When I was a practicing neurosurgeon, I performed surgeries to treat severe deformities of the spine. It was time-consuming, painstaking work, with virtually no margin for error.
No one is born with the skills to do such surgeries. Starting in medical school and continuing at the hospital where I completed my neurosurgery residency, I learned alongside more experienced surgeons as we cared for patients in need of our help. The training was literally hands-on, and it sparked the curiosity that led me to investigate novel ways to diagnose and treat these disorders.
For me, the experience epitomizes the essential role of academic medical centers in training physicians. Looking to the future, having a well-trained physician workforce will only become more crucial as the health care industry focuses on ways of delivering and paying for care that reward quality and better outcomes for patients rather than volume of care. Yet because some repetition and redundancy is necessary for training, the rise of fee-for-value models casts uncertainty on the fate of academic medical centers -- the very institutions primarily responsible for training those new doctors.
Readers may wonder why as an executive of a major health insurance company, I would take an interest in this topic. It's not just that I once directed a residency program at an academic medical center and later served as chief medical officer at the same hospital, though those experiences inform my perspective. The fundamental truth is that all of us -- insurers, health and hospital systems, the physician community and patients -- stand to lose if we don't work together on innovative ways to support medical education.
A MISSION IN THREE PARTS
The three-part mission of academic medical centers -- clinical care, medical education and research -- is what distinguishes them from community hospitals. They provide both routine clinical care and some of the most specialized care for rare and complex conditions. They also typically have a close connection to a medical school, and serve as training sites for medical students, residents and fellows. Lastly, they conduct cutting-edge clinical research that often serves as the basis for innovations in health care.
Due to their prestige and in deference to the multiple missions they serve, academic medical centers also have traditionally received favorable per-unit contracted reimbursement rates from private insurers and add-on payments from Medicare, both of which have served as indirect or direct funding sources for training and research.
But if recent years have demonstrated anything, it is that business-as-usual in the health care industry is unsustainable. Health spending in the United States continues to rise precipitously, and with it has come increased demand for high-quality care, improved outcomes and closer management of the costs of care.
Those costs, however, translate to revenue for academic medical centers. Spending on care by private insurers, state and federal government and patients themselves makes up about 85 percent of a typical academic medical center's revenue, according to a report by PriceWaterhouseCoopers. Because those payments subsidize all other operations of the hospital, cuts to that revenue mean everything else, including training, will be affected.
As a former director of a neurosurgery residency program, I had first-hand knowledge how clinical care overlaps with education. Medical training requires discussion-based, didactic instruction and hands-on practice in a clinical environment. Inexperienced providers are appropriately slower and more cautious when they practice, and work must sometimes be stopped for instruction and redirection before repeating some steps.
Though repetitive and redundant medical services are considered crucial to education, they are also examples of the utilization-based inefficiency that value-based alternative payment models like ACOs and medical homes are designed to minimize.
Few would question that academic medical centers fulfill a vital role in our society, but it's also clear that this role makes them among the costliest places to receive care. For the three-part mission to continue, we as health care leaders must find better ways to support and sustain it.
TRAINING THE NEXT GENERATION
An alternative funding plan might involve favorable tax considerations for stakeholders in the health care industry that make education grants to academic medical centers. This could help make up for the loss of fee-for-service revenue and could also drive competition for efficiency in training outcomes. Some might criticize this kind of tax break, but I would argue that money going towards training doctors to care for the American people is a worthy public investment.
This is just one potential solution. There are no easy answers, but a first step will be to understand the skills physicians will need in a value-based environment where those who pay for care -- government, insurers, employers and patients themselves -- will demand accountability for quality, outcomes and cost.
In such a world, doctors will need to assess the relative value and appropriateness of different treatment and test options, to communicate and collaborate as the member of a team, in order to improve care and reduce waste, and to also focus on patients' experience and perception of value. Some academic medical organizations have explored potential solutions already, and their knowledge can be leveraged as we as a society rethink the entire model, including how inefficiencies can be minimized without compromising training.
Once we understand what is required of the education mission, we can assess the alternatives for how these vital functions can be funded in a more straightforward, understandable and purposeful way. We cannot afford to allow high-quality medical training in the United States to erode due to a lack of foresight. As a country we not only owe it to the next generation of physicians but also to our children and ourselves.