First, it was Charlie Baker in his blog (click here ) talking frankly about the difficulties in this market dealing with the seemingly insatiable desire for and power of academic medical centers (aka: Partners) — and a fascinating follow up dialogue, now up to 38 comments. Now it’s Paul Levy in his blog posting (click here) today wondering — if Charlie is correct — why it’s worth bothering to compete on better quality and value. Money quote:
So, here is the question. Since BIDMC has and will continue to have an excellent clinical reputation and very good relationships with community hospitals, multi-specialty groups, and other referring physicians, should we abandon our call for structural changes in the payment system? Would we be better off just living with the current arrangement, i.e., receiving rates that are just below those provided to the dominant provider network? Sure, we would never catch up with them in terms of earnings potential, but we would do better than most hospitals in the region. As consolidation and closures continued in the state, we would inherit a share of the clinical volume that will be passed along.
First, this is fascinating stuff. A new kind of public discussion — formerly held behind the scenes in senior management and board meetings — is coming out in public through these blog sites. Great stuff, so keep it up.
Second, if I can read between the lines of what Paul really wants, it’s … insurers, pay me more for the great quality work we’re doing. Yes/no? Implication — Beth Israel (and others) are getting underpaid in comparison with Partners, and it’s not fair. Just for the heck of it, I went to the hospital financial reports website at the state’s Division of Healthcare Finance and Policy. I looked up data on BIDMC, Mass. General, and Brigham & Womens. Here’s what I found:
Total Surplus FY02/FY06
Total Net Assets FY02/FY06
Brigham & Women’s
Yes, BIDMC’s major competitors are bigger and badder. Doesn’t seem, though, that BIDMC is doing too shabbily itself. Doesn’t seem like it’s time to take the hankies out.
So I’m left wondering, what are the “structural changes in the payment system” Paul wants to see? Paying for quality sounds like a promising idea. But there are literally hundreds and hundreds of quality indicators, and each provider would like to get paid for those things it does well, and not get penalized for the things it does poorly. Who should decide which indicators matter, and which do not? Given the recent negative evidence on “pay for performance,” how does this get decided? And, in a market where government stays out of payment negotiations between providers and payers, how do you really eliminate the impact of market share?
I don’t want to discourage the conversation. I would like to see it move to the next level. Let’s get specific…