Healthcare Is Expensive Without Showing Better Results

1781 Words8 Pages
The need for healthcare analytics is high: United States healthcare is expensive without showing better results. In 2013, healthcare spending represented 17.4% of GDP at $2.9 trillion (Centers for Medicare and Medicaid Services [CMS], 2015c). This equates to $9,200 per person, up from $6,100 ten years earlier (CMS, 2015b). These figures are significantly higher than other countries; total healthcare spending per capita range between $3,364 in the United Kingdom to $6,325 in Switzerland (Squires & Anderson, 2015). Yet, outcomes in the United States are worse than other countries. Using data from the Organization for Economic Cooperation and Development, the Commonwealth Fund concluded the United States has the lowest life expectancy and the highest percentage of 65+ population with two or more chronic conditions (Squires & Anderson, 2015). No other industry can continue with increasing costs and poor outcomes. Analytics can bend the cost curve and improve patient outcomes if done correctly to create insights and spur action. Costs are high because the current reimbursement models pay for each service completed, which is called fee-for-service (FFS). Each visit, each test, and each interaction with any healthcare entity or provider is paid on a per transaction basis. The per-episode payment model incentivizes providers to recommend more tests and procedures, even if unknowingly. Healthcare is also quite disjointed: healthcare is delivered to the same patient
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