What Insurers Must Do to Accelerate Health Care Reform Now
The first car I ever bought was a 1976 Chevrolet Monte Carlo. I cannot recall exactly what I paid for it, but it was a fraction of the average price of a new car today. Automobile prices have risen dramatically over the last several decades, yet no one seems up in arms over it.
I believe this is because we get so much more for what we spend on a car today: air bags, crumple zones to absorb impact, better gas mileage and computers that diagnose engine problems.
We cannot say the same about health care in recent years. Consumers are complaining about how much they have to pay for health care, both in insurance premiums and out-of-pocket costs. They want greater value for what they’re paying.
What will it take to give consumers what they are rightfully asking for?
The answer is, of course, complex. It involves transforming our health care system to reward quality instead of pay for the volume of services provided. But there is one simple part of the equation that those of us in health care must embrace: We have to accelerate our transformation.
We do not have the luxury of taking our time. On the current course, health care spending will exceed 20% of our nation’s GDP by 2020. We cannot afford this as a nation or as individuals. We need to think in terms of revolution, not evolution. We can build a system that provides affordable, quality health care – but it has to be done with greater urgency. And it will take everyone in health care, including insurance companies.
Committing to Transparency
In my own organization we decided we couldn’t wait for transparency in health care costs to become the norm. In 2011, we unveiled a web-based treatment cost estimator that allowed our customers to see average costs of dozens of common elective procedures. This year, we expanded our transparency efforts by becoming the first insurer in the nation to offer an online consumer tool that provides cost information on more than 1,200 procedures. And we made those prices available to anyone with an Internet connection. For our customers, we offer an enhanced tool that adds information about providers’ quality of care and an estimator that allows customers to consider the out-of-pocket costs for specific procedures.
Others are moving forward with their own transparency initiatives. This is an essential step. For many years, health care prices have been shared on a “need to know” basis, with insurers and health care providers acting as if consumers simply didn’t need to know. In fact, even many doctors are in the dark about what their services cost – a stark indicator of an irrational economy.
That irrationality continued for decades, but now consumers want a health care system that operates with more of a retail model. The price of health care is no longer an afterthought and consumers want access to information that will help them better understand what sort of value they are getting for their money.
Consumers can play a crucial role in health care transformation, but they cannot help control costs unless they know what the costs are. Transparency is central to a consumer-focused health care system and it is one of the most immediate ways we can accelerate reform. We must equip consumers to make the best decisions about their health and what they spend on it.
Moving Past Fee-For-Service
The fee-for-service model of paying for every test and procedure – regardless of quality, need or outcome – is unsustainable. Insurers not only have to adopt payment models that reward quality outcomes, we also have to help physicians and hospitals make that transition. They need the data, analytics and communication support that insurers can provide. So let’s give them what they need. We must move from a system that pays for the number of procedures and toward a system that is geared more towards positive health outcomes.
This transition may involve some difficult conversations between insurers and providers. We cannot allow that possibility to delay our taking action. Alarm bells are ringing and there is no time for a wait-and-see response.
Already, insurers and health care providers are making progress with collaborations like Accountable Care Organizations that provide comprehensive care with incentives for positive health outcomes. Bundled payment agreements call for a single price covering the entire course of treatment for joint replacements. These are a good start, and we need more of this kind of innovative thinking to replace the fee-for-service model.
Fee-for-service is going away. Payment based on quality outcomes is the future. The sooner we all embrace this concept, the better our system will become.
Consumers at the Heart of the System
In order to create truly consumer-centered health care, both insurers and health care providers need to be better communicators. If we are sharing more information with the public, we have to present that information in language that is easy to understand, not in technical jargon filled with acronyms that only health professionals can decipher. We need to communicate using the tools consumers prefer, like mobile devices.
And we need to be as good at listening as we are at talking, always inviting consumer feedback on our progress. Our company has placed a renewed emphasis on improving the customer experience, gathering feedback in a comprehensive way so we can meet their expectations. Based on what we are hearing, we are designing more personalized insurance offerings to meet the needs of our diverse membership.
Everything we are doing in health care – working to improve quality, manage rising costs, deliver better outcomes and increase patient satisfaction – stems from our need to put consumers at the center of the health care system.
For many of us in health care, this is a sea change. I am pleased with the progress we are making in transparency and shifting to value-based care. Yet there is plenty of work to do to transform our system.
The question that remains is how quickly we can get there.
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