The Cleveland Clinic Way to Health-Care Reform

By David Ignatius
Sunday, September 6, 2009

When President Obama visited the Cleveland Clinic in July, he lauded its innovative approach to low-cost, high-quality health care: "They've set up a system where patient care is the No. 1 concern, not bureaucracy," he said. "Those are changes that I think the American people want to see."

That's exactly right, Mr. President. But you're running out of time. And rather than trying to reassure people that their health-care plans won't change under your reform proposals, you should be honest that embracing the Cleveland Clinic model would represent a revolution in American medicine.

The "cowboy capitalism" model for health care, in which every doctor, hospital and MRI laboratory is on its own, has to end. That's the Cleveland Clinic lesson. The change will have to be gradual, taking place over the next decade. And it will have to be led by our best doctors and hospital administrators, who know what works.

The Cleveland Clinic approach was outlined for Obama by its chief executive, Dr. Delos "Toby" Cosgrove. He explained the organization's pillars: not for profit, based on group practice, led by doctors who are salaried rather than "fee for service," and subject to rigorous annual professional review. That's what much of our system should look like in 10 years.

When Obama speaks to Congress Wednesday night, he should remember what he heard in Cleveland: His goal should be reforming the health system, not simply the insurance market. He should propose incentives that push doctors and hospitals to work together, so that they make money by keeping patients well, rather than simply by performing procedures when they get sick.

To understand the Cleveland story, I spoke last week to Cosgrove. He explained some basic ideas that he hopes Obama will embrace this week. His proposals are similar to those of Dr. Denis Cortese, the chief executive of the Mayo Clinic, whose thoughts I outlined in a recent column.

First, Cosgrove argues that the government must create incentives for doctors and hospitals to bundle their services. Take knee replacement surgery: Rather than separate payments to the surgeon, anesthesiologist, MRI technician, hospital, laboratory, physiotherapists and the rest, Cosgrove favors one payment to be shared among them. That would encourage economic use of resources. Haggling over the money would be a nuisance, so many doctors probably would decide to take a salary. So much the better.

Younger doctors are already adapting to a Cleveland Clinic world in which salaries and group practice are the rule. According to Cosgrove, only 10 percent of doctors under 40 are going into practice alone or with a partner.

Second, Cosgrove says that a more efficient system will inevitably mean consolidation of hospitals. Rather than five trauma centers in a metropolitan area, say, a region could do fine with three. One way for the government to encourage consolidation would be to require electronic records. Smaller and less-efficient hospitals that don't connect to the grid will disappear.

Third, the system needs greater transparency and competition -- in both costs and quality of care. Doctors may be wary, but Cosgrove argues that it works. He notes the experience of New York, which 20 years ago created a public record of cardiac surgery. Doctors and patients could see who was performing best, and the resulting competition has improved the mortality rate in New York.

Cost competition sounds scary in medicine -- do you really want the cheapest heart-bypass surgeon? But Cosgrove notes that when coupled with transparency about results, it makes sense. In the San Francisco area, he says, patients can review costs and quality measures for several dozen providers for some common procedures.

Finally, the government should create incentives for people to take better care of themselves. This means taxing cigarettes out of existence; it means giving companies tax breaks if they have "wellness" programs that can reduce the obesity of their workforce. In a healthier country, quality care will be easier to afford.

To get started on these big reforms, Obama should propose changing incentives in the areas the government already controls -- Medicare, Medicaid, care for veterans and military families. Once these giants begin to move, the private market will inevitably follow.

Obama can regain the initiative on health care by being honest with the country. The system we have isn't working. It's too expensive, and if we insure everyone without reforming the delivery process, the costs will be ruinous. Obama saw what works when he visited the Cleveland Clinic. Now he should open that same pathway for the nation.

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