Regardless of what you think about the Affordable Care Act (ACA), also called Obama Care, the delivery of healthcare in the U.S. needs a major overhaul. The focus should be on patients and on high value healthcare. That means doing what it takes to get better outcomes, better safety, better service at lower overall costs — a focus on value, not on volume.
The ACA has taken a step in this direction, but additional changes are needed to make healthcare more effective and economically sustainable in the U.S.
The present system is not sustainable. For example, U.S. federal spending on healthcare has risen from 5 percent in 1970 to 23 percent in 2010.
Moreover, the U.S. spends more than 17 percent of its total gross domestic product on healthcare – nearly twice as much as any other nation. For this level of spending there is significant variability throughout the country in value (results of care vs. spending).
In order to change this, at least three things need to happen: patients and payers must pay for value; all citizens should own their own health insurance; incentives for greater integration and coordination among providers and payers are needed.
Pay for value
If we agree that we want better results at lower overall healthcare spending we need to begin with a pay-for-value model that can drive the way healthcare is delivered in the U.S. Valuable healthcare is healthcare that provides better outcomes, better safety and better service while using fewer resources. Today, in the U.S. this is not the case. Two examples: Medicare while it will pay for certain levels of skilled nursing care for limited time spans, it currently does not routinely pay for ongoing nurse provided care that might help patients with chronic conditions avoid a visit to a doctor, and emergency room, or a hospital admission over longer time spans.
Medicaid and most commercial insurance payers will not pay nurses or health aides, or community workers interacting with patients with chronic conditions. Unfortunately, under the current payment model of fee for service, providers get much more money if they wait for the patients to get sick, or visit the emergency room, or get admitted to a hospital. Overall, home or workplace based healthcare services are usually not covered, so even if the best way to care for a particular patient is to provide care wherever the patient is located at a given time of the day, it is not encouraged by the present payment models.
We must start paying for value not just for services, and Medicare needs to be the driving force in making paying for value an accepted practice. The best way to start is to increasingly pay providers a bundled payment for all medical services related to a patient condition rather than paying piecemeal for each service (e.g. for each office visit, lab test, each x-ray, etc.). Then the incentive would be to get it right the first time and be as efficient as possible doing so.
Insurance for all
The ACA, if it attains its goal of getting more people insured, is a step in the right direction. But any long lasting policy must allow individuals to own their insurance and have the means to choose appropriate levels of medical care. Of this, there are two key components – consumer choice and consumer involvement.
Choice refers to giving the consumer different options from which to choose. It allows them to be the consumers of healthcare services and be involved in making those critical decisions.
Consumer involvement means patients would bear responsibility for things they can help control. It could mean premiums might be lowered according to whether the consumer is following healthy lifestyles and chronic disease treatment plans. On the other hand, consumers who smoke, are overweight, have high blood pressure or high cholesterol, and chose not to change their behaviors might pay higher premiums.
Integration and coordination
Care and information must be integrated into all services, creating a seamless personalized experience for patients and providers. Integrated delivery systems exhibit higher quality and better cost-containment.
When taken as a whole, these modifications should be relatively painless for the consumer. What the consumer will notice is better delivery of care and fewer visits to the hospital or clinic. Quality of life will improve as a result.
Dr. Denis Cortese, MD, is director of Arizona State University’s Healthcare Delivery and Policy Program and former CEO of Mayo Clinic. Robert Smoldt is the associate director of ASU’s Healthcare Delivery and Policy Program. They recently published the “Roadmap to High Value Healthcare.” For more information, visit evtnow.com/4y4. [Cortese photo by Donald Graham; Smoldt photo courtesy ASU]