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Healthcare Cost vs. Patient Care Quality

Important Conversations in Times of Healthcare Change

One thing that is puzzling and debatable in the United States is the gap between what we spend on average for healthcare, and the quality of care we receive in this country. According to studies, “per capita spending on healthcare is estimated to be 50 to 200 percent greater in the United States than in other economically developed countries.” However, that money may not be as well spent as it could be.

The United States also ranks 26th in the world for human life expectancy.

So what’s up with cost v care?

And what do we need to know as we continue to see our healthcare systems changing?

These two facts raise a number of questions about the US healthcare system:

  • Where is the waste going?
  • Is this having a negative impact on care?
  • How does our health system differ from those at the top, and where do those countries rank for life expectancy?

Hospitals are also forced to ask themselves similar questions as they have been pushed to decrease patient costs while improving care in recent years. For instance, what if they release a patient too soon to save the cost of caring for that patient a little bit longer? Then, that patient gets sick again quickly thereafter and has to be readmitted, which will in turn drive up the cost of care.

What is the solution to curbing the costs of healthcare while maintaining quality?

Research has produced mixed results about the connection between healthcare experience vs patient care experience and their relation to cost. In one study, hospitals with the highest costs of care also showed the highest quality of care scores. But in another study, the opposite results occurred when it came to pneumonia care.

The discrepancies between results of these kinds of studies have led many researchers to conclude that organizational structures and processes for delivering care, staff scheduling, and other administrative qualities may be the source of most waste. In this article published on Becker’s Hospital Review, there are several practical ways listed that show how facilities can cut waste and save money without affecting patient safety processes.

Some of the examples include weighing food prepared in the cafeteria. By adhering to the same ingredient tracking processes that restaurants use to reduce food cost, you can trim dollars and give cafeteria customers a more consistent experience. They also suggest looking into the benefits of a smoke free work place, and to give employees incentives for helping create ways to save money. One hospital also saved $24,000 a year by switching to fountain drinks from bottled soda.

In a Harvard Business Review article outlined ‘The Strategy That Will Fix Health Care‘ the authors state that the main goal is to deliver the best care for the best value possible.

They say the problem lies in the fact that profits are aligned with the volume of services, not delivering high quality of patient care in hospitals. The main goal for providers and stakeholders, they argue, must be an improvement where ‘value is defined as the health outcomes achieved that matter to patients relative to the cost of achieving those outcomes.

Basically, the goal is to improve patient outcomes without raising cost, or to lower costs without reducing patient outcomes.

But how…

In the past few years, we have seen many healthcare facilities seek practical and creative ways to improve care and lower costs. However, news reports are already stating that health care companies are seeking rate increases for 2017.

However, many of these rates are subject to review and may not hold up to scrutiny. When you add in the new White House administration’s call to repeal the ACA and implement a replacement, it can seem like much of the current state of healthcare is up in the air!

No matter what happens with patient costs, insurance premiums and deductibles–you can bet all types of healthcare facilities will be seeking ways to improve their own costs.

Do you have ideas for ways organizations can save money without affecting patient care?

Share your ideas with us on social media, or email us at info@healthadministrationdegrees.com to start the conversation!

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