Pacific Business Group on Health Health Cost

I serve on the Board of the Pacific Group on Health. This organization is made up of about 50 major employers who have about 3.2 million and 29 employees [CAL Insurance is the 29 employees] that they are providing health coverage for.

The goals of the organization are:

1.Engaging Consumers in Health Care Decisions

2. Paying for Value

3.Redesigning Care Delivery

4. Advancing Value Based Policy

I learned something yesterday that should be shocking to you. In the best case scenario only 2.5% of the payments to health providers are based on pay for performance. The average is 1%.

What an indictment of the US health care system.

It clearly highlights that in the US we pay for procedures with almost no concern of the outcomes of those procedures. In fact if a provider makes mistakes we pay them more than providers that do things correctly. The classic example is acquiring a staph infection at a hospital.

One of the goals of PBGH is to increase the pay for performance to 20% by 2015.

Why am I telling small businesses around the state? The reason is that the cost of health care has been the number one issue for small businesses in each of our 7 Small Business California surveys.

We must be vocal in the debate over reducing health care cost. We must play an active role in questioning the insurance companies how their providers stack up and pushing them to do more. We must let our employees know that they have a role in their health decisions and they must constantly question their providers.

We cannot continue to see health costs rise from the current 17% to 18% [$2.5 Trillion] and yet see the outcomes in many cases at the bottom of the industrial world.

Scott Hauge
President
Small Business California
2311 Taraval Street
San Francisco, CA 94116
shauge@smallbusinesscalifornia.org
415-680-2188