1. Describe how medical technologies contribute to high healthcare costs.

2. Describe connections between technological advances in care and patients’ expectations.

3. Explain how medical technologies are becoming increasingly patient-facing.

Healthcare and Technology

Learning Objectives

By the end of this chapter, you should be able to:

1. Describe how medical technologies contribute to high healthcare costs.

2. Describe connections between technological advances in care and patients’ expectations.

3. Explain how medical technologies are becoming increasingly patient-facing.

4. Discuss how medical technologies can be used to reform the U.S. healthcare system in the areas of accountability, effi ciency, and eff ectiveness.



The Double-Edged Sword of Technology: Need Versus Cost Chapter 10

Imagine entering a doctor’s office and the doctors and nurses have access to all of your previous medical records. Your waiting time is shortened, you don’t need to fill out forms, and you don’t have to explain prior hospitalizations. And should you move to a new city, your medical files will follow you there. Now imagine being able to review your lab results on your iPad at home and send electronic messages to your doctor’s office at any hour of the day. These types of interac- tions may be less common right now, but with the growth of new technologies in healthcare, they could become part of the typical healthcare experience in the United States.

Medical technologies can include a broad array of devices, instruments, or systems related to how medical knowledge is applied. Such technologies are not limited to the way we transmit health information, but can include innovative devices, such as an artificial pancreas for diabetics and brain implants for epileptics, and treatment procedures. Medical technology extends even to video games designed to hone the decision-making skills of medical students. Though varied, all of these technological innovations share the same goals: To help people stay healthy, diagnose disease, treat illness, and provide a better quality of life for patients.

Table 10.1 shows some examples of recent developments in medical technology.

Table 10.1: Examples of medical technology


Medical procedures

Medical devices

Diagnostic equipment

Information technology

Chicken pox vaccine Open-heart surgery Pacemaker MRI (magnetic resonance imaging)

Electronic health record

Viagra Arthroscopic knee surgery

Insulin infusion pump

CT (computed tomography)


Some have argued that medical technology is the most significant catalyst for change in the healthcare sector. This chapter introduces the leading medical technologies and discusses the role they play in sustaining particular aspects of the U.S. healthcare system, such as high costs, healthcare disparities, and the culture of healthcare. The chapter also describes the complexity of the advantages and disadvantages of these technologies in the ever-changing healthcare land- scape of the United States.

10.1 The Double-Edged Sword of Technology: Need Versus Cost

It is hard to deny two aspects of medical technologies: their benefits and their costs. Tied to the notion of efficiency (see Chapter 1), a healthcare system is challenged to balance the health needs of its population and the costs of providing the best healthcare services available.

The medical technology industry is one of the most profitable industries in the United States. In fact, the United States is both the largest producer of medical technologies and the biggest consumer. The U.S. market value share exceeded $110 billion in 2012, equivalent to almost 40% of the global medical technologies industry (Select USA, n.d.). According to the Department of Commerce, U.S. exports of medical technologies were valued at approximately $44.2 billion in 2012, a 7.2% increase from the previous year (Los Angeles County Medical Association, 2013).

The Double-Edged Sword of Technology: Need Versus Cost Chapter 10

One subset of this industry includes companies producing medical devices. Several of these com- panies have international reputations for their innovations and high quality standards. This can be attributed in part to the large investment in research and development (R&D), which more than doubled during the 1990s. In fact, research and development in this industry is more than double what is invested in other domestic industries.

The outcomes of these significant investments in medical technology have been credited with increasing life expectancy in the United States. Although life expectancy more than doubled between the years 1900 to 1965 due to improved sanitation, nutrition, and overall living condi- tions, increases in longevity beyond this have largely been attributed to medical technologies (Burger, Baudisch, & Vaupel, 2012).

However, the increase in longevity has come with other costs. Some have argued that one rea- son the United States has not been able to fund medical care for the entire population is the high costs associated with operating a healthcare system that is reliant on medical technologies (Chaudhry et al., 2006). In contrast, other countries with a universal healthcare system (e.g., the United Kingdom [UK] and Canada) have much tighter regulations on the use of technology in basic healthcare. These health systems use medical rationing, a process which restricts health- care goods and services based on the value they add to an additional year of an individual’s life (i.e., quality-adjusted life year). For example, in the UK, the healthcare system generally does not recommend paying for therapies that exceed more than $31,000 to $47,000 for each year of life gained (Porter, 2012). As a result, a patient might not have access to the latest (i.e., most expen- sive) therapy available. This type of rationing has been strongly criticized for “putting a price on life” and has been widely rejected by the majority of Americans. The tradeoff is that medical rationing enables the UK to offer free healthcare to all its legal residents, not simply to those who can afford it.


The Automated External Defibrillator (AED)

The idea of using electrical impulses to treat abnormal electrical activity in the heart was first conceived in the 1800s in Switzerland and was used in the United States in the early 1930s in hospital settings (Furman, 2002). However, it was the invention of the automated external defibrillator (AED) that was responsible for the gradually increasing numbers of people surviving sudden cardiac arrest. Increased portability, availability, and ease of use have made AEDs an accessible medical technology that has saved many lives.


▶ First conceived in the 1800s, the automated external defibrillator has been credited with saving many lives.


The Debate Surrounding the Latest Technologies Chapter 10

10.2 The Debate Surrounding the Latest Technologies A key aspect of the culture of healthcare—and a source of national pride—is international recog- nition that the U.S. healthcare system provides the latest and the most technologically advanced care. Tied to the ideas inherent in the biomedical model of health (see Chapter 1), medical inter- ventions are supported by technological advances in almost all areas of medicine.

Attitudes toward Medical Technologies

Patients seeking medical assistance have grown accustomed to demanding the latest treatment, which in the United States has become synonymous with the best treatment. This trend is par- ticularly true for elective (i.e., not medically necessary) surgeries where doctors compete for fee-paying patients. For example, to create a competitive advantage over other surgeons, plas- tic surgeons often boast that they use recently developed, less invasive procedures with quicker recovery times.

The use of the latest technologies also raises consumer expectations about what is possible. For example, it is now possible to have a mini “tummy tuck” (abdominoplasty) and be wearing a bikini within a week. These expectations also continue to fuel the never-ending cycle of demands for the newest technologies available, and in the end, these expectations define the standard of care as synonymous with the latest technology.

The attitude that “newest equals best” is not exclusive to elective surgeries, but occurs across the healthcare landscape. Whether the procedure is an amniocentesis for prenatal care or a coronary stent to treat heart disease, a patient is often reassured that the latest technologies are being used. For example, until recently, coronary stents were hailed for their effective treatment of heart dis- ease, but they left metal scaffolding inside arteries, which carried risks for future complications. Then a new, fully absorbable stent was developed by Abbott Laboratories. Although still in its trial stages and as yet unapproved by the FDA, soon patients undergoing this treatment will be able to request the absorbable version (Gravitz, 2009; Japsen, 2011). The U.S. healthcare culture

An AED is a portable electronic device manufactured by several different companies to immedi- ately diagnose abnormal heart rhythms and treat them through defibrillation (electrical pulses) to establish a normal rhythm. AEDs use an electronic voice to prompt users through each step. They are becoming smaller and less expensive, which makes them more readily available at public places, such as movie theaters, restaurants, and sporting events. They are often highly visible in bright colors and are often mounted in protective and alarm-activated cases near the entrance of public venues.

AEDs do not require significant training to use and have limited liability because if used correctly they cause little harm to the individual, which is particularly important in a litigious society such as the United States. AED use is taught in most first-aid and CPR classes. As such, the AED is relatively easy to operate and volunteer responders who use them are protected in most states under Good Samaritan laws, which protect individuals who are not using the device as a part of their occupa- tion. These “good Samaritans” cannot be held civilly liable for the harm or death of a victim by pro- viding improper care (National Council of State Legislatures [NCSL], 2013).

The Debate Surrounding the Latest Technologies Chapter 10

will probably endorse this product as superior to its metal predecessor given that it uses the “lat- est” technology.

However, questions emerge: Is the newest technology always the best? Or is a less technological intervention more beneficial at times? Clearly, the answer to these questions varies case-by-case. Yet some have argued that the idea of the newest always equating to the best might be a danger- ous assumption to apply universally.

Childbirth is often used as an example to demonstrate the value of less technology. As Chapter 1 discusses, the United States has one of the highest infant mortality rates among industrialized nations and also employs the most medical technology during childbirth. The ensuing argument is that the use of technology—in the form of medical interventions such as C-sections and the induction of labor through medication and pain relief—has actually led to worse health outcomes for mother and child. The medicalized nature of childbirth in the United States is often compared to other industrialized countries, where medical technology is reserved for medical complica- tions, rather than used as the standard for childbirth.

Insurance Coverage and Consumer Disregard for Cost

One reason for the use and possible overuse of some technologies has been attributed to consum- ers’ and providers’ disregard for the high costs of technology. Patients who have private insurance are particularly disconnected from the cost of technology as part of their overall healthcare. Policymakers have concluded that as long as a third party pays (i.e., nei- ther the provider nor patient), patients have little motivation to care about the specific costs involved. Furthermore, until lately, there have been few checks and balances to determine if certain high-cost technologies are even medically necessary.

For example, a privately insured patient generally receives a bill from the physician that lists only the total dollar amount owed. The statement might contain a few words of explanation, but it is rarely itemized. The insurance company sends the patient an explanation of benefits (EOB), which also does not have any itemized information. Instead, the statement explains the amount the insurance paid to the treating physician relative to the amount billed and then lists any applied discounts, outstanding balances, co-payments or coinsurances. The EOB also might note what portion of the annual deductible the patient has met so far. Therefore, for most patients, it is relatively irrelevant what the physician charged for the use of a certain technology as long as it does not affect the standard rate of co-pay or coinsurance.

Beyond the third-payer system, a lack of transparency in the cost of healthcare also explains the sustained absence of patient and provider accountability. Studies have shown that even if patients


▲ Patients who have private insurance are often disconnected from the cost of healthcare technology as they rarely see exactly what they are paying for.

Patient-Facing Technology Chapter 10

were made aware of the specific costs associated with high-tech procedures, it would not affect their decision to proceed with treatment. (See the section, Healthcare as an industry, in Chapter 1.) If a third party continues to bear the costs of technology and perpetuate a lack of transparency in prices, patients and providers will continue to be indifferent to the high costs of technology and have little incentive to refrain from using technologies to the highest degree.

10.3 Patient-Facing Technology Much of the system’s reliance on technology can be explained by U.S. consumer demand, as well as the consumer-driven culture of healthcare. Patient-facing technology is a broadly defined term that encompasses policies, processes, or procedures controlled or supported by a healthcare organization that facilitate the access to and use of health information by individuals, family mem-

bers, and other proxies. One of the goals of such technologies is to support direct inter- actions with customers. Given the high economic input, it is no surprise that high- tech procedures are more readily available in the United States than in most other countries. Per person, the United States has the largest number of high-tech equipment, such as magnetic resonance imaging (MRI) and computed tomography (CT) scanners, of any country (Farrell et al., 2008). Other countries, such as Canada, limit providers’ use of technology by requiring that patients wait for complex procedures (Wait Time Alliance [WTA], 2013).

In contrast, the expansion of the health- tech industry in the United States is with- out economic limits, largely because of

the increased spending on research and development (R&D) and the guaranteed returns on the investment given the demand. Another unique feature of U.S. technology is that the majority of medical technology R&D is privately funded. As a result, R&D spending in the United States exceeds any other country both on a per-person basis and as a percentage of total healthcare expenditures (Dorsey et al., 2010). As Chapter 1 discusses, the health outcomes are not com- mensurate with this investment. Increasing evidence supports a lack of correlation between posi- tive health outcomes and expensive procedures (Skinner, Chandra, Goodman, & Fisher, 2009; Skinner, Staiger, & Fisher, 2006).

These studies suggest that relatively low-cost preventive healthcare is not evenly available across different populations, thus high-cost procedures at late stages are often not effective. Policymakers and physicians alike conclude that lower-cost healthcare often results in better health outcomes (Skinner et al., 2009). Nonetheless, technology continues to have a sizeable direct impact on the everyday lives of patients. The following sections discuss some of the technologies that directly affect patient health.


▲ The majority of medical research and development in the United States is privately funded.

Patient-Facing Technology Chapter 10

Online Ability to “Shop Before You Buy”

A growing number of Americans use the Internet as a primary source for healthcare informa- tion. Websites such as WebMD and the Mayo Clinic provide succinct and accessible informa- tion about both common and rare conditions, including symptoms, diagnoses, and treatment. WebMD recently added a new feature known as the “symptom checker,” which matches a disease and its most likely symptoms (WebMD, n.d.). In fact, one recent study found that more than three-quarters of all Americans use online information to make healthcare decisions (Fox, 2013). Doctors themselves increasingly use the Internet to obtain medical information and prescribing data (Chan, 2011).

Levels of patient education and literacy are also unprecedented. Largely attributed to global- ization, medical information and products can be shared easily across space and time. That is, regardless of location, an Internet connection affords direct access to scientific knowledge and an awareness of the latest medical technologies. This type of access includes everything from “infor- mational, educational, and commercial ‘products’ to direct services offered by professionals, non- professionals, businesses or consumers themselves” (Maheu, Whitten, & Allen, 2001, p. 1).

Online health management has become part of the American healthcare culture as medicine has become more patient-centered. That is, patients are now more active participants in their own healthcare. Self-advocacy has developed into an important societal norm. Patients have the necessary tools to become empowered partners with health professionals in their own health management. This trend directly contrasts earlier decades, when patients were passive recipients of care.

Some have argued that patients’ ability to “shop” before they buy will lead to a more efficient healthcare system. Although not everyone can afford to seek preventive healthcare in the United States, the Internet theoretically can level the playing field through equal access to information. However, it also has the potential to produce inaccurate self-diagnoses or act as a substitute for proper medical care.

Point-of-Care Technologies

Simple technologies, such as portable glucose meters, blood pressure machines, and home preg- nancy tests, have made significant differences in people’s lives. For example, someone diagnosed with diabetes may purchase a portable glucose meter that most likely will be covered by pri- vate insurance, Medicaid, or Medicare. Over time the demand for these simple technologies has reduced their cost and made them more accessible, even commonplace.

In fact, in the mid-1980s the first blood glucose meters represented an important milestone in technology and subsequently led the way for further development of other point-of-care testing (POCT). POCT technologies allow patients to test their own vital signs and immediately com- municate them to a healthcare professional at a remote location (Clarke & Foster, 2012). Prior to the development of POCTs, diabetics had to visit a doctor’s office to test their glucose levels. With the advent of the portable glucose meter, managing diabetes became more efficient. The same is true for the first home pregnancy test, introduced in 1978 (National Institutes of Health [NIH], n.d.-d). This not only changed the way women experienced the news of being pregnant, but also facilitated earlier prenatal care.

Health System Change and Technology Chapter 10

Blood-pressure machines are one of the oldest POCTs (beginning in the 1940s) and have become significantly more user-friendly and effective (Pickering, 1992). For instance, an Apple product known as the iHealth Wireless Blood Pressure Wrist Monitor can be used in conjunction with an iPod, iPad, or iPhone to track blood pressure (Apple, 2013). The product advertises that with “the free iHealth app, you can measure and track your systolic/diastolic numbers, heart rate, pulse wave, and measurement time” (Apple, 2013, para. 1).

All of these simple technologies increase the likelihood that the patient, physician, and care team receive almost immediate results. In addition, the simple design of these products allows self-administration: No health professional is required. The end product is more efficient healthcare.

10.4 Health System Change and Technology In terms of patient care, technology has undoubtedly been a significant driver of change. It also has been credited as one of the primary causes of the high costs of healthcare. Many policymak- ers recognize the need to manage the growth of health technology in the United States. At the core of this call for a system change is redefining the role of technology and determining when it is medically necessary. The aim is also to employ technologies selectively, so that the healthcare system may function more effectively, efficiently, and equitably.

Ensuring Greater Accountability

At the center of this debate is the question of how to promote greater accountability when employing technology (Shortell & Casalino, 2008). That is, how can the healthcare system be revised to make patients, doctors, hospitals, and insurers more responsible for the costs of tech- nology? Policymakers have proposed several intervent