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Health care costs can be cut

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By Rick Stouffer

Published: Thursday, Sept. 14, 2006

Half of all health care dollars spent -- $1 trillion -- is wasted on poor quality care, safety issues and a perverse incentive plan that rewards mistakes, a leading reformer said Wednesday.

"The problem with health care is that it has become unaffordable -- and passively or actively you, employers, have the system you paid for," said Robert Mecklinburg, whose 86-year-old Virginia Mason Medical Center in Seattle was forced earlier this decade to closely examine its operations when health insurer Aetna told the provider it was too expensive.

Mecklinburg, chief of medicine at Virginia Mason, spoke at the Pittsburgh Business Group on Health's seventh annual health care symposium at the Marriott Pittsburgh City Center Hotel, Downtown.

The only way for the health care system to be fixed is for employers, those paying the bill, to stand up and say "we're not paying," said Richard P. Shannon, chairman of Allegheny General Hospital's Department of Medicine.

Credited with groundbreaking work illustrating the money-losing prospects of dealing with in-hospital-acquired infections, Shannon said there is a perverseness to the existing medical system that needs to be changed.

"Health care providers are paid for probing, not for successful outcomes," Shannon said. "Payers are paying for activities, not outcomes."

The answer for Virginia Mason and, Mecklinburg said, health care in general, is found in carmaker Toyota's production system, recognized internationally as the model for just-in-time efficiency and quality.

Following trips to Japan by Virginia Mason's executives and board members to see the Toyota system in action, Mecklinburg said new attitudes were taken back to Seattle, with all 5,000 Virginia Mason employees educated in the process.

"Better, faster and more affordable," became Virginia Mason's mantra, and the results were stunning.

"We redesigned our spine clinic, where waiting time decreased to the same day from 31 days, MRI (magnetic resonance imaging) utilization dropped from 42 percent to 6 percent, patient satisfaction climbed to 3.8 out of 4.0, 94 percent of patients experienced no work loss, no (pain) prescription was needed in 73 percent of cases, health care purchasers' costs savings were as much as 65 percent, and 13 percent less staff now provide service to five times the appointments," Mecklinburg said.

Yesterday's daylong health care symposium was centered on transparency, meaning the need by all providers to provide health care buyers, including employees and employers, with clear and concise data concerning quality and prices.

With one of the major efforts in health care today to give consumers more say in selecting their particular health care options, industry experts agree that easy-to-understand pricing and quality data from all health care providers is a needed prerequisite.

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