Medicare currently pays doctors in a “fee for service” system, with little regard for quality of care or patient outcomes. The more procedures or office visits, the more revenue a physician generates.
Instead of spending time with patients or counseling them in preventive care, there is financial pressure to see as many patients as possible. And this financial pressure is a fundamental reason why health care costs are spiraling out of control. It’s no wonder both doctors and patients are dissatisfied with the system.
There is little data showing that providing more care actually benefits patients. For decades, researchers at Dartmouth College have even gone so far as to suggest that more medical services, at higher cost, do not necessarily equal better patient outcomes. Large integrated health systems, like Minnesota’s Mayo Clinic, have shown it’s possible to provide higher quality care while using fewer medical services.
But there are challenging obstacles. Doctors practice in a fragmented delivery system, making it difficult to consolidate into integrated systems. And there is tremendous resistance to changing the status quo. After all, one doctor’s “unnecessary care” is another physician’s income stream.
It’s imperative that physician payments be divorced from the volume of services provided. Until we change the way doctors are financially incentivized, no amount of reform will result in meaningful cost control.
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