American businesses hold a solution to one of the most fundamental flaws of American health care: misalignment of incentives. We live in a nation where profit-seeking behavior can be more alluring than high-quality patient care. To date, major health care reform efforts have paid little attention to the business community’s potential to address this issue.
Status quo
Currently, the status quo is such that health insurance companies and health care providers act as profit-bearing entities. This is fine when profit is correlated with the value of care provided. Unfortunately, in the current fee-for-service system, profit is driven by quantity rather than value. The problem is easily seen: There are few incentives for enhancing health care delivery when patient care does not equate with larger profits.
Employers, on the other hand, have tangible incentives to enhance the quality of health care while decreasing costs. The CDC estimates that employees with chronic or preventable illnesses cost employers over $93 billion each year in health insurance claims alone. In the meantime, the cost of insuring workers has increased. Estimates show American businesses losing up to $186 million dollars annually due to increasing health insurance premiums.
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