Scissors & Consumerism: Winds of change in healthcare

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Kaitlyn Dmyterko, senior writer

In healthcare, reform remains a hot topic. How can we do more with little money remains the question on the table for hospital administrators and staff. How can hospitals provide high-quality care when the government has asked all to take out the scissors and cut?

It is obvious that many in the healthcare community are not too keen on the government’s sustainable growth rate (SGR) formula, which if enacted, would cut 2012 physician fee schedule services by 30 percent. But how realistically can it be remedied?

Last week, the Medicare Payment Advisory Commission (MedPAC) proposed scrapping the SGR, and while the idea was commendable, many associations scorned the proposal due to the fact that it was laced with long-term freezes and cuts to physician payments.

“We have to do something about rising costs and we have to do something to get rid of the SGR because it is a mushrooming nightmare,” Jack Lewin, MD, CEO of the American College of Cardiology (ACC), told Cardiovascular Business. "But this [MedPAC] solution is not a good one."

Because Congress has repeatedly delayed fee cuts, the gap between the target and spending has widened and is now close to 30 percent, Michael E. Chernew, PhD, from Harvard Medical School in Boston, wrote in a New England Journal of Medicine perspective.

According to Congressional Budget Office estimations, the cost of freezing  physician fees rather than cutting them could add up to nearly $300 billion over the next 10 years.

Interestingly, in another NEJM perspective, Pamela Hartzband, MD, and Jerome Groopman, MD, offered that healthcare has changed due to reform. Rather than having “doctors” and “patients,” we now have “providers” and “consumers.” The authors blamed this new terminology on the economic downturn. Currently, the healthcare system has become a “commercial transaction,” where the patient is the buyer and the physician is the seller.

“Reducing medicine to economics makes a mockery of the bond between the healer and the sick,” Hartzband and Groopman wrote. How, then, do we maintain medical integrity while addressing cost realities?

Taking the time to understand and identify strategies to reduce unnecessary Medicare spending is the first step and could reduce spending $20 to $30 billion per year, Lewin offered. Additionally, there must be more alignment between primary care physicians and specialties, which could include incentivizing physicians for quality care, rather than volume.

What are your thoughts on reforming the payment system? Email us and let us know.

Kaitlyn Dmyterko
Cardiovascular Business, senior writer
Kdmyterko@cardiovascularbusiness.com