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21 Taking Stock: Numbers and Policies
Pages 585-598

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From page 585...
... Institute of Medicine J Michael McGinnis, in comments in the "look back" session summarizing the issues and estimates from the first two meetings and in the wrap-up concluding session, offered a broad preliminary overview of the implications of just examining totals of various estimates from the workshop presentations and the background literature review developed to inform the discussions.
From page 586...
... Approximations using this approach would amount in 2009 to about $210 billion in excess health costs from unnecessary services, $130 billion from inefficiently delivered services, $210 billion from excess administrative costs, $105 billion from prices that are too high, $55 billion from missed prevention opportunities, and $75 billion from fraud. These lower-bound domain estimates, and those for the contributing components, are noted in the commissioned background paper that placed the workshop analytics in the context of additional national estimates found in the literature (Box 21-1 below, and see "Summing the Lower Bound Estimates" in Appendix A)
From page 587...
... Specialists ii. Generalists – Hospital services • Product prices beyond competitive benchmarks – Pharmaceuticals – Medical devices – Durable medical equipment MISSED PREVENTION OPPORTUNITIES Total excess = $55 B*
From page 588...
... , who developed a 10-year estimate of $201 billion in savings from a national effort to improve care coordination targeted at dually eligible Medicare and Medicaid beneficiaries. With respect to the returns from investments in preventive services and community-oriented chronic disease management, McGinnis referenced the ongoing field debate about how best to assess those returns (CBO, 2004; DeVol et al., 2007; Russell, 2009; UnitedHealth Group, 2009)
From page 589...
... Bovbjerg's review of the econometric literature led him to suggest that tort reform would reduce personal health spending by approximately 0.9 percent, or almost $20 billion in 2010. Similarly, several studies highlighted by Rainu Kaushal and Ashish Jha projected significant savings from nationwide implementation of health information technology (HIT)
From page 590...
... With the example of market-based strategies, McGlynn elaborated that this group of reforms has a strong, underlying economic theory, yet they have largely gone untested. A contrasting example focuses on regulatory strategies, which fall on strong supporting economic theory along with significant experience with prior successes and failures.
From page 591...
... On the quantity side, inefficiently-delivered services, unnecessary services, and missed prevention opportunities represented major targets for reform. As Massachusetts was preparing to embark on the second stage of its healthcare reform agenda, the range of targets and strategies along the price and quantity dimensions were considered.
From page 592...
... Reforms such as bundling arrangements and episode-based payments transform the perverse incentives of the current system from encouraging more services to better services. As lower priorities, Neumann would consider implementation of knowledge-based strategies, preventive care, comparative effectiveness research, and health information technology.
From page 593...
... McClellan from the Brookings Institution, Joseph Onek from the Office of the Speaker of the House of Representatives, and Dean Rosen from Mehlman Vogel Castagnetti -- drew from their backgrounds and experiences in federal government in discussing the priorities for effectively advancing healthcare reform policies to lower cost growth and improve outcomes. The far-ranging discussion on the politics of and priorities for currently ongoing health reform discussions centered particularly on four interrelated pillars of the Brookings Institution Bending the Curve report, described by McClellan (Antos et al., 2009)
From page 594...
... Onek agreed that there are political advantages as well to bundling reforms in the way McClellan described. His analogy of legislation focused on closing military bases illustrates the point: compartmentalizing reform makes it easier politically to overturn or block reform, but strategically packaging reform initiatives not only makes sense for the reasons McClellan highlighted but also because it allows a broader coalition to support a bill.
From page 595...
... One such innovation identified in the discussion with the potential to improve quality and control costs was accountable care organizations (ACOs) , which represent combinations of primary care physicians, hospitals, and other healthcare providers including specialists, who together would be held accountable for the healthcare costs and quality of care for an identified group of patients.
From page 596...
... Drawing from his experiences in the Carter administration, he emphasized the need to look at spending that is truly excess spending in areas such as Medicaid and Medicare, so that those programs do not become crippled by cuts, spurring unintended consequences in other areas of health care. Additionally, generating savings in both the public and the private markets should be part of every discussion about reducing costs or using existing funds more efficiently.
From page 597...
... Keeping an eye on innovations in both the private and the public payer sectors, they suggested that integrating reform initiatives to capitalize on their reinforcing impacts and increasing the capacity for experimentation with new and promising models for care delivery and/or healthcare payment will all be critical in the next chapters of the healthcare system in the United States. They additionally proposed that regardless of what reform legislation passes this year or early next year, we will continue to confront complex issues regarding access, cost, and quality in future efforts and discussions.
From page 598...
... 2007. An unhealthy America: The economic burden of chronic disease charting a new course to save lives and increase productivity and economic growth.


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