A Case Study for Payment Reform

May 29, 2009
3:42 pm

Daily journalism is an exercise of trying to fit an adequate amount of necessary information into a limited space or minimal time frame, whether it be print or electronic media outlets.  Thus, when it comes to healthcare, we are given basic message points – too many people are uninsured, healthcare costs too much, the United States doesn’t get the quality patient outcomes it should for the dollars spent – without ever discussing the reasons these problems exist.

That’s why I value articles like the one Atul Gawande wrote for The New Yorker in its current issue.  We have been making the case for some time now that the payment systems used in healthcare today are not serving patients, taxpayers or the healthcare system itself well.  Paying for volume of services does not lead us to an environment in which there are genuine incentives to keep patients well and to utilize the best, most cost-effective medical practices.

Gawande took these policy notions with him on a trip to McAllen, Texas where, in 2006, Medicare spent $15,000 per beneficiary, almost double the national average.  He conducted extensive interviews and gained a greater on-the-ground understanding of why spending disparities exist, and why the number of dollars Medicare spends in a particular location doesn’t necessarily equate to better health outcomes.  It’s well worth reading.

On the bright side, Gawande also spotlights several facilities around the country, including HLC members Mayo Clinic and Marshfield Clinic that practice coordinated care, utilize best practices and achieve better patient outcomes with less spending.

A disproportionate amount of newsprint and airtime will be spent over the next few weeks on hot-button issues of health reform such as the so-called government plan option and the imposition of health coverage mandates.  Let’s hope we don’t give short shrift to one of the most critical issues of all – how we reconfigure our payment systems to ensure that the dollars we spend are yielding the best possible care for patients.

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