Lessons From the Past Drive Future Innovations

Following decades of relatively static healthcare payment and delivery models which have failed to offer affordable care to the populous, activity is growing around a push for changes in legislation and the adoption of a more value-driven, or outcomes based healthcare model. Despite recent increases in value-driven offerings, consumer convenience and familiarity remain controlling factors in utilization, with the result being that costs associated with treatment may be less affected by these efforts than expected.

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Summary

Recently, many healthcare providers have responded with the creation of a "retailized" system. If implemented correctly, the retailization model aims to reduce the cost of healthcare and educate patients nationwide. Although the technological and institutional standards of today's healthcare system can make it difficult to adopt to a new approach, a proactive perspective to retailization can turn it into a reality sooner than we think.

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  • The average pay rate of physicians is mostly flat, and reimbursement to medical facilities from insurance claims has decreased
  • Majority of patients do not pay the full cost of medical care
  • Medical necessity is not always the driver of medical costs.
  • When a large healthcare system controls most of how a physician can interact with the patient, the overall patient care suffers

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Retailization of Healthcare

Healthcare costs are out of control and unsustainable. Employers and plans that want to reduce spending need to understand and address all of the drivers which influence medical decision making.

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