Decreased need for blood transfusions: bad for business but good for people

The New York Times of August 23, 2014, contains a front-page story by Matthew L. Wald with good news. The use of blood in the US has gone down, because the need has gone down significantly: a decline of almost one-third over the last five years. One big reason is that new surgical techniques, such as laparoscopy and other “minimally-invasive” methods, have replaced many of the traditional “cut someone open” surgeries, so there is thus less blood loss and less need for transfusion. The other reason is that guidelines for blood transfusion have been more standardized and made more stringent, so that only people who really need blood get it rather than it being administered “routinely” to people after certain kinds of surgery. Certainly, in my institution, the physician who is director of our blood bank keeps a close eye on transfusions being ordered for people whose blood counts are above the generally-recommended cut-offs (provided of course, that they are not actively hemorrhaging). Since blood transfusion, like any other treatment, can have negative effects (the transmission of viral diseases like Hepatitis B and C, and HIV are not very significant any more now that we can test for them, but transfusion reactions still occur, especially in those who have multiple transfusions), it is obviously a good idea to limit them to only when they are really needed. Wald notes other reasons:

…new guidelines emphasize treating patients for anemia [my note: not with transfusions but with treatments that encourage the body to make more of its own blood, such as iron] in the weeks before surgery to minimize the need for transfusions. Cancer therapies have also changed in a way that reduces transfusion needs. So has surgery: In a total hip replacement, loss of 750 milliliters of blood, about 1.5 pints, was considered standard; now it is just 200 milliliters.

So it is a little surprising that the title of the article is in the negative: “Blood industry hurt by surplus” in the print edition (a little less negative, “Blood industry shrinks as transfusions decline” in the on-line version), and much of its thrust is about how this decreased need for blood and associated pressure from its purchasers (mostly hospitals) for lower prices is leading to decreased profits, industry consolidation, and worker layoffs. I assume that (based on the fact that the on-line version is part of “Business Day”) that this is in part because it is a business article and that Mr. Wald is a business reporter, not a health reporter. I guess it is indeed too bad for the owners of the for-profit blood banks (as opposed to the non-profit American Red Cross), and it is really bad for the workers, many of whom seem to be represented by the Communication Workers of America, who are losing their jobs. But from a health point of view, the fact that people are only getting blood transfusions when they really need them, and that the frequency of that need is declining, is a very positive development.

One of the more interesting points that Wald makes is the cost of blood products:

Nonprofit organizations collect whole blood from unpaid donors, but hospitals may pay $225 to $240 a unit, according to executives in the business, which covers a variety of costs, including testing. If the unit is billed to the patient, the price can be $1,000 or more.

That’s quite the markup. The markup from unpaid donors to the cost to hospitals is in part explained by the cost “…for storage, management and inventory losses; around a million units a year are discarded, mostly because they are not used soon enough.” Fair enough; these are real costs that must be covered, and the blood banks are bearing them, and hospitals want to pay less for the blood. Less justifiable is the markup by the hospitals, from less than $250 to over $1,000 per unit of blood, although as I have often discussed, this is not atypical for hospital charges. Once again, this is an example of business interest (maximizing profit, even in non-profit hospitals) diverges from the health interest of people (to get their care at a reasonable cost).

The treatment of positive health developments as negative business developments is not new, or unique to blood banking. If more care can be safely and effectively delivered in the outpatient setting, so that hospital admissions decrease, it may be bad for hospital business but it is good for people. If cheap drugs are effective for preventing or treating serious medical conditions (like aspirin to prevent heart attack in men or stroke in women, or folic acid – a vitamin – given to pregnant women to prevent neurologic defects in babies), it may be bad for companies making more expensive drugs to do the same thing, but it is good for people. Conversely, when a previously generic and cheap drug is allowed by a glitch in federal law to be patented, it is good for business but bad for patients (this actually happened in the case of the anti-gout drug colchicine; see the April 16, 2010 guest blog by R. Steven Griffith, VISA and colchicine: maybe the banks and Pharma really ARE in it for the money!). If we have duplication (or triplication, or quadruplication, or whatever) of expensive health care services so that there are more cancer centers, or MRI machines, or transplant centers than a community needs, it may be perceived as necessary for that individual hospital to “compete” but it costs our health system (that is, us all) more money.

What is interesting about this article is the difference in how the cost of health care services are treated by a business reporter (good or bad for business) and how they are treated by a health reporter such as Elisabeth Rosenthal, whose series of NY Times articles (e.g., “The $2.7 Trillion medical bill”) extensively document the high costs and markups in health care. The question for the rest of us is what we feel is more important, business profits or quality cost-effective health care, without unnecessary markups or excessive redundancy in capacity. It is sad when jobs are eliminated because certainly our people need jobs, but that is another question.

I think I am pretty clear on where I stand.