Thursday, October 23, 2008
Share the savings
I was invited to be a panelist today at the MA Medical Society's annual leadership forum, entitled "Cost, Quality and Access, The Challenging Journey Continues." Secretary of Human Services Judy Ann Bigby provided an overview of the state's health care environment. This was followed by a national perspective from Susan Dentzer (picture above), Editor-in-Chief of Health Affairs, having joined that journal in May after ten years as the on-air health correspondent on PBS' NewsHour with Jim Lehrer. And then we heard from Elliott Fisher (also shown above), Director of the Dartmouth Institute for Health Care Policy and Clinical Practice.
There were a number of common themes between Susan and Elliott which were reminiscent of points I have heard before from other observers like Brent James. Much of this, though, is based on the actual work done by Elliott and colleagues at Dartmouth. Key points: Unnecessary variation in the delivery of health care and an inverse correlation between spending and clinical results. The "paradox of plenty", explained Elliott, suggests that those regions with more medical resources not only have higher costs, but worse technical quality; worse access to primary care; lower satisfaction with hospital care; worse communication among physicians; greater difficulty ensuring continuity; great perception of scarcity; and lower satisfaction by providers with their career.
Brent James had talked about "local medical mythology" as an explanation for the unexplained variation in medical treatment across regions. Elliott reinforced that but also tied it into the payment system by suggesting that the payment system ensures that existing capacity in a region will be fully utilized because physicians adapt to available resources with more referrals, more admissions, and more ICU stays. He advocated a reformulation of the current fee-for-service approach that would establish a target growth rate in overall health care spending and then share the savings between the insurers and the providers if the provider group achieved lower-than-expected growth in spending.
I'm sure I am not giving this all justice in this short summary, but I think you get the idea. Lots of food for thought. In particular, this shared savings approach offers an interesting alternative to the fully capitated type of plans that have recently been proposed in some forums.
Addendum: I found out they made a podcast of the panel discussion. Here it is.
Posted by Paul Levy at 10/23/2008 09:21:00 PM