Some Texas-sized Ideas for Reducing Health Spending

By March 2, 2018Commentary

The US spends a lot of money on health care.  A lot of people believe a lot of that money is wasted.  There are a lot of ideas about how to reduce spending.  Something called the Texas Medical Center Health Policy Institute convened a panel of ten experts to come up with a lot of ideas to reduce a lot of that spending.  (TMC Report)   I am going to have a lot of fun reviewing the report.  It starts with the urban legend that we waste $1 trillion in health spending.  And here are their brilliant ideas to save that $1 trillion.  Note how specific all these are and how different and innovative.  (that is my usual sarcasm, in case you were wondering)  Eight ideas that will save the system:  (maybe I should put them in caps since they are from experts)  1) Allow the government to use cost and cost-effectiveness in decision-making.  They already do, as anyone who has any experience with Medicare or Medicaid coverage and reimbursement knows.  The whole death panel thing has no impact.  And using cost-effectiveness doesn’t save much money.  2)  Eliminate fee-for-service.  Yep, because doctors working for institutions on a salary have no economic incentives.  Hospitals are a great example of this–they buy or hire physicians, put them on a salary, but give them bonuses tied to “productivity” or referrals to other parts of the hospitals.  And they charge more for the doctors’ services.  The issue isn’t fee-for-service, it is who has market power, and we have allowed a lot of market power in health care that is raising prices and spending.  3)  Standardize quality of care metrics.  Might save a couple of bucks on admin costs with this.  Seriously, this is the best idea this panel could come up with?  4)  Empower patients to be responsible for their own health and health care.  Oh, Jesus, more gibberish.  This means nothing and saves nothing.  How about–penalize patients who won’t keep their weight under control, stop smoking, drinking and using drugs, take their prescribed medicines and otherwise be responsible.

5)  (it is not getting better) Improve care coordination.  This is unbelievable.  We are spending billions on care coordination, if it was going to make a big dent in spending, and maybe it has, we would see it by now.  6)  Reduce ER use and readmissions.  Oh, God, please spare me any more, I can’t take it.  Haven’t we already done this?  7)  Develop more specific approaches to end-of-life care.  See number 6.  8)  Meaningfully address the impacts of adverse childhood experiences.  You mean like reading this report?  Seriously?  Seriously?  I think I have identified our real health spending issue.  Our experts are morons.  We have a price problem in health care spending in the US.  We need to pay hospitals and physicians and drug companies less.  We can either create market conditions that allow that to happen or we do it by regulatory fiat.  We also have a personal lack of responsibility issue, one that won’t be fixed except by refusing to give free or cheap health care to people who act irresponsibly.  Don’t wear a motorcycle helmet and end up in a coma, the public isn’t paying for that.  Keep drinking too much, the public isn’t paying for that.  Don’t lose weight, the public isn’t paying for that.  Those two ideas would do a lot to reduce spending.  The nonsense in the TMC report won’t even be noticed.

Kevin Roche

Author Kevin Roche

The Healthy Skeptic is a website about the health care system, and is written by Kevin Roche, who has many years of experience working in the health industry through Roche Consulting, LLC. Mr. Roche is available to assist health care companies through consulting arrangements and may be reached at khroche@healthy-skeptic.com.

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