Pay for the person – not the procedures

When people talk about health reform it’s often shorthand for covering the uninsured. But improving access without tackling costs is a recipe for a fiscal crackup.

Just take a look at Massachusetts, a pioneer in universal coverage, where the cost of medical care is growing at more than 8 percent a year. Ballooning subsidies for coverage of the poor are one problem. Another is heavy use of high-priced hospital care.

costs
Photo by skpy via Flickr

The Boston Globe reports on the recommendations of a state commission to pay doctors and hospitals a set amount for each person’s care for a year. (Read the report here.)

Some might call it capitation redux. The payment approach, once popular with managed care, aims to curb incentives for doctors and hospitals to do more to get paid more. Previous attempts at capitation were too stingy and inflexible and remain worries this time around, critics say.

On the national front, the cost of health reform is moving to the fore, galvanizing opposition to the plans advanced in Congress. The Washington Post reports that the head of the Congressional Budget Office “delivered a devastating assessment” of the fiscal consequences of the proposals because they don’t do enough contain the fast-growing costs of government health programs.

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