Bending the curve through health reform implementation.

In September 2009, we released a set of concrete, feasible steps that could achieve the goal of significantly slowing spending growth while improving the quality of care. We stand by these recommendations, but they need to be updated in light of the new Patient Protection and Affordable Care Act (ACA). Reducing healthcare spending growth remains an urgent and unresolved issue, especially as the ACA expands insurance coverage to 32 million more Americans. Some of our reform recommendations were addressed completely or partially in ACA, and others were not. While more should be done legislatively, the current reform legislation includes important opportunities that will require decisive steps in regulation and execution to fulfill their potential for curbing spending growth. Executing these steps will not be automatic or easy. Yet doing so can achieve a healthcare system based on evidence, meaningful choice, balance between regulation and market forces, and collaboration that will benefit patients and the economy (see Appendix A for a description of these key themes). We focus on three concrete objectives to be reached within the next five years to achieve savings while improving quality across the health system: 1. Speed payment reforms away from traditional volume-based payment systems so that most health payments in this country align better with quality and efficiency. 2. Implement health insurance exchanges and other insurance reforms in ways that assure most Americans are rewarded with substantial savings when they choose plans that offer higher quality care at lower premiums. 3. Reform coverage so that most Americans can save money and obtain other meaningful benefits when they make decisions that improve their health and reduce costs. We believe these are feasible objectives with much progress possible even without further legislation (see Appendix B for a listing of recommendations). However, additional legislation is still needed to support consumers – including Medicare beneficiaries – in making choices that reduce costs while improving health.

Duke Scholars

Author Mark B McClellan Fuqua School of Business