Three Reform Ideas Whose Time Has Come

As luck would have it, I was a student in Paris during the revolution of May ’68. Many protest banners featured Victor Hugo’s famous observation that nothing is as powerful as an idea whose time has come, and innumerable Left Bank discussions were dedicated to identifying the new thoughts that could lead to desired changes after the revolution was over.

The faltering reform battle in Washington reminds me of “les événements” in Paris—not because it is going to revolutionize American health care right away, but because its heated discussions actually highlighted concepts that are going to transform health care in the US in years to come. In my opinion, three powerful ideas that did not become linchpins of the reform bills will nevertheless be translated into progressive actions via the “invisible hand” of the marketplace (hopefully facilitated by supportive government actions).

• Progress in health care requires digital transformation of the way health care is delivered. State-of-the-art electronic medical records and related health information technologies (HIT) were common denominators of health systems that have accomplished the cost and quality improvements of health reform. These systems (e.g., Kaiser, Geisinger, Mayo, Intermountain) have already created the digital infrastructure required for exemplary performance improvement.

• Successful reform requires integrating hospitals and physicians in accountable care organizations. In addition to deploying HIT throughout the enterprise, systems that provide models for reform have employed their medical staffs and put physician leaders in their C-suites. These integrated systems eliminate the market failure created by competition between hospitals and independent medical staffs.

• Global payment mechanisms rewarding value must replace fee-for-service reimbursement that rewards volume. The significant waste of paying for medical services on a piecemeal basis was consistently demonstrated in expert testimony on reform. Providers and payers need to be given specific incentives to develop and implement efficient, bundled reimbursement mechanisms.

The House and Senate reform bills include limited programs to demonstrate the power of these ideas, but I don’t believe that federal demonstrations can produce the necessary changes fast enough. From my perspectives as economist and futurist, American health care delivery needs to be transformed sooner rather than later. We do not have the luxury of waiting 5-10 years for the results of demonstration programs based on ideas that have already proven their value. The 21st century economy is not going to be kind to a medical sector playing by 20th century rules.

Do you think that the health reform revolution of ’09 produced any powerful ideas whose time has come? Please comment on the three ideas above…or propose others.