Cathedral versus Bazaar: Builidng a 21st Century Health System

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Our current health care system needs to be radically transformed to met the needs of our nation. There are many models of innovation which can help us overcome our current challenges. The large integrated delivery networks have demonstrated that a monolithic model ("The Cathedral") can produce very efficient, low cost, and high quality. However, 90% of healthcare is delivered by small, autonomous group practices (The Bazaar). New tools and technologies are emerging to bring these two worlds together (The Bazedral) in innovative, and occasionally inspiring, ways.

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Cathedral versus Bazaar: Builidng a 21st Century Health System

  1. 1. The Cathedral versus the Bazaar: Building a 21st Century Health Care System Scott Shreeve, MD Chief Executive Officer April 14, 2009
  2. 2. Cathedral vs. Bazaar
  3. 3. Care Financing Continuum Fully Capitated Fee for Service • Provider Risk • Payor Risk • Preventive Care • Disease Care • Coordination of care • Lack of coordination • Some navigation help • Consumer left to navigate • Results • Results – Better Quality – Highly variable quality – Lower Cost – High costs – Better Outcomes – Worse outcomes
  4. 4. Cathedral Care Vertical Characteristics: • Kaiser, Mayo, Intermountain, VA, etc Ancillary • Optimization at the system level Services • Full coordination of care • Information technology supports Hospital • Incentives aligned for outcomes Services • Reward for results • Patient consumer for life Physician Services • Consumer is guided through process Patient Services
  5. 5. Bazaar Care Non - Integrated Characteristcs: • Fee for Service Ancillary • Optimization at the component level Services • Disease Care • Lack of coordination Hospital • No Accountability Services • Consumer left to navigate • Incented for volume not value Physician Services • Churn and burn; “treat ‘em & street ‘em” Consumer Services (None)
  6. 6. The Bazedral Virtually Comments: • Software and services integration layer that coordinates patients, providers, and payment Ancillary Services with dramatic increase in value • Key points of “Virtualization” Organizing Entity • Financing (payment / business models) Hospital Services • Delivery (new types of arrangements) • Incentives (increased $ for high value) Physician • Examples: Services • Medical Home -> • Accountable Care -> Consumer • Health Vitality organizations Services (None)

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