Managing Health Care Costs: Private Sector Innovations

By Sean Sullivan; Polly M. Ehrenhaft | Go to book overview

Shifting the Cost of Health Care:
Private Sector Response,
Public Policy Reforms

MR. ESCH: As we move into this afternoon's session we hope you will be willing not only to present items on your own agenda but to respond to the other panelists, so that we can begin to crystallize some of the differences and interests among us.

We would like to have two persons frame the discussion before we move into a more aggressive crossfertilization of ideas. We have asked Larry Lewin, president of Lewin and Associates, to begin our afternoon's discussion. Lewin and Associates perhaps more than any other group is looking at private sector involvement and what is going on in the field in a very significant way.

LAWRENCE LEWIN, Lewin and Associates: If I had to put a title on what I am going to talk about, it would be "Cost Shifting -- Villain or Scapegoat?" I am more inclined toward the latter view, that it is more a scapegoat than a villain.

It is probably becoming clear to everyone that we are entering or are well into the era of the purchaser. For years we talked about reform of the health care system and about trying to change the reimbursement system to bring about systemwide reform. That has really become a thing of the past. Even though some of the strategies of today may arguably be in support of system reform, it is clear that we are in an era where it is every person for himself or herself. Nowhere is that more apparent than in the position taken by the federal government as symbolized in the approach to the Medicare reimbursement program for hospitals. One could argue, of course, if one is cynical enough, that the whole animus is really to reduce the fiscal liability, but I think a strong case could be made that each purchaser must do his best to lower costs. The aggregate effect might be a better, more efficient system. There are some other consequences of the era of the

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