Connecting value to coverage: a first glimpse

MPainterWould you take a virtual walk with me across the Dartmouth Atlas map on RWJF's web site?  Just follow the link.  Now, move your cursor first over, say, anywhere in Minnesota.  There, you'll see that 2006 Medicare reimbursements were roughly $6,700 per beneficiary.  Now, move your cursor across the country, way over to Massachusetts–specifically, Boston, for instance.  There, 2006 Medicare reimbursements were almost a whopping $3,000 per beneficiary higher.  You'd sure think that the quality of care in Massachusetts must be extraordinarily better for that extra $3,000 per person–but, guess what?  It's not–it's roughly the same–maybe even worse in some cases.  Plus, Massachusetts has embarked on its own universal coverage experiment.  First in its class, Massachusetts is providing the rest of us with a real-world unfolding example demonstrating how health care cost, quality, value, and coverage intersect.  If Massachusetts could figure out how to pay for high-quality care at the level of, say, Minnesota, their coverage experiment might just get exponentially easier.

So, are our national leaders taking this unfolding lesson to heart?  We're beginning to learn.  Last week the Senate Finance Committee released a set of policy options on transforming the health care delivery system.  Their statement is really the first glimpse we've had at how our national leaders might (or might not) be linking value and coverage.

If value is so important, what are the key change elements?  I'd argue that there are four:  significantly better public information about performance and what works, significant support for quality improvement once doctors and nurses understand the need to improve, strong emphasis on the patient and public role in demanding high-quality care, and serious attention to payment.  Changing payment is important and builds off the other three ingredients.  We simply cannot be shocked and surprised that we've created a system of uncoordinated, high-volume, incredibly expensive procedural care when that's what we pay for–high volume.  Oh, you mean you wanted high-quality?  Then why are you rewarding more rather than better care?  But we can't simply make payment fixes to support value without the other ingredients.

What do we actually see in the Finance proposals?

They certainly emphasize improving the way we measure performance and publicly report that information.  And public reporting matters–that information won't help much if we keep it secret, will it?  They include a number of interesting proposals about payment.  They propose experimenting with payment that rewards decreased hospital readmissions.  That sounds good.  Readmissions are potentially avoidable–and potentially wasteful.  If we can reduce them, there would be many winners–not the least of which would be the patient–remember the patient?  They also suggest that we experiment with bundling payments across episodes of care–again so that payment starts to reward care that matters to whom?  Yes, the patient.

There's, of course, lots more in these proposals–and there's obviously more to come.

What's the good news?  At least here, folks seem to understand that Massachusetts problem.  They seem to get that unless we start creating high-value care and paying for it, the coverage solutions remain impossibly difficult.  They seem to be on the right track–more public information about care and lots of payment experiments to find better ways to reward high-value care.

What's missing?  Information and payment incentives are not sufficient.  Health care professionals are among our most dedicated professionals–they want to provide the best care.  However, even once the information shows the need for improvement–and we stop penalizing them with payment schemes, like fee for service, that discourage their efforts to improve–they will still need significant help to improve.  It doesn't happen by magic.

And, there's nothing in there to bring the public along.  We, the people, have an important part in creating high-value care–based on our health care decision-making.  And I don't just mean selecting a doctor.  We have to be informed and active in treatments we select or forego.  We have to step up and work with our physicians and nurses to help them help us.  In fact, come to think of it, we may be the hardest piece of this entire puzzle.

As we're seeing in Massachusetts, the overall reform challenge will likely hinge on our ability to create and sustain high-value health care.  Right now, we have a long, long way to go.  Could these early proposals suggest more, and faster, steps on that road?  Clearly.  Are they, nevertheless, a good start in the right direction?  Absolutely.

Michael W. Painter, J.D., M.D., is a physician, attorney,
health care policy advocate, and 2003-2004 Robert Wood Johnson Health
Policy Fellow. He is currently senior program officer and a senior member of the
RWJF Quality/Equality Team.

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2 replies »

  1. Apples to oranges. Yeah, it would be great if everyone practiced like Minnesota, but that’s like a swim coach saying “wow, my team would be so much better if they were all fish.” The relevant question is how do we get healthcare systems that aren’t like Minnesota to achieve higher quality at lower cost? How do we move the pieces without breaking the system?
    And it’s becoming blindingly obvious that universal healthcare is part of making healthcare systems more efficient. Massachusetts is only now talking about payment reforms. This is something it never did before instituting universal coverage. Because, of course, system change is HARD. Each year, it is much easier to deal with costs by allowing half a percent of the population to become uninsured than it is to do very delicate and very difficult things to reform the care delivery system.
    To date, we’ve dealt with our food shortage by kicking people out of the lifeboat. Maybe if we stopped allowing that, we’d figure out how to fish. Massachusetts shows that we only get serious about cost containment when we’re no longer allowed to contain costs by rationing care.

  2. “Now, move your cursor across the country, way over to Massachusetts–specifically, Boston, for instance. There, 2006 Medicare reimbursements were almost a whopping $3,000 per beneficiary higher.”
    Higher real estate prices? Can’t see how reimbursements in NY, NY or Boston can be the same as Little Town, USA. I guess my point may be that, are you only looking at medical costs and not overhead?