Makeover Needed for Health Care Incentives


(Guest blogger Daniel F. Evans is president and CEO of Clarian Health. He will also be sharing additional health care reform insights in two additional postings.)

At Clarian Health, Indiana’s largest health care system and academic medical center, we have a big stake in seeing that the right kind of health care reform emerges from Congress in the months ahead. 

The right kind of health care reform starts by realigning financial incentives for hospitals and physicians to reward quality of care rather than quantity.  As its name suggests, fee-for-service medicine pays providers based on the volume of services provided, rather than on patient outcomes or quality metrics. 

Real reform will organize care around patients, not providers. Too often, patients see multiple specialists without sufficient coordination or communication, putting them at risk of receiving care that is redundant or even harmful. 

Real reform will expand access to care for the uninsured in a way that does not explode the federal deficit and exacerbate the inefficiencies and cost shifting of today’s system. Every day, we see the consequences of a system that does not provide regular access to health care services for millions of people.

Finally, real reform also will include incentives for individuals to assume greater responsibility for their health and their health care decisions. When the bulk of health care services are paid by third parties, either private insurers or public health programs, is it surprising that demand increases and costs soar? We must make more informed decisions about treatment options and provide incentives to people to maintain their own health.

Getting the “incentives” right is critical to improving our health care system.  If we want better quality and more efficient health care, we must reward doctors and hospitals that provide it.  If we simply cut payments to providers to reduce health care costs, the results will be terribly damaging to the well-being of patients and communities.

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