California Forum Calls for Healthcare Revamp

As California addresses record high health care costs-the average state resident currently spends $23 a day on healthcare-a new report reveals ways that could curb those costs considerably.

According to findings published by the Berkeley Forum, the Golden State could axe more than $110 billion in healthcare spending over the next 10 years by revamping its current healthcare system and moving away from the standard fee-for-service medicine to a design highlighted by coordinated, preset fees.

The Berkeley Forum is a group of healthcare executives, insurance providers, state officials, and educators who have been studying the state’s healthcare market for the past year in an effort to make healthcare not only better, but more affordable.

“For the first time, the key actors who deliver and pay for our health care have come together to support a road map for fundamental change in how we buy and provide health care services,” said Stephen Shortell, dean of the UC Berkeley School of Public Health, and a co-author of the report.

The key factors in savings come from changes in how doctors and hospitals are paid, the group concludes. 

The Forum suggests a move toward what members call “global budgets,” with doctors and hospitals providing care for preset amounts that can be adjusted based on not only the health of patients, but also quality of performance.

“This could be a game changer in the state,” Shortell said. “These are the CEOs of big insurers, big health systems, and large medical groups saying it’s time for a change, and these are the people who can get things done.”

The model is designed to reduce the number of fee-for-service payments, which has the potential to encourage unnecessary tests or procedures. That number now stands at 78 percent, but the Forum calls for a reduction of that to 50 percent by 2022.

The Berkeley Forum also calls for increased integrated care, which coordinates patient care among multiple hospitals and physician groups to make maximum use of all available assets.

Pam Kehaly, president of Anthem Blue Cross in California, said this industry-wide collaboration “puts us on a path to improving the ailing California healthcare system.”

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