Clipping Board » Medical Affairs and Administration ─ Medical system, pharmaceuticals, and medical community-related reports
Author: Huang Dafu, President of Koo Foundation Sun Yat-Sen Cancer Center
April 19, 2008, Apple Daily Forum
We all know that the Mayo Clinic is a world-renowned hospital. In an editorial published in The New York Times on April 10, it was pointed out that a study on the correlation between healthcare quality and costs among the top five medical centers in the United States found that the cost of "care for patients in the last two years of life" at the Mayo Clinic was significantly lower than at other medical centers. The most important factor is that physicians at Mayo are paid a fixed salary, while at other centers, they are paid based on performance.
The Flaws of Performance-Based Pay
I believe the core value of a fixed salary system is that the goal of physicians is to make the best use of resources to provide the best care for patients. In such institutions, physicians who take good care of patients are most respected. On the other hand, performance-based pay inevitably leads physicians to focus on performance metrics. In those institutions, physicians who generate more revenue are valued more.
Koo Foundation Sun Yat-Sen Cancer Center is probably the only hospital in Taiwan that does not adopt a performance-based pay system. We have found that when our medical team focuses on the well-being of patients and dedicates themselves to doing things the right way, not only does patient survival rate improve, but healthcare costs also decrease. This aligns perfectly with the experience of the Mayo Clinic. However, under the current "fee-for-service" payment system of Taiwan's National Health Insurance, the better we perform, the more we lose financially.
Therefore, in 1996, we used our hospital's comprehensive data on breast cancer patient survival rates and medical costs to lobby the National Health Insurance Bureau to implement a "pay-for-quality" pilot program for breast cancer. After five years of continuous discussions, the Bureau finally launched four pilot programs in 2001 to encourage the medical community to do the right thing.
Coincidentally, I recently read a book published last year titled "Health Reform, Now!" by George Halvorson, CEO of Kaiser Foundation Health Plan and Hospitals. In the book, he directly points out the flaws of the traditional healthcare payment system. He states that market mechanisms and financial incentives can reduce costs in any industry, except in healthcare. It's not that market mechanisms don't work, but rather that the healthcare payment system misplaces financial incentives.
The Serious Overuse of Volume-Based Pricing
He explains that, under the current U.S. healthcare system, there are over 9,000 billing items, including various tests, procedures, surgeries, and medications. As long as these are performed, regardless of their usefulness or effectiveness, insurance companies pay for each item. However, none of these items include "cure" or "health improvement." Therefore, taking good care of patients does not generate revenue. No wonder the medical community strives to provide more tests, procedures, surgeries, and medications. For example, if you put in great effort to cure a patient's cancer in one go, you only earn money once. However, if you are careless and the treatment fails, leading to a cancer recurrence, you have more opportunities for treatment and thus earn more money. Isn't such a system extremely counterintuitive?
In fact, in Taiwan, because the payment standards are less than one-tenth of those in the U.S., and due to the volume-based pricing system, whether it's outpatient visits, tests, or medication usage, the numbers are several times higher than in the U.S., indicating that the overuse of medical services is even more severe in Taiwan than in the U.S.If the healthcare system in the United States requires immediate reform, then isn't the urgency for healthcare reform in Taiwan even greater?
Source: http:/ / 1- apple. com. tw/ index. ……19& art_id=30468892& SubSec=67
Urgent Need for Healthcare Reform
April 19, 2008, Apple Daily Forum
We all know that the Mayo Clinic is a world-renowned hospital. In an editorial published in The New York Times on April 10, it was pointed out that a study on the correlation between healthcare quality and costs among the top five medical centers in the United States found that the cost of "care for patients in the last two years of life" at the Mayo Clinic was significantly lower than at other medical centers. The most important factor is that physicians at Mayo are paid a fixed salary, while at other centers, they are paid based on performance.
The Flaws of Performance-Based Pay
I believe the core value of a fixed salary system is that the goal of physicians is to make the best use of resources to provide the best care for patients. In such institutions, physicians who take good care of patients are most respected. On the other hand, performance-based pay inevitably leads physicians to focus on performance metrics. In those institutions, physicians who generate more revenue are valued more.
Koo Foundation Sun Yat-Sen Cancer Center is probably the only hospital in Taiwan that does not adopt a performance-based pay system. We have found that when our medical team focuses on the well-being of patients and dedicates themselves to doing things the right way, not only does patient survival rate improve, but healthcare costs also decrease. This aligns perfectly with the experience of the Mayo Clinic. However, under the current "fee-for-service" payment system of Taiwan's National Health Insurance, the better we perform, the more we lose financially.
Therefore, in 1996, we used our hospital's comprehensive data on breast cancer patient survival rates and medical costs to lobby the National Health Insurance Bureau to implement a "pay-for-quality" pilot program for breast cancer. After five years of continuous discussions, the Bureau finally launched four pilot programs in 2001 to encourage the medical community to do the right thing.
Coincidentally, I recently read a book published last year titled "Health Reform, Now!" by George Halvorson, CEO of Kaiser Foundation Health Plan and Hospitals. In the book, he directly points out the flaws of the traditional healthcare payment system. He states that market mechanisms and financial incentives can reduce costs in any industry, except in healthcare. It's not that market mechanisms don't work, but rather that the healthcare payment system misplaces financial incentives.
The Serious Overuse of Volume-Based Pricing
He explains that, under the current U.S. healthcare system, there are over 9,000 billing items, including various tests, procedures, surgeries, and medications. As long as these are performed, regardless of their usefulness or effectiveness, insurance companies pay for each item. However, none of these items include "cure" or "health improvement." Therefore, taking good care of patients does not generate revenue. No wonder the medical community strives to provide more tests, procedures, surgeries, and medications. For example, if you put in great effort to cure a patient's cancer in one go, you only earn money once. However, if you are careless and the treatment fails, leading to a cancer recurrence, you have more opportunities for treatment and thus earn more money. Isn't such a system extremely counterintuitive?
In fact, in Taiwan, because the payment standards are less than one-tenth of those in the U.S., and due to the volume-based pricing system, whether it's outpatient visits, tests, or medication usage, the numbers are several times higher than in the U.S., indicating that the overuse of medical services is even more severe in Taiwan than in the U.S.If the healthcare system in the United States requires immediate reform, then isn't the urgency for healthcare reform in Taiwan even greater?
Source: http:/ / 1- apple. com. tw/ index. ……19& art_id=30468892& SubSec=67