VA Hospitals as Quality Leaders
By Arnold Kling
On the previous post, Spencer left a comment recommending an article by Phillip Longman on Veterans Administration hospitals, which it turns out over the past decade have improved quality in many areas relative to other medical care systems.
suppose an HMO decides to invest in improving the quality of its diabetic care anyway. Then not only will it risk seeing the return on that investment go to a competitor, but it will also face another danger as well. What happens if word gets out that this HMO is the best place to go if you have diabetes? Then more and more costly diabetic patients will enroll there, requiring more premium increases, while its competitors enjoy a comparatively large supply of low-cost, healthier patients.
…In many realms of health care, no investment in quality goes unpunished.
Why has the VA done a better job of improving quality? Longman speculates that one reason might be sheer scale. However, I doubt that this is much of a factor.
Another reason is that the VA has a captive patient base, so that it has an incentive to worry about long-term outcomes for patients. In contrast, with employer-provided health insurance, most of the wellness benefits that your current employer provides could serve to reduce the health care costs of your next employer.
My view is that if quality in health care were measured and reported more consistently, it would be rewarded. If I know that doctor X does a better job of helping patients avoid major illnesses than doctor Y, then I will pay a premium to go to doctor X, until doctor Y starts to copy doctor X’s practices. I will do that even if my insurance company prefers doctor Y. But in the absence of data, I might as well pick a doctor who “participates in the plan.”
For Discussion. Will health care quality be measured and reported more consistently in the future, or is this a false hope?