Charles Dickens' classic novel of the French Revolution, A Tale of Two Cities, opens with the oft-quoted line, "It was the best of times, it was the worst of times..." It is a description that, with some modification, could apply to the U.S. health care system.
People often say that the United States has the best health care in the world, and in a sense we do. Leaders from government and business from across the globe beat a path to the doors of our hospitals seeking treatment for serious conditions. And the path is almost completely one way—few Americans seek treatment abroad. So in one demonstrable sense, we indeed provide the best health care in the world.
But that is not the whole story; the U.S. health care system underperforms on any number of measures. By World Health Organization statistics, we rank well below 20 other nations in attainment of key health objectives. Look within our own country and you'll see great disparities among races, with an infant mortality rate of 13.3 per thousand for black babies, more than double the rate for white babies. Look further at the numbers and you'll see that we are the most costly system in the world, with 15 percent of gross domestic product (GDP) going to health care in 2003, well ahead of our closest competitor, Switzerland, at 11.5 percent of GDP and the European median of 8.6 percent. And in terms of access to care, the U.S. is practically the only nation without universal coverage.
Now some will take issue with these criticisms, saying we are a less homogenous society than others, or that we are more insistent consumers of high-cost services, or that comparisons inevitably have some element of apples and oranges to them.
But nearly everyone in health care knows one simple truth—we could do so much better. And if we can do better, we should.
Creating a High-Performance Health System
With advances in medical science and the aging of the population, health costs will continue to go up. There will be even more pressure to address one of the greatest challenges our health system faces—the disconnect between people wanting the new things that medical science can produce, yet not being sure that they are willing or able to pay for them. This disconnect will lead to more of a focus on the value equation in health care—and to more of a focus on a high-performing health system.
So how do we create a high-performing health system? How do we deliver care that is high quality, efficient, and effective?
First, we focus on issues of quality and safety and, in particular, reliability. Medical professionals know that the gap between what we know and what we do in medicine is too large, even within our best systems. To take a well-known example, too many heart attack patients don't receive aspirin and beta blockers. We must work to close such gaps.
As recently as 15 or 20 years ago, people rarely spoke of safety in health care; it was assumed to be part of good care. But ensuring safety demands a special focus on such issues as reporting errors and near misses.
In addition, a high-performing system is focused on efficiency and effectiveness, both of which impact heavily on costs. Are we staffing correctly, purchasing correctly, designing workflow processes correctly? Effectiveness is a less examined concept in medical care. It involves the question of whether every service provided has a positive impact on a patient's condition. We are a long way from answering this question. To begin, the evidence base underlying medical interventions and treatments needs to be examined to distinguish effective from ineffective services.
Finally, a high-performing system provides access to all. Our shortcomings in health coverage are the most well-known failing of our system, and yet they are poorly understood. Most people know there are millions of uninsured Americans, but many believe these individuals are able to access services when they need them. But many studies show that, although the uninsured do usually receive needed acute care services, they do not receive much-needed care for such life-threatening chronic conditions as hypertension, diabetes, and heart disease. Even if everyone were covered, we do not have adequate personnel and facilities in inner cities and rural areas to provide care to all.
Providing Value
Now let me turn to how we are attempting to deal with these issues at Partners HealthCare. At Partners, we are convinced that value, which to my mind encompasses quality, safety, effectiveness, and efficiency, is critical to our success over the next decade. In an era of increasing transparency, we cannot just assert that we provide value to our health care consumers and payers, we have to demonstrate it. To do so, we have adopted five "Signature Initiatives."
Our first initiative is to link our increasingly integrated health system with a sophisticated information system. We want to give all our physicians electronic medical records with built-in clinical decision-support. This will strengthen our ability to disseminate and support best practices and evidence-based medicine across our system.
Our second initiative is to improve patient safety by improving electronic inpatient drug ordering and administration systems. We want to have failsafe systems for medication error prevention.
Our third initiative aims to ensure the reliability of care across our system. We are tracking our care against optimal treatment protocols for three conditions—heart attack, congestive heart failure, and diabetes—and measuring ourselves against the 90 percentile of performance standards. We are meeting this high standard in the great majority of instances.
Our fourth initiative is to employ disease management strategies. Disease management has earned a bad name over the past decade—often being a surrogate term for payers' refusal to reimburse certain medical services. Yet, with 10 percent of the population accounting for 70 percent of health costs—and with just 1 percent representing 30 percent of costs—it's clear that real care management for these very sick patients can provide greater effectiveness as well as greater efficiency. To begin, we will expand a congestive heart failure management program, which in a pilot test has shown a 20 percent reduction in readmissions. We also will identify 1,000 of our sickest and most expensive Medicaid patients and create a special nurse call center to provide them with extra support.
Our fifth initiative is to manage the use of services, specifically outpatient drug use and high-cost imaging procedures. These are the fastest cost-growth areas and are of most concern to our payers. By using electronic prescribing systems and monitoring prescribing patterns, we already have beaten the local and national trends in the rate of increase of outpatient drug costs by more than 40 percent.
To manage radiology services, we are implementing decision-support software for ordering diagnostic procedures. Not surprisingly, this strategy has been controversial because any savings come right off of our bottom line. But we are convinced it is the right thing to do and we've built it into our pay-for-performance contracts.
Through these five initiatives, we hope to become a concrete demonstration of how to improve the health care system by linking integrated delivery systems with advanced clinical information in order to create a clinically coherent framework for care. One of the engines that will drive us forward is the pay-for-performance contracts we have negotiated with our local payers, which parallel and reinforce the goals of our Signature Initiatives.
Financing Challenges
Typically, the problem of the uninsured is not discussed in the same conversations as are problems of health care quality, safety, and effectiveness. But in fact these are inseparable elements of a high-performing health system. Shame on us if we were to improve the system for the 85 percent of the population with coverage and leave the other 45 million of our countrymen behind. Health plans can help move us toward a high-performing health system. But to increase access to care, the government must play a lead role.
Why are coverage issues so important? The primary reason is because the poor do not receive all the care they need. The Institute of Medicine Committee on the Consequences of Uninsurance documented that the uninsured are far less likely than the insured to have seen a physician in the past year, far more likely to postpone or go without care, and far less likely to receive preventive care. They are twice as likely to be hospitalized for avoidable complications of diabetes or hypertension.
The committee estimated that in addition to a known burden of sickness and disability, there are an estimated 18,000 premature deaths yearly as a result of uninsurance.
This is about people's health.
Why are coverage issues so intractable? First, it's because they involve money. And for the past 30 years, money has always trumped peoples' care as this issue has been considered on Capitol Hill. The Institute of Medicine Subcommittee on the Societal Costs of Uninsured Populations, which I chaired in 2003, estimated that the price tag for services not received by the uninsured would range from $35 to $70 billion a year, or about 3 to 5 percent of health care spending—less than each year's annual spending increase. Actual costs of any legislation would likely be higher, from $70 to $100 billion a year, because most bills would provide subsidies to employers who offer coverage, state fiscal relief, or other support. In terms of aggregate health spending, these numbers are not insurmountable. And, according to our estimates, there would be a return to society as a result of improved health of $65 to $130 billion a year.
But, as a nation, we get stuck on this issue because these returns would not directly benefit the taxpayers and employers who would be asked to pay to cover the uninsured. Health care financing involves a huge income transfer from the young to the old, the healthy to the sick, and the rich to the poor.
We also get stuck because, on some level, we believe that we should be able to finance expanded coverage with savings from an efficient system. But this logic runs into many barriers. First, there may be no savings, and second, any savings from greater efficiencies could easily be overwhelmed by the costs of new drugs and procedures and an aging population. Under the current system, any savings revert to the government, employers, and employees and would have to be "taxed" back to the health system.
In the end, the coverage issues come down to the need for additional taxes or employer mandates to finance additional coverage. This need runs into the teeth of the strongest force of the last 30 years in our political culture—the anti-tax movement, which has pushed federal taxes to their lowest level in 45 years. Tax levels in the 1990s, which drove one of the most productive economic eras we have ever seen, averaged 18.5 percent of GDP, significantly higher than today's 16.3 percent. This difference would yield more than 200 billion dollars of additional revenue.
Progress in the struggle to finance universal coverage will not come easily and will be bitterly fought at every step. I believe progress on health insurance will come only when we as a nation answer the question of what happened to social justice as a moral value.
To paraphrase Dickens, working to improve our health system will be a "far, far better thing we do than we have ever done before."
James J. Mongan, MD, is Chair of the Commonwealth Fund Commission on a High Performance Health Care System.
The views presented in this commentary are those of the author and should not be attributed to The Commonwealth Fund or its directors, officers, or staff.