New Commonwealth Fund Cost Containment Report

In a new report released this week, the Commonwealth Fund Commission on a High Performance Health System, to hold increases in national health expenditures to no more than long-term economic growth, recommends a set of synergistic provider payment reforms, consumer incentives, and system-wide reforms to confront costs while improving health system performance. This approach could slow spending by a cumulative $2 trillion by 2023—if begun now with public and private payers acting in concert. Payment reforms would: provide incentives to innovate and participate in accountable care systems; strengthen primary care and patient-centered teams; and spread reforms across Medicare, Medicaid, and private insurers. With better consumer information and incentives to choose wisely and lower provider administrative costs, incentives would be further aligned to improve population health at more affordable cost. Savings could be substantial for families, businesses, and government at all levels and would more than offset the costs of repealing scheduled Medicare cuts in physician fees.

The report provides specific recommendations organized around three guiding principles: 1) Provider Payment Reforms to Promote Value and Accelerate Delivery System Innovation, 2) Expand Options and Encourage High-Value Choices by Consumers, and 3) Systemwide Action to Improve How Health Care Markets Function. This report is different from the myriad cost containment reports published lately because it focuses on the need to contain costs across the entire health care system, and explicitly acknowledges the roles that both employers and employees have in this endeavor.