Harvard Economist Offers Health Reform Solution: Says change must focus on cost containment

He mentioned a study from Intermountain Healthcare, a nonprofit network of 25 hospitals and 100 clinics, which identified 25 instances in which using evidence-based care at Intermountain could improve outcomes and control costs. But in 23 of those 25 cases, their revenue would decline by more than their costs.

“So doing quality improvement cost-reducing care, they will be punished by the reimbursement system,” Dr. Roberts said, “because they will generate fewer marginally unnecessary tests and procedures and admissions. We have a system that encourages inappropriate and marginal overuse.”

“Anyone who says to you the U.S. has the best health care system in the world clearly has not been looking at the numbers.”

—Marc Roberts, PhD

The “Sagamore Bridge Plan”

“What we need to do is give researchers an incentive to develop cost-reducing technology,” Dr. Roberts said. He added that the much-discussed “public option,” creating a public purchaser that could bargain with providers and drive down costs, would not have helped much.

“We already have a big public option—it’s called Medicare,” he said. “And it already can negotiate and so on and so forth. The brouhaha about the public option, this was entirely misconceived. And its loss does not account for the fact that the bill will not do anything about cost because it would not have done anything about cost.”

He offered what he called the “Sagamore Bridge Plan,” named for a narrow, old, crowded bridge to Cape Cod, a route no one would ever drive on—except it was the only way to Cape Cod. His plan is similarly unpalatable, he said.

In it, the government would issue tax-supported vouchers, which patients would give to a provider in exchange for basic care. The government would pay the provider based on the person’s risk factors. Patients could pay for better care out of pocket if they chose and would be able to use vouchers to shop around, which would give providers an incentive to provide cost-effective care.

“Those of you who think that this is a really horrible idea can rest assured there is absolutely no chance of our doing this politically,” he said. “But we are going to have to move in some way or other in this direction.”

Feedback

Reactions to Dr. Roberts’ remarks were largely favorable.

“I went into medicine to provide care for patients, and the only way we can do that is if we can afford to,” said Carol MacArthur, MD, a pediatric surgeon in the otolaryngology-head and neck surgery department at the Oregon Health and Science University in Portland. “Right now, too many people don’t have any access. They come to us really, really sick, and that’s very expensive, and it’s not ethical.”