McALLEN, RGV – Famed public health researcher, author and surgeon Atul Gawande is back writing about healthcare costs in McAllen again.

Six years after publishing a damning essay for The New Yorker titled “The Cost Conundrum” about McAllen physicians ordering more of almost everything – diagnostic testing, hospital admissions, procedures – for their patients, Gawande says things have improved considerably in McAllen and Hidalgo County.

Atul Gawande
Atul Gawande

Gawande is a general and endocrine surgeon at Brigham and Women’s Hospital, professor in both the Department of Health Policy and Management at the Harvard School of Public Health and the Department of Surgery at Harvard Medical School.

His new piece, also published in The New Yorker, is titled “Overkill – An avalanche of unnecessary medical care is harming patients physically and financially. What can we do about it?” In the essay, Gawande devotes more than 3,000 words to what he sees is happening in McAllen, which when he first wrote about it had some of the highest per-capita costs for Medicare in the nation.

Things are better now, Gawande writes. With the help of economist Jonathan Skinner, of the Dartmouth Institute for Health Policy and Clinical Practice, Gawande said his studies reveal that the cost of a Medicare patient has flattened across the country. In fact, he says, U.S. health-care inflation is the lowest it has been in more than 50 years.

“Most startling of all, McAllen has been changing its ways. Between 2009 and 2012, its costs dropped almost three thousand dollars per Medicare recipient. Skinner projects the total savings to taxpayers to have reached almost half a billion dollars by the end of 2014. The hope of reform had been to simply “bend the curve.” This was savings on an unprecedented scale,” Gawande writes.

Gawande gives examples of healthcare costs flattening: “In-patient hospital visits dropped by about ten per cent—and physicians reduced the mad amounts of home-health-care spending by nearly forty per cent. McAllen’s spending on ambulance rides—previously the highest in the country—dropped by almost forty per cent, too.”

Gawande said he checked in with cardiac surgeon Lester Dyke, who was the only McAllen doctor quoted directly in ‘The Cost Conundrum.” In 2009, Dyke had said: “Medicine has become a pig trough here. We took a wrong turn when doctors stopped being doctors and became businessmen.” In the new essay, Dyke tells Gawande: “The reaction here was fierce, just a tremendous amount of finger-pointing and yelling and screaming. The piece infuriated the local medical community, which felt unfairly singled out. I became persona non grata overnight.”

Gawande says the spotlight of TV crews and federal investigators made it harder for McAllen physicians to ignore evidence of unnecessary care.

“Several federal prosecutions cracked down on outright fraud. Seven doctors agreed to a twenty-eight-million-dollar settlement for taking illegal kickbacks when they referred their patients to specialty medical services. An ambulance-company owner was indicted for reporting six hundred and twenty-one ambulance rides that allegedly never happened,” Gawande writes.

“Four clinic operators were sent to jail for billing more than thirteen thousand visits and procedures under the name of a physician with dementia. The prosecutions involved only a tiny fraction of the medical community. But Dyke thought it led doctors to say to themselves, ‘Hey, we’re under the magnifying glass. We need to make sure we’re doing things strictly by the book.’”

Other healthcare specialists interviewed by Gawande for his new essay include Jose Peña, an internist who was a board member at Doctors Hospital at Renaissance in 2009, Armando Osio, a 63-year-old family physician in McAllen, Carlos Hernandez, an internist and the president of WellMed, and Dr.  Omar Gomez.

In “Overkill,” Gawande writes: “McAllen, in large part because of changes led by primary-care doctors, has gone from a cautionary tale to something more hopeful. Nationwide, the picture is changing almost as fast. Just five years after the passage of health-care reform, twenty per cent of Medicare payments are being made to physicians who have enrolled in alternative-payment programs, whether through accountable-care organizations like those in McAllen or by accepting Walmart-like packaged-price care—known as bundled payment—for spine surgery, joint surgery, and other high-cost procedures. If government targets are met, these numbers will reach thirty per cent of Medicare payments by 2016.”

Click here to read Gawande’s absorbing new essay in The New Yorker.