Ambitious Reforms of Current System: A Path to Single Payer?

January 24, 2025

From Laggard To Leader: Why Health Care In The United States Is Failing, And How To Fix It
Health Affairs
January 22, 2025
By Donald M. Berwick, et al

Health care in the United States is among the most technologically advanced in the world, but it is largely failing to meet the needs of the nation. The US can claim international excellence in important areas of care, such as cancer treatment, and it leads the world in biomedical innovation and building a well-prepared and dedicated clinical workforce. However, Americans are faced with staggering health costs, inadequate access to care, pervasive health inequities, and lagging life expectancy compared with other developed nations. In this article, we propose bold national goals: affordable and equitable care for all, an additional decade of health after retirement, elimination of racial and ethnic disparities in health, substantial reduction in health care expenditures, and, most important, improved health outcomes. To achieve these goals, we recommend changes to ensure coverage for all, invest in primary care and social determinants of health, create financing to incentivize population health, and improve transparency and accountability. Major systemic transformation of the US health care system is not just required; it is a moral and economic imperative.

Yielding to pragmatism, we have based the following principles and action agenda on several key assumptions: First, we assume that the private market for health insurance will continue to exist, with many competing private health plans, and second, we assume that employer-sponsored health insurance will continue to be the largest source of coverage in the private sector. We also assume sufficient political will to enable a substantial increase in regulation of the health care market, as well as much stronger governmental leadership in the health care sector than exists today. Given the urgency of the need for change, we dare to hope for bipartisanship.

Principle 1

Our first principle is that all Americans should have access to affordable, comprehensive health coverage and care. We propose eliminating all medical debt.

Congress should create a Medicare-Plus public option available to all Americans, including those with employer-sponsored coverage. Premiums, deductibles, and copays would be set on the basis of income, no family paying more than 5 percent of income on health care.

Principle 2

Our second principle is that integrated primary care should provide an anchor for the health and well-being of all Americans. This requires a massive restructuring.

Principle 3

Our third principle is that improvements in health outcomes should be incentivized through population-based payment. Payers should minimize fee-for-service payment and substitute payment for care of populations. To reduce overuse and underuse of services, physicians should be, as much as possible, salaried.  Congress should empower CMS to lead an all-payer effort to rebalance payment levels for primary and specialty care.

Principle 4

Our fourth principle is that social determinants of health and health equity should be prioritized.

Principle 5

Our fifth principle is that financing should be simplified to minimize administrative complexity and enhance efficiency. Market-based pricing has failed in the commercial market, and payment complexity continues to exploit patients and breed waste. Financing and administrative operations should prioritize simplicity and uniformity. Americans should not be guessing how much they may be charged based on where they seek care. Hospital pricing should be standardized, transparent, and, within reason, uniform. … CMS should also create a mandatory Medicare Advantage administrative contractor to provide, on a uniform basis, all preauthorization, claims adjudication, and claims review activities.

Principle 6

Our sixth principle is that transparency and organizational professionalism should serve as foundations for accountability. Leaders of medical organizations, such as hospitals, health systems, and group practices, including executives and governing boards, should affirm and adhere to the ethical mandate of putting patients’ needs first.

Principle 7

Our seventh principle is that health systems should embrace data-driven decision making and a culture of continuous learning.

Principle 8

Our eighth principle is that robust governance and accountability measures are necessary to protect the health and needs of communities. Without much stronger accountability to patients and the workforce, fragmented, siloed systems, with varying costs, levels of access, and quality will continue to plague Americans seeking care.

From the Conclusion

Our proposed path forward is impossible unless Americans take equally seriously the need to stamp out price gouging and waste. Administrative pricing will need to be more actively used, high prices for specialty services will need to be reconsidered, health plan games such as upcoding in Medicare Advantage will need to be ended, predictable global payments will need to replace much of fee-for-service payment, useless administrative complexity will need to yield to simplification, and much more thorough price transparency will be required so that authentic competition can emerge. Profiteering in its many forms must be made unacceptable and, indeed, illegal.

Americans spend by far the most in the world but do not have the best care as a result – not even close. Incremental reform has failed in the past and will not work in the future. Only a systemic transformation can achieve the goals of equitable, accessible, affordable, and high-quality health care for all Americans. Why should Americans not, as a nation, have health and health care that stand as a model of excellence for the world?

 

Comment by: Jim Kahn & Don McCanne

Donald Berwick – a hero of ours for his decades of focus on patient well-being – and his colleagues shine much-needed light on the problems with our health care system and propose various measures to improve it. Their recommendations align reasonably with the policies which we single payer supporters have pursued for so long. We agree with administrative simplification, expanding primary care, limiting health care costs for financially struggling families, and shifting the system focus from profits to patients.

It is long past time that the nation listens to and adopts these ideas so that we can all have superior, comprehensive health care at a price that each of us can afford.

However, we are skeptical that the proposed changes can succeed in their goals within the current fragmented system. For example, a public option is notoriously vulnerable to attracting sicker and more expensive patients, which increases prices, which leads to insolvency. Many will remain uninsured. Efforts to standardize hospital prices sacrifice the administrative efficiency gains of hospital global budgets, and don’t address pricing outside hospitals. Effective control of gaming (e.g., diagnostic upcoding and risk selection) within capitated systems like Medicare Advantage have dismally failed, because the extremely competent profit-seeking financial intermediaries defeat regulatory efforts.

Thus, unfortunately, the proposals would leave in place the fragmented approach that underlies the problems that we have. We can’t solve these problems without fundamental simplification of our stunningly complex structure and processes, combined with a (not-for-profit!) government payer – as we would have in a well-designed single payer system.

Still, most of the article’s proposals constitute meaningful steps toward the high-performance health care system that we need. Perhaps we can arrive at specific policies and wrangle the politics that will be required to implement them as intended. Indeed, this may foster enactment and implementation of our ideal system: meaningful defragmentation and radical simplification may open an easier pathway to the less expensive and higher-performing single payer system. Let’s take their suggestions seriously, with the ultimate goal always in mind