Network News

X My Profile
View More Activity

Delivery System Day: Henry Aaron

aaronh_portrait.jpgHenry Aaron -- or Hank Aaron, as he's called -- is a senior fellow at the Brookings Institution and an expert on the economics of health care. He's also one of my favorite reality checks: About as far from an gauzy optimist as you can get, Aaron tends to give it to you straight. Here's his take on the health-care reform's most important, but little-known, priority:

Analysts -- right, left, and center -- agree that integrated delivery systems, exemplified by the Mayo Clinic, deliver high quality of health care at lower cost than do individual physicians and hospitals delivering uncoordinated care under the fee-for-services system. They all agree that care would improve and growth of spending might be at least temporarily slowed if typical patients, especially those suffering from multiple or complex conditions, received care from organizations that emphasized Mayo’s team-based approach to care and that used modern information technology. They would do even better if they had available a rich library of comparative effectiveness research -- a library far larger than can be created with the modest funds contained in the economic stimulus bill passed earlier this year.

Yet, no one has a very good idea how to foster and accelerate the emergence of such organizations. The draft health reform bills contain proposals for demonstrations or pilots of new payment systems. Even if these pilots and demonstrations work optimally, it will be many years, even decades, before entrepreneurial hospital administrators and physicians make integrated health care systems a reality for most Americans. The simple fact is that transforming the delivery system will be a long, hard slog. Every responsible analyst knows how hard and how central this problem is, but it is not clear what more legislation can do at this point.

Quick Hank Aaron story before we end this post: As you might have noticed, he shares a name with a certain famed baseball player. For years, a letter hung in the Brookings elevator asking Aaron if he couldn't sign a ball and send it to a charity auction somewhere. Rumor has it that he signed a copy of his report "The Peculiar Problem of Taxing Life Insurance Companies" instead.

Photo credit: Courtesy of Brookings.

By Ezra Klein  |  September 22, 2009; 10:59 AM ET
Categories:  Health Reform  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   StumbleUpon   Technorati   Google Buzz   Previous: Delivery System Day: Judy Feder
Next: Scoring Single-Payer


"Every responsible analyst knows how hard and how central this problem is, but it is not clear what more legislation can do at this point."

Exactly, which re-raises the point made a few posts ago regarding the length of legislation: it seems that the length of legislation is inversely proportional to the clarity of its goal, with longer bills needed to address the murkiest of topics.
While doing nothing is certainly not an answer, doing the wrong thing, and potentially clouding the issue for those who ultimately arrive at a practical solution, is equally as bad.

Posted by: rmgregory | September 22, 2009 11:22 AM | Report abuse

The Mayo model is good, but we should also consider the delivery systems in all them other countries who spend less for the same or better outcomes. There's been a lot of chatter about how people over there get covered, but not as much about the delivery side. My (limited) understanding is that a lot of them involve actual house calls.

Posted by: jeirvine | September 22, 2009 11:23 AM | Report abuse

Aaron is, of course, correct. But it doesn't take lengthy, central-planning style legislation to get more Mayo type systems out there. It just takes a system that pays for what we want. Incentives will do the rest.

Posted by: TheIncidentalEconomist | September 22, 2009 11:29 AM | Report abuse

gainsharing is a key component in lowering costs. See the example below:

The problem is we need this across the country. Its basically the physician model's example of the Safeway system. It pays providers to save the hospital money by safely reducing admission days. If we can give a doctor $500 for saving the system $2000 then we all benefit.

Posted by: visionbrkr | September 22, 2009 11:36 AM | Report abuse

"Yet, no one has a very good idea how to foster and accelerate the emergence of such organizations. "

This is a false assumption. Mayo has been proposing ideas I read.

But in general, it's clear how to encourage value (higher quality vs cost) in health care:


once you consider the general idea you, then you need to have the reasonable structure and flexibility to pay-for-outcomes that handles complexity, failure, partial success, time, verification, etc.

wish I could summarize in 2 paragraphs, but anyone could read the link in 7-10 minutes.

Posted by: HalHorvath | September 22, 2009 12:09 PM | Report abuse

In a perfect world we would all be treated by Mayo, or Geisenger, or Kaiser. There are other examples (Kelsey in Houston).

I think the main point here is Aaron's statement regarding an accessible library of rich CER data. That does not exist today. That has to be built.

Same with interoperable Health IT. I am really tired of having a test repeated because the doc can't readily access the test run by the other doc.

Those two items would help "Mayo-ize" this cottage industry.

Posted by: scott1959 | September 22, 2009 12:31 PM | Report abuse

Seems like we could try to emulate the amoeba. How much would it cost to lure a team of (ex-)Mayo people to move to an area with high healthcare costs and set up a new Mayo in that area? If Uncle covered the costs the chance to build their own organization should be attractive to some. And how many key people do you need to re-create a successful organization somewhere else?

Posted by: bharshaw | September 22, 2009 4:46 PM | Report abuse

My guess is that we'd have to do a combination of changing the incentives (i.e., changing the style of Medicare payment away from fee-for-service, and then give higher compensation to doctors working in Mayo-like clinics), and a degree of local-federal cooperation. Maybe the federal government could agree to pay for the capital costs of starting up Mayo-like clinics, or at least off them subsidized loans and tax credits.

Posted by: guardsmanbass | September 22, 2009 4:51 PM | Report abuse

The comments to this entry are closed.

RSS Feed
Subscribe to The Post

© 2010 The Washington Post Company