Summary
Despite all the skepticism surrounding the claim of being able to cut costs by over $2 trillion in the next decade coming out of the meeting in the White House last week involving six major healthcare organizations which (other than patients) may have the largest stake in healthcare reform, achieving that goal may not be nearly so difficult as many have said. That's the conclusion of three of the most respected leaders in healthcare in a feature article for the "New England Journal of Medicine" published this week.
Analysis
The Institute of Medicine laid out a "chain of effect" that links systems at four different levels as the interrelated determinants of healthcare quality that must be aligned for reform to yield desired results. These four levels are:
--The aims to achieve better care experience (safe, effective, patient-centgered, timely, efficient and equitable) better health for the population and lower total per capita costs;
--The design of the care processes that affect the patient ("clinical microsystems");
--The healthcare organizations that house almost all clinical microsystems and can ensure coordination among them; and
--The environment which includes the payment, regulatory, legal and educational systems.
Physicians may help best in this effort to align these forces by:
--Supporting and helping to develop integrated systems of care, especially population-based models such as the Geisinger Health System in Pennsylvania with strong incentives to invest in primary care;
--Recognizing that achieving savings sufficient to cover the cost of expanded coverage need not impose a hardship on patient or providers.
Even the 1.5% decrease called for at the White House meeting would still permit total incomes of all financial stakeholders in the healthcare system to rise from $2.6 trillion in 2010 to $4.3 trillion in 2020. Through the cost savings compounding process, this 1.5% reduction in annual spending from 6.7% to 5.2% would actually save the healthcare system $3.1 trillion of the $40 trillion currently projected to be spent between 2010 and 2020 according to the Lewin Group. Out of these savings, the federal government would harvest around $1.1 trillion, which might well permit the universal health insurance coverage sought by the Obama Administration and the Democratic Majority in the U.S. Congress.
Accomplishing all of the above is obviously far easier said than done. Achieving these savings will result in shifting of fortunes away from specialists toward primary care practitioners (similar to the situation in most other OECD nations). Whether doing this in America will achieve the improved coordination of "clinical microsystems" as theorized in the "Medical Home" models being advocated remains to be seen. Many pharmaceutical, medical device and imaging companies will need to come up with more cost effective alternatives (as General Electric, among others, has recently committed to do).
Nevertheless, the current course in the multi-trillion healthcare system is clearly unsustainable. Unfunded liabilities of $45 trillion for the Medicare Program alone will result in America's losing its AAA rating which has permitted other nations (most notably China) to keep America financially afloat throughouit the current economic crisis. The next economic crisis (whether it occurs in a few years, or a few decades, from now) we may not be so lucky if we don't take advantage of what could be a once in a generation opportunity to set in motion what needs to be done to prevent the medical cost explosion which will surely occur by the 2020s, if we don't align the forces mentioned above to "bend the curve" of cost trends over the next decade.
