Why We’re Optimistic About Payment and Delivery Reform

We’ve been optimistic about the promise of payment and delivery reform, despite all the challenges ahead in implementing chapter 224. Is that justified?

This week, the Institute of Medicine issued a detailed report, Best Care at Lower Cost: The Path to Continuously Learning Health Care in America:

[T]he knowledge and tools exist to put the health system on the right course to achieve continuous improvement and better quality care at lower cost…

The costs of the system’s current inefficiency underscore the urgent need for a systemwide transformation. The committee calculated that about 30 percent of health spending in 2009 — roughly $750 billion — was wasted on unnecessary services, excessive administrative costs, fraud, and other problems. Moreover, inefficiencies cause needless suffering. By one estimate, roughly 75,000 deaths might have been averted in 2005 if every state had delivered care at the quality level of the best performing state.

Incremental upgrades and changes by individual hospitals or providers will not suffice, the committee said. Achieving higher quality care at lower cost will require an across-the-board commitment to transform the U.S. health system into a “learning” system that continuously improves by systematically capturing and broadly disseminating lessons from every care experience and new research discovery. It will necessitate embracing new technologies to collect and tap clinical data at the point of care, engaging patients and their families as partners, and establishing greater teamwork and transparency within health care organizations. Also, incentives and payment systems should emphasize the value and outcomes of care.

We fully agree. The IOM released this fabulous infographic to illustrate their findings. A piece of it is below – click to see the full version:

Excerpt - IOM Best Care Infographic

Click for the full graphic

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