from Midwestern academic and community practices identified some of the barriers. Examples are taken from respondents' comments. Respondents were allowed to name more than one barrier.

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A delicate balance

Here are five things to remember when talking to patients about cost.

  1. Be sensitive to your patient's financial needs by creating an environment in which patients feel comfortable talking about medical costs.
  2. Be willing and open to discuss your patient's financial situation, whether by gently but firmly initiating the conversation at the appropriate time, such as when writing a prescription, or taking the time to discuss the issue if the patient brings it up.
  3. Be honest about the cost of medical procedures and be ready to present viable options to the patient.
  4. Be attentive to patient cues that suggest financial stress.
  5. Be aware that your patient's financial situation might affect the ability to follow a recommended course of medical treatment.

Sources: C. Caleb Alexander, MD, assistant professor, University of Chicago; Gary Cordingley, MD, neurologist, Athens, Ohio; William Andereck, MD, internist, San Francisco

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