Center for American Progress

Changing How Health Care Is Paid for and Delivered

Changing How Health Care Is Paid for and Delivered

Delivery System Reform Is Integral to Health Care Reform

A recent CAP event looks at the importance of delivering better health care at lower costs.

The Affordable Care Act is the most far-reaching health care legislation to date to tackle health care costs. On May 22 the Center for American Progress hosted an event looking at the Affordable Care Act’s different payment and delivery methods and at how the act has lowered health care costs in the United States. For instance, almost 4 million seniors paid more than $2.1 billion less on prescription drugs in 2011, and people on Medicare paid an average of $4,200 less on prescription drugs from 2011 to 2012.

In her introductory remarks, CAP President Neera Tanden said that lowering the costs associated with health care “is a fundamental way to actually improve the quality of health care in our economy but also one in which we can improve our national competitiveness.”

A panel discussion followed Tanden’s remarks. Moderated by Topher Spiro, CAP Managing Director for Health Policy, the panel also included Sen. Sheldon Whitehouse (D-RI); Richard J. Gilfillan, director of the Innovation Center at the Centers for Medicare and Medicaid Services; Morey Menacker, president and CEO of the Hackensack Physician-Hospital Alliance ACO; and CAP Senior Fellow Ezekiel J. Emanuel, vice president for global initiatives at the University of Pennsylvania.

Emanuel explained that alternative payment methods in the Affordable Care Act—such as bundling payments around hospital episodes of care rather than having patients pay separately for medical procedures and physician services provided during an episode of care—are the key to transforming how we deliver care, to lowering costs, and to improving quality. He added that we need deadlines for implementing these methods so providers can begin to transition to new systems.

Sen. Whitehouse discussed the success of health care reform in Rhode Island, including the building and growth of the state’s electronic information infrastructure—such as electronic health records—which can reduce medical errors and improve the efficiency of the health system.

Gilfillan pointed out that the Affordable Care Act’s delivery system reforms such as accountable care organizations and the Partnership for Patients program are beginning to support health care providers such as doctors and nurses, enabling them to provide better care. Accountable care organizations, for example, reward providers for improving Medicare patients’ health and lowering costs through improved care coordination.

He said that, “It’s not about changing institutions first, it’s about changing people’s minds. People need to believe they can get there and deliver that new care.”

Morey explained how “delivery system reform goes hand in hand with health care financing reform because if you have a more efficient delivery system, then the equivalent care will cost less … because of the efficiencies within the system.”

Morey also discussed the importance of good communication between a patient’s doctors and care facilities in making sure that the patient gets consistent care.

All of the panelists agreed that delivery system reform is integral to health care reform as a whole, and that it will lead to better care and a better patient experience.

For more on this event, please see its event page.

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