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Institute of Medicine Report

By September 10, 2012Commentary

The Institute of Medicine has issued a report called Best Care at Lower Cost:  The Path to Continuously Learning Health Care in America.    (IOM Report)  As the title suggests, the report is full of buzz words and platitudes.  The problems of health care in America are well known and documented again in this lengthy publication.  According to the authors, if every state had the same quality of health care as the highest performing state, there would be 75,000 fewer deaths in 2005.  And the authors estimate that there is $750 billion in annual “wasted” health care spending.  The two primary challenges identified in the report are to manage health care’s increasing complexity and to reduce constantly growing costs.  Information technology, through vast computational power and omnipresent connectivity, is seen as the primary method to improve care delivery, which the report properly characterizes as still largely driven by the decisions of each individual provider, leading to great variation in both care processes and outcomes.  Patients have become more complex as well, as the aging population presents with more chronic diseases and comorbidities.

The $750 billion is supposed wasted spending was drawn from “expert” speaker estimates from an IOM workshop, which is not the kind of evidence one would expect from a “science-driven” organization, but rather seems designed to grab attention.  One suspects duplication between, for example, the categories of Unnecessary Services at $210 billion and Fraud at $75 billion.    And the Unnecessary Services category has no offset for the costs of delivery of services which patients should be getting but aren’t, a category which other research has suggested would cost at least as much as would be saved by not delivering inappropriate services.  And there as usual is no real support for the notion that there are $190 billion in excess administrative costs.  The Institute’s fundamental prescription to cure our health care problems is the creation of a continuous knowledge development and application culture, in which clinicians and patients are mutually engaged in applying scientific knowledge about diseases and treatment options, and apply cumulative outcomes information to further improve health care.  This is on its face a ludicrous fantasy.  The idea that an extremely complex system with hundreds of thousands of individual providers and tens of thousands of organizations and hundreds of millions of patients is going to be universely transformed is not even worth talking about.   If the fundamental economic problem of third-party payment isn’t addressed, don’t expect a lot of cost savings.  And as long as i

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