The United States can proudly tout its status as a global leader in any number of fields — but when the conversation turns to healthcare, it has to sit down. According to the latest figures from OECD Data, the United States spends over fifty percent more on healthcare costs than the average OECD or G8 country, with over $9,800 spent per capita in 2016. For comparison: the per capita spending in the UK came to just over $4,000, while that in Spain totaled around 3,200. Despite the seemingly increased investment in healthcare, however, American patient health and mortality outcomes lagged behind those found in OECD countries.
These statistics paint a clear picture of the risk the cost crisis poses to patients: those who know that they can’t afford to pay for needed care are unlikely to seek it. Just this year, a joint study by 20|20 Research and CarePayment found that a shocking 64% of surveyed patients “avoided or delayed medical care in the last year due to expected costs.” America’s mounting health care costs paint a clear picture for those at every level of the system, from legislators to corporate leaders to providers and payers, that the current system requires a robust systemic transformation to meet the financial and health-based needs of those it tries to serve.
The U.S. system needs to spend its money smarter, not harder. The current care model prioritizes volume of care over value, with a greater emphasis on offering a variety of services rather than providing those individual patients need at high quality. For the most part, this is due to the U.S. healthcare system’s reliance on the fee-for-service reimbursement model. Under this approach, providers charge for individual services rendered, rather than bundling the costs into one rate. This model incentivizes providers to order more tests, suggest additional procedures, and manage more patients than they might have otherwise. Quantity is the priority here, rather than quality of service. As a result of the fee-for-service model, treatment costs trend higher, leading the healthcare industry to spend more on care without achieving equivalent gains in patient outcomes.
The answer to our healthcare dilemma lies in promoting a system of value-based care. Unlike a volume-centered model, value-based systems prioritize the patient by linking payment to care quality and rewarding providers when they deliver treatment effectively and efficiently. This system creates an economic incentive for providers to turn away from the quantity-centered approach by building evidence-based treatment plans, optimizing health services, prioritizing patient experience, and tracking long-term performance.
The key to achieving the above is coordination. Today, our volume-centered model allows for fragmentation; independent businesses offer some health services at differing rates from their competitors, leaving patients to stitch their care into a loose patchwork of providers. In a value-based system, providers would operate within loose networks that could meet patients’ diverse needs with high-quality care at a manageable cost and with one-stop ease of access. By coordinating care, organizations could optimize the quality of service for member businesses, better patient experiences, and lower overall costs for patients and providers alike.
The United States has the care centers, talent, and resources it needs to provide high-quality healthcare at an affordable price. The only factor holding the healthcare industry back is its volume-based incentives; to move forward, the country as a whole needs to shift towards a value-centered model of care that can make the most of what we already have in hand and set the foundation for a healthier America.