Attacking healthcare’s true cost-drivers – such as unhealthy lifestyles, chronic diseases, misaligned payment incentives to health providers, ineffective and unsafe care, uncoordinated care, and powerful lobbying activities that protect many of these cost-drivers – continue to percolate below the surface and remain mostly hidden from public scrutiny. In some cases, badly-needed policy action is required. One major cost-driver is waste, estimated by the Institute of Medicine to be about 30 percent of health spending on unnecessary services, excessive administrative costs, fraud and many other issues. We are far from resolving these problems.
Employer-sponsored insurance covers about 56 percent of the U.S. population, roughly 147 million people. This number dwarfs the individual markets around the country, with the ACA covering about 20 million Americans. Additionally, employers cover more people than Medicare and Medicaid combined. Because of this, employers have a great deal of power and influence over healthcare reform efforts. For progress to be made, employers will need to coalesce diffused whispers into one loud voice when pushing for similar priorities to control costs and enhance quality. Waiting for the healthcare industry to reform from within will never happen, as it will take purchasers and outside players to disrupt a highly dysfunctional non-system.
The goal of any healthcare reform effort should include the central focus of improving efficiencies over the entire system, not just with insurance markets. To be fair, the ACA does provide experimentation within Medicare to leverage payment incentives to encourage coordinated care, but much more disruption is needed.
The Skinny: Insurance costs are nothing more than a derivative of healthcare costs. Focusing on the symptoms and ignoring the root cause(s) will not reform nearly one-fifth of our economy. Real, meaningful reform begins with establishing broader coalitions to address the key cost-drivers that make healthcare delivery so fragmented and costly. The result of this reform will eventually make insurance options more affordable for all payers.
To read the entire ThinkPiece article from the Des Moines Business Record, you can find it here.
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