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We bet some of you may already have seen these articles on ways to contain healthcare costs, but we wanted to pass them on in the event you missed them. Below are links to two “Sounding Board” papers from the August 1, 2012 New England Journal of Medicine (and our bulleted CliffsNotes summaries – no thank you necessary).

The first is entitled “A Systemic Approach to Containing Health Care Spending” and is authored by Zeke Emanuel, MD, et al. Their framework for reform includes, among other things:

  • Promoting payment rates within global targets. An independent “council” of providers, economists, business and consumers would set the target.
  • Accelerating alternatives to fee-for-service such as bundled payments and accountable care organizations.
  • Using competitive bidding for all commodities, including durable medical and hospital equipment.
  • Requiring healthcare exchanges to offer tiered products. Patients seeing high quality/low cost providers would have lower cost sharing requirements and vice-versa.
  • Administrative simplification including centralized credentialing for payers and hospitals.
  • Full transparency of prices.
  • Utilizing non-physician providers without the need for physician supervision.
  • Reducing defensive medicine costs by providing a medical liability safe-harbor for physicians who follow their specialty’s clinical practice guidelines.

The other article is entitled “Bending the Cost Curve through Market-Based Incentives” and is authored by Joe Antos and others. Their proposal includes:

Market reforms for Medicare:

  • Implementing a defined contribution/premium support system; although traditional Medicare would be a continued option.
  • Providing incentives for seniors to choose high quality/low cost providers.
  • Annual spending limits based on costs of efficiently provided care.
  • Reducing fee-for-service by implementing bundled payments in traditional Medicare.
  • Eliminating the need or incentives for Medigap policies.
  • Subdividing traditional Medicare into regional fee-for-service plans, headed by regional CEOs.

Market reforms for private sector:

  • Implementing premium support for employer-sponsored health plans.
  • Leveling out or limiting the current tax exclusion of health insurance premiums.
  • Establishing health insurance exchanges that allow for more competition among health plans rather than the overly regulated ones established under the Affordable Care Act.
  • Medical liability reform (though no specifics are outlined).

So, on the left (Emanuel et al), we have global budgets; spending limits; bundled payments; cost information and patient incentives; and medical liability reform. On the more conservative right (Antos et al), we have global budgets; spending limits; bundled payments; cost information and patient incentives; and medical liability reform.

Hard to decide which side to be on.

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