Science in the Triangle

Durham is home to Duke University hospital, rated one of the best 50 hospitals in the U.S., but Durham also has one of the highest HIV infection rates in North Carolina. Sixty-five percent of adults are overweight or obese and an estimated 15 percent of the children in Durham are uninsured, according to the 2010 State of the County health report.

Dr. Victor Dzau

Considering that the Duke University Health System dominates healthcare in Durham, the community’s health status stands in stark contrast to the hospital’s nationwide ranking. Dr. Victor Dzau, Duke’s chancellor for health affairs and chief executive of Duke University Health System, acknowledged as much during a speech he gave March 9 at the Research Triangle Park Rotary Club’s Luther Hodges Ethics Luncheon.

But then Durham is no exception. Communities surrounding the best health systems in the country often have the worst health status, Dzau said.

The problems these communities face with access to healthcare and healthcare quality and affordability in many ways epitomize national challenges: Healthcare spending has increased faster than the economy and now represents 16 percent to 17 percent of the U.S. gross national product, but the U.S. population isn’t getting healthier. Obesity and diabetes rates are up, the infant mortality rate is higher in the U.S. than in most other developed countries and about 50 million American age 18 to 64 are uninsured, according to the Centers for Disease Control and Prevention.

“Some people say we’re in a crisis,” Dzau said.

As a doctor who promised to hold service above self and as the head of a health system whose costs for services to patients unable to pay reportedly increased from $45 million in fiscal year 2009 to $47.7 million in fiscal year 2010, Dzau said he believes healthcare is a human right and he worries about who’s going to pay for it.

He sees part of the solution in the federal healthcare reform act that passed last year. The law “has lots of elements we should embrace,” Dzau told RTP Rotarians, even though it’s “pretty scary for providers. It changes my entire business model.”

But he also envisions a role for academic health sciences centers like Duke to better pass on their knowledge from the bench to the bedside and to help surrounding communities come up with strategies for prevention and treatment. (More about organizational changes at Duke to embrace Dzau’s vision here.)

Implementing the reform act, which would expand health insurance to more than 30 million uninsured Americans, is projected to cost more than $1 trillion over nine years, according to a Congressional Budget Office report. But it also promises to change an inefficient and expensive fee-for-service system in which healthcare providers are paid whether treatments work or not.

Another CBO report estimated that by 2019 reform act provisions will reduce the national deficit by up to $143 billion.

Healthcare reform aims to, for example, reduce the more than $28 billion spent every year on infections by bacteria that can be traced back to healthcare settings. Provisions in the reform act include programs to increase measuring and reporting of healthcare-associated infections, to restrict reimbursements to hospitals for HAIs and to establish financial penalties for providers with high HAI rates. (More about efforts to reduce HAIs in North Carolina hospitals here.)

Other provisions restrict reimbursements to hospitals that discharge patients too quickly and have to readmit them within 30 days of the discharge.

The reform act would also test whether healthcare costs can be reduced by bundling payments to multiple providers, from the physician who treats, say a patient being admitted for a heart attack, to the home-health nurse who makes sure the patient takes his medicines, adjusts his diet and sticks with an appropriate exercise regimen.

“It’s going to be painful,” Dzau said. But “we’ve got to get the cost down and keep the quality.”

Financially, the status quo of U.S. healthcare is no longer tenable, he said.

Private health insurers have ratcheted up copays and deductibles for years to corral payments. To deal with a drop in tax revenue and a rise in Medicaid enrollments, states have begun slashing Medicaid programs to fill budget deficits. Meanwhile, hospitals have been shifting costs from Medicare and Medicaid patients to privately insured patients to reduce losses, Dzau said.

In addition to charity care for patients who couldn’t pay, Duke reported it absorbed $62 million in losses during fiscal year 2010 because Medicaid reimburses only 60 cents for every $1 spent on patients.