A Must Read

April 24th, 2008

“The Third Path…Systematic Change Will Focus on Returning Value” is an article written by Greg Poulsen, SVP at Intermountain Healthcare that appears in Modern Healthcare’s, April 21st issue on page 26.

It is a must read; one of the most insightful, clear, forward-thinking approaches to health care…I hope all of the presidential candidates and their teams start listening, - and that whoever is elected stops listening to the special interest lobbyists.

In his article, for those of you who might not have access to it, he clearly points out that neither a consumer-driven approach nor the concept of universal insurance coverage addresses the core health care challenges we face: that of providing quality and value.

The core flaws, as he points out, are:

1. A fundamental flaw is not one of access or insurance – but rather, one of cost issues, structure and the need to align incentives.

2. Patients who lack complete medical histories must navigate a sea of provider settings. Poor communication increases the chances for errors. There is also a lack of real peer accountability.

3. The current system has powerful incentives to increase utilization; physician fees are affected by treatment decisions. Physicians can substantially increase their incomes by performing procedures versus providing consultations. Patients often request more expensive testing and medications. Finally, physicians with ownership in delivery systems such as ambulatory centers or imaging have their utilization incentives greatly magnified. Most physicians do what is right because they take their professionalism seriously; otherwise we would find our problems to be much greater.

Suggestions:

1. That the payment system move away from the fee-for-service structure to a more bundled approach.

2. Patients need to be motivated to opt for a high value approach.

3. The regulatory environment should change to better facilitate cooperation and coordination among the providers, doctors, hospitals and others.

4. Health information technology and EMRs need to be expanded.

Talk to you soon.

Stan