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Cost of Care, Part 2

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Health care is big business; just ask those who work at the Dartmouth-Hitchcock Medical Center in Lebanon, N.H. Last year, revenues totaled more than $1.2 billion.

"Health care costs too much money. There is too much variability in health care. We have the problem of costs going up. And we the problem of people who are uninsured or underinsured," said Dr. Edward Merrens, the chief medical officer.

The cost of care cannot be ignored.

"We spend more on health care in this country than any other nation in the world and yet it's not producing a return we want," said Dan Jantzen, the chief operating officer.

There is a tremendous amount of uncertainty in health care from patients, doctors, nurses and insurance companies. But one thing is consistent-- everyone is talking about cost.

All this tough talk comes at a time when Vermonters might be covered by government-sponsored insurance through a single-payer system. National issues are in play, too, as the United States overhauls its health care system. They are controversial changes.

"I think our interest is not to have them political but be patient-centered," Merrens said.

Working closely with patients can lead to controlling costs says Merrens.

"Allowing the patients to say, I want this, I don't want this, I don't understand this, and allowing them to be part of the decision process, whether it's a kind of cancer care, cardiac intervention, joint replacement or spine surgery. And when you invite patients to be part of the process, the best decisions get made and the best cost-effective decisions are made," Merrens said.

Dartmouth's goal is to make everyone accountable when decisions are made about care. They believe costs can be controlled by reducing readmissions, sending people home when it's safe and finding an alternative to admitting a patient to the hospital. Dartmouth says the approach has saved millions in federal Medicare dollars already. The number watchers also say while costs associated with in-hospital care have been increasing by double digits nationally, Dartmouth's increases are less than 2 percent.

Economics and demographics are driving Dartmouth to change.

"We have a tidal wave of older Americans coming our way and when you think where we spend our health care dollars, it's later in life. You put those two factors together, I would say health care in general is on a pathway that simply is not sustainable," Jantzen said.

The same goes for the region's smaller hospitals. A hospital in Bennington has formed a partnership with Dartmouth Hitchcock.

"Working together creates sustainability, the ability to provide high quality to our patients and to do it in a way that is much more cost effective by sharing resources," said Tom Dee of Southwestern Vermont Health Care.

Dartmouth-Hitchcock is not a fan of a system that pays hospitals and doctors a fee for a service. Dartmouth contends more procedures don't always lead to healthier patients. They are promoting a system that pays based on positive results.

"We are paying for the wrong things," Jantzen said. "How many people would take their car to a mechanic, pay a thousand dollars, pick it up and have the problem persist? They would take it right back and say hey! Yet in health care we just pay for the production widgets. We pay for more activity, but not necessarily outcome or value. Our fee for service provides the wrong incentives."

"You want to be in a system that is patient-centered, that is not driving the last paying procedure until a fee for service is over, and looking toward a time where health care is more patient-centered delivering true value, improving our quality and reducing costs. And we not only training our residents but our med students to think about it that way," Merrens said.

It's a health care system that's changing with all those in the thick of it, talking about the cost of care.

Dartmouth says its accountability approach is translating to savings. By managing readmissions, the hospital avoided $1 million in federal penalties last year. It predicts even better results this fall.

Related Story:

Cost of Care, Part 1

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