Ophthalmologists around the country found themselves in the headlines this month thanks to the decision by the Centers for Medicare & Medicaid Services to release Medicare payment data that has been private for more than three decades. While I don’t envy the position in which they unfairly found themselves, those doctors, along with their professional societies, who chose to respond to media inquiries had appropriate responses at the ready, and the coverage for the most part seemed fair. You can’t educate the public about health-care financing overnight, and the complaint from medical societies and doctors—that the data dump, with no context and nothing more than raw dollars reimbursed, risked unfairly portraying physicians as bilking the system—was indisputable. Again, I didn’t have a microphone in my face, but those who did had pretty legitimate answers.
In an ideal world, those who set out to cover this story would first have read an excellent article this month by Drs. Melissa and Gary Brown and their coauthors, of the Center for Value-Based Medicine.1
The authors propose that medical expenditures comprise three types: direct medical costs (e.g., a drug, physician cost for examination, diagnostic testing); direct nonmedical costs (residence costs such as moving to a new home due to vision loss, caregiver costs); and indirect medical costs (impact on employment and earnings).
They evaluated the return on investment for three procedures: ranibizumab for AMD, timolol for glaucoma and first-eye cataract. The respective ROIs were 450 percent, 3,957 percent, and 4,567 percent.
A hypothetical regarding the cataract ROI was especially illuminating: An investment of $1 in 1964 in Warren Buffett’s Berkshire Hathaway stock would be worth $5,868 in 2012. The same investment in the S&P 500 Index over the same time period would be worth $74. If first-eye cataract surgery were considered an investment, the theoretical ROI of $1 from 1964 through 2012 would be $4,350,403 to society.
“The majority of the costs returned to society is returned to patients,” say the authors, “but there is also a considerable financial ROI to health-care insurers. For the cataract surgery in the first eye for example, approximately 64 percent of dollars returned by the intervention over the direct ophthalmic medical costs went to patients, 29 percent to Medicare and 7 percent to secondary insurers.”
Ophthalmology has been very effective in recent years at broadening the conversation from a narrow focus on what procedures cost. As the Medicare data dump showed, there is still much work to be done, but as the politicians like to say, that’s a conversation we’d love to have.
1. Brown M, et al. Financial return-on-investment of ophthalmic interventions: A new paradigm. Curr Opin Ophthalmol 2014 May;25(3):171-6.