Health care reform part 2 - cost and quality

In Part 1, I said there are three problems - cost, quality, and extending coverage to 47 million people. I then went on to talk about the coverage problem. Now to discuss the cost and quality issues.

1. Quality - studies show that medical care in this country can be of poor quality. Hundreds of thousands die each year from mistakes. Others suffer prolonged illnesses due to poor quality care. This creates human misery and also contributes substantially to higher costs. A number of things that need to be done, have been done or are started

• Reporting medical errors - the federal government set up a process for hospitals to self-report medical errors. Many states have done the same thing.
• Promote e-prescribing - Medicare has done this and many providers are using it. E-prescribing means sending a prescription from a doctor to the pharmacy electronically. When this is done, medical management systems can review a person's prescription history and help identify when a prescription might conflict with other prescriptions in a way that could cause medical problems for the patient
• Improve information sharing between providers - In the so-called "Stimulus package," billions of dollars were provided for the federal government to help the health care industry move forward with developing ways to share patient medical records so that a doctor treating an individual can know everything there is to know about that individual before prescribing care
• Stop paying for medical treatment associated with medical errors - CMS is soon to implement a policy of not paying for "never events" - treatment related to medical errors (or treatment that never should have been necessary). Health plans are starting to do the same thing. Previously, there was no financial incentive for hospitals to eliminate errors, other than fear of lawsuits. Quite the contrary, a hospital could make a lot of money as a result of medical errors, as was documented in the Pittsburgh Post-Gazette some time back (or so I have been told)
• Do no more - all of the above measures are being implemented at the same time. All are very significant changes for the medical industry. Give the industry a chance to implement these. If you ask someone to do more than they can do at one time, do you get the quality results you really want or do you get rushed sloppy results? If we want to improve medical quality, then give people a chance to implement these measures right. Government too often fails to look at the big picture and just jams one new requirement on top of another.

2. Costs - costs come from two places - medical care and administrative activities.

• Eliminating medical errors will eliminate unnecessary treatment and this will save costs.
• Promote cost effective medical treatment - generic drugs are cheaper than prescription drugs for example. Natural child birth is cheaper than a c-section. There are many examples where one medical treatment is cheaper than another while also being as good as another. However, the danger here is who makes that decision? In the past, HMOs were condemned for managed care decisions promoting lower costs. Will the Government step into the role of the HMO, giving us Government bean counters overruling doctors instead of HMO bean counters? This is not easy to do but it is important to do.
• Reduce administrative costs - in 1996, President Clinton signed a law to do this, called HIPAA. HIPAA provided for standard transactions that could be used by providers and health plans to eliminate some serious administrative costs. Unfortunately, this has not happened the way folks thought it would. First, the regulators in both the Clinton Administration and the Bush Administration have done a poor job implementing it. Second, Medicare and Medicaid programs don't use the standard transactions the way they could. They set really poor examples for the rest of the industry. Third, some payers and providers have not fully complied with the requirements, much less adopted these to improve their operations. A revised set of HIPAA regulations has been issued and the Government should set the example and lead the way by fully using these transactions and code sets whenever possible to reduce administrative costs.