Waste accounts for $850B of healthcare costs annually

I do not believe this is practical to the average non health care person, other than upsetting those that truly don't understand the magnitude of solving such a problem. This, along with the 60 billion fraud in Medicare would be enough to cover all those without and many with insurance. But this story is like showing a child ice cream out of reach. This would be impossible to fix but nothing wrong with trying. Lastly - The bigger concern here is thinking our Government could squeeze out the savings from these Human errors. Now, that would be an impossible task, although some believe it is possible.

This administration has NO intention of cutting lawyers's ability to sue. So the defensive medicine will continue. Abusive Trial lawyers may be the source of the biggest savings, but also the #1 source of funding for the Democrat party - and most legislators are lawyers. Regarding Medicare/Caid fraud: Rather than attack the problem with better and more audit (an extremely cost effective strategy), they'll contort themselves to tax productive sectors of the economy. Look at NY state, in a permanent structural deficit, yet unwilling to go after a drain of 10+ billion annually. And these (both parties) are the same people you trust to save the "system" money rather than the private sector?

Waste in healthcare costs.
In addition to the vast waste of fraud, inappropriate diagnostics and therapeutics,etc, what about lifestyle? What savings would accrue if we ate healthy food, exercised, maintained ideal weight, controlled our stress and personal lives? The answer is that we would have almost no need for the great majority of our "disease care system." Self responsibility for keeping costs down does not appear in public discourse, even though it constitutes the lion share of necessary reform.

OK so there are all sorts of areas that could use intelligent scrutiny to reduce the overall healthcare costs. Example Physician's insurance - raise the rates of MDs who have excessive claims and settlements against them, not on the rest of them. Curb excessive profits from the pharmaceutical companies. Prohibit physician-owned labs and other side companies that they then use to generate unnecessary fees. But what you don't cut are the things that promote patient safety. Hey Docs - don't let your patients do the diagnosing; listen to them but use your prescription pad with restraint. Don't let the Pharmas bully you into using their products even vicariously through your patients.

The Reuters article is right. Cost effective processes and quality outcomes are not mutually exclusive.

One area not addressed is the opportunity to remove significant amounts of unnecessary costs from hospitals by assuring that more facilities are employing industry standard inventory control techniques which alone can provide large one-time reductions in excessive inventory, which in Surgery and Cardiac Catheterization alone can potentially be valued in the millions of dollars. Reducing and maintaining appropriate inventory levels of these expensive high-tech supplies and devices only provides a one-time reduction and recovery of excessive dollars tied up in inventory.

For continuing savings, more facilities should consider developing teams with process improvement skills as process improvement should be a continuous function. If hospitals are not setting goals, establishing the necessary metrics to gauge the efficacy of their process improvement initiatives and continuously moving toward those goals, they’re missing opportunities to remove unnecessary costs from our healthcare system.

Effective value analysis teams with appropriate multi-disciplinary representation can affect decisions that favorably impact financial and clinical outcomes in the most cost efficient manner. Implementation of an effective value analysis committee with physician and clinical representation as well as representatives from risk, finance, reimbursement, clinical education, infection control and materials management can effectively insure that products are appropriate, cost effective and contribute to positive clinical outcomes before they are purchased.

Value analysis teams need to become the gatekeepers for the purchase of new supplies and they should start examining the supplies being currently used, beginning with the most expensive Diagnosis Related Groups (DRG’s) and working down the list. DRG’s are used for prospective payment of Medicare hospital operating costs.

The Value Analysis team should have executive sponsorship, established cost savings targets and have clearly defined and reproducible processes that address the aspects of appropriate functionality of supplies and devices, the relationship between cost and reimbursement and clinical safety and efficacy.