What if medical care came with a 90-day warranty?
Health PlansQuality Control
Articles in this series are examining new approaches to addressing common shortcomings in the nation’s health care system.Previous Article the Series »
That is what a hospital group in central Pennsylvania is trying to learn in an experiment that some experts say is a radically new way to encourage hospitals and doctors to provide high-quality care that can avoid costly mistakes.
The group, Geisinger Health System, has overhauled its approach to surgery. And taking a cue from the makers of television sets, washing machines and consumer products, Geisinger essentially guarantees its workmanship, charging a flat fee that includes 90 days of follow-up treatment.
Even if a patient suffers complications or has to come back to the hospital, Geisinger promises not to send the insurer another bill.
Geisinger is by no means the only hospital system currently rethinking ways to better deliver care that might also reduce costs. But Geisinger’s effort is noteworthy as a distinct departure from the typical medical reimbursement system in this country, under which doctors and hospitals are paid mainly for delivering more care not necessarily better care.
Since Geisinger began its experiment in February 2006, focusing on elective heart bypass surgery, it says patients have been less likely to return to intensive care, have spent fewer days in the hospital and are more likely to return directly to their own homes instead of a nursing home.
Geisinger presented the first-year results of its experimental program at a meeting last month of the American Surgical Association.
Geisinger stands out as a group that has transformed the way it delivers care, said Dr. Donald M. Berwick, the chief executive of Institute for Healthcare Improvement, a national nonprofit organization whose goal is better patient care.
In almost no other field would consumers tolerate the frequency of error that is common in medicine, Dr. Berwick said, and Geisinger has managed to reduce the rate significantly. “Getting everything right is really, really hard,” he said.
It is still too early to know whether the approach, which Geisinger calls ProvenCare, will catch on with employers and health insurers.
So far, the only insurer that Geisinger has contracted with under the new arrangement is its own insurance unit, which covers about 210,000 people in Pennsylvania. Eventually, though, Geisinger hopes to attract other insurers and employers that provide health benefits by expanding the approach into other lines of care provided by the nearly 660 doctors it employs at its three hospitals and 55 offices in the region.
Geisinger is trying to address what it views as a fundamental flaw in the typical medical reimbursement system.
Under the typical system, missing an antibiotic or giving poor instructions when a patient is released from the hospital results in a perverse reward: the chance to bill the patient again if more treatment is necessary. As a result, doctors and hospitals have little incentive to ensure they consistently provide the treatments that medical research has shown to produce the best results.
Researchers estimate that roughly half of American patients never get the most basic recommended treatments like an aspirin after a heart attack, for example, or antibiotics before hip surgery.
The wide variation in treatments can translate to big differences in death rates and surgical complications. In Pennsylvania alone, the mortality rate during a hospital stay for heart surgery varies from zero in the best-performing hospitals to nearly 10 percent at the worst performer, according to the Pennsylvania Health Care Cost Containment Council, a state agency.
Around the world, other modern industries whether car manufacturing or computer chip making have long understood the importance of improving each piece of the production process to tamp down costs and improve overall quality.
But hospitals have been slow to focus their attention on standardizing the way they deliver care, said Dr. Arnold Milstein, the medical director for the Pacific Business Group on Health, a California organization of large companies that provide medical benefits to their workers. Geisinger “is one of the few systems in the country that is just beginning to understand the lessons of global manufacturing,” Dr. Milstein said.