Improving Health Care Value through Shared …

1 Health care Reform Insights Improving Health care Value through Shared accountability Bert Zimmerli Rising costs and increasing demand for Health care services requires a broader approach to Health care reform than the insurance mandates incorporated in the Affordable care Act. At Intermountain Healthcare, an approach focused on Shared accountability was designed to increase the effectiveness and lower the cost of Health care by emphasizing the Triple Aim of better care , better Health , and better cost management.

2 Introduction tors of our economy because people are using more care and more expensive types of care . Utilization The Health care system in the United States is fac- is driven by a number of factors: ing staggering challenges of rising costs and wide variation in both clinical quality and access to care . n An Aging Population Recent Health care reform legislation which focus- Aging is the first of a number of demograph- es more on insurance mandates than on improve- ic changes fueling Health care expenditure ments in care delivery is unlikely to significantly increases.

3 According to the 2010 census, a alter the fundamental trends of growing demand, growing percentage of seniors (age 65 and growing utilization, and rising costs. older) now constitute about 13 percent of the population (compared to 12 per- But there is good news, if we as a nation choose cent in 2000 and 1990 and just percent to embrace it: We know how to provide excellent in 1930).3. care at a lower cost. It's already being done by orga- As more and more of the 77 million nizations in different parts of the country, includ- baby-boomers turn 65, the percentage of ing Utah, where Intermountain Healthcare is the seniors is increasing and will account for leading provider.

4 If Utah were a country, by many 19 percent of the population by measures, it would rank as having the most effective Moreover, the oldest old those 85 and Health care in the older are growing as a group, from 15. Intermountain's approach called Shared percent of seniors today to more than 20. accountability is designed to achieve the Triple percent of seniors by Aim goals of better care , better Health , and better Since per capita spending rises with To understand our approach, it's age,6 Health care expenditures will increase useful to understand the factors causing Health care as increasing numbers of seniors require utilization and costs to rise.

5 Increasing amounts of care . n A Sicker Population A much more troubling demographic Drivers of Health care change is the rising incidence of obesity in Utilization and Costs our population. According to the Centers for Disease Control and Prevention, 63 per- Health care expenditures are rising at a rate that's cent of Americans have a body mass index disproportionate to the growth rates in other sec- (BMI) greater than 25, which is considered INSIGHTS WINTER 2013 27. overweight, and 31 percent have BMIs New breakthroughs in Health care , greater than 30, which is considered unlike other fields, often require addi- These percentages have increased rap- tional human resources, and these so-called idly in the last two decades.

6 The prevalence advances have not always improved out- in children is especially alarming, because comes, even as costs rise. it has nearly tripled since The options for the definitive treat- The Health risks of obesity are well- ment of prostate cancer, for example, now documented and numerous; they include a include radical prostatectomy, robotic pros- greater risk of Type 2 diabetes, cardiovascu- tatectomy, brachytherapy (radiologic seed lar disease, cancer, hypertension, dyslipid- implant), radiation therapy, intensity-mod- emia, stroke, joint disease, and other Health ulated radiation therapy, and proton beam therapy.

7 The annual medical care costs of obe- While there are not demonstrably sig- sity are estimated at $147 nificant differences in outcomes between these various modalities, the costs of these n Incentives for Physicians and Hospitals interventions vary by a factor of nearly Current financial incentives in the domi- nant fee-for-service payment model encour- age physicians and other Health care pro- n Incentives for Patients fessionals to do more tests and proce- Patients tend to view more care and dures and especially reward them for newer modes of care as better care .

8 In the doing expensive tests and procedures. This decades after World War II, Americans ben- is one of the main differences between the efited enormously from greatly expanded Health care system and the systems in access to employer and government Health other countries. insurance. As a result, America excels at rescue But an unintended consequence of this care : trauma care , cancer care , cardiac insurance was an almost unchecked incen- care , transplantation, etc. By contrast, most tive for patients to desire and for caregiv- other nations place a greater emphasis on ers to provide access to every sort of care , preventive and primary care , such as immu- effective or not, with consumers largely nizations, prenatal and well-baby care , and insulated from the true cost of care .

9 While the treatment of chronic Americans have been sharing in more of Similarly, our fee-for-service payment the costs of care and coverage in the last model pays on the basis of services pro- decade, the view that more is better per- vided rather than on outcomes or effective- ness, rewarding the quantity rather than the quality of care . And fear of litigation It should be noted that Health care organiza- causes physicians and hospitals to err on tions like Intermountain have been very successful the side of providing extra services.

10 through the years in Improving efficiency and in Many caregivers take the course of reducing the unit costs of care materials and pro- least resistance and order additional tests cesses. and services, even though their medical We've done this through innovations in supply judgment tells them these extras aren't chain, revenue cycle, information systems, and other initiatives that enhance operational effective- n Technology ness. As a result, the unit costs of care have tended In addition, technology has been a mixed to remain stable and in some cases have even blessing in Health care .