Payers Drive Value-Based Healthcare Reform

Christopher Cheney, for HealthLeaders Media , May 28, 2014

As change continues to reverberate throughout the healthcare industry, health insurers are well-positioned to influence greater cost efficiencies.

For millennia, divinity was the guiding force in medicine, through the healing hands of the local priest and shaman.

Then 2,500 years ago, the Greek physician Hippocrates helped launch the Scientific Revolution, which transformed Western medicine. A pledge "to do no harm" became the first patient-centered medical maxim and scientific diagnosis was elevated over the divine.

Now, at least in the United States, medical advances based on the laws of science appear to be butting up against the laws of economics.

With some medications costing $1,000 per pill and inpatient hospital bills often breaking the $100,000 mark, healthcare payers from Medicare to insurance companies to private citizens are finding ever-increasing medical costs unbearable.

"There are finite resources. Economics is the study of finite resources," David Friend, who holds a medical degree from the University of Connecticut and an MBA from The Wharton School at UPenn, told me recently.

"Healthcare is part of the finite resources the country has… Everything else is going to get crowded out. Something has to give if you can't raise taxes and roads and bridges are falling apart. The answer is to become more efficient."

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1 comments on "Payers Drive Value-Based Healthcare Reform"

Robert Weaver (6/1/2014 at 7:42 AM)
The problem in health care isn't rising costs. The problem is we don't know what it is we are paying for. When health records are not systematically and reliably kept, we can't audit them. That's the basis of the chaos in health care.




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