Review: Is a patient-centered system the solution to health care insurance reform?

Beginning with the death of his father from an avoidable hospital-acquired infection, David Goldhill launches an indictment of the U.S. health care system which, he shows in his book “Catastrophic Care,” is fraught with ineffective care, serious and preventable risk to patients and extraordinary overall cost.

Goldhill, a cable company CEO, has experience changing health care. He is a member of the Leapfrog Group, a business coalition that uses employee insurance buying power to leverage health systems to improve patient safety.

He describes how health care leaders seem disconnected from the cost of care and patient outcomes but responsive to payer demands. He asks “why,” wanting to know who is the customer, the patient or the insurer?

Goldhill goes on to posit that a fundamental problem in achieving an efficient and effective health care system is the payment mechanisms, which Goldhill calls the “surrogates”: private insurance companies and government programs.

These surrogates become the “customer” for health care providers, leaving the patient little leverage in trying to change readily remediable care deficits such as long waiting times, rushed visits, over-testing and depersonalized care.

Goldhill shows that although we pay almost twice as much as other industrial countries for health care, we are not aware of the total cost to us because these payments are scattered and disguised. We all see the employee portion of insurance premiums in our pay stub, but we do not see the employer portion, which is a wage cost. And we do not add in Medicare taxes and Medicaid payments made through general taxes.

In aggregate, the cost is staggering. So rather than being happy with the sometimes mediocre care we get from variably accessible providers, we actually should be demanding higher quality and more accessible care.

Goldhill also goes on to show how incentives in health care are aligned against change. Profits drive health care utilization. Hospitals aim to deliver more services, the pharmaceutical industry pushes to sell more medications and doctors may order more tests if they stand to benefit financially. All these services add up to more volume but not necessarily more value to the patient.

The system’s focus on a higher volume of procedures has even distorted the availability of physicians, with fewer doctors entering primary care and geriatrics since the reimbursement for patient care is relatively low for primary care compared to procedure-based physicians.

Historically, employers have relied on the insurance industry to control costs, but insurers actually benefit from increased utilization, since a bigger pie leads to bigger profits when costs can be passed through to employers and patients. Patients sometimes are not sensitive to cost, expecting, and occasionally demanding, unnecessary care. Providers then order that care and insurers reimburse for services that don’t benefit the patient.

Goldhill calls for more effective competition in health care, placing the patient, not the insurer, at the center of care and at the point of service purchase. He believes that health insurance benefits should be limited to catastrophic care, and that a combination of out-of-pocket payments and health savings accounts should be used to build a competitive market, thus enabling patients to use their buying power to pressure providers and more wisely choose services. Goldhill proposes an innovative set of payment models that could eventually refocus care around the patient and align incentives to improve care.

Goldhill presents a convincing argument in many ways, and this book already has challenged policymakers to examine his proposals.

However, some of his assumptions need to be challenged. First, can patients really make independent decisions balancing what they believe is the best care for them against the cost of that care? Studies have shown high-yield preventive care may not be their highest priority.

Although renamed in the 21st century, “snake oil salesmen” are in no short supply in many parts of the health care system. Patients need a trusted adviser who has no financial conflict in making recommendations about evaluation and treatment. That role has historically been that of the primary care provider, but that shrinking group of providers would need to be reinvigorated and training dramatically improved to meet this need.

Finally, is there sufficient impetus and willingness to change American health care? The entrenched components of health care — insurers, hospitals, the pharmaceutical industry, physicians and even government agencies — will not gracefully give up control of this $2.6 trillion industry.

The stalemated Congress and Executive Branch only partially addressed many of these issues in the recent health care reform legislation and show no will to reform health care any further.

So the battle will fall to enlightened CEOs such as Goldhill and business collaboratives such as the Leapfrog Group.

Other alliances have formed such as the Patient-Centered Primary Care Collaborative, founded by Paul Grundy of IBM, which includes hundreds of partners who contend that building back primary care in the form of patient-centered medical homes will empower patients to join with their primary care provider to meet their care needs and reduce cost.

Ultimately, the front lines must consist of activated, dissatisfied patients who can advocate through their employers or associations such as AARP to improve care. After all, we are already paying an exorbitant bill; it’s time to demand better, more effective individualized care at a reasonable price.

Reviewer William P. Moran is a medical doctor, professor and director of General Internal Medicine and Geriatrics at the Medical University of South Carolina.