A Warranty for Health Care?

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<p>Warranties are commonly available for many consumer products. But could they possibly work in health care as well? In a new <a href="/publications/journal-article/2009/jun/should-health-care-come-warranty"><em>Health Affairs</em> Web Exclusive</a>, the authors argue that warranties could improve the care delivered to patients while giving medical providers the opportunity to improve their profit margins.</p>
<p>The article, by François de Brantes of Bridges to Excellence, Guy D'Andrea of Discern Consulting, and Meredith Rosenthal of the Harvard School of Public Health, describes the "Prometheus Payment" model, which was developed with support from The Commonwealth Fund and the Robert Wood Johnson Foundation. If the model were applied to payment for care of acute myocardial infarction—heart attack—then for providers to be consistently profitable, they would need to reduce their current rates of potentially avoidable complications by roughly two-thirds.</p>
<p>Under the new payment model, a risk-adjusted global fee covers all recommended services for a specific condition, including all inpatient and outpatient treatment. But while these "evidence-informed case rates" fully compensate providers for the expected costs of providing evidenced-based care, they compensate providers for only half the predicted cost of addressing potentially avoidable complications—in effect, creating a warranty.</p>
<p>"Fee-for-service payments reward quantity, not quality. In some cases, providers are even rewarded for poor care by payments for the treatment of complications that could have been avoided with better care in the first place," said de Brantes, the leader of the Prometheus payment design team.</p>
<p>De Brantes says that health insurance coverage expansions "will not be sustainable if we do not encourage better and more cost-effective care through innovative payment methods like the Prometheus model."</p>