There is growing evidence that the healthcare system in the United States is not providing the services appropriate to a society with advanced economic development, and that the services being provided are far more expensive for their value than those in other developed countries. There is even some limited evidence that the federal government is aware of this. Over the last two decades many books have been published addressing the problem:
https://www.redoxengine.com/blog/70-healthcare-books/ which include: The Price We Pay: What Broke American Health Care--and How to Fix It The Healing of America: A Global Quest for Better, Cheaper, and Fairer Health Care An American Sickness: How Healthcare Became Big Business and How You Can Take It Back and others. Each author focuses on a different aspect of the problem, not the complex system that must be modified.
Despite claims to the contrary, by many measures the US healthcare system is not the best in the world, and a higher percentage of Americans are dissatisfied with their system than are the citizens of other developed economies. The factors that contribute to this dissatisfaction are:
1) uncovered lives. Over 40% of Americans are not covered by health insurance at the present time, and a significant number of the other 60% feel that the amount they are paying is more than they can afford. And this problem is intensified by businesses trying to shift more of this cost onto workers.
2) Excessive costs per capita: This brings up the next issue: the cost of US Health services, even given the limited % of insurance covered lives, is higher than in any other developed country. Either Americans are much sicker people than other countries citizens, which seems doubtful from our shared genetic roots, or our healthcare system is not efficient at delivering the necessary services and avoiding unnecessary ones.
3) Poor overall outcomes: Evidence that the higher cost is not delivering superior care comes from outcome data: overall mortality, infant deathrate, and other measures of overall care are worse in the US than other developed countries and even worse than some developing countries. So clearly the increased costs are not buying better “health” as measured by overall statistics of the population. So what are they buying?
4) Uneven distribution of care: The delivery of services is disastrously uneven. Over 30% of Medicare dollars are spent in the last month of life. There are major inequities in the differential of delivery between richer and poorer patients, urban vs. rural patients, and an excess of services are delivered to “well insured” patients.
It is necessary to define the problem in systems terms and then develop the appropriate solutions.
What is the goal (the “mission statement”) of the healthcare system?
To provide healthcare to the largest percentage of the population possible while keeping costs as low as possible and ensure that the maximum number of citizens are capable of productive service to the society.
Instead, the current healthcare system operates with an “apparent mission statement”: To provide healthcare services in proportion to the available payment, to ensure that providers and suppliers of materials get the best possible chance for income, to maximize cost controls by agencies not directly involved in care, and to make every effort to ensure entry into life, and prolong death, for those who can afford to pay, for as long as possible. An important difference is the goal of “productivity”, vs “prolongation of death”. The latter goal makes sense in a for profit model, though often held up as a “moral imperative”. Unless this fundamental issue is addressed in any system of funding delivery of services, no real change in the care system will occur.
In countries with single payer systems, an implicit triage principle occurs. Those with very high income have a separate healthcare delivery option which ignores goals of the primary system. This division raises moral issues for the society, but takes some burdens off the cost of healthcare for the general society. The opportunity to waste personal funds to those who are so inclined, supports a special group of providers.
The healthcare system/process should keep the members of the society functioning as effectively as possible. Persons with less ability to participate (on health basis) will have fewer services, and those about to die (and no longer contributing) will have very few. This is rationing services, not correlated with the socio-economic status of the individuals. It has moral implications for the society. The goal of “eliminating illness” applies to certain controllable problems which are almost always related to public health or sanitation issues, including the use of vaccines. The current healthcare system fails to achieve this goal in several ways: 1) a disproportionate amount of care is delivered to elderly with limited productive capacity, for example data (several years ago) that 30% of Medicare was spent in the last month of life, unlikely to be productive. 2) emphasis on treatments that affect the quality of life but not productivity have an excessive role; 3) mental health and addictive disorder disability have an enormous impact on productivity, but are not effectively addressed or funded (mostly considered, in effect, untreatable).
In order to achieve this goal there must be appropriate distribution of healthcare services. The number of providers and institutions for delivery of services must reflect the population, its age, and likely illness, and must be adjusted as these change. It is especially important to avoid over-concentration of services in locations where providers are trained and in regions that have high socio-economic status. The compensation of providers must be adjusted to reflect the relative desirability and challenges of delivering services in different regions. (This is less of a problem in a smaller country like England, than in a larger one like US, or Canada.) Organizing delivery of services by simple fee-for-service and/or for-profit corporate management are both inadequate to meet these objectives. Simple fee-for-service badly skews services toward affluent users, and corporate management exaggerates this problem by emphasizing employer based coverage and cost control decisions about funding. Associating healthcare with employment is consistent with the goal of productivity, but complications arise when the benefits become part of labor negotiations. And loss of healthcare with injury or disability prevents recovery of employ-ability and productivity. Healthcare insurance, corporate or individual, manages demand for services, cost of services, and providers income, proportional to services delivered (though very different for different classes of providers). The variable or increased demands by users are not easily adjusted by closed systems, and relatively inflexible. A series of corporate interventions which claimed to be addressing these issues have not succeeded in regulating care or costs. Concerns about the cost of current healthcare in the US come from insurers or care providers, and individuals charged dramatically increased premiums. The statistic usually stated is the cost per capita where the US is about one third more than the next country. (https://www.statista.com/statistics/236541/per-capita-health-expenditure-by-country/) "Managed care corporations" were created to address cost containment by insurers without a clear mandate about which costs and how to accomplish their goal. How to differentiate the costs of increased number of users, increased cost per user, and increased cost of service provided remains challenging.
When talking about who pays for healthcare, people sometimes lose sight
of the economic reality that the society as a whole always pays for all the healthcare. It
is an economic allocation of resources to a sector, that may have a
multiplier effects to other sectors as well. That is why productivity is what
matters to the society. Individuals amy make
decisions to behave in ways and use resources for personal life enhancement.
The two sometimes overlap, but not always. The healthcare debate is
always about how the payments are divided up between members of the
population, and how much each individual can claim in return. That is
why middle and upper class payors always want less coverage for the
poorer members. They are paying the costs, whether in increased
insurance costs or through taxation in a single payor. In the US this
has now reached the point of measurable deterioration of care in
healthcare statistics, etc. but is being challenged by Obamacare.
The statistical data quoted might reflect a higher percentage of the population using services, or higher costs of the services provided, or both. The higher costs of medications in US, even compared to neighbors like Canada, and the higher cost of health services and procedures in US, are both important contributors to the extra cost. The "managed care" solution had limited ability to address either of these issues, and could only limit delivery of services, resulting in social and legal backlash, And did not reduce costs significantly.
The development of “managed care” in the 90s was an effort by insurance carriers to provide a system for reducing the overall number of healthcare events, and per event costs. It was a clear statement that providers were not motivated to reduce the numbers of events, which will be discussed next. Initially, this process was successful in reducing the numbers of events, but it has lost effectiveness for several reasons: 1) it has no impact on uninsured events. This problem is now being taken up by states who are hiring managed care companies to address the utilization in Medicaid delivery of services. 2) The return to the companies diminishes with their effectiveness. Bonuses that come from decreasing the number events eventually hit an asymptote that results from the absolute number of events needed for care of ongoing health problems. Reducing necessary events leads to increased liability, and eventually lawsuits with significant economic penalties. As this process has taken root (it was intensively opposed in the courts for years), the result is the direct competition between the profit motive and health service goals. 3) Increased costs are incurred in the system by the administrative and management costs of an additional layer of management which must be included in the overall cost of healthcare. Future healthcare delivery must control the management costs.
The Kaiser-Permanente solution was merging the insurer and provider organizations into a combined healthcare system. Large provider corporations have subsequently taken over much of the healthcare delivery in the US. These corporations purchase provider practices, and create exclusive relationships with insurers (or merge with them) to control provider costs. Overall costs have not gone down in private for-profit versions of K-P! The money saved from lower level workers and providers is appropriated by senior management, and paid to shareholders for stock price enhancement. So there is no reduction in healthcare cost. Lowering payment to providers sometimes results in compromised services, and closure of low profit hospitals. None of these corporate changes have any commitment or financial benefit from public health measures, which was painfully obvious during the Covid crises when the demand for hospital services were overwhelming, and the costs remain unresolved. There is no evidence that the for-profit motivation in corporate management does anything to improve the quality of care or reduce the overall costs over time. Corporatization of health care delivery is driven entirely by profit motivation. This is especially true where the services provided are chosen to be the most expensive, as in cardiac surgery. The American experiment in for profit corporate organization of healthcare has been a total failure for patients, providers, and insurers. Only the senior management of the corporation and stockholders have benefited. ANY healthcare system which is primarily driven by private enterprise capitalism favors profit returns over healthcare statistics and will not extend to covered lives unless a profitable funding source is attached. This does not mean that a multi-payer system cannot work, but it does mean that some way to prioritize service delivery over return on investment must be included or the priorities will never be aligned with the needs of patients.
This would be publicly recognized and government regulation instituted if it weren't for the major lobbying of this industry, several members of congress were the heads of corporate healthcare companies. If the current corporate system were instantly removed, US healthcare would collapse. The apparent exception is the Kaiser-Permanente system, a corporate entity that merges payor and providers relatively successfully because Kaiser is a non-profit entity. No excess funds are extracted from the care system for stockholders. The lesson from these experiments is that some regulation of delivery of services is necessary, but for-profit entities, motivated by other corporate goals than the overall delivery of healthcare, are not cannot provide it. Recent debates on the healthcare situation in America have made the issue “single payer” vs “free choice”, as if configuring the system one way or the other will somehow magically solve the many problems of the current system. This places the debate in a politically divisive issue without solving the basic problems. The solution has several elements: 1) The metric of healthcare system performance must be the productivity of the members enrolled, regularly measured publicly available data. Quality of services, fairness of delivery, and overall satisfaction are secondary considerations. 2) Cost containment is necessary. Delivery of services must be regulated by amounts, providers, and location.
Providers are not motivated for cost containment and should not be expected to be the controllers. The simplest model, provider control of the delivery of events, only performing those needed for patients, has clearly not worked. Ignoring the fraudulent claims for services, which are a significant drain on the system, there is still clear evidence that unnecessary events were and are being delivered. Most providers dispute this on the basis of two sorts of concerns: events are needed to protect providers from liability concerns of malpractice, which are not deemed necessary by managed care companies, and providers and some consumers determine the quality of services by the frequency of contacts not the outcome. Users are variable in expectation of services, and comparison shopping of quality is almost impossible for consumers, especially in crisis situations.
Some component external to the delivery system must evaluate the two factors and regulate performance of providers. Two different models can be defined: A) in the single payer model (government or other) there is one countrywide regulator to which users pay an annual fee. This entity sets standards for services based on annual experience. This is the Medicare model and numerous problems in fraud, government administration, and political intervention have plagued this system. B) Several regional non-profit entities (similar to the airline system, but non-profit) receive payments and negotiate or integrate with provider entities to lower cost of services. This creates a competitive model for quality and control, but the overall costs of administration are higher. A separate requirement is needed for public health services, and these may be included by providers as they are in some countries, or provided by government entities. The US is slowly moving toward the multi-component model, but for-profit corporations are dominating the system and this must be regulated or challenged.
Providers include more than the physician/nurse/specialist individual service providers and the aggregate corporations that contain them. It also includes a large number of institutional providers, hospitals, nursing homes, specialty care facilities, which provide structure for delivery of services which cannot be delivered on an ambulatory basis (ie, some surgery). The factors impacting costs in these institutions is even more complex than the problems in regulation of individual service providers. And therefore the task of reducing events and the cost of events is more complex. To the extent that such institutions compete with each other, their attempts to improve services and maximize quality of event delivery are good for the consumer. But when competition leads to decreased occupancy in the competing facilities, it contributes to increased costs of delivery. This can only be controlled by regulating the overall number of facilities in a given area, a process that is partially managed by the Certificate of Need process for hospitals but not for other facilities. The other conundrum of institutional care that has emerged in recent years is the competitive negotiation over managed care contracts. As large institutional provider systems have emerged in metropolitan areas, it has been possible for them to negotiate on a relatively equal basis with managed care organizations with the potential to refuse care to the patients covered under the managed care contract if a desired rate is not obtained per service. This results in improved income for institutions but limits the effective control of costs by the managed care mechanism, or at least converts it into another form of bargaining with the patient group in the middle.
A complicating factor in cost containment is the role of healthcare in the overall American GDP. A chart shows that US is on the high side of both per capita and percentage of GDP spending on healthcare. (https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries/) What is not stated in this is the important economic role in the overall economy of hospitals, providers, drug companies, medical equipment companies, and the rest of the industry. A sudden reduction of cost containment of 5% would certainly put the economy in recession! So no political entity will enact rapid changes to challenge the overall costs!
After considering the contribution of providers to the number and expense of healthcare events, another contributor is the cost of pharmaceuticals. There is a strongly market driven presumption that the newest and most expensive drugs and technologies are better than older ones, and patent protection of new products, allows pricing for maimum return over 17 years. This drives a constant pressure for use of the most expensive products for treatment. These products are not competitive with prices in the rest of the world, and recently the FDA has blocked the importation of less expensively priced versions of the same drugs from Canada and Mexico, despite any evidence that the agencies of these countries are not any more lax than the FDA in examining the products they regulate. Just because a pharmaceutical company can demonstrate efficacy of a new product, there is no assurance that it is more effective in comparison with already available agents, and there is no basis for concluding that it is more cost effective. The tendency for pharmaceutical companies to develop drugs for common diseases in competition with other already available drugs only magnifies this.
A similar issue can be found in the use of biotech components and procedures. Newer high tech scanning technologies are much more sensitive than older techniques, but they are vastly more expensive and institutions are attempting to amortize them more quickly due to the likelihood of becoming obsolete more quickly. The same is true for new high tech surgical procedures, etc. There is no doubt that many of these new techniques are more effective, but the costs of upgrading healthcare delivery are substantial and must be carefully controlled both in time and spatial distribution or they become an unjustified additional cost to the system. An example can be seen in the situation of coronary catheterization procedures. These are very lucrative both for the practitioner and the institution in which they are performed. So many facilities have been set up to do procedures, with a substantial setup cost, creating increased demand for their performance. How often are procedures done on questionable indication? Who would have the authority to evaluate this?
There is the issue of indigent care. Institutions that are required to deliver care to uninsured incur an unreimbursed costs that must be shifted to other payors somehow. As a higher percentage of the society becomes insured, this cost goes down, as in the impetus for “Obamacare” or vice versa. Some institutions get around this by defining their role in a manner that avoids any responsibility for such care. Which reduces their unreimbursed services at the cost of transferring it to other facilities. So this solution, while economically favorable to the involved facilities, is not a workable solution for the society.
In order to discuss the process of controlling healthcare costs in any system of delivery, it is helpful to consider a “healthcare event”: this is any instance in which a healthcare service is delivered and a cost incurred by the system. To lower the cost of healthcare, the system must reduce the cost of events, by either decreasing the number of events, reducing the cost per event, decreasing the number of “very expensive events”, or some combination of each. This leads naturally to: How to reduce the number of events? How to reduce the cost of each event? Four distinct types of healthcare event can be distinguished, which are not currently effectively differentiated in payment plans:
“Routine Healthcare events" (RHCE) include vaccination for children, screening for cancer, hypertension, diabetes, and cholesterol screening, along with other known treatable diseases, and a number of other visits for minor recurring problems seen in the majority of the population (e.g. minor cut requiring sutures, sinus infection, etc.). These events are a significant component of healthcare services, they are not insurable as unpredictable low incident risk to be distributed across a population. The evidence that screening procedures lower the overall cost of delivering care once the illnesses are diagnosed is not supported by studies in managed care companies. RHCE fall most clearly under the “public health” rubric and some of these services are delivered in this manner in the U.S., e.g. tb screening. Most are delivered in a mix of public health clinics, family practice and pediatric offices, and specialty care facilities. More efficient and cost saving delivery can be effected if a serious commitment to public health care were to develop in this country. Recent experiments in locating service delivery for these services in drug stores and supermarkets show a positive trend, but the regulation of such delivery methods is not yet in place.
“Insurable Healthcare Events” (IHCE) are those events with a low enough rate in the whole population to allow for risk and cost distribution to be spread across a group in insurance risk models. In such events, the larger the paid group, the lower the overall event cost per person (but the actual event cost is not a function of group size except when economies of scale are achievable in delivery of services). In this group, we also find the routine trauma of auto accidents, stabbings, and other events of the routine urban emergency room. From an insurance perspective, only the IHCE are appropriate for insurable coverage. Expanding coverage to all members of the society will increase the total number of IHCEs per unit time, and cost control depends upon attention to the specific costs of delivery of the unit service.
“Exceptional Healthcare Events” (XHCE) are those events for selected patients (usually a small number) which incur extraordinary costs. This would include neonatal intensive care services for premature babies, coma care for severe head trauma, and life support for brain dead, or severely compromised end-of-life patients. The high percentage of Medicare costs utilized in the last month of life certainly attests to the delivery of this sort of service, though it is only in retrospect that the practitioner can often tell that it was “the last month of life”. These events while rare for the society as a whole, impose a significant percentage of healthcare event costs, but attempting to limit them comes squarely into confrontation with social and moral questions of the sanctity of life and when to discontinue expenditure and delivery of healthcare events. XHCEs pose a special problem in cost control. Almost by definition, these events deal with the decision to preserve life or not. Thus the decision to withhold services amounts to a decision to allow death, a moral act in our society. Litigation over the payment for bone marrow transplant and other cancer treatments have already begun to address this complex area, along with cases like that of Terry Schiavo and Karen Quinlan.
“Voluntary Heathcare Events” (VHCE) include plastic surgery procedures with no direct functional benefit, fertility procedures for infertile couples, psychotherapy for other than return to adaptive function in the community, and lifestyle enhancement interventions (e.g. lasix eye correction procedure). These events contribute to overall healthcare costs but are usually borne at least in part by the individual. The extent to which such services fall under insurable events or are misplaced there is not entirely clear.
The process of controlling the number of healthcare events creates many moral issues for any society. Triage of healthcare services (and events) is already occurring in American healthcare. The poor and those living in distant rural areas have dramatically less access to healthcare delivery systems than insured persons living in urban areas. This has been recognized since the 1960s when the NHSC was developed but the split continues to worsen. If a more universal system of care is the goal then these problems must be addressed.
Even gradual cost containment requires several issues: 1)The cost of training of providers. The current US education system burdens the training of providers unless they enter the military. This creates a cost for the individual or the system and has affected the charges by providers, and the distribution of services. The solution to replace more expensive providers with less expensive ones is a partial answer, but it increases the cost of the replacement providers, and may lower the quality of delivery of care. 2) The cost of pharmaceuticals. Pharmaceutical innovation is both a strength and a weakness of the US healthcare system. New and effective treatments have benefited users, but many ineffective or marginal treatments have also flooded the market and new pharmaceutical costs are poorly regulated in the US. Companies often target similar "blockbuster" medications seeking large long term profits which are protected by patent law. The US is a huge market and despite this the government has been unwilling to set price limits, (though individual states have). There is room for negotiation here. 3) The cost of medical treatment and equipment. A similar process is involved in the costs of medical devices and treatments. Various insurers decide on when or how much they will pay for the new devices, but patients are rarely informed of the options. Hospital charges are notoriously inflated in expectation of being "written down" by insurers. The creation of a realistic cost based pricing system in healthcare delivery seems an unattainable goal without regulatory intervention.
This leads to the last consideration of healthcare, the consumer. There is a long history of giving the consumer no information about the differential value, and differential cost, of various treatments. This can be viewed as the provider's attempt to deliver more expensive care, or the insurer's unwillingness to fund more expensive care, but in either situation the patient is left out. How can an individual in need of services decide on what the best and most affordable course of action should be? The evidence that this is not a trivial issue can be found in the reports of doctors who refuse cancer chemotherapy because they do not believe that the additional time provided is worth the side effects or cost. Hopefully this is done after a review of the literature that patients are unable to perform. How to provide more informed consumers? TV advertising has flooded the airwaves with promotions for various medications, and their terrible side effects, which further confuse the consumer. Providers are not the source because they are motivated toward specific treatments. Insurers will err on the side of lack of value. Some other source of expert evaluation must be created, and ongoing, and available to patients. There is a need for a process of effective cost benefit review of treatment courses framed in language accessible to patients. There is also a need for the consumer to evaluate their own ability to make health benefiting choices. The role of diet, exercise, certain nutrients, and social activity have strong documentation. Yet the US has dramatic obesity across the age pyramid, despite its impact on health. And the prevalence of excessive alcohol, tobacco, and other drug use are also major health dangers. There are many public health messages about these dangers, which appear to have limited benefit, so some process of individual reward/cost for individual behavior is likely to be necessary. (The willingness of pharmas to rush into the "treatment" of obesity with new drugs is a dangerous sign!)
Recent critics of the current healthcare system have pointed to the archaic information system in most healthcare environments, and proposed that a national healthcare data bank would somehow be a solution to the healthcare problem. Implementing major improvements in healthcare info systems has three main problems associated with it: 1) cross compatibility: to implement standards of data collection and cross platform distribution. Technically this is not a problem. But politically it involves competition among providers for product exclusivity. The fact that facilities like the VAH system have already achieved such a system illustrates how much easier it is to accomplish this goal in a single payer model, and how much it favors that model. And 2) absolute cost: in a system that is already experiencing cost increases well beyond inflation, this suggestion imposes massive additional immediate costs, with no immediate guarantee of cost savings. To impose this cost on an already too expensive system as a solution to the expense problem is totally unrealistic to all but the purveyors of hardware and software, who are the major proponents. 3) privacy and confidentiality is already a difficult issue in HIPPA requirements and maintaining these controls across communicating systems would require additional encryption technology. This critique does not challenge the overall benefit of improving, incrementally, the data management of healthcare systems. But all businesses that have endured the investment in data management systems know that the costs are always greater than predicted, the problems always more complicated than anticipated, and the results never as efficient as promised.
Another critical variable in the cost of healthcare events is management. The troubling report that the chief of Cardinal healthcare was taking home a mega paycheck in the face of rising costs, which his company was supposed to control, raises serious questions about his role in reducing costs for the healthcare system versus increasing profits for his company. An inescapable conundrum of for-profit management of healthcare delivery is the issue of how management compensation is based on profits for the company or reduction in overall costs of healthcare in society while preserving quality. The two must be linked, that more consumers use the company because of lower costs and better service. But this has not proven to be the case. In many instances, profits have been achieved by negotiating exclusive contracts with companies and then saving expenses by delivering less satisfying services. The result has not been lower costs for companies as these managers have failed to control rising event costs, but they have succeeded in improving executive compensation the way the rest of American industry has: but cutting the costs of services delivered. This has generally been described as “aggressive management” until the decline in services loses customer support and then a new management team is brought in to repeat the process. Is it possible to define an evaluation tool/process that would measure effective cost saving that preserves critical quality of care delivery of services (and one that is not too expensive to implement)? If such a measure can be defined who would be empowered to require both for profit and not for profit delivery systems to measure their systems, who would audit that the measurements are accurate, and who would have the authority to require both agencies to link their return and compensation to these measures?
The most difficult issue is who will initiate and regulate the changes needed? The Federal government would provide the most general standard but would be subject to all the politics that are currently degrading the system. State governments will be most motivated to require configuration of services that reflect the politics and economics of their citizens. This is a plus and a minus. When abortion intervention was only available in some states, women traveled to others, an undesirable and economic hardship. Citizens would likely relocate over a generation to states that best fit their image of healthcare needs, with interesting but counter-productive effects on the population. This will occur if the current pressures on the federal government are transferred to states. There the public will have more direct influence, but also more potential to under serve certain populations.
Whoever is assigned the role of regulating services has some responsibility to limit availability (triage), an essential issue in
costs. It is about denying more expensive drugs, treatments,
surgeries, etc. And it is also about denying life preserving interventions
in elderly, or younger dying persons. A peculiar view of modern
healthcare is that it exists to prevent death. Stated in this way, it
is clearly impossible! A realistic statement is that healthcare
interventions delay death and facilitate productivity in those who are
able to contribute. The view of the last century that delaying death
is the "humane" thing to do seems to be changing with the increased
incidence of laws supporting assisted euthanasia.
This brief review supports the following plan for the remediation of the American healthcare system:
1) while increasing the covered lives to near universal coverage,
2) the aggregate cost of delivering services must be reduced to the per capita range of other developed economies. At the same time,
3) indices that measure overall quality of healthcare delivery, including consumer satisfaction, must be increased to be in line with other developed economies.
Accomplishing this will require
4) correcting the uneven distribution of services across economic levels and the urban/rural continuum.
Steps to implement these changes will require reducing the per unit cost for delivering “healthcare events” by
5) modifying provider compensation for events to include reducing cost per event and improving outcome, and some differential for serving underserved populations
6) greatly reducing un-reimbursed institutional services (see 1)
7) careful auditing of institutional services for misrepresentation of costs
8) negative compensation differential for utilization of newer more expensive procedures, unless clear documentation of differential cost/benefit has been established
9) control of excess distribution of expensive high cost services providers by regulation of numbers of providers to demonstrated need
10)negative differential reimbursement for newer more expensive drugs and equipment unless clear documentation of differential cost/benefit has been established
11)improved utilization of public health care and distribution of routine universal services to lower cost delivery
12)effective moral/economic regulatory process for authorizing the delivery of high cost extreme events
13)clear discrimination of voluntary costs and elimination of them from universal coverage of services
14)clear definition of the funding sources for the insurable events (IHCE) with a suitable balance between personal direct cost, personal indirect cost (taxes), and employer direct costs.
15)Establishing review agencies ( not for profit or governmental) with the authority to set terms for reimbursement of health care events.
16) Establishing review agencies ( not for profit or governmental) with the authority to set terms for location and distribution of service providers (specially high cost specialty services)
17) Link compensation of management of review agencies to the overall goals of reducing costs of events while preserving effective outcomes and quality; unlink from ROI considerations whether for profit or not
18) Incrementally improve the overall information management of the national healthcare system to provide the data necessary for the above steps
19) Assign contracting for the review of data and compliance to organizations without conflicts of interest with regard to stakeholders, providers, etc.
20) determine a distribution of payment for a system with these features and controls that balances reward of individual healthy habits in the individual component, and assigns a secondary component to the work environment based on productivity, and to the government based on the need to fund the return to productivity of those in need.
IN SUMMARY This exercise shows that the tasks for improving the US healthcare system require identifying reasonable goals and redesigning the system to achieve them. The goal of the healthcare system is (should be) to maintain the productivity of all members of society at the highest level possible, while preparing new members to enter the society productively. In order to achieve this goal there must be appropriate distribution of healthcare services with control of their costs.
The problem is political. The entrenched stake holders in the system have resisted reform beginning in the ill-fated Clinton effort, and even with the Obamacare partial solution. Historic interventions addressing these issues have not succeeded in regulating costs or distributing services more effectively. The lesson from these experiments is that regulation of delivery of services is necessary, for-profit entities are more motivated by other corporate goals than the overall delivery of healthcare, and are not effective. Some other approach to regulation and cost containment is needed, at a government or independent agency level. This cannot be done willy nilly by repealing laws of the current system without introducing alternative methods, or the role of the system in the economy will result in devastating problems. (It appears that some are too stupid to understand this even now.)
WHAT WILL IT TAKE TO TRANSFORM AMERICAN HEALTHCARE?
WILL LEADERS CREATE A COMPLEX SERIES OF COMPROMISES AND REVISIONS OVER A REASONABLE TIME?
OR WILL THE COUNTRY WAIT UNTIL THE HEALTHCARE SERVICES SYSTEM FAILS TO MAINTAIN A PRODUCTIVE WORKFORCE?
TIME WILL TELL
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