Many analysts and policymakers agree that the fragmentation of the health care delivery system results in uncoordinated care, frustrated patients, higher costs, wasted administrative dollars and lost opportunities for rapid improvement in our health care system. There is less agreement as to how to reform health care payments in order to harmonize health care delivery and reduce this fragmentation. How do institutions, communities and practitioners transform their organizations to deliver high-quality, patient-centered care when different payers pay at different rates, and some patients have no one paying at all?
Headlines regularly call attention to pockets of fraudulent activity in the health care area–scams that amount to millions and potentially billions of dollars. The stories typically focus on catching the “crooks” but not so much on efforts to prevent fraud, waste and abuse in health care programs. Both types of efforts are important. With continued concerns about rising health care costs and the current focus on deficit reduction, how much money can be saved and put to better use by reducing waste, abuse and outright fraud?
The Budget Control Act of 2011 tasked six senators and six representatives, from both sides of the aisle, to find at least $1.2 trillion in deficit reduction over the next decade. After weeks of deliberation, members of the “Super Committee” did not reach an agreement by the November 23 deadline. As a result, automatic spending cuts to defense and social welfare programs are set to kick in beginning in January 2013, leaving many questions about the short-term and long-term consequences of the committee’s failed negotiations.
Medicaid currently provides health and long-term care to 68 million Americans, and the Patient Protection and Affordable Care Act would significantly expand Medicaid beginning in 2014. As a countercyclical program, Medicaid typically faces increased enrollment at the same time that states are looking to cut their budgets. Although the Budget Control Act of 2011 exempts safety-net programs like Medicaid from across-the-board cuts, Medicaid has remained a keenly debated topic in discussions of how to reduce the deficit.
Spending on prescription drugs in the U.S. rose at a faster clip in 2009 than spending for hospital and physician care, a trend that is expected to continue through 2020. By some estimates, prescription drugs account for 15 cents of every health care dollar spent. Thus, federal and state budget cutters – as well as private health plans and hospitals – have a keen interest in restraining drug costs.
According to a recent survey, a number of states have expressed interest in expanding managed care approaches within their Medicaid programs. But while managed care may present an opportunity for better delivery of care, it presents challenges within certain populations and geographic areas.
Medicare has been a keenly debated topic in discussions of how to reduce the deficit. It accounts for a large and growing share of both federal spending and of the national economy, although the projected pace of growth is now at a historic low. Its policies often set the pace for the rest of the health care system.
After much heated debate on the U.S. debt limit, the Budget Control Act of 2011, containing more than $900 billion in spending reductions over 10 years, was passed on August 2. The members of the Super Committee created by that law are hard at work, and the process is in gear to achieve at least $1.2 trillion in additional deficit reduction — either through Congress adopting the committee’s recommendations or through further automatic spending cuts.
The high and rising cost of health care is a central concern for governments at all levels, employers and families. A large portion of the cost problem can be traced to the care received by persons with chronic conditions like asthma or diabetes. Treating those with multiple chronic conditions, including the elderly and disabled populations, accounts for 30 percent of total U.S. health care spending as of 2010. Half of this amount is spent by Medicare and Medicaid on behalf of beneficiaries eligible for both programs.
This was an introductory session designed to inform the staff of new members of Congress both in Washington and in district or state offices about the people who receive benefits from both the Medicaid and Medicare programs (often called “dual eligibles”). The briefing was designed to be helpful to staff members unfamiliar with this important issue.
In addition to expanding coverage to 32 million previously uninsured Americans, the health reform law of 2010 aims to improve the health of the population and the quality of health care delivery, while reducing costs. One tool to pursue these goals is the creation of a national voluntary program for accountable care organizations (ACOs). The law authorizes Medicare, beginning next year, to contract with accountable care organizations in a Medicare Shared Savings Program. ACOs provide financial incentives to improve the coordination and quality of care for Medicare beneficiaries, while reducing costs.
The fact that health care costs vary sharply around the country is becoming well known; less understood is that there is also wide regional variation in health care quality. Some regions enjoy low cost, high quality care while others report high cost, lower quality care. Some people have ready access to providers and good care; others may not be receiving necessary care or may be receiving unnecessary, health-endangering care. The root cause of these differences has been the subject of many studies and discussions.
To improve the health of communities and the general population, an array of health reformers, states and businesses alike are all looking to a range of prevention measures such as chronic disease management, alcohol and smoking cessation, and obesity programs. The hope is that these measures will also improve value and control costs.
This toolkit, supported by the Robert Wood Johnson Foundation, will help you understand trends in U.S. health spending, and some of the reasons why spending is going up. We also cover some ideas for restraining health care costs. In addition, this resource offers story ideas, selected experts with contact information, selected websites, and a glossary.
The U.S. health care system is often touted as a model for the rest of the world. We are clearly a leader in costs, but how well are we performing in return for our high investment? How do we do compare to benchmarks of achievable performance? And is performance getting better?
Putting the Brakes on Health Care Costs: Would the Candidates’ Plans Work? Are There Better Solutions?
Polls show that health care is the #2 domestic issue facing the next president and Congress. But drilling down, it’s clear that for many consumers, business leaders and government decision-makers, this means: “Reduce my health care costs first, then let’s talk about covering the uninsured.”