In this volume, Porter and Teisberg examine health care issues in three broad areas: “The first is the cost of and access to health insurance. The second is standards for coverage, or the types of care that should be covered by insurance versus being the responsibility of the individual. The third is the structure of health care delivery itself.” Porter and Teisberg explain why the only way to truly reform health care is to reform the nature of competition itself; more specifically, to transform health care by realigning competition with value for patients. “How to do so is the central focus of this book.” How to explain dysfunctional competition in health care? Suggest several that include “misaligned incentives and a series of understandable but unfortunate strategic, organizational, and regulatory choices by each participant in the system that feed on and exacerbate each other. All actors in the system share responsibility for the problem...The problem is that competition does not take place at the medical condition level, nor over the full care cycle. Competition is the current system is at the same time too broad, too narrow, and too local.”
While conducting their research, Porter and Teisberg concluded that there should be no presumption that good quality health care is more costly. On the contrary, they learned that “better providers are usually more efficient. Good quality is less costly because of diagnoses that are more accurate, fewer treatment errors, lower complication rates, faster recovery, less invasive treatment, and the minimization of the need for treatment. More broadly, better health is less expensive than illness. Better providers can often earn higher margins at the same or lower prices...so quality improvement does not require ever-escalating costs.” Porter and Teisberg have a convincing, indeed compelling, argument in support of value-based competition on results in health care within a system which is “ripe for change”...and change for the better but not for the costlier if competition in health care is redefined and then conducted as Porter and Teisberg advocate. One of the most important benefits would be that the changes they propose would be self-reinforcing. “Changes by health plans and providers to compete on values will reinforce and magnify each other, and will spur innovation by suppliers. As consumers and employers adopt these principles, providers and health plans will be more motivated, and more able, to improve the value they deliver.”
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