The Most Expensive Medical Equipment in the World

I’m new to this whole social media thing. But I like the fact that it attracts a semi-lunatic set of people who aren’t content with the medical status quo and want to make a difference.

So, I want to talk about something that I reckon is just about the most important healthcare issue facing those of us privileged enough to be living and working in the first world.

For my money, the elephant in the Health living room is in the budget. Like many doctors, for a long time my wife (a nephrologist) and I (an emergency physician) have shaken our heads in disbelief at the crazy inequities of the health system. Why for instance does total health spending (public & private) continue to rise as a proportion of GDP in Australia? (7.5% of GDP in 1995, 8.3% in 2000, & 8.8% in 2005? (according to the Australian Institute of Health & Welfare)

And why is total health expenditure in the USA nearly double ours (incl public & private) with worse outcomes & far worse inequities?

Because the money is going to the wrong places and into pockets rather than into real improvements in health outcomes. This is ‘the elephant in the living room’: something everyone knows or suspects but is never discussed.

Photo by Murilo Morais



  • Governments fear to discuss the issue (because healthcare reform is seen as just too hard because of all the well-funded vested interests — look what happened to Hilary Clinton and then Barack Obama when they tried to take it on in the USA)
  • An ill-disciplined & lazy media ignores it
  • An ill-informed public is too easily bamboozled by cynical & emotive pleas for more funding by those same vested interests who are profiting at the expense of the public purse
  • Individual doctors either lack the time and resources (like most busy people juggling jobs and family) or just happen to have some of those vested interests I just mentioned.

Many doctors in countries like mine [Australia] have a strong commitment to high quality, equitable healthcare. But we are well aware that (a) important ethical decisions get made ‘on the hop’ by doctors every day, and (b) the decision-making process can be opaque / arbitrary / self-serving / up to personal whim.

A case in point:

The cardiologist, the vascular surgeon and a nephrologist were managing an elderly vasculopath with significant renal impairment, who developed angina as a hospital inpatient. After a great deal of discussion with the patient, his family and the three teams, all agreed that his angina would best be managed conservatively, because of the risk that a coronary angiogram would push him into end stage renal failure. After five days, a changeover in the medical term led to a brand new cardiology trainee walking into the patient’s room to inform the patient that he had booked him for an urgent coronary angiogram the next day. Nothing had changed except the trainee, who hadn’t bothered reading any of the medical notes for the last five days. For the record, the patient and his family told the trainee to go to hell.

Another case:

I was on duty in my Sydney ED on the day of a nursing home fire last year. Some very frail, very elderly, very badly burned patients were transferred in and I was faced with an urgent question: to palliate or resuscitate? The intensivist, the plastic surgeon and I arrived at acceptable decisions on a case-by-case basis. But I couldn’t help thinking at the time that, had the ED physician, intensivist and plastic surgeon been different individuals, perhaps very different clinical management decisions would have been made… just as well-intentioned, and just as shaped by personal beliefs and experience rather than evidence.

So what’s the real problem here?

It’s not about what is actually the best treatment in any given case. (But how that decision is reached merits a whole rant in itself.)

And it’s not whether healthcare should be public or private. (It doesn’t matter who pays the bills if the person who decides the best treatment and in the Australian private system sets the cost in the form of a ‘gap fee’- is also the person who reaps the financial benefits.)

In my opinion, it’s the very system that allows the most important health care decisions (such as resuscitation orders, interhospital transfers and very expensive procedures) to be made by individuals who are given an extraordinary licence to do so, with neither adequate oversight nor formal training in the ethics and economics of their decisions.

It staggers me that simply having the title ‘doctor’ confers this power, and that decisions like this are made every day, by the specialists who stand to gain the most from such decisions and also by doctors in training with little experience. A striking analogy is suggested in a New Yorker article by Atul Gawande just sent to me: imagine if you were building a house and you paid an electrician for every outlet he recommends, a plumber for every faucet, and a carpenter for every cabinet. Would you be surprised if you got a house with a thousand outlets, faucets, and cabinets, at three times the cost you expected?

I recently discovered that there is a whole branch of study devoted to ‘clinical practice variation‘, particularly where such variation is ‘supply-sensitive’: that is, based more on individual doctors’ preferences rather than actual benefit to the patient. The concept was defined by the The Dartmouth Institute for Health Policy and Clinical Practice and published in the Dartmouth Atlas. I’ll quote from them here:

Effective care refers to services that are of proven value and have no significant tradeoffs; the benefits of the services so far outweigh the risks that all suitable patients should receive them.
Preference-sensitive care comprises care for conditions for which there is more than one treatment option, each with its own benefits and tradeoffs.
Supply-sensitive care represents services for which the supply of physicians and other resources — such as hospital beds — strongly influences the amount of care delivered.

In other words, effective care can be rephrased as ‘We should do this… so we will.’ And supply-sensitive care equals ‘We can do it… so we will.’

It’s no surprise that supply-sensitive care is the most expensive, but it is disappointing that in many cases it is no more effective than the cheaper alternative. The references listed below all cite examples of comparable regions whose populations have very different rates of certain treatments (orthopaedic procedures for example) without any difference in long-term outcome.

And the worst news? Supply-side care is the type of care that we practise. Every time a junior doctor orders a ‘Serum Rhubarb’ because the boss might just want it and you don’t want to look stupid on the ward round, and every time an ED doctor orders a CXR for a kid with bronchiolitis or orders a CT abdomen for the patient with appendicitis ‘because the surgeons will want one’, that’s supply-sensitive care happening right there.

And you’re not immune just because you’ve got grey hairs. Quoting from a 2010 MJA article:

Research commissioned by the Clinical Excellence Commission provides particular insight into variation in clinicians’ prescribing behaviours regarding red blood cells. The study found that most senior doctors interviewed were not particularly interested in learning more about inappropriate transfusions [because] they believe their current practices are not deficient, and that it is others who need to be encouraged or educated to change their practices.

So there is a problem. It’s been defined and measured. In countries like the USA you can compare hospitals based on their care versus their outcomes. In New South Wales, the Garling Report discerned clear variation in practice, observing that much clinical care reflects clinician or organizational preference, not patient needs.

Does it matter? Why should any of us get all hot under the collar about it?

Well, it may depend on where you stand in the equation: a supplier of supply-sensitive care may not be that interested in decommissioning the Gravy Train, and in a country where ‘socialist’ is a pejorative term, the rest of us probably don’t fancy the thought of being called bolshy bastards by our colleagues.

For me the best analogy is climate change: action now appears painful & can always be deferred. But the private and public costs of healthcare are spiralling in our country, and eventually they will be unsustainable. At that point, even our politicians will have to toughen up and make some hard decisions. And I would rather that the tough budget and ethical decisions are made now, with time to discuss and reflect, rather than made by panicky policy makers with a tenuous grasp of the issues.

Let’s be selfish: by the time I get to the ripe old age when I need to open the healthcare cupboard for my own care, I hope there’ll still be something in it.

What can be done?

Well, part of the answer is to develop and disseminate best practice guidelines, and there are plenty of excellent organisations worldwide that are doing just that.

But leading a horse to water won’t make it drink, and just providing cantankerous, individualistic and possible greedy doctors with a whole bunch of guidelines won’t be enough on its own. I shudder to even think it, but perhaps the answer is to give up a little bit of our vaunted autonomy.

H.L. Mencken once said, ‘For every complex problem, there is a solution that is simple, neat, and wrong.’ But one solution that has often appealed to me (when watching fee-for-service interventionalists signing up ED patients for benefits of doubtful utility) is the ‘traffic light system’: divide treatment decisions into:

  • GREEN: those which most stakeholders agree are worthwhile (e.g. coronary stent in a 30 year old with STEMI) and that a doctor can prescribe with complete freedom;
  • AMBER: those which must meet certain criteria before they are allowed e.g. stent in an independent 80 year old: perhaps such decisions would have to be approved case-by-case by a specialist from an unrelated specialty or by the hospital general manager;
  • RED: those which a majority agree are inappropriate & which are simply not allowed (e.g. stent in a 100 year old). (Apologies to all those 100 year olds who were hoping to make it to 200.)

Now what?

Well, I don’t know what to do from here.

I have no idea if there is a ‘constituency for change’ out there among the medical community in general, let alone critical care doctors. But I’d like to find out. I reckon it would be in the public interest to get the conversation started in an open forum. It would be refreshing to see a large number of doctors publicly put their hands up and admit that our profession is out of control and we are wasting money and precious resources. Wouldn’t that be something?

And perhaps we could build on that and start a public conversation with all the stakeholders: government, hospitals, clinicians, public health experts and the community.

So here’s a list of what I reckon are the pertinent questions:

  • The key question is ‘How should healthcare decisions be made?’ Or rather, ‘How do we spend the healthcare budget?’
  • Are there treatments we all agree deliver value for money to our patients?
  • Are there specific treatments that we all agree are poor value?
  • Should the medical profession as a whole take responsibility for treatment decisions that most of us consider to be wrong? Personally I consider that we should. We are best placed to understand and advise on the issues, and the public looks to us to provide the best possible care and dispassionate advice.
  • Would any doctor who took on this battle be prepared for the inevitable media backlash when disgruntled colleagues (and angry patients) discover they are on the losing end of the process? This might be the biggest stumbling block.

I’ll sleep more soundly at night if we at least try to do something about the issue. As members of the profession best placed to understand the intricacies of the system, it’s about time we demonstrated to our patients that we actually merit the respect we demand.

For the record, all my opinions are my own and I do not presume to speak on behalf of my hospital or anyone else.

So, what’s the most expensive piece of medical equipment in the world? Well, according to Gawande in his New Yorker article, it’s a doctor’s pen.

References and links

Want to read more? Try these:

Aussie emergency physician and ultrasound tragic based in Sydney. Hobbies include being bossed around by his small yet opinionated daughter


  1. Agree!

    As you say, currently it depends on individual doctors to recognise that decisions regarding individual patient testing and treatment have impacts on the overall health budget.

    In some Emergency Departments I have worked in the traffic light system has worked well for rationalising investigations. Removing coag tubes from IV trolleys alone, I believe saved thousands of dollars each month. I’m sure simple actions like this (and avoiding any pre-op bloods and chest x-rays on healthy young adults) are a good place to start.

    Other examples of lunacy is how vitamin D testing has increased 100 fold over the past decade. (http://www.smh.com.au/national/health/fears-over-vitamin-d-tests-20120722-22i6v.html)

    Regarding broader treatment guidelines it becomes more difficult as different specialties have different and vested interests. Any any suggestion of healthcare budget cuts will lead to immediate uproar – but healthcare budget re-orientation?

    Has anybody heard of QALYs or DALYs lately? Obviously just using these is too simplistic. Palliative chemotherapy will lose, whilst hip replacements will be more beneficial — but it could be a place to start the conversation?

    Your example regarding the angiogram is particularly illustrative: 1) it shows that collaborative decision making is likely to be more efficient and 2) when informed, patients and their families will be on side.

    I look forward to the ongoing dialogue.

  2. Brilliant.
    Im right behind you on most of this and the stuff that we differ on will be good to debate!
    This is unsexy stuff for some but its crucial.
    It irks me.
    And it irks me that it doesn’t irk others more!
    I’m all up for some irking.
    Consider me an ally!

  3. Certainly a very thought provoking article that I have some empathy for. The resistance to Healthcare reform is a good example, as is the imbalance between the funding of Medicare locals, supposedly the vehicle for all primary care service delivery, and Local Hospital Networks with budgets 50 to 100 times as large. The power of potential intervention with Social Determinants of health and preventative care should warrant much more funding than the current models allow.

  4. Interesting article…. two questions: (1) is there evidence that the presence of an emergency department or emergency medicine as a specialty improves the cost-effectiveness of healthcare? and (2) how do we define “effectiveness” in healthcare?

    Or, stated differently: what are the aims for healthcare on a national and global level, what is the role of Emergency Medicine in this, and what price is society willing to pay (both monetary and non-monetary) to achieve these aims?

    (I have my own opinion on these issues, but am interested to hear your thoughts…)

  5. Thank you for your thoughts. Your comment on health care costs being reduced and care becoming more effective with improved administrative oversight of costly (and at times risky or unnecessary) physician-led care is timely. I work as a doctor and find that the days of our working in isolation largely ended in the twentieth century, and we have yet to become true members of the health care team (a team that may very well include administrators overlooking our own work).

  6. Thanks for bringing up this complex but pertinent issue.

    I’d disagree with the cartoonish characterisation of the US health system, its outcomes by comparable measures such as cancer survival rates are the best in the world.

    It is interesting to see how other countries have reformed their systems, and the main themes seem to be a move away from centralised control and cost feedback via co-payments.

    So for example, Singapore and the Netherlands moved towards insurance based systems with more competition in the mid-2000s , with increased transparency on cost and quality of care.

    France and Japan seem to rely heavily on increasing co-payments to control the escalating costs of healthcare.

    It will be interesting to see which way Australia moves, either in the direction of the Dutch or Singaporeans, or towards a more centralised model like the NHS.

  7. I disagree with the need for administrators to overlook our clinical processes. This kind of thinking should be ingrained in all those training in medicine today. Resources are limited, and will probably become more so. The cost of healthcare arena touches on many difficult issues that will be faced by all patients, but also by ourselves and our families.

    It is time this debate was launched into the public domain; but if doctors are unable to face or discuss these problems, how do you think the media will be able to deliver them to the public in such a way that we can have a rational discussion.

    In other words, what are we going to do about this? I for one, would be most interested in being involved in the development of these ideas. Guidelines make for easy decision making although perhaps they detract from true clinical understanding. Nonetheless, optimal, evidenced based care should be available for all. How one judges cost-effectiveness remains a thorny problem.

  8. I am highly irritated by this article.

    You’ve managed to succintly put into words a general feeling that I have been walking around with since I started medicine. I felt a cold chill, deja vu, and an inner sense of excitement- all simultaneously while reading this.

    Truly great, well-thought out writing. Please, please continue this debate.

    With your permission I will share this to every doc I know.

    • Thanks Olusegun, and thanks also to the others who have replied as well. I’m particularly fond of Wanda Tan’s two questions: (1) is there evidence that the presence of an emergency department or emergency medicine as a specialty improves the cost-effectiveness of healthcare? and (2) how do we define “effectiveness” in healthcare?

      Opening up a debate on how to spend the healthcare dollar will inevitably lead to a light being shone into all sorts of areas and practices that we might prefer to be left dark. For example, what if we discover that nurse practitioners and physicians’ assistants are just as effective and cheaper than my specialist group (emergency physicians)? Well, in the interests of fairness I guess the answer has to be: bring it on.

      Also Kath’s thoughtful point: Any any suggestion of healthcare budget cuts will lead to immediate uproar — but healthcare budget re-orientation? Yes, I agree one doesn’t want to scare the chickens. A softly softly approach is a wise way to proceed. Sure you’re not a politician?

      Jonathan Thomson notes that It will be interesting to see which way Australia moves, either in the direction of the Dutch or Singaporeans, or towards a more centralised model like the NHS.

      Let’s not just wait and see which way Australia moves. Let’s try and have a say in the process. Remember, [here’s that climate change analogy again] doing nothing equates to making a choice in itself.

      It looks like we agree there’s an issue here. So how do we get it debated outside of this blog? I hate to say this, but I suspect that those of us reading this aren’t actually a majority of healthcare professionals, so how do we get everyone else to pay attention?

      As I said, I’m new to this blogging business. I’d like to see this debate continue and actually help make a diference.

      I suppose anyone who reads this and thinks it’s worth debating could send his/her colleagues a link to this blog. Is it worth sending it to non-medical people as well? Or is there a health policy forum one could target by making a submission?

      Any ideas, team?


      • Sending the link to our colleagues in one thing…… have you though of trying “The College”?

        Surely this should be one of their major areas of focus for future planning and policy development.

        Or do you think Justin they should just sit back and not get involved, just being happy to deal with whatever the Govt of the day throws at them?

  9. Justin

    I’m a late arrival, but I’m well in your “constituency for change”. I’d like to expand on Kath’s point and say:

    Is there evidence that the presence of an emergency department or emergency medicine as a specialty improves the effectiveness of healthcare full stop? Never mind cost-effectiveness.

    I am uncomfortable by the current background ethos I perceive in emergency medicine of “because we can, we should” and by assumptions that “if we can know it now we should”, whatever the opportunity costs of that knowledge….. we need to start thinking outside our 4 hour box.

    I’d love to be in touch with anyone working or who wants to work on QALYs or patient-oriented outcomes in emergency care.



    • Thanks Kirsty for your comments. I agree with you & Kath that QALYs are probably the tool that is required… and that ED physicians also need to look at our own practices.

      1. There is a problem
      2. There is a tool to compare treatment in terms of outcomes [DALYs/QALYs]
      3. There are plenty of guidelines that can be used
      4. BUT there are plenty of vested interests that have successfully scuttled previous attempts to reform the system.

      Quoting a recent email from a mate who has more experience than me in this area:

      ‘Witness the fate of the Relative Value Study in 1999, commissioned by the AMA to try and bring some reality to the unit cost of time of various specialties, only to get shot down in flames by friendly fire in the Federal Council room of the AMA, by none other than the specialist craft groups… We can’t have a rational discussion because peoples’ incomes depend on their ability to cross-refer, provide inappropriate services etc. “It’s difficult to get a man to understand something when his job depends on him not understanding it” is a nice way to put it.’ “

      1. As I see it, the final problem is that none of us well-meaning types really has a lot of time to fight the fight.

      So what are the options available?

      A. One could simply fire articles into the ether to stimulate public interest, but this approach would probably fail, because public debate would likely be stifled by interest groups with the time and resources to brand any such an initiative as mad ranting.

      B. Approach the AMA: as some colleagues have suggested, they are probably the only group big enough and representative enough to actually get anywhere. The problem appears to be that the AMA wouldn’t take up the fight because of the special interest groups.

      C. Editorial in the MJA and propose an informal group with input from various disciplines eg ED, administrators and the like. That way one could build up the resources [eg enough people to take turns at checking email traffic / acting as group spokesman]. So when the time comes to launch a public debate for real, there’d be more chance of succeeding- and less chance of being branded ‘lunatic fringe’.

      D. Focus on local solutions eg approach our individual hospitals to try policing the decisions eg institute a ‘traffic lights approach’ as described above.

      E. My colleague above suggested picking an individual issue and work through it – inappropriate dialysis decisions for example, or comparative outcomes study of DVA Gold card vs Normal Aged Gents… do research on it (PhD??) and use it as an example of how irrational the system is, rather than try and take things on too broadly.

      So, tough work and heavy going any way you look at it.

      Hmm… baby steps! Any other suggestions on where to start?

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.