Opportunities to Reduce Healthcare Costs Without Rationing

Improving Cancer Care

Payment reform for cancer care is badly needed. National spending on cancer care has doubled in the past decade and is projected to exceed $150 billion by 2020. There are many opportunities to reduce spending that do not require denying patients access to life-saving treatments. For example, many patients experience expensive hospitalizations for side effects of treatment that could have been prevented or addressed more quickly and at lower cost. Also, studies have shown that many patients receive expensive drugs and tests that are not necessary or not appropriate.

The current payment system for cancer care is a barrier to reducing these avoidable costs. Oncologists don't get paid for delivering the kinds of care management and rapid response services that could enable patients to avoid expensive hospitalizations during treatment. In addition, despite the cost and complexity of treating cancer, oncologists get paid very little for the extensive time needed to ensure an accurate diagnosis and to identify the right treatments, and oncology practices don't get paid at all to provide the wide range of education, counselling, and support services patients need when trying to cope with the burdens of cancer and when making tough decisions about what type of treatment to pursue.

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Reducing Hospital Readmissions

One of the best ways for communities to reduce healthcare costs quickly and improve patient care in the process is to implement initiatives to reduce hospital readmissions. Research studies and quality-reporting initiatives around the country show that 15-25% of people who are discharged from the hospital will be readmitted to the hospital within 30 days or less, and that many of these readmissions are preventable. The patients certainly would not mind having fewer hospitalizations, and billions of dollars in spending on hospital stays could be saved if these hospitalizations could be avoided. In other words, reducing readmissions is a win-win for both cost and quality, without a hint of rationing. Moroever, savings can be achieved rapidly, since the principal focus is on a short-term outcome: readmissions within 30 days.

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Improving Maternity Care

One of the biggest opportunities for reducing healthcare costs is improving the quality of maternity care. For most businesses, childbirth and newborn care is the largest or second largest (after heart care) category of hospital expenditures, and it's by far the largest category of hospital expenditures for state Medicaid programs, so even small improvements can result in large savings.

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Improving Cardiac Care

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