Reform incentives to create a demand for health system reengineering

Abstract

America needs a far more efficient health care financing and delivery system than the one we have. Our present system is a serious threat to public finances and is pricing itself out of reach. At the root of the problem are incentives and organization. The present fragmented fee-for-service small practice model is filled with cost-increasing incentives. There are some relatively efficient organized delivery systems, mostly based on large multi-specialty group practices. Unfortunately, most consumers are not offered the opportunity to save money and get better care by choosing such a system. This situation presents great opportunities for improvement in performance by re-engineering the system. However, for this to happen, incentives must be fundamentally changed so that everyone is cost conscious and care is organized in accountable care systems seeking improvement.