Healthcare Town Hall

This post is excerpted from the new paper by Jon Shreve, “Changing Expectations in Healthcare.”

Increasing access is not the only goal of real reform; improving overall quality and efficacy is also an important goal. Simply pumping more money–or people–into the present healthcare system does nothing to improve the underlying quality of care. Provider practices and patient demands that result in low-quality care are not only bad for the patients involved, they also force on all of us a kind of rationing driven by the inefficient use of resources.

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Evidence-based Requirements, Quality of Care, Reform expectations, Healthcare Reform, Jon Shreve

What follows has been excerpted from an essay by Jon Shreve, the first portion of which ran yesterday.

For many years, conventional wisdom assumed that barriers such as price or underwriting restrictions accounted for the large number of uninsured Americans. Remove the barriers, the reasoning went, and the problem would disappear. So there was reliance on subsidies to lower the entry cost to access—from government for low income individuals, from employers for employees, from the young for the old.

A number of states have introduced low-cost options for low income people (sometimes at four times the federal poverty level), only to capture a very low percentage of the uninsured. Even free expansions of Medicaid have often experienced take-up rates of only 60% or less. Others imposed restrictive rules on medical underwriting and/or community rating, with similar results—little change in the uninsured rates. Our own research of health consumer behavior shows that offering an affordable insurance option to the uninsured does not necessarily compel them to purchase insurance.

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Accountablity, Efficiency, Evidence-based Requirements, Quality of Care, Reform expectations, Healthcare Reform, Jon Shreve

What follows has been excerpted from a new paper, “Changing Expectations in Healthcare,” by Milliman Principal Jon Shreve.

Widespread evidence that our healthcare system is in need of substantial reform continues to mount. Most of this agreement centers on issues of access to affordable health insurance, the need to improve the quality and efficacy of care, and the costs associated with our present system. In order to achieve meaningful reform, a solution must address all three problems.

Of course this is easier said than done. While there may be general agreement on common goals for healthcare—increased access, improved quality, and reduced costs—there is no such agreement when it comes to how we accomplish these goals. If comprehensive healthcare reform is to occur, it should start with a clarification of the fundamental expectations for those involved in healthcare, and then incorporate policies designed to meet these fundamental expectations. Such expectations can help the healthcare system coalesce around interrelated responsibilities for patients, for care providers, and for payers.

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Accountablity, Cost, Evidence-based Requirements, Fragmented system, Quality of Care, Reform, Transparency expectations, Healthcare Reform, Jon Shreve

The National Institute for Health and Clinical Excellence in England offers an interesting model for healthcare reform.

We asked Joanne Buckle for her perspective.

Q: What is NICE and what does it do?

Joanne Buckle: In 1999, the British National Health Service (NHS) created the National Institute for Health and Clinical Excellence, or NICE. NICE is responsible for evaluating treatments and drugs and recommending whether or not the NHS should pay for them. In the years since then, other countries have looked to NICE as an example of how they might approach cost-effectiveness questions; in fact, last year, NICE established a policy consulting wing to help these countries.  In the United States, the recently enacted stimulus bill includes $1.1 billion devoted to fund studies into the comparative effectiveness of different drugs and treatments.

One measure used by NICE to approve or disapprove payment for a drug or a treatment is the cost per quality-adjusted life year (QALY). Cost per QALY is internationally recognized as a method of comparing the cost-effectiveness of alternative treatments. Treatments that increase QALYs, but at a higher price than alternatives, are likely to be approved, as long as the resulting incremental cost per additional QALY is not too high. However, new treatments that have a very high cost per QALY are not likely to be approved for payment because the health budget is limited and these treatments are poor value for money and divert resources away from treatments that produce more QALYs for the same or lower cost per QALY.

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Accountablity, Comparative Effectiveness, Evidence-based Requirements, Global, Reform Comparative Effectiveness, cost per quality-adjusted life year, Healthcare Reform, National Institute for Health and Clinical Excellence, NICE, PCTs, Primary care trusts, QALY