In medical school, students spend a lot of time thinking about how to communicate with patients and incorporate shared decision-making into their treatment. The American Medical Association (AMA) believes it is time that finance becomes part of that crucial conversation.

The AMA recently adopted a new policy calling on medical schools and residency programs to include content related to healthcare economics. Under the health economics umbrella, the AMA recommends training on topics like modes of practice, cost-effective treatments and testing, practice management, and the economics of practices in various financing systems.

Wise use of limited resources

Susan Skochelak, MD, AMA’s Group Vice President for Medical Education, said physicians can no longer separate clinical care and economics. She said she remembers being a broke college student years ago and needing antibiotics. Her doctor wrote her a prescription for a $40 medication when a much cheaper option, amoxicillin, would have been just as effective.

“Doctors may not be paying attention to things that could make a huge difference to patients,” Dr Skochelak said. “They need to be trained to understand they have a role in making sure they are using resources wisely and bringing value to their patients.”

Understanding finances can help doctors who want to make a difference be part of the discussion in their own communities. They also need to place patient care into context by taking into account insurance coverage, copays, and eligibility for care such as mental health or long-term services.

“A graduating student who doesn’t know the difference between Medicare and Medicaid is not good,” she said. “They are definitely smart enough to know that, we are just not putting it in front of them.”

Creating a curriculum

To begin the process of familiarizing physicians with the financial and economic issues of patient care, AMA gave grants to 11 medical schools 5 years ago to develop curricula that incorporate instruction on these topics. Two years later, the AMA offered another round of grants and now supports 37 of the 150 medical schools nationwide in developing health sciences curricula.

With health economics training, AMA hopes to equip new doctors to provide cost-effective care and understand how the system works and impacts patients. Another objective is to help physicians understand that they have a leadership role in working with patients to select high-value care.  

“They shouldn’t just order a hundred things and think more is better,” Dr Skochelak said. “And don’t just order something without knowing the patient’s copay.”

Dr Skochelak said some students like this type of instruction and others do not. No one expects medical students to have an education in finance, but it is important they understand cost in a clinical context, she said.

“If they have an understanding around value-based care and looking at payments and payment approaches, they will have the confidence they need when trying to negotiate contracts with insurers,” she said.

Making smart choices

At the University of Michigan Medical School in Ann Arbor, students take an online course during the first year to learn about the university’s healthcare system and policies as well as various insurance options. Much of this information will help as the system moves toward value-based care, said Rosalyn Maben-Feaster, MD, assistant professor and director of the health systems science curriculum at the university.

In their fourth year, students learn about learn about cost-conscious care, a response to the American Board of Internal Medicine’s (ABIM) Choosing Wisely campaign. As part of this initiative, more than 70 medical societies have created more than 400 recommendations of tests and treatments that are overused. 

In a physician survey about unnecessary testing in healthcare, ABIM found:

  • 73% said the frequency of unnecessary tests is a problem.
  • 58% think providers are in the best position to deal with the problem.
  • 53% said they will order an unnecessary test if a patient insists.
  • 72% said the average doctor prescribes at least 1 unnecessary test each week.
  • 70% said if they tell the patient there is no need for the test, the patient typically avoids it.

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The University of Michigan health system has tried to combat unnecessary testing and other services among providers in the field. For instance, Dr Maben-Feaster said if a provider tries to order a vitamin D test, a computer alert pops up with different indications that are not appropriate for testing. It suggests that the provider prescribe vitamin D supplements instead of testing when a test will not change the outcome.

Dr Maben-Feaster said it was not until after medical school that she realized a patient’s insurance coverage or ability to pay for medications may impact a treatment plan. In today’s complex healthcare system, a patient’s drug formulary may differ each year. Something a patient was using one month may suddenly not be affordable the next.

“Doctors need to address that,” she said. “That may include talking to an insurance company or finding an alternative. But if they are not asking patients about these things, they don’t have the opportunity to help.”

Doctors can learn more about health economics by working with their billing department or their community’s social services agencies to understand external patient resources, Dr Maben-Feaster said. The AMA also has modules on health systems sciences on their website.

“The modules are well done and the people who did them are experts in those fields,” Dr Maben-Feaster said. “Those are a great way for people to get a quick overview and get some CME credit as well.”