Cleveland Clinic CEO sees 'total restructuring' ahead for healthcare business

Healthcare's shift from paying for volume to paying for value will require a "total restructuring" of the industry, Cleveland Clinic CEO Dr. Toby Cosgrove said Monday evening, Oct. 23, during a panel at the clinic's 15th annual Medical Innovation Summit.

"I think as we do that we're going to see the quality improve, we're going to see the cost come down, and hopefully that will allow us to look after more and more people across the United States. But this is an enormous transition we've been at it now nine years, and we're just beginning to see the effects of this," Cosgrove said.

The clinic will be moving about 600 of its providers — primary care physicians from both pediatrics and adult — into a different group of the organizations, where they will be measured by different metrics and judged by their ability to keep people healthy.

"The idea is to keep people well, keep them out of the hospital, reduce the number of visits that they have to make," he said.

He mentioned the initiative during a wide-ranging conversation about healthcare with Seema Verma, administrator for the Centers for Medicare and Medicaid Services.

The two talked for an hour about the need to rein in the rising costs of healthcare, the need for electronic medical records to communicate with one another, the opioid crisis, price transparency and more.

Verma laid out numerous problems with the Affordable Care Act, notably the rising costs and fewer choices for consumers. She also talked about the regulatory burden from the federal government, particularly when it comes to Medicaid.

States who want to make a change to their program often have to seek permission from the federal government, she said.

"Imagine you're trying to run this program that is the number one program in your state in terms of cost, and every time you want to make a change you have to check in with the federal government and see what they think," Verma said. "These are people in Washington that don't know your state. They don't know your people, they're not close to them. They don't understand your delivery system ... To me, it starts with resetting that so that states are actually in control of their programs and making those decisions."

Alongside that would be holding states accountable for outcomes just as providers are starting to be held accountable for the health of their patients in value-based payments. The final piece, she said, will be program integrity and reducing fraud and abuse.

Cosgrove said he'd love to see more flexibility out of Washington, but "we don't want 50 different healthcare programs across the country."

"Ultimately, we need to experiment, we need to figure out what we can do well and get it applied across the country in an even handed way so that you're not going to have people moving from one state to another simply for their healthcare," he said.

"Cleveland​ Clinic​ CEO​ sees​ 'total​ restructuring'​ ahead​ for​ healthcare​ business"​ originally​ appeared​ in​ Crain's​ Cleveland​ Business.