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CMW News: Technology adds to growing healthcare costs

Case Management Weekly, July 23, 2008

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Increased technology in most industries often leads to better, more cost-efficient results. But that maxim does not always hold true in the healthcare field, according to Business Week.

New technology, such as the da Vinci robot, may decrease patient recovery times, but can leave a hospital with an extremely high bill. The robot, which is operated by a surgeon and works well in very small spaces, facilitates surgeries by making extremely small incisions. But the cost of the machine is $1.5 million, and requires $2,000 worth of replacement equipment between every surgery for sanitation reasons. Patients often demand the machine and are unaware of the increased costs because their co-pay for the surgery is the same. Furthermore, there is no research that indicates the machine is any better at performing surgeries than a surgeon alone.

Although there is little or no competition available and consumer price insensitivity drives up the costs, technology can still be valuable in healthcare. Implantable cardiac defibrillators, for example, can decrease the risk of death from heart attack by up to 30%.

Source: Business Week

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