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1 The Healthcare Imperative
Pages 69-84

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From page 69... ... . Beginning in the early 1980s, as healthcare costs began to rise, salaries began declining at public institutions relative to private institutions at all academic ranks, putting public universities at risk and at clear competitive disadvantage with their private counterparts in faculty recruitment (Figure 1-2) Read the entire page →
From page 70... ... . While health insurance prices rapidly escalate and employers cut back on the provision of health insurance benefits (Kaiser Family Foundation, 2009b) Read the entire page →
From page 71... ... Peterson Foundation, a private philanthropy dedicated to the nation's fiscal security, in the conduct of a workshop series The Healthcare Imperative: Lowering Costs and Improving Outcomes, part of the Learning Health System series, in 2009. Guided by an IOM Planning Committee, the meetings were aimed at engaging participants in specifically exploring, identifying, and characterizing the major causes of excess healthcare spending, waste, and inefficiency in the United States; considering the strategies that might reduce per capita health spending in the United Read the entire page →
From page 72... ... Office of Management and Budget Rising healthcare costs are not only a critical issue for employers and for both enrollees and patients who ultimately bear the costs of health insurance and health care, they also constitute the nation's central fiscal challenge. On our current trajectory, Medicare and Medicaid will double as a share of spending on federal programs within the next 30 years (OMB, 2009) Read the entire page →
From page 73... ... Crowding Out Key Investments While rising healthcare costs are projected to drive the federal budget toward fiscal insolvency over the long term, they also threaten to crowd out key governmental investments. State funding for higher education provides a striking example of this crowd-out effect. Read the entire page →
From page 74... ... Rather, these dollars are simply wasted. Embedded in this troubling conclusion is a substantial opportunity: the possibility to reduce healthcare costs without adversely affecting health outcomes. Read the entire page →
From page 75... ... Health reform uses the best available knowledge and most promising ideas from across the political spectrum to control healthcare costs by transforming the health system from one that delivers greater quality with less quantity. It does so by, among other changes: • Imposing an excise tax on the highest-cost insurance plans, provid ing employers with an incentive to seek higher-quality and lower cost health benefits; • Reforming incentives to improve the way health care is delivered to patients throughout the country through such mechanisms as bundled payments and accountable-care organizations; and • Creating an Independent Payment Advisory Board in Medicare so that reforming the healthcare system is not a one-time event but an ongoing process with the goal of improving care and lowering costs. Read the entire page →
From page 76... ... McKinsey Global Institute In 2006, the United States spent $2.1 trillion on health care, more than twice what the nation spent on food, and more than China's citizens consumed on all goods and services. With growth in healthcare costs continually exceeding growth of the gross domestic product (GDP) Read the entire page →
From page 77... ... * Outpatient care includes physician and dentist offices, same-day visits to hospitals including emergency departments, ambulatory surgery and diagnostic imaging centers, and other same-day care facilities. Read the entire page →
From page 78... ... Theoretically this shift might save costs, because supporting fixed costs tend to be lower for outpatient care than when patients stay overnight in a hospital. Indeed, we estimated that the United States saves $100 billion to $120 billion a year on inpatient costs from shorter lengths of stay and fewer admissions. Read the entire page →
From page 79... ... Exploration of Alternative Cost Drivers Among alternative explanations for higher healthcare costs in the United States, two bear further investigation: (1) Americans are sicker than people in other OECD countries, and (2) Read the entire page →
From page 80... ... ; and (3) Americans smoke far less than OECD peers and, as a consequence, have lower healthcare costs for related conditions. Read the entire page →
From page 81... ... . And if the healthcare cost trajectory is going to bend, a focus on outpatient care spending is essential to that effort. Read the entire page →
From page 82... ... The Healthcare Imperative: Lower ing Costs, Improving Outcomes, Understanding the Targets, an Institute of Medicine Workshop. McKinsey Global Institute. Read the entire page →
From page 83... ... 2009. Income, poverty and health insurance coverage in the United States. Read the entire page →

From page 69...

... . Beginning in the early 1980s, as healthcare costs began to rise, salaries began declining at public institutions relative to private institutions at all academic ranks, putting public universities at risk and at clear competitive disadvantage with their private counterparts in faculty recruitment (Figure 1-2)

1 The Healthcare Imperative Pages 69-84

1 The Healthcare Imperative
Pages 69-84