I have at least one more post in my about the Virginia Mason lean experiment.
So far, we've talked about how reporting near misses and medical errors is a key missing piece of hospital process improvement. We've also discussed how the current reimbursement model leads to higher-than-necessary medical expenses.
The next foul piece of the American health care delivery system exposed by the Virginia Mason lean experiment is the way providers are reimbursed. One thing Virginia Mason CEO Gary Kaplan mentioned as a key reason for their ability to implement these sweeping changes is that their physicians are salaried. Meaning their individual payment is not tied to the amount or kind of services they are providing to patients. Kaplan says that they try to hire the right kind of provider who wants to improve and blah blah blah, but what really helped drive their improvements were providing the right incentives to their salaried physicians to help them want to order fewer unnecessary tests. There's a telling quote in the Health Affairs article... "It remains to be seen how VM’s cardiologists will respond to the projected margin losses from less frequent cardiac testing." Yes it does.
Along the same lines as my previous post about hospital reimbursement, non-salaried doctors tend to make more money when they perform more surgeries, order more tests and perform more services. Doctors aren't going to respond well to a lean process that eliminates unneeded services if it winds up cutting into their pay.
In sum, we need to redo reimbursement to give doctors incentive to practice medicine with less waste and more value. An improved system that truly puts the patient first and eliminates waste doesn't have to result in lower provider reimbursement if the model is corrected. Yes, there will be winners and losers in this new system. Maybe primary care doctors will see their reimbursement go up while oncologists or surgeons see their pay go down, but rewarding the true "value centers" in health care like primary care can bring us to the more efficient system we all want.
Comments