What’s Inflating U.S. Healthcare Costs? Volume-Fee-For-Service Model

by Barry Hill


Most people agree that our healthcare system is flawed. It really boils down to an inefficient structure and misguided value system, which results in costs well above what they should be for the care received. As with any structure that is unsound, the results are detrimental to the end-user – you and me, the patients – particularly over time as the structure is tested and the detrimental effects compound.

Today’s healthcare system is provider-centric, driven by fee for service payments – and therefore rewards increasing the volume of services provided vs. incentivizing specific outcomes. The mass adoption of EHR/EMR (electronic health/medical record-keeping systems), while potentially offering time-savings and other efficiencies, has been criticized for its ease of use in increasing the volume … of the bill, that is.  Dave Chase, a thought leader in innovative healthIT and CEO of Avado, speaks to the importance of patient relationship management (PRM) in existing EHRs.  In theory, and evidenced in early adoption of PRM, both patients and physicians are held more accountable to outcomes vs. “checking a box” for procedures or treatments.

In many cases, increasing the volume of treatment does not necessarily equate to effective or affordable care. In a recent review of Starbucks employees in Seattle, WA, afflicted with back pain, the following was discovered:

“90 percent of what the hospital was doing was of no value.” As it turns out, the best way to treat most back pain is with physical therapy. That insight led to new processes, including same-day visits (as opposed to 31-day waits), reduced use of imaging tests and prescription drugs, and the addition of psychological support. Within three months, 94 percent of Starbucks employees with back-pain complaints were back at work within a day.

This is not intended to bash physicians in any way. On the contrary: we have great respect for medical professionals, particularly those who acknowledge and work toward improving current systems via healthy lifestyle promotion. Many are leading the way into an emerging value-based system that is patient-centric — and, increasingly, population-centric — driven by global payments. “Most industries compete on value. U.S. healthcare does not. But that is about to change” (Oliver Wyman’s Volume to Value Revolution).

What You Can Do Now

While we see potential for positive change in the basic structure of the healthcare system, it will take awhile to see the effects on your wallet and health. Meanwhile, it is becoming more and more important to do whatever it takes to keep yourself healthy. Exercise, eat well and educate yourself…it’s a lifestyle!  And be prepared to ask your physician about alternatives to any recommended treatments. Make your own fully informed choices, rather than be led into tests, treatments and services of which you don’t fully understand the benefits.  It’s okay to ask constructive questions.

Up Next on Fit After Fifty: What’s Inflating U.S.Healthcare Costs? Consumers Play a Passive Role – What You Can Do Now

The full series:

Our Healthcare Crisis – Why Should You Care?

What’s Inflating U.S.Healthcare Costs? Volume-Fee-For-Service Model

What’s Inflating U.S.Healthcare Costs? Consumers Play a Passive Role

What’s Inflating U.S.Healthcare Costs? Third-Party Payment Systems

Source: http://www.forbes.com/sites/davechase


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1 comment

Our Healthcare Crisis - Why Should You Care? - FitBehavior February 12, 2013 - 7:31 am

[…] Up Next:  How Our Healthcare System is Inefficient: The Volume-Fee-For-Service Model – What You Can Do Now […]

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