James Capretta and Jack Rowing urge policymakers to build on momentum for market-based reforms in health care.
The federal government has done more in the past decade to promote transparency around medical care pricing than it has since the advent of Medicare and Medicaid in the 1960s. The benefits from these requirements are only now emerging and are likely to expand as enforcement of the regulations improves and researchers and others identify the most effective strategies for leveraging the information.
Given the potential for progress that already exists from what has been issued to date, there may be a temptation to step back and see what happens. That would be a mistake for two reasons.
First, as seen in the current push for codifying legislation in Congress, there is strong bipartisan support at the moment for enforcing transparency in health care, but it may not last for any number of reasons, including growing pushback from powerful provider groups. Therefore, it is important to lock in the most effective rules possible before the window for policymaking closes. That means taking full advantage of the bill under consideration in the current Congress.
Second, it is already clear that today’s rules, which form the basis of the current House and Senate bills, do not fundamentally change the incentives for the consumer. Without stronger financial rewards for patients, employers and insurers will hesitate to push forward aggressive cost-cutting strategies. With consumers engaged, however, the possibilities would expand dramatically.
The building blocks for a consumer-led transformation have been under development for several years. The market has multiple credible examples of bundled payments for standardized clinical episodes, along with monthly fee models for more routine health maintenance and chronic disease monitoring and treatment.
The final step is to push forward a coherent package of requirements on providers to populate the market with pricing for understandable, consumer-facing service bundles and then also require insurers to integrate their coverage offerings with the use of the pricing made possible by these rules.
