The following is excerpted from

The following is excerpted from "Quote of the Day", an e-newsletter by Don McCanne, MD. See Berwick's remarks in an interview from 2005.

Berwick is also a professor of pediatrics and healthcare policy at the Harvard Medical School and a professor of health policy and management at the Harvard School of Public Health.

An elected member of the Institute of Medicine of the National Academy of Sciences, Berwick served as a member of the IOM's Committee on Quality of Health Care in America, which launched the slowly building revolution in healthcare quality improvement. The committee published in November 1999 To Err is Human: Building a Safer Health System, which gave the healthcare industry one of its most totemic phrases: "At least 44,000, and perhaps as many as 98,000 Americans, die in hospitals each year as the result of medical errors."

Donald Berwick is president and chief executive officer of the Institute for Healthcare Improvement (IHI) in Boston, Massachusetts. Bob Galvin is director, Global Health Care, at the General Electric Company in Fairfield, Connecticut.

Galvin: I'm interested in your thoughts on the impact of the Leapfrog Group, an effort organized by the purchasers of health care, both private-sector employers and public purchasers. The Leapfrog agenda has focused on... benefit incentives that engage consumers and patients in the quality and cost of care...

Berwick: The one part of the (Leapfrog) plan that I am absolutely against at the moment is the shifting of burden to individual patients. I do not believe that making the individual American patient more "cost-sensitive" has any rationale in science, ethics, or evidence. It will fail, and it will fail miserably. It will result in a shifting of care away from the people who need it the most. It is a displacement of responsibility for changing the system. You know, if CalPERS or Xerox or GE can't change care through using its purchasing power, then I absolutely promise you that Mrs. Jones can't. The idea that she will now be more sensitive because she pays an extra ten bucks out of pocket is, to me, nearly stupid. So I really disagree with that element of the agenda.

Internationally, when one looks at high-performing systems around the world - and ours is nowhere near the highest-performing one - it is almost a routine characteristic of the best systems that they have first-dollar coverage, and there is no attempt to make patients pay more when they're sick, which is a stupid thing to do.

Galvin: The conceptual basis of this is - as unsettling as it may be to "dangle money" to increase motivation-grounded in personality and motivation theory. In private industry, we would simply call it understanding what makes people tick. People respond to incentives. So part of the pay-for-performance movement is based on this idea that clinicians are really no different than other people and that they'll respond to incentives.

Berwick: At the individual level, I don't trust incentives at all. I do not think it's true that the way to get better doctoring and better nursing is to put money on the table in front of doctors and nurses. I think that's a fundamental misunderstanding of human motivation. I think people respond to joy and work and love and achievement and learning and appreciation and gratitude-and a sense of a job well done. I think that it feels good to be a good doctor and better to be a better doctor. When we begin to attach dollar amounts to throughputs and to individual pay, we are playing with fire. The first and most important effect of that may be to begin to dissociate people from their work. That's really where we've come to, and we've done it by pay-for-performance in terms of throughput measurements and manipulating payment schemes.

Galvin: Let me move to another issue, and that is the explosion that's about to play out in biomedical innovation. If you talk to patients... they are also interested in innovations that can cure them or their loved ones. They speak about it with pride and passion...

Berwick: I do think this: We have a learning disability in this country with respect to the difference between technologies that really do help and technologies that are only adding money to the margins of the companies that make them, without essentially paying their way in value. One of the drivers of low value in health care today is the continuous entrance of new technologies, devices, and drugs that add no value to care. If we had strong national policy, it would allow us to know the difference, and I would more fully support what I think you're correctly proposing, which is an innovations value. We need to help the public know the difference. There's a big agenda here, possibly for government, to help create a public awareness that more is not necessarily better. Frequently it's worse. So we can be smart about what we buy and what we choose not to buy.

Galvin: Many of us on the purchaser side see radically improving the efficiency of the system as a way to free up capital to cover the uninsured and to fund innovation. How do you think efficiency fits into the quality agenda?

Berwick: Let's define efficiency as making sure that every dollar you spend gets a dollar of value back, so that efficiency is the opposite of waste. Right from the start, it has been one of the great illusions in the reign of quality that quality and cost go in opposite directions. There remains very little evidence of that. There may be some innovations that raise cost while raising quality, but many, many improvements reduce costs.

What puzzles me is how to access efficiency as a social agenda in health care. There are couple of problems. The first is that a lot of people make a lot of money on inefficiency - on production of things that have no value. So the minute you try to become truly efficient, you're going to run into stakeholders who are going to tell you that you're harming care, and the knee-jerk reactions of doctors and others will be to reinforce that idea. And they include you. I mean, GE pays out of one pocket and then makes money on products and services that do not add real value.

Galvin: There's a threshold issue with most purchasers when you talk about getting a patient financially engaged. That is that no one ends up paying more because they're sick. The only option would be to pay less. Let me give you an example: Many employer-sponsored benefit plans across the country have hospital copays as part of their cost sharing. This means that there is a fee of a hundred or several hundred dollars when one is admitted to a hospital. In these benefit designs, while most people have pretty free choice of what hospital they go to, going to the one that objective data demonstrate is of superior quality and efficiency would result in a waiver of the copay.

Berwick: Well, I can be an empiricist about it. Go ahead and try it. I shudder to think about what may happen, because in the end, that sick patient arriving at that hospital is in the absolutely weakest position at that particular point to decide, "Aha, I'm going to save a hundred dollars and go elsewhere." That person is more likely to be poor, more likely to be black, more likely to be a low-wage earner. I think it's regressive social policy, and I predict that it won't work. It's a displacement of responsibility from the stewards who actually have the job of crafting systems to meet the needs of the people who come to them for help. I think it's a bad, bad policy, and I don't see it playing out productively in other countries, either.

Canada is, in many respects, culturally and economically similar to the United States, and until relatively recently, the two countries had similar health systems. However, since passage of the Canada Health Act in the 1970s, that nation’s health statistics have become increasingly superior. Although the costs of Canada’s health system are high by international standards, they are much lower than U.S. costs. This paper describes several factors likely to be responsible for Canada’s better health at lower cost: universal financial coverage through a so-called single payer; features conducive to a strong primary care infrastructure; and provincial autonomy under general principles set by national law.

Differences in health — both overall and regarding social disparities — in two countries that are otherwise quite similar are attributed to the important effect of two related phenomena: achievement of important health-system characteristics and a strong clinical primary care infrastructure in Canada. Several international studies have confirmed the importance of three health-system characteristics of countries that achieve better health at lower cost: government attempts to distribute resources, such as personnel and facilities, equitably; universal financial coverage either through a single payer or regulated by the government; and low or no cost sharing for primary care services.

U.S. policy achieves none of the three structural characteristics of good health systems. Canada achieves all three. At the same time, although Canada’s efforts to distribute resources equitably have been more extensive and successful than in the United States, Canada’s are less adequate than in other countries, such as Sweden, Finland, Denmark, the Netherlands, Spain, and the United Kingdom.

The United States also is the only industrialized country to lack a national strategy to address important building blocks of a strong primary care system, including services delivery, workforce, information systems, medical products, vaccines, technology policy, financing, leadership, and governance. International experiences demonstrate that national stewardship, financing, and generation of resources are important for an adequate primary care infrastructure. ...

"Build Foundation for Health Care on Medicare: Johnathon Ross, M.D."
by Johnathon Ross, M.D., as printed in The Plain Dealer, May 30, 2010

Mrs. Brown (not her real name) was recently in to check on her blood pressure. She knows I've worked decades for a national health plan that would benefit individuals and businesses alike.

"So what do you think of the reform bill, Doc?" she asked, hoping I'd be pleased.

I replied with a question of my own: "Would you add a third floor to a house that has a crumbling foundation?" Because that is what Congress just did.

The crumbling foundation is our private, for-profit, insurance-based system of financing health care. As nonprofit, community-service organizations, health insurers were once a boon to millions of workers and thousands of companies. Now, they are a very bad bargain, indeed.

Private insurers make money by denying claims. They cause us to waste enormous amounts of money on excess paperwork and bureaucracy -- their own paperwork and the paperwork they inflict on hospitals, patients and doctors like me. An estimated 31 cents of every health care dollar goes toward administration in U.S. health care, at least half of it unnecessary.

The problem is getting worse. The number of administrative personnel in health care jumped more than 3,000 percent over the past three decades, while the number of doctors, nurses and other caregivers has grown by less than 200 percent.

In effect, health care has been overtaken by an army of bureaucrats whose "generals" -- the CEOs -- get astronomical salaries. Money-changers and paper-pushers thrive chasing the money to pay for care -- not deliver it. In our complex, multipayer system, chasing money is expensive work.

Does the new law remedy this? No. "Insurance exchanges" will add yet another layer of private bureaucrats and IRS agents to determine eligibility for subsidies and enforce fines for those who fail to purchase insurance.

Private insurers in the new exchanges will continue to advertise and market their products, bill for premiums, determine eligibility for coverage, coordinate benefits, manage a multitude of yearly contracts with brokers, businesses, individuals, doctors, hospitals and other providers and, lastly, pay stockholders a high rate of return.

Each hospital and doctor will continue to track myriad contracts, discount arrangements, benefit packages, drug formularies, limited referral networks and insurance rules designed to reduce utilization of our medical resources and to increase insurance company profits.

The new law perpetuates this wasteful overhead and guarantees insurers more profits as we spend $447 billion over 10 years to subsidize the mandatory purchase of shoddy private insurance by 16 million uninsured Americans.

The exchanges are supposed to bring down prices by promoting "market competition" among various insurers. But Massachusetts and several other states have had plenty of experience with such exchanges, and the verdict is clear: They don't control costs. In fact, Massachusetts now has the highest health care costs in the world.

As a rule, "market competition" doesn't work well in health care. Health care is not an ordinary product that people want. Rather, it is a necessity that they must have. The most expensive care is most often not optional, predictable or negotiable.

Businesses are groaning under the burden of the rising costs of employee and retiree health care benefits. They, too, need to get out from under the heel of the private health insurance industry and the skyrocketing, volatile prices that come with it.

So what's the alternative? It's building on the solid foundation of our tax-financed, low-overhead Medicare system, and extending it to cover everyone without exception. The administrative savings from such a streamlined system would amount to $400 billion per year, enough to provide comprehensive coverage to all with no significant out-of-pocket expenses and with complete choice of doctor and hospital.

A single-payer system would also have the clout to negotiate drug prices and provider fees, and to allocate resources efficiently and wisely. It would possess powerful tools for improving quality and controlling costs.

Conventional wisdom suggests we have to "wait and see" how the administration's new law plays out. But we can't afford that: With about 50 million uninsured this year, some 50,000 people will die because they lack coverage, a recent study estimates. By 2019, those figures will only be halved, experts say.

It's not too late to do the right thing. The sooner we adopt an expanded and improved Medicare-for-all, the better off our patients and our economy will be.

Johnathon Ross is past president of Physicians for a National Health Program (pnhp.org) and a leader of the Single Payer Action Network in Ohio (spanohio.org).

In his e-newsletter of June 9, 2010, Don McCanne, MD, criticizes the Rand Corporation, which I have thought to be a reputable analyzer.

RAND created a microsimulation model called RAND COMPARE that was designed to "provide independent analysis about how different reform proposals would impact the American health care system." Using this model, Dr. Elizabeth McGlynn concludes, "Of all the proposals on the table that would expand health insurance to more Americans, the final health reform law included those that covered the largest number of people at the lowest cost to the federal government."

On a RAND Webinar event held in January of last year announcing the release of RAND COMPARE, I noted that a single, public insurance model (single payer or Medicare for all) was not an option available on the RAND COMPARE website. Dr. McGlynn then assured me that it was a model that should be added. In followup, others also contacted RAND to request that this model be added, and they received assurances that the matter was being addressed.

If you check the RAND COMPARE website, you will find that they did add well over 100 legislative proposals before Congress. They marked each proposal as to whether or not they addressed specific policies evaluated by the RAND COMPARE model. Some of the policies considered included individual mandate, employer mandate, tax credits, Medicaid eligibility, high deductible health plans, bundled payment, comparative effectiveness, and others. In the chart, H.R. 676, John Conyers' Medicare for all bill received no marks whatsoever, as if it did absolutely nothing under the RAND COMPARE model.

Everyone who understands the single payer model knows that the final health reform law will not cover "the largest number of people" since single payer would have covered tens of millions more - that is, everyone. Also the single payer model would be far more effective in slowing health care cost increases than would the legislation enacted. RAND dodges this by repeatedly stating that the bill represents the "lowest cost to the federal government," but it is our total national health expenditures and not the federal budget that matters.

The slogan for RAND COMPARE on their website is "Facts you can use, analysis you can trust." Well, that sounds "Fair and Balanced." It's only people who need health care that are being victimized.