How 23 Top-Down Central Planners and Reform Experts Would Systematically  Contain National Health Care Spending Through Eleven Alternative Schemes and One Common Approach

The following solutions could be implemented separately, or, more effectively, integrated as a package…Our approach addresses the system as a whole, not just Medicare and Medicaid.

Ezekial Emanuel, MD, PhD and 22 others, “A Systematic Approach to Containing Health Care Spending,” New England Journal of Medicine, September 6, 2012

The best laid schemes o  mice and men

Gang aft a-gley.

Robert Burns (1758-1796),  To a Mouse

September 9, 2012 – The September 6, 2012 New England Journal of Medicine contains a remarkable article “A Systematic Approach to Containing Health Care Spending.”  It is remarkable because 23 respected and experienced top-down national experts – from think tanks, government, and academia – set forth eleven alternative approaches for reining in health costs.  These eleven alternatives share the belief that physicians are responsible for many, if not most, of responsibility of high health care costs, a belief I do not share.

Top-down national approaches to bending down the health care cost curve have never impressed me much. They tend to be bureaucratic, labyrinthic, and restrict innovation and personal freedoms. These approaches rarely come to pass. But backers of these approaches are worth listening to.   Most have been thinking and consulting on national health cost problems for decades.

I favor market-based incentives which go by different names– fixed dollar subsidies, premium support, health plan buying across state lines, defined contributions, predetermined tax credits, health saving accounts, and people spending one’s own money for nonessential care or where affordable.  Some of these market approaches are also discussed in the same NEJM issue (“Bending the Cost Curve Through Market-Based Incentives.

23 Experts

The 23 experts include.

Ezekiel Emanuel, M.D., Ph.D., Neeta Tandem, J.D., Stuart Altman, Ph.D., Scott Armstrong, M.B.A., Donald Berwick, M.D., M.P.P., François de Brantes, M.B.A., Maura Calsyn, J.D., Michael Chernew, Ph.D., John Colmers, M.P.H., David Cutler, Ph.D., Tom Daschle, B.A., Paul Egerman, B.S., Bob Kocher, M.D., Arnold Milstein, M.D., M.P.H., Emily Oshima Lee, M.A., John D. Podesta, J.D., Uwe Reinhardt, Ph.D., Meredith Rosenthal, Ph.D., Joshua Sharfstein, M.D., Stephen Shortell, Ph.D., M.P.H., M.B.A., Andrew Stern, B.A., Peter R. Orszag, Ph.D., and Topher Spiro, J.D.

Representing These Institutions

The experts represent these institutions;

From the Center for American Progress (E.E., N.T., D.B., M. Calsyn, D.C., T.D., E.O.L., J.D.P., A.S., T.S.), DLA Piper (T.D.), and Brookings Institution (B.K.) — all in Washington, DC; the University of Pennsylvania, Philadelphia (E.E.); Brandeis University, Waltham, MA (S. Altman); Group Health Cooperative, Seattle (S. Armstrong); Health Care Incentives Improvement Institute, Newtown, CT (F.B.); Harvard Medical School (D.B., M. Chernew) and Harvard School of Public Health (M.R.) — both in Boston; Harvard University, Cambridge, MA (D.C.); Johns Hopkins Medicine, Baltimore (J.C.); Venrock, Palo Alto (B.K.), Stanford University School of Medicine, Stanford (A.M.), and the University of California, Berkeley, School of Public Health, Berkeley (S.S.) — all in California; Princeton University, Princeton, NJ (U.R.); the Department of Health and Mental Hygiene, State of Maryland (J.S.); and Columbia University (A.S.) and Citigroup and the Council on Foreign Relations (P.R.O.) — all in New York.

Eleven Alternative Approaches

The eleven alternative ways, which would involve a national approach across all regions and  would be imposed   both federal and private health plans,  to implement cost containment are

One, promote payment rates within global targets

Two, accelerate  use of alternatives to fee-for-service payment

Three, use competitive bidding for all commodities

Four, require exchanges to offer tiered products

Five,, require exchanges to be active purchasers

Six, simplify administrative systems for all payers and providers

Seven, require full transparency of prices

Eight, Make better use of nonphysician providers

Nine, Expand the Medicare ban on physician self-referrals

Ten, Leverage the Federal Employees Program to drive reform

Eleven, Reduce the costs of defensive medicine

Addendum – If the GOP sweeps  the November elections and if the Accountable Care Act is repealed,  some of  these alternative approaches  may be difficult to implement, such as those involving health exchanges.

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