imited Solutions

Evidence-based guidelines, disease management, pay for performance, and electronic health records can all play roles in quality improvement. But the fragmentation of U.S. health care and its perverse financial incentives will limit the impact of these innovations. Moreover, even a dramatic rise in quality won’t save our system from economic disaster. While higher-quality care will eventually cut spending by reducing medi¬cal complications and waste, it’s going to cost more in the short run.

There is evidence that better hospital treatment of patients with pneumonia and blocked coronary arteries can cut costs immediately,30 and the same undoubtedly is true for other acute conditions. The common-sense improvements in hospital care that IHI president Donald Berwick champions have not only saved lives but also prevented complications that are expensive to treat. With chronic diseases generating 75 percent of health costs, however, the most Herculean efforts to improve inpatient care can have only a limited impact on spending growth.

The better-quality solution also ignores two other factors in the cost explosion: rapid advances in medi¬cal tech¬nology and the financial motivation to do more and to sell more. Until we address those issues, we will continue to see spending expand at a rate that will exclude more and more of us from high-quality health care. The next part explains how the profitability of health care has helped fuel this conflagration of spending.