Can payment and other innovations improve the quality and value of health care?

January 27, 2009

A paramount topic at the moment is value in health care: What should we pay for and how much? Resources aren't unlimited, and desires or demands for health care should be balanced against various realities--including the effectiveness of care or the desire for other goods and services. Especially in a depressed economy, questions about value in health care may well be at the center of coming health reform debates.

In a commentary published in Health Affairs today, Brandeis health economists and policy experts Robert Mechanic and Stuart Altman write that unless the forty-year historical spending trend for health care "miraculously abates," expanded public and private cost control initiatives are inevitable. Policymakers will face pressure to cut provider payment rates in order to achieve short-term savings, say Mechanic, a senior fellow, and Altman, the Sol C. Chaikin Professor of National Health Policy, both at the Heller School for Social Policy and Management, Brandeis University.

They warn, however, that, "in the fragmented U.S. delivery system, cutting fee-for-service (FFS) payments over any sustained time period will hurt both quality and access. A more sensible approach would be to develop a long-term agenda to restructure the delivery system into organized networks of providers capable of delivering reliable, evidence-based care within realistic budgets." However, such delivery system reforms cannot occur without significant changes in health care payment policy.

The authors examine four payment reform options that have been widely discussed: recalibrating FFS; instituting pay-for-performance (P4P); creating "episode" payments that combine hospital and physician reimbursement; and adopting global payment approaches such as capitation; they discuss these options' potential impact on future cost, quality, and provider integration. Mechanic and Altman say that payment reform cannot succeed without Medicare as a major player, and they suggest that episode payments may be the most promising near-term opportunity for payment reform in Medicare.

Source: Brandeis University

Explore further: The U.S. health care system—a patchwork that no one likes

Related Stories

The U.S. health care system—a patchwork that no one likes

October 19, 2017
Almost all parties agree that the health care system in the U.S., which is responsible for about 17 percent of our GDP, is badly broken. Soaring costs, low quality, insurance reimbursements and co-payments confusing even ...

Regenstrief study to determine whether health information exchange improves emergency care

October 19, 2017
Are patients less likely to be hospitalized if emergency departments have access to their complete medical record via health information exchange?

New study finds childhood cancer survivors commonly stay at jobs to keep health insurance

October 19, 2017
The results of a national cancer survey find a significant number of childhood cancer survivors are worried about keeping their health insurance, to the point of letting it affect their career decisions. The findings were ...

People with and without mental health conditions receive preventive care at similar rates

October 19, 2017
People with schizophrenia and bipolar disorder received preventive health screenings at rates similar to or higher than people without mental illnesses, according to a study of more than 800,000 patients published today in ...

Keeping people out of poverty—do health insurance benefits make a difference?

October 19, 2017
Do Medicaid and other health insurance programs help keep families out of poverty?

Report: Medicaid enrollments, costs begin to stabilize

October 19, 2017
States are seeing more stability in their Medicaid programs after experiencing a surge in enrollment and costs associated with the Affordable Care Act, suggesting that one of the major pillars of former President Barack Obama's ...

Recommended for you

Three million Americans carry loaded handguns daily, study finds

October 19, 2017
An estimated 3 million adult American handgun owners carry a firearm loaded and on their person on a daily basis, and 9 million do so on a monthly basis, new research indicates. The vast majority cited protection as their ...

More teens than ever aren't getting enough sleep

October 19, 2017
If you're a young person who can't seem to get enough sleep, you're not alone: A new study led by San Diego State University Professor of Psychology Jean Twenge finds that adolescents today are sleeping fewer hours per night ...

Eating better throughout adult years improves physical fitness in old age, suggests study

October 18, 2017
People who have a healthier diet throughout their adult lives are more likely to be stronger and fitter in older age than those who don't, according to a new study led by the University of Southampton.

Across Asia, liver cancer is linked to herbal remedies: study

October 18, 2017
Researchers have uncovered widespread evidence of a link between traditional Chinese herbal remedies and liver cancer across Asia, a study said Wednesday.

Global calcium consumption appears low, especially in Asia

October 18, 2017
Daily calcium intake among adults appears to vary quite widely around the world in distinct regional patterns, according to a new systematic review of research data ahead of World Osteoporosis Day on Friday, Oct. 20.

New study: Nearly half of US medical care comes from emergency rooms

October 17, 2017
Nearly half of all US medical care is delivered by emergency departments, according to a new study by researchers at the University of Maryland School of Medicine (UMSOM). And in recent years, the percentage of care delivered ...

1 comment

Adjust slider to filter visible comments by rank

Display comments: newest first

Mauricio
not rated yet Jan 27, 2009
Prevention of disease is the way to go. It is cheaper and safer. Diseases are related with behavior patterns, they don't "just happen". That is the solution for the health crisis in the US. Not putting a lot of money in pharmaceuticals to discover magic pills.

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.