health care and the us economy problems and prospects seattle economics council february 8 2012
Download
Skip this Video
Download Presentation
Health care and the US Economy: Problems and Prospects Seattle Economics Council February 8, 2012

Loading in 2 Seconds...

play fullscreen
1 / 43

Health care and the US Economy: Problems and Prospects Seattle Economics Council February 8, 2012 - PowerPoint PPT Presentation


  • 85 Views
  • Uploaded on

Health care and the US Economy: Problems and Prospects Seattle Economics Council February 8, 2012. Mary McWilliams Executive Director. Average Health Care Spending per Capita , 1980–2009 Adjusted for differences in cost of living. Dollars. THE COMMONWEALTH FUND.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Health care and the US Economy: Problems and Prospects Seattle Economics Council February 8, 2012' - levana


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
health care and the us economy problems and prospects seattle economics council february 8 2012

Health care and the US Economy: Problems and ProspectsSeattle Economics CouncilFebruary 8, 2012

Mary McWilliams

Executive Director

average health care spending per capita 1980 2009 adjusted for differences in cost of living
Average Health Care Spending per Capita, 1980–2009Adjusted for differences in cost of living

Dollars

THE

COMMONWEALTH

FUND

Source: OECD Health Data 2011 (June 2011).

health care is a bigger problem than social security
Health care is a bigger problem than Social Security

Source: Congressional Budget Office

slide8
Among Persons Under 65, Approximately 1 in 7 Persons Is Uninsured and 1 in 5 Has Public Coverage Primary Source of Insurance for Persons Under Age 65

Source: 2010v1 Washington State Population Survey.

slide9
The Percent Uninsured Has Returned to the Level of the Early 1990s and Employer Coverage Has Declined Over Time
health care costs have wiped out real income gains
Health Care Costs Have Wiped Out Real Income Gains

$ 870 for inflation

$ 945 for health care

$ 95 for spending

$1910 more income

reducing healthcare spending requires less hospital spending
Reducing Healthcare Spending Requires Less Hospital Spending

Hospitals are the largest component ofhealthcare spending and of increasesin healthcare spending

the cost curve is already bent
2.6

2.5

2.4

2.3

Actual Spending

On Health Services

2.2

2.1

% Growth NHE

2.0

1.9

1.8

1.7

1.6

1.5

1.4

1.3

1.2

The Cost Curve is Already Bent

Actual Spending On Health Services

% Growth NHE

Source: CMS, Office of Actuary

hospital admission trends 2000 2011
HOSPITAL ADMISSION TRENDS2000-2011

Source: Banc of America Securities LLC

patient visits at lowest level seen in over 7 years
FOR REFERENCE ONLY

LIVE AREA

Slide auto layout

Patient visits at lowest level seen in over 7 years

Source: IMS Health, National Disease and Therapeutic Index, Apr 2011

slide18
Branded Generics Disaggregated

Generics continue to grow strongly

Source: IMS Health, National Prescription Audit, Mar 2011, Branded generics disaggregated

slide20
Chart 4.6: Aggregate Hospital Payment-to-cost Ratios for Private Payers, Medicare, and Medicaid, 1989 – 2009

Source: Avalere Health analysis of American Hospital Association Annual Survey data, 2009, for community hospitals.

(1) Includes Medicaid Disproportionate Share payments.

wide variation in prices per delivery in ma hospitals
Wide Variation in Prices Per Delivery in MA Hospitals…

Source: Massachusetts Health Care Cost Trends: Price Variation in Health Care Services Massachusetts Division of Health Care Finance and Policy, June 2011

with no relationship to quality
…With No Relationship to Quality

Source: Massachusetts Health Care Cost Trends: Price Variation in Health Care Services Massachusetts Division of Health Care Finance and Policy, June 2011

wide swings in cost and care
Wide Swings in Cost and Care
  • The Dartmouth Atlas uses Medicare claims data to track how cost and quality vary across the U.S.
  • The Results:
    • There is a 2.5 fold variation in Medicare spending by region (population-adjusted)
    • Patients in high-cost areas are not sicker nor do they have better health outcomes
    • More health care spending does not result in living better or longer. In fact, the opposite may be true
  • Reducing unwarranted variation could improve quality and reduce spending 30%
tale of two cities miami vs minneapolis
Tale of Two Cities: Miami vs. Minneapolis

More Money Does Not Improve Value

* Effective care index includes: pneumonia vaccination; breast & colon cancer screening; eye exams, HbA1c & blood lipid monitoring for diabetes; and, aspirin therapy, beta blockers, ACE inhibitors and reperfusion with thrombolytic agents or PTCA for heart attack victims. Source: Health Affairs

what drives decisions on care
What Drives Decisions on Care?
  • Doctors decide based on local medical opinion and supply of medical resources, not on science or what informed patients want
  • Doctors have surprisingly little information on what works or the “right” amount of care
  • This is why Congress is funding “comparative effectiveness” research
supply sensitive care is more health care better
Supply-Sensitive Care: Is More Health Care Better?
  • People assume that more care is better
    • Reinforced by fee-for-service payment
    • Where more care is provided, patients with chronic conditions do not have better health
    • “Supply of services” accounts for 50% of the regional variation
alliance role show how care varies and promote better value
Alliance Role: Show How Care Varies and Promote Better Value
  • The driving force: Ron Sims and King County
  • Purchasers, Providers, Plans & Patients
  • 2 million lives in 5 counties
  • Funded by participant fees and grants
  • Nationally recognized by the Robert Wood Johnson Foundation and the federal Secretary of Health and Human Services
how will transparency make a difference
How Will Transparency Make a Difference?
  • Creates public accountability
  • Sets targets for improvement
  • Stimulates dialogue among providers to compete
  • Gives consumers more information about care they need and how providers vary
  • Results may be tied to provider pay incentives and/or network design
  • Improving results will reduce the personal and financial cost of chronic disease and preventable conditions
transparency necessary but not sufficient need to pay providers for value not volume
Transparency: Necessary but Not Sufficient – Need to Pay Providers for Value, not Volume
  • We now reward providers for delivering more services to more people, not for better quality
  • Providers are not rewarded for keeping people healthy
  • Fundamental payment reform is needed to reward value
  • Medicare, the largest payer, sets payment standards, but local innovations are underway
organized systems of care are needed for new payment models
Organized Systems of Care Are Needed for New Payment Models
  • Deliver and/or arrange full range

of services

  • Skilled in quality and cost

management

  • Coordinate care with specialists

and others

  • Engage patients in shared

decision-making and help patients self-manage their conditions

  • Commit to creating a better way to deliver care to patients
  • Supported by Electronic Health Record
prospects for real health reform
Prospects for Real Health Reform
  • The Good News:
    • There is agreement that the system is unsustainable
    • We know what’s needed to fix it
  • The Bad News:
    • The challenge is execution
    • It will be disruptive and take time to fix
what s needed to fix the system
What’s Needed to Fix the System
  • Research into what works
  • Focus on chronic care prevention and management
  • Coordination of patients’ care
  • Organized systems of care
  • New ways to pay doctors and hospitals
  • Patient access to evidence-based information on quality and cost
challenges to fixing the system
Challenges to Fixing the System
  • One person’s “waste” is another person’s revenue
  • Hospitals have huge capital investments
  • New provider payment systems are unproven and complex to administer
  • Conversion from paper to electronic health records is costly and slow
  • “Organized Systems” can be cartels and drive up costs
  • Comparative effectiveness research takes time and money
  • The public assumes that more care is better
the public needs to understand what s at stake
The Public Needs to Understand What’s at Stake
  • High rates of overtreatment, under treatment, and misuse of medical services endanger their health
  • U.S. cannot prosper when 18% of the economy wastes 30% of what it spends
  • Diverting resources from education and innovation to medical care imperils our global competitiveness
  • If U.S. keeps borrowing to pay for ineffective care, we and our children will pay the price
ad