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Why Healthcare Performance Is Important to U.S. Competitiveness

Baldrige criteria can help reduce healthcare costs and improve quality

Harry Hertz
Tue, 02/05/2013 - 11:48
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According to a recent PBS report based on information from the Organization for Economic Co-operation and Development (OECD), the United States’ healtcare expenditures are 2.5 times greater than that of the most developed nations around the world. Depending on which report you read, our healthcare expenditures account for between 17.6 percent and 17.9 percent of our nation’s gross domestic product (GDP).

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In contrast to our healthcare expenditures, the Commonwealth Fund’s 2011 comprehensive assessments of U.S. population health and healthcare quality, access, efficiency, and equity show the United States scoring 64, with benchmark performance at 100, across 42 performance indicators.

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Submitted by DCDOC on Mon, 02/11/2013 - 12:27

Goals and Relationships

Granted that US healthcare could be improved by wider use of the Baldrige criteria.  However, we need to be careful about how and why this is done.  The biggest problem in US healthcare today is cost.  Healthcare services just cost too much.  If this is true, why all the attention to health insurance (Medicare, etc.)?  They just mirror the cost of the services they pay for.  Harry lauds teaching hospitals for their wider use of the Baldrige Criteria, but they are also the most expensive places to get healthcare.  The same service costs more at a teaching hospital than anywhere else. The missing link here is price competition.  No one in the US loses market share because the hospital next door underbid them.  Healthcare in the US is patchwork of mini-monopolies that by and large do not compete with each other and never compete on price.

He also perpetuates the mythical relationship between healthcare and population health.  The health of a population is mostly related to air and water pollution, personal habits, and genetics.  None of those factors can be improved by healthcare.  The various factors by which countries are evaluated--life expectancy, infant mortality, etc.--have almost nothing to do with healthcare per se.

If we had price competition in US healthcare, institutions might utilize the Baldrige Criteria to improve their competitive advantage in the market place and put ther neighbor out of business.  Until then, the Criteria for Performance Excellence will have little influence on the key problem with US healthcare--cost.

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