Payment Reform

We came to the National Press Club today ready for a debate on health care and entitlement reform. What we got was a lot of consensus on the serious challenge of health care cost growth and the need to do everything in our power to bend the cost curve. That, and an interesting bowl of gazpacho with chunks of watermelon in it….

Our cold soup confusion aside, we were pleased to participate in the panel of experts put together by our colleague Maya MacGuineas, Director of New America’s Fiscal Policy Program and President, Committee for a Responsible Federal Budget.

Our co-panelists addressed the need to make hard choices in health care and the budget and the potential of Medicare to drive changes in the system. With such a broad range of expertise in fiscal and health policy, there was naturally some disagreement on priorities and political viability of different options. But every panelist shared the goal of getting health care costs under control. The purpose of our presentation was to show that there are real, tangible ways of holding down costs that can provide the basis of meaningful reform.

 You can find the whole discussion webcast here. Below are a few of our key themes:

I've been doing a lot of traveling, attending meetings about health care quality and payment reform, and I wanted to share a bit of what I learned at the recent Healthcare Payment Reform Summit in Pittsburgh. The topic was "bundling"—paying for an episode of well-coordinated care. In the current system, we pay for quantity of procedures, not quality or outcome.  Everybody at the Pittsburgh summit understood that this procedure-focused system leads to overutilization of care.

Moving from the status quo to bundling will take some careful planning and transitioning, but Francois de Brantes gave a presentation that underscored how worthwhile it can be. He presented data showing that improved management of diabetes and heart disease leads to better quality—as well as a 50 percent drop in costs.