Everyone (or at least almost everyone) agrees that we have a problem in health care. We are going broke because of costs. We have millions of uninsured. We have millions of under insured. We have problems with access to care, even among the ranks of the insured. We have problems with quality and safety. Have no fear, this elite group of very bright people can rebuild and rewire the house of medicine, even without having to turn the power off. There is a small problem, however. It appears as thought they haven't a clue as to how they can actually accomplish this these tasks. Take for example their first charge:
I couldn't agree more that the current system is a mess and not sustainable, but let me try to understand this alternative. Who would negotiate and with whom would they negotiate if whatever deal they struck would be binding on other parties with whom they did not negotiate? Negotiation requires effort and information on costs, local factors, alternatives, and countless other details. Which entity would invest in amassing this information if there are no particular advantages.
"PROMOTE PAYMENT RATES WITHIN GLOBAL TARGETS
But there is more...
That's the ticket! An independent council. Now all of our problems are solved. All we need to figure out how the members of this council could remain independent (of what?), avoid issues of regulatory capture, and be able to avoid the missteps associated with imperfect information which have bedeviled every other central regulatory entity that have attempted to set prices administratively since Diocletian. I shouldn't fret. We are obviously smarter than every else in history who has attempted to do something similar in the past. We will finally get price controls to have the desired effects."The privately negotiated rates would have to adhere to a global spending target for both public and private payers in the state. After a transition, this target should limit growth in health spending per capita to the average growth in wages, which would combat wage stagnation and resonate with the public. We recommend that an independent council composed of providers, payers, businesses, consumers, and economists set and enforce the spending target."
No matter what the discussion might start with, we always end with:
Again, I will not defend the present fee for service system, but it is not a fee for service system alone which creates the current nightmare. It is the FFS system coupled with a third party payer which allows for providers to deliver and patients to receive often near worthless services without rapid feedback as to the cost. The global payment system will have its challenges and it is being foisted upon us on the assumption that it simply cannot be worse than what be presently have. It will succeed in its major goal by successfully stinting on care and not raising too much of a public protest.
"ACCELERATE USE OF ALTERNATIVES TO FEE-FOR-SERVICE PAYMENTFee-for-service payment encourages wasteful use of high-cost tests and procedures. Instead of paying a fee for each service, payers could pay a fixed amount to physicians and hospitals for a bundle of services (bundled payments) or for all the care that a patient needs (global payments)."
When the RBRVS system was pushed forward, I recall someone describing it as the worst of Harvard dressed up as the best of Chicago. Next, various central planning exercises have been dressed up as market driven efforts. Here we go again.
"USE COMPETITIVE BIDDING FOR ALL COMMODITIES
Value is now the buzzword. Everyone wants to purchase and deliver high-value products and services.
It is like Lake Wobegon where all the children are above average. Since value will be defined as high quality and low cost, and no one really can measure quality, it is all about cost. I agree that price transparency is essential and I have nothing against tiers in pricing, as long as the information transmitted by differential pricing contains useful information. Which leads us to the next recommendation..
"REQUIRE EXCHANGES TO OFFER TIERED PRODUCTS
Note all of this in contingent upon the existence of reliable quality reporting systems which do not yet exist! Also remember that these exchanges are not about the purchase of actual health care services, they are involved in the purchase of insurance. They will be charged with the task of driving prices down first and examining their effect on quality later, if an when the tools become available to do so.
This is almost laughable if it were not so serious.
Yes there are gains to be had from uniform credentialing, common information exchanges, and streamlined eligibility processes. But they must be joking! The informatics infrastructure to implement all the above will make the $360 billion in administrative costs look like chump change. This will require huge investments and complete re-engineering of workflows in millions of separate offices. They miss the obvious here. The inclusion of insurance into more and more transactions which should be be insured is the driver of the ballooning administrative costs. And yet another task force of experts working within the political realm.