by Kylie Jia
WASHINGTON, Nov. 10 (Xinhua) -- "A universal and mandatory healthcare insurance will eventually lower the cost for everyone," a leading U.S. expert on strategy has told Xinhua.
The United States spends more on healthcare per capita than any other country and the healthcare costs to its citizens are rising faster than wages or inflation, making medical debt the leading cause of personal bankruptcy in the country.
Michael Porter, the renowned strategy guru from Harvard Business School, said the federal budget could not nearly catch up with rising government spending on healthcare. Therefore, healthcare reform had been at the top of the national agenda since the beginning of Obama's presidency.
"The problems with America's healthcare system are really systemic and not isolated," Porter said. "They can be divided into two broad types."
One type of problem had to do with the nature of health insurance: the availability of insurance, the way the insurance market works, and the problem of the uninsured.
The other type of problem was around the delivery of healthcare, and the effectiveness and efficiency around delivery, "which is what I like to call 'value', the outcomes of the heath result achieved from every dollar spent." Fundamentally, we have to fix both," Porter said.
Porter is generally recognized as the father of the modern strategy field, and has been identified in a variety of rankings and surveys as the world's most influential thinker on management, competitiveness and social problems such as healthcare, environment, and corporate responsibility.
In Porter's view, the purpose of any healthcare system is to deliver value by "achieving the very good outcomes as efficiently as possible."
Current U.S. public debate over healthcare system centers on questions about whether there should be universal and mandatory health insurance, the quality achieved for the high cost and on the sustainability of expenditures that have been rising faster than inflation.
U.S. public opinion is divided along party lines in their views regarding the role of government in the health economy. Some people are in favor of universal healthcare, while others argue that this impinges on their personal freedom.
Porter said the Obama administration was approaching the first type of problem - the nature of health insurance - "in a reasonable way," in terms of trying to make health insurance universal and mandatory.
When asked why this was necessary, Porter explained that, "for those people who are not covered, their care expenses is eventually more costly than they need to be, because these people go to hospitals or emergency rooms only when they are sick. The hospitals are required to provide care. This is fundamental human rights, which is also a pillar of our system."
"If people only buy health insurance when they are old and sick, the cost is going to be astronomical for the system," he said.
"Mandatory health insurance is just like mandatory car insurance. When those without car insurance have an accident, they are inflicting costs on everybody else."
When asked what concerned opponents of healthcare reform and what was missing from the reform, Porter said the Obama administration ignored completely the second type of problem - the whole question of delivery on healthcare reform and that, if they don't improve the delivery, they are going to create a "financial catastrophe" in the future.
"The problem in the U.S. is we have not had a healthcare system that is really designed to deliver value," Porter said.
In his opinion, the system is driven by volume but not value, where the providers in hospitals are getting paid for the services they perform. This has led to an incentive for more services. "So by not measuring outcomes, and by not aligning reimbursement with value, we ended up with a system at a really high cost," he said.
Porter emphasized that the No. 1 priority for U.S. healthcare reform is to create a national system for measuring outcomes - how well hospitals and doctors actually performed in terms of the health of their patients.
"We have to measure the whole care for the patient's medical condition, rather than the outcome of a particular single visit or intervention," said Porter. "We also have to reward the providers for value - for producing good health - through change of reimbursement."
Porter believes that the future of health care is going to move away from a generic approach, and start to build a different primary care model around different patient populations with different pricing consistent with the service.
Another very important step to come, according to Porter, is information technology improvement, which enables delivery reform. There are lots of talk about information technology, but "all too timid and not necessarily focusing on the core issues."
"We need to open up competition," Porter emphasized. Under increased competition, every provider is no longer guaranteed patients. The patients can choose who they go to with the assistance of their doctors based on good information about outcomes, Porter added.
Of course, all of these will take some time, "so we have to have some kind of phased-in approach," said Porter. However, the U.S. government has not articulated this staged approach to ensure that the increased coverage will be aligned with the degree of achievement in the delivery reform.
This creates a timing mismatch with an immediate increase in cost from universal coverage. "This, fundamentally, is what makes lots of Americans nervous about this whole reform process," he said.
Although some of the other countries Porter has studied are focusing more on the healthcare delivery side than the United States, he is still cautiously optimistic about U.S. healthcare reform.
