Healthcare Costs

The rising cost of health care...

...in the US is driven by several forces. WIRE-Net members have complained for years to COSE, to the Legislature, to Congress (yes, even to WIRE-Net) about double digit increases in insurance for their employees, about passing those costs on to employees or trimming benefits. They've gone to high deductible plans, and shared cost information with employees, rewarded wellness...but the rates keep climbing.

WIRE-Net itself saw a 60% increase in our premium with Kaiser (thru COSE) this year.

So whats behind this? Several factors:

• Waste (up to 40% of health care costs is estimated by Industry Week to go for duplicative, or unnecessary procedures, wasted overhead, etc.).
• Expensive technology driven procedures that fix problems that were basically unsolvable in the "old days".
• Aging of the population, driving ever larger share of GDP being spent on health care...just wait a few years for the boomers to start retiring!
• Poor feedback: as Michael Porter puts it, the system is competing on the wrong levels.

My immediate question is this... given the complexities, can't the various key stakeholders in holding the line on health care costs agree that cutting out waste is a good first step? Lets form a NE Ohio "Lean Health Care" initiative, organize some big corporations, the unions, public agencies, one or two key insurers and help the health care providers streamline their operations. As I said above, Industry Week estimates that up to 40% of the bill is for wasted procedures, overhead and inefficiencies.

Even modest progress would give NE Ohio a competitive advantage over other regions in the US, and would help products made here be more competitive around the world to boot.