By Robbie Hughes, Founder and CEO, Lumeon
When I heard that President Trump would be making a speech about a healthcare overhaul this month, I hoped he’d be recommending real regulations to actualize the commitments on price transparency he made over the summer. What we need is to ensure consistent implementation of the ideas in his executive orders. Groups like the Surgery Center of Oklahoma are already publishing prices for some services, so we know it’s possible. How do we get the rest of the market to move?
However, now we hear that plans for big changes to healthcare may be on ice, with the administration instead focused on the imminent ruling on the constitutionality of the Affordable Care Act from the 5th U.S. Circuit Court of Appeals. A group of 21 Democratic attorneys general are defending the law after a federal judge ruled it unconstitutional last December, and experts are anticipating that the appeals court will uphold the law.
With healthcare for millions of Americans hanging in the balance, it’s worth stepping back at this moment and imagining what a better U.S. healthcare system would really look like. If we could wave a magic wand and institute a complete redesign of the care delivery system and the funding model to go with it, what would we do?
Central to the solution is solving for cost. The reason I advocate for price transparency is that carriers can price with more accuracy and consumers can shop with more information when they know the total cost of care in advance. There is generally great concern about the cost of deductibles, but this comes from the problem that the deductible is the only cost that is exposed to the patient.
The root-and-branch way to fix the mess of healthcare finance is to provide and fund proper primary care. This needs to be risk-based and following a capitated model in which payers allocate a set amount of funding for each covered individual for a given period of time, regardless of whether that person seeks care. Those funds will be drawn from traditional premiums with no deductibles.
We need to move standardized, common procedures out of hospitals and into dedicated facilities that specialize in these routine interventions, where there’s little risk of contamination from infectious patients and where physicians are not overburdened with unsustainable caseloads. These procedures will be priced as shoppable services, dictated by the market and funded by payors. These facilities can be run essentially like factories for health interventions, with phenomenal outcomes compared to today’s measures at a fraction of the cost.
For all other procedures and care needs, we can run highly specialized tertiary centers that will resemble the hospitals of today. These will be paid on activity, but the risk pools of the carriers will ensure that patients are not penalized for non-preventable care.
To support this new paradigm, we should also redesign medical training to provide young doctors the specific skills they need to manage whichever role they choose. Their training will be based on data and evidence, and focused on learning to operate in multidisciplinary teams.
We also need to have a better way of tracking each patient in the system and accounting for all the costs that patient incurs. This would look like a system of common identifiers that patients use regardless of where they receive care or how it is paid for.
In my dream world, this is the type of healthcare overhaul Trump would step to the microphone to announce this month. In reality, it looks like we won’t be getting even a shadow of this kind of progress.