The tale of one Seattle medical center’s quest to improve care and reduce costs illustrates the obstacles physicians face in practicing more efficiently under a fee-for-service payment system that overpays for some medical services and underpays for others, according to a study by researchers at the Center for Studying Health System Change (HSC) published July 10 as a web exclusive in Health Affairs.
Faced with exclusion of several physician specialties from Aetna’s high-performance network, Virginia Mason officials worked with the insurer and four large Seattle employers--Costco, Starbucks, King County, and Nordstrom--to redesign care delivery for four common conditions: uncomplicated lower back pain, gastroesophageal reflux disease, migraine headaches, and cardiac arrhythmias. Adapting aspects of the Toyota Production System to a healthcare setting, VMMC mapped out how to improve efficiency per episode of care for each of the conditions, according to the article.
“The good news is that Virginia Mason identified ways to streamline and improve care; the bad news is that the medical center’s bottom line may take a significant financial hit as a result,” said Hoangmai H. Pham, MD, an HSC senior health researcher and lead author of the study.
In an accompanying HSC issue brief, Paul Ginsburg, PhD, HSC president, points out that “most efforts to improve efficiency for a specific medical condition usually reduce the number of services per patient that can be billed, posing financial challenges for providers. These challenges are often magnified by the current fee-for-service payment structure, where some services are highly profitable and others are unprofitable.” Read the abstract.
