Category Healthcare
SUB CATEGORIES General  |  HIV |  Medical Schemes | 

Innovation a critical part of the healthcare industry, but could push prices out of proportion

06 March 2018 Graham Anderson, Profmed
Graham Anderson, CEO of Profmed.

Graham Anderson, CEO of Profmed.

Innovation is an essential part of improving the healthcare industry. However, with innovation comes the unavoidable hike in prices that has the potential of placing health insurance just out of reach of those who need it the most.

Graham Anderson, Chief Executive Officer of Profmed, believes regulation can ensure the perfect balance between introducing innovation into the healthcare industry while keeping prices at bay.

“Healthcare can ill afford to stand still in terms of innovation. However, the problem with new technology and modalities is that it can be rather expensive to use. If these expensive modalities come out and are routinely used, they can push medical aid costs out of proportion. We need to be careful and selective in when to use new modalities, and strict protocols must be put in place to ensure costs don’t run rampant,” Anderson explains.

The dilemma facing the industry at the moment is that while these new modalities are expensive, they provide patients with a safer and more effective solution than most conventional methods currently in use.

One of the latest modalities that have come out in the health industry is the Transcatheter Aortic Valve Implantation, or more commonly known as a TAVI. Anderson explains that before TAVI became available, in order for doctors to replace a patient’s faulty heart valve, they had to cut open the patient’s sternum to access the heart.

“It would take weeks or even months for the patient to fully recover from such a serious operation. With TAVI, doctors are able to gain access to the heart through the aorta and the patient is able to be discharged from the hospital within a day. This pushes the costs up significantly, but it saves the patient from having such an intense operation and a long hospital stay,” he says.

Anderson explains that Computerised Tomography (CT) scans were arguably the greatest innovation in radiology. “When it first became available in South Arica, the radiology department assured the medical aid industry that due to the medical criteria, protocols, and costs involved, they wouldn’t do more than seven scans a day. However, very soon they were doing up to 25 scans a day. Doctors didn’t want to look at black and white X-rays anymore - CT scans just became the norm,” explains Anderson.

The Magnetic Resonance Imaging (MRI) scan was another new modality that completely changed the entire healthcare industry. “As with CT scans, doctors assured the medical aid industry that they wouldn’t utilise the MRI scans too often as to keep costs down. However, this was not the case because the imagery you receive with an MRI scan, enables doctors to help identify any issues that could have been missed with the other scans or X-rays,” he says.

Another example of how an expensive innovation can completely change the healthcare industry is biological drugs. Manufactured in factories, these drugs are extracted from biological sources. They can be used for vaccines, blood plasma, allergenics and other life-saving treatments.

“Unfortunately, biological drugs are extremely expensive. For example, to treat autoimmune diseases and many forms of cancer, medication could cost patients up to R50,000 a month. Unlike chemically manufactured drugs, biological drugs don’t have cheaper generic versions available that are identical in every way. This is because you can easily copy a chemical compound, but not an organism. These are known as biosimilars - while cheaper, they can never be the same as the biological drugs,” clarifies Anderson.

Recently, there has been a remarkable breakthrough with regards to male prostatectomy. The Da Vinci Surgical System is a new electronic modality of removing the prostate which has far fewer side-effects than more conventional modalities.

“While it has great health benefits for patients, it will cost them. The old way of removing a prostate would cost you in the region of R65,000 whereas the Da Vinci method will cost you anything between R120,000 and R130,000. Doctors are now looking to use the Da Vinci machine to remove tonsils, which used to be a simple and cheap operation. With the Da Vinci machine, some patients might not be able afford these types of procedures,” he says.

Anderson stresses that regulation should enable medical practitioners to be more selective in utilising the new modalities. For example, doctors should only perform a TAVI on a patient who isn’t medically capable of undergoing a major surgery on their chest.

“When new modalities are introduced at conferences, doctors learn how to utilise these new procedures and suddenly they only want to use them on all their patients. This isn’t the ideal way of doing things. On average, medical aid costs increase by approximately 3% to 4% above inflation every year. Once you start introducing these new expensive machines, you run the risk of putting medical aid care out of reach for most people,” he concludes.

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