Have you considered how healthcare economics seem to be at odds with classic free market performance trends? Why is it that increased supply leads to increased utilization? In Healthcare Law, Christopher C. Gallager cites John Wennberg, of Dartmouth, who offered critical testimony on the connection between the availability of health care providers and utilization...with health care, supply drives demand. This leads to "unwarranted care," which leads in turn to higher costs for everyone in the health care system.
One example of this dynamic may be found in the artificial demand brought on by the practice of investment in medical technology, in this case imaging and diagnostic services, to generate revenue for the healthcare practitioner/practice. In HealthLeadersMedia Industry Survey 2009, 59% of non-rural practices plan to add an ancillary service to increase revenue in the next three years.
Supply Efficiency Scoring is a strategic reimbursement innovation for imaging and diagnostic services that promises to slow the growth of healthcare costs by eliminating artificial demand without disrupting free market activity or applying administrative review techniques.
In my opinion, Supply Efficiency Scoring has the potential to be an effective, measured innovation in cost control that should be considered by health plans with fee-for-service contracts for imaging and diagnostic services.
You may be interested to help validate this concept by participating in a demonstration project. For more information, read the entire article or contact G2 Management Group directly.
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