As healthcare reform moves to center stage on the congressional agenda, crucial questions remain unanswered about how to balance the need to curb costs while setting proper limits on risky and unproven medical procedures.
With President Clinton expected to make his healthcare reform proposal a centerpiece of his State of the Union address later this month, the sense of entitlement among the general population is likely to swell. At the same time, Commerce Department projections that health spending will top $1 trillion in 1994 are fueling demands for relief from those who pay the freight.
A tangled, bureaucratically complex plan for state-run health purchasing alliances and managed competition doesn't provide a satisfactory answer for allocating limited resources to a demanding public, but neither do any of the other reform proposals that have been proposed. The problem is the wide gulf between theory and reality for individuals who come up against the ugly "R" word-rationing.
A recent survey on access to care conducted by the University of Utah illustrates the problem. Respondents were asked to choose between spending $50,000 on either basic healthcare for many or a single medical procedure for one person facing a life-threatening situation. Nearly two-thirds of the Utahans said the money should go to provide basic healthcare for all. There was one important exception, however-if the life-threatening situation involved an immediate family member, then two-thirds wanted to spend the money on their relatives.
A recent Superior Court jury decision in Riverside, County, Calif., illustrated the public backlash that can accompany efforts to ration care. The jury whacked Health Net with $77 million in punitive damages as well as $12 million in compensatory damages because it refused to pay for a bone marrow transplant for a woman with advanced breast cancer. The American public seems to believe every individual is entitled to every high-technology treatment for every ailment, whatever the cost.
In the near term, the government should concentrate on underwriting and coordinating research on the best medical quality practices and allow the industry to focus on forming integrated networks to provide a continuum of high-quality managed care and rapidly cut costs.
Examples abound. One of the newest planned mergers involves HealthTrust-The Hospital Co. and Epic Healthcare Group, two of the largest for-profit chains. In Minneapolis, the University of Minnesota Health System, Fairview Health System, Fairview Physician Associates, Aspen Medical Group and Blue Cross and Blue Shield of Minnesota have announced plans to form an integrated organization.
In New Jersey 40 hospitals and 7,000 physicians are forming the state's largest health maintenance organization, First Option Health Plan.
Redesigning work and cutting staff are high on other executives' agendas. A quarter of hospitals polled by the national accounting and consulting firm of Deloitte & Touche say they plan to trim their work forces-many by up to 24%.
Every administrator should initiate an Office of Innovations in his or her hospital or system, decentralize authority and generously reward caregivers and staff who contribute ideas for redesigning the way care is delivered. Healthcare executives of the future must be change agents, directing facilities that deliver cost-efficient, high-quality care focusing on maintaining health and preventing sickness.