valuing health care: improving productivity and quality

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V a l ui n g H e a l t h C a r e : I m p r o v i n g P r o d u c t i v i t y a n d Q u a l i t y

rom some angles dierent than those typically ound

in reports or studies in this policy area.

This report represents the distillation o thecollective wisdom o the Task Force members. They

were not asked to support every suggestion or idea

put orth here or to approve the precise wording o

this entire report; requiring unanimity would have

ruled out too many good ideas. Instead, we present

here a “sense o the room” as to which approaches

hold the most promise (and which are overrated) and

what the basic choices are. Despite our multiplicity o

perspectives, we ound many points o intersection.We canvassed what we call the adjacent

possible—that is, incremental, but important,

workable reorms that should improve the productivity

o health care and its value independent o whether

and how the recently enacted Aordable Care Act

o 2010 is ultimately implemented.2 We did not seek

giant, dramatic steps; we avoided sweeping claims

and rejected purported magic bullets. We believe

that a quest or sweeping, comprehensive, one-shotreorm is problematic because it misconceives the

health care system as an engineered “system” rather

than a natural ecosystem, perhaps as intricate and

complex as anything to be ound in nature.

Instead, we ocus primarily on incremental

changes which, taken together, can cumulate to

signifcantly advance both productivity o health

care and its outcomes. These reorms build on or

accelerate changes whose implementation runs with,not against, the grain o the health system’s existing

stakeholders and structures. We thus sought to avoid

measures requiring massive new expenditures. Some

o the regulatory or structural changes we recommend

would gore established interests’ oxen. But they havein common the virtue that, as the saying goes, you

can get there rom here.

Finally, we have chosen measures or their

exemplary value, as well as or their intrinsic

merits. They point toward a promising general

strategy: releasing and putting to work resources

that, or whatever reason, the current system has

locked up. Japanese automakers’ leap orward in

productivity came, in the main, not rom technologicalbreakthroughs unavailable to Detroit or rom

out-investing Detroit, but rom better use o existing

resources: reeing up the knowledge o assembly-line

workers, implementing real-time quality controls,

reorganizing and streamlining supply chains, and

putting the customer at the center o the system.

In that sense, the Japanese automakers unlocked a

leaner, more productive, more modern orm within

the confnes o an older system.In much the same way, we propose the

“jail-breaking” o health care. Our health care

system is rie with opportunities to improve

productivity by using existing resources better—

resources that include not just money, but the talent,

organizational skill, and knowledge o practitioners,

providers, researchers, and (especially, in our view)

patients. Much as the cheapest and oten astest

source o new energy is the more efcient use o oldenergy, so the cheapest and astest road to a more

productive health system is to put untapped value

to work.

2 We borrow the term “adjacent possible” rom Steven Johnson, who coined it. See Steven Johnson. Where Good Ideas Come From: A History of Innovation (Riverhead Trade, 2011, reprint edition).



Localism is another common thread running

through many o our suggestions. Although

cross-cutting changes to policy or regulationsometimes are needed, too much time and energy are

ocused on top-down, Washington-directed reorms.

This is true especially now, as the new Aordable Care

Act (ACA) eectively has exhausted, or the time

being, the country’s capacity or sweeping change

at the ederal level. Particularly while the ACA is being

digested, implemented, and perhaps modied, most

eective change will be locally designed or adapted to

local conditions, oten varying rom region to region,provider to provider, and even patient to patient.

What we can generalize, however, are changes

in incentives that help identiy and propagate

productivity improvements. Much as a hydrologist

uses general principles o geology and fuid

dynamics to understand where to build or to remove

dams or levees to change fows through a larger

system, so understanding and using incentives

better can point the way toward health productivityimprovements tailored to particular regions, providers,

and patient populations.

By design, we have brought together a varied

assortment o ideas and suggestions, illustrating the

messy, grab-bag nature that eective changes oten

need to take. Yet our proposals do all (albeit with

some overlap) into our broad categories, which

structure the recommendations section o this report.

Our specic policy recommendations are summarizedin the table at the end o this Introduction.

n Harnessing information: how systematically

gathering and sharing data can unlock knowledge

that produces systematically better choices. Thekey here is to incentivize a new corps o data

entrepreneurs to collect and analyze existing

medical data to discover and then disseminate

the use o new therapies.

n Improving research: encouraging more

collaboration across institutions and unding more

translational research (aimed at “translating” basic

scientic discoveries into medicines and therapies).

n Legal and regulatory reform: modernizing

medical malpractice systems, removing

counter-productive restrictions on health insurance

premiums, and streamlining new drug approvals.

n Empowering patients: there are large

benets o giving more power to the people

who matter most—patients—to make inormed

decisions about their own care.

The ideas here are not new, though many o

them are amiliar only to the cognoscenti. To the

contrary, we have sought ideas that have showed

promise in the eld, and then attempted to set them

in a context that exploits the adjacent possible.

I this report can ocus more minds in the health

policy community and general public on nding and

implementing those changes, in everything rom

clinical practices to regulatory structures, it willhave succeeded.



Lie certifcate Birth and death certifcatesalready exist. The “liecertifcate” is a bundleo standardized healthinormation that would

travel with consumers andaccumulate as they passthrough health-relatedgateways: vaccinations,procedures, medications,

amily history, and so on.

The ederal government should undresearch and development o the liecertifcate concept.

PolicyRecommendation

DeploymentDescription

reseach recommendations

Teams or research

Encouraging translationalresearch

Break down the isolationo researchers andencourage collaborative,crosscutting researchby creating teams oresearchers rom across

multiple institutions.

Eorts to encouragetranslational eorts, suchas the National Center orAdvancing TranslationalSciences at NIH, should

be strengthened andaccelerated.

The National Institutes o Health couldcondition a portion o its R01 and othergrants on being awarded to teams oresearchers, with larger average grantsmade available to larger teams.

Translational research should be viewedas a discipline in its own right, supportedby unding models that encourageinterdisciplinary, applied research and

nourished by a stream o researchers

trained specifcally in college ortranslation.

PolicyRecommendation

DeploymentDescription

Data recommendations—continued



12

a recod of innovton

I the United States had accomplished

nothing else in the past hundred years, it would be

remembered in history or its extraordinary record omedical innovation. In a century o staggeringly

rapid improvements in medical knowledge and

technology throughout the West and Asia, the

United States towers over others. Odd though it

may seem, at the dawn o the twentieth century,

the United States was a medical backwater

relative to Europe; but the second hal o the century

saw a remarkable fowering o science, technology,

and innovation, supported and driven by the world’slargest economy and the world’s greatest scientic

and academic inrastructure. One might say, without

undue ear o exaggeration and despite the current

angst over health care cost and quality in the United

States, as the Italy o the High Renaissance is to art,

so America o the past sixty or so years has been to

medicine.

Benets rom these advances have been valued

in the trillions o dollars and have led to a consistentlyhigher quality o lie or people all over the world.

Quantity o lie has improved, too. Health care

advances have contributed—along with improvements

in living standards, saer workplaces and childhood

vaccinations—to an increase in lie expectancy at

birth, which or Americans rose rom orty-seven in

1900 to seventy-seven in 2000 (an astonishing gain

o 110 days per year or two days per week during the

twentieth century).

3

One reason or this remarkableimprovement is the dramatic drop in inant mortality

o more than 90 percent (coupled with the 99-plus

percent decline in maternal mortality) over the

century. In addition, the two decades rom 1930

through 1949 alone, a period including the Great

Depression, remarkably saw the introduction o

electrolyte therapy and use o antibiotics,

accompanied by a 52 percent drop in inant mortality.4

Chapter One

Contours of the problem

3 National Vital Statistics 59(1): 33–34, Table 12 (June 28, 2010).4 CDC, MMWR Report 48(38): 849–858 (October 1, 1999).

valuing health care: improving productivity and quality

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