The current debate about healthcare reform in America is fundamentally flawed. A new government sponsored health plan or a new tax to pay for reform will do little to make high quality healthcare more affordable for more people. Unless we get serious about changing the way we deliver healthcare and the way we pay for care, costs will only continue to escalate exponentially.
The way we deliver care today is inefficient and wasteful. The Institute for Health Care Improvement estimates that 30-50 percent of the healthcare services do nothing to improve patient care. The Dartmouth Atlas of healthcare has revealed that the communities with the highest healthcare spending do not have better quality than communities that spend half as much.
The way we now pay for care rewards hospitals and physicians for providing ever more expensive procedures, with little attention to the quality and outcomes. The current payment system actually penalizes providers who improve quality, lower costs, and keep people healthy.
Learn on-demand, earn credit, find products and solutions. Get Started >>
To find the money to pay for reform, we need to focus on where the most money is being spent and wasted – the delivery of care.
The alternative to massive tax increases and further provider reimbursement cuts is a concerted effort to take waste and inefficiency out of the existing care delivery system. Examples of waste include medication errors, post-operative infections, over utilization and over capacity.
ThedaCare, an integrated healthcare system with four hospitals and 27 physician clinics in Northeastern Wisconsin, has radically redesigned patient care. Using quality improvement tools adapted from manufacturing, ThedaCare has reduced the total cost of inpatient care by 25 percent, improved quality and increased patient satisfaction.
Gunderson Lutheran, a multi-specialty clinic and hospital system in La Crosse, Wis. has had similar success. Healthcare costs for Medicare beneficiaries during their last two years of life were half the national average, according to Dartmouth Atlas data.
These real life examples can add to real dollars saved. If all Medicare patients were treated at Gunderson in La Crosse, it could generate annual savings of $200 billion or nearly $2 trillion in savings over 10 years.
Changing Medicare rules takes an act of Congress, which rarely happens. If we must have another federal insurance program like Medicare, how do we design it so that fatal flaws hampering Medicare aren’t repeated?
• Pay for healthcare services based on the provider’s ability to improve quality, reduce costs and improve access.
• Improve the efficiency of the current delivery system by encouraging the use of improvement methods such as Lean.
• Ensure that healthcare cost, quality and value data is transparent and local.
• Allow states to implement reform plans that make sense for their citizens. States like Massachusetts and Wisconsin, which have programs that cover nearly 100 percent of their residents, should be allowed to continue with their statewide plans.
NOW IS THE TIME
Many of us in the healthcare industry agree that now is the time for healthcare reform. ThedaCare, Gunderson Lutheran and 13 other healthcare delivery organizations in the U.S. and Canada have come together to accelerate and spread our learning on delivering better patient value.
The new debate regarding healthcare reform in America should be about encouraging provider competition based on who can provide the best healthcare outcomes for the population in the most cost efficient manner. The structure and incentives in our current “illness care system” must be changed to reward physicians and hospitals that reduce waste and improve quality.
John Toussaint, MD, is president of the ThedaCare Center for Healthcare Value. Dan Ariens is president of Ariens, Inc.