Traverse City Record-Eagle

September 9, 2012

Another View: Waste rampant in health care

By The Free Press, Mankato, Minn.

---- — A recent report that we're wasting $750 billion a year on the nation's health care system was surprisingly hopeful in that it suggested common-sense solutions and would appear to cost us very little.

The influential Institute of Medicine detailed the $750 billion in waste in a report ... and suggested we simply apply principles of business, be better consumers and change payment incentives to curtail some of the waste.

It comes at a time when both presidential campaigns are accusing the other of cutting Medicare by almost the same amount of savings detailed in the report but over 10 years.

That means if we can save 10 percent of the waste per year, deep cuts to Medicare or elsewhere may not be necessary (even though the Medicare system still needs significant reform.)

An 18-member panel at the Institute comprised of health professionals, business people and public officials came to some pointed realizations.

A report by the Associated Press summarized the problems: "If banking worked like health care, ATM transactions would take days. If home building were like health care, carpenters, electricians and plumbers would work from different blueprints and hardly talk to each other.

If shopping were like health care, prices would not be posted and could vary widely within the same store, depending on who was paying.

"If airline travel were like health care, individual pilots would be free to design their own preflight safety checks — or not perform one at all."

This analysis rings true to anyone who has tried to negotiate the ins and outs of health care and the insurance industry. But the panel's recommendations can also be implemented without a lot of cost.

The panel reported that almost a third of all the waste was unnecessary services.

First and foremost, health care consumers need to get more informed. We all need to realize in a system where all of us pay for the use of physician services, we save everyone money if we don't go to the doctor for every little thing. There are now many legitimate medical websites that one can go to to assess if one needs to see a doctor. Sometimes a nurse will do.

The medical providers have to be on the same page. Can they write a common prescription after a phone call or e-mail with the patient instead of an office visit?

The panel estimated another $190 billion was wasted on unnecessary administrative costs. Health care providers, insurance companies and the government really need to step up on this one and work together to have common claim forms and streamline other procedures. There may be some upfront costs, but if we can show savings in a relatively short period of time, the moves would make business sense.

The panel did recommend basic strategies to bring about savings. Payment reforms need a system for quality outcomes, not just the volume of procedures. Employers shouldn't assume health care premium increases are a given but demand more accountability from providers.

The panel recommends doctors shed some old notions of solo practice and work together with peers and other health care professionals.

While some of the changes in attitudes toward health care, practices and consumer knowledge will be big hills to climb, they are not insurmountable and eventually will not be just nice ideas, but necessary steps.

The Free Press Mankato, Minn.