According to a recent Gallup survey, Americans’ view of medical services–and those who administer them–continues to decline. Over the past decade, ratings have fallen across a multitude of providers and other stakeholders, with hospital emergency rooms (-13 points), hospitals (-14 points) and physicians (-15 points) seeing some of the steepest drops. Meanwhile, public dissatisfaction with healthcare quality in the U.S. has reached an all-time high. Clearly, the industry is in a state of self-induced free-fall.
Pick your adjective: fragmented, dysfunctional, confusing, expensive–they all aptly describe the state of today’s U.S. healthcare delivery system. To better understand how and why it is failing on every imaginable level, it’s instructive to look through the lens of the patient-consumer.
Recently, a close associate of mine recounted his frustrating healthcare saga, which stems from a hospital ER visit to treat a bruised knee sustained in a fall. The injury only required a band-aid–but he has suffered constant proverbial headaches ever since.
While in treatment, he asked for an adhesive, flexible bandage, but was told they didn’t have any, and was given an elastic wrap instead. In the examination room, he was given pages of “consent to care” forms to sign on the spot–care to which he already consented upon entering the facility. Before leaving the hospital, the attending physician came back into the room and told him he forgot to check a vital sign. These incidents were only the beginning of the patient’s frustrations.
My associate then received a $1,500 hospital bill, of which his insurance only paid half. He thought that was the final tab–until he received another bill for just over $1,000 from an outside integrated acute care medicine provider. This time he owed an additional almost $230. Unsure what this separate bill was for, he called the hospital’s billing department multiple times, leaving voicemails with no call back. When he tried contacting the other provider online, the virtual chat assistance feature wasn’t working. After finally getting through to a representative on the phone, he learned that the charge was for the services provided by the attending physician, who was not employed by the hospital. After weeks of trying, he finally got through to the hospital to re-confirm the contracting issue.
Nightmare experiences like this play out every day, all across the country–a sad reminder that the fee-for-service payment model on which most providers rely is fundamentally broken beyond repair. It also demonstrates a complete lack of transparency in cost and quality, key ingredients for a patient-centered market-based model. Yet even after the nation’s largest payer, the Centers for Medicare and Medicaid Services, spent decades trying to correct the system’s worst abuses and control rising healthcare costs, sadly, we are in many ways worse off now than we were 40 years ago when CMS began its long journey to reform.
Why have we made so little progress? As the data and actions continue to show, it comes down to three main drivers: lack of vision, resistance, and fear.
The journey in getting to a new model that delivers higher quality care at lower cost (i.e. Population Health Management), which all healthcare delivery stakeholders claim they want, continues to be painfully slow. As our 2022 Numerof & Associates State of Population Health Survey Report found, an overwhelming majority (81%) of healthcare executives continue to say population health is the way of the future. However, our study also confirmed that the potential threat of financial losses incurred under a new model remains the primary barrier (21%) to pursuing population health. These numbers tell us that it’s extremely hard for leaders to conceptualize a new model. The old system, which has paid the bills by encouraging the utilization of more tests and treatment, is all they know. But this old FFS system also completely buckled during the pandemic. Stakeholders need to accept that change is well overdue.
The patient example highlighted above is just the tip of the iceberg in terms of everything that continues to go wrong in healthcare delivery. Let’s break it down.
The ER could not supply a simple band-aid upon request–a sign of a wider, endemic problem. As I’ve discussed previously, the shortages we face today–from drugs to basic medical supplies–are very troubling and originated long before Covid-19 pandemic disruptions.
The patient saw a physician who was not employed by the hospital. Why? Contracting out ER labor to medical staffing companies that employ fewer doctors and more Physician Assistants and Nurse Practitioners cuts costs in the face of fierce, downward economic pressures. But it also points to a more systemic problem. The FFS reimbursement model does not incentivize doctors to take the time to do their jobs properly or even get an accurate diagnosis on the patient. Coupled with poor compensation and burnout, the system is sending scores of primary care physicians, our medical “gatekeepers,” to the exits.
Lastly, the patient was unable to get basic questions answered about the cost of care in a timely fashion. Opacity is a culturally ingrained attitude in many hospitals and other provider settings. As I’ve explained elsewhere, non-profit hospitals in particular continue to stray far from their intended mission in pursuit of higher profits, despite their generous federal, state and local tax exemptions.
Taken together, the U.S. healthcare delivery system begins 2024 in continuing decline–both in capability to deliver the outcomes patients expect, and in the esteem of its customers–the U.S public. As the industry continues to drag its feet on compliance with reforms as simple as price transparency and to resist congressional efforts to further reign in this and other abusive practices, there is no coherent administrative response from CMS in the offing. Until we have a healthcare delivery system that is more convenient, affordable, responsive, transparent and, most of all, accountable to all of its stakeholders, patient-consumers will be left in bewilderment, paying $1,500 for a band-aid.
Patient-consumers and their advocates need to demand more and challenge practices they would not accept in any other sector of the economy.
