Flattening the Trajectory of Health Care Spending

Insights from RAND Health Research

Research Brief

Key findings

  • Growth of health care spending is at the core of our nation's long-term fiscal imbalance.
  • RAND Health research provides insights into four broad strategies to restrain further spending growth without compromising health care quality: (1) foster efficient and accountable providers, (2) engage and empower consumers, (3) promote population health, and (4) facilitate high-value innovation.

The Policy Challenge

The second Obama administration and 113th Congress must address the relentless growth of health care spending, a major contributor to our nation's long-term fiscal imbalance. With the exception of two years in the mid-1990s, health care spending has outpaced gross domestic product by an average of 2.0 to 2.3 percent per year since 1950.[1] In 2009, a year that the U.S. economy was in recession, Americans spent nearly $100 billion more on health care than they had the year before. Although the United States devotes a far larger share of its economy to health care than our global competitors, spending continues to grow. Other high-income nations are struggling with spending growth as well, but we stand out from the rest (Figure 1).

Growth of health spending is fueling the federal budget deficit,[3], [4] crowding out other priorities in state budgets,[5], [6] hindering the competitiveness of American businesses,[7] restraining job growth,[8] and jeopardizing the finances of American families. A 2011 RAND analysis determined that between 1999 and 2009, rising health care costs wiped out the income gains of a typical middle class family.[9]

Figure 1. International Comparison of Spending on Health, 1980–2009

International Comparison of Spending on Health, 1980-2009
SOURCE: The Commonwealth Fund, 2011.[2] Used with permission.
NOTE: PPP = purchasing power parity — an estimate of the exchange rate required to equalize the purchasing power of different currencies, given the prices of goods and services in the countries concerned.

Figure 2. Estimated Cumulative Percentage Changes in National Health Care Expenditures, 2010 Through 2019, Given Implementation of Possible Approaches to Spending Reform

Figure 2. Estimated Cumulative Percentage Changes in NationalHealth Care Expenditures, 2010 Through 2019, GivenImplementation of Possible Approaches to Spending Reform
SOURCE: From Hussey PS et al., 2009.[14] Copyright © 2009 Massachusetts Medical Society. Reprinted with permission.
NOTE: NP = nurse practitioner and PA = physician assistant.

The RAND/UCLA Appropriateness Method

The RAND/UCLA Appropriateness Method uses a structured process for integrating findings from the scientific literature with clinical judgment to produce explicit criteria for determining the appropriateness of specific procedures.

Ranking of Procedure Definition
Necessary Produces substantially more health benefit than harm and is preferred over other available options
Appropriatev Produces more good than harm by a sufficiently wide margin to justify the use of the procedure
Equivocal Potential health benefits and harms are about equal.
Inappropriate Health risks are likely to exceed health benefits.
SOURCE: Fitch K et al., 2001.[29]

The payoff for curbing health care spending will be worth the effort. Victor Fuchs, considered by many to be the father of health economics, was recently quoted as saying, "If we solve our health care spending, practically all of our fiscal problems go away."[10] There is no lack of ideas for how to slow spending, but action is hindered by a lack of consensus.[11], [12]

In this summary brief and the supporting briefs that accompany it, we present findings from RAND research that address four broad strategies for constraining spending growth in our market-oriented health care system:

  • Foster efficient and accountable providers.
  • Engage and empower consumers.
  • Promote population health.
  • Facilitate high-value innovation.

Foster Efficient and Accountable Providers

Although consumers are the recipients of health care services, health care providers drive the bulk of spending through their purchasing decisions (e.g., tests, treatments, hospital admissions) and the fees they charge patients. Thus, the nation cannot hope to control cost growth without active provider participation.[13] Unfortunately, fee-for-service (FFS) payment, the prevailing approach to reimbursement, gives providers a powerful economic incentive to do more and charge more.

There are a number of ways that motivated providers can deliver better care at lower cost:

1. Focus on value rather than volume. There is widespread agreement that payment policies must change to motivate providers to deliver value (broadly defined as health benefits per dollar spent) rather than volume (the number of examinations, tests, procedures, and treatments). In 2009, RAND quantified the likely effects of eight policy options for reducing spending growth that broadly apply to both the public and private health care sectors. The analysis generated high and low estimates of cumulative savings for 2010 through 2019 (see Figure 2).

Of the eight options examined, the most promising was to change how health care services are paid for. Based on optimistic assumptions, bundled payments, which are designed to encourage providers to coordinate care and practice more efficiently, could reduce national health spending by 5.4 percent over ten years.

The second most promising option, setting hospital prices for all public and private payers, was common in the 1970s and 1980s but was later abandoned. Under the most optimistic assumptions, RAND researchers predicted that it might reduce national health care spending by 2.0 percent. The other six options generated much smaller savings or none at all.

The appeal of shifting from FFS to alternate models of payment must be tempered by the practical challenges. RAND researchers have extensively studied two popular methods, pay for performance[15] and bundled payments.[16], [17], [18] Although both are appealing in theory, they are proving difficult to implement in practice. So far, evidence of their impact on spending growth is slim.[19], [20]

Another approach to payment reform, prominently embedded in various sections of the Affordable Care Act (ACA), is formation of accountable care organizations (ACOs) — networks of health plans, hospitals, and physicians that are willing to work together to efficiently meet all of the health and long-term care needs of a defined group of patients. Because the ACA offers financial incentives to providers who embrace this concept, ACOs are proliferating across the country.[21]

ACOs are so new health system administrators have limited knowledge of how to best structure them, and federal regulators and policymakers have little understanding of how ACOs will ultimately affect performance and costs. Hopefully, pilot efforts will build the required experience base. In California, for example, Blue Shield of California has given $20 million in grants to 18 provider organizations to develop infrastructure and delivery systems to support ACO implementation.[22] RAND Health is evaluating this effort.

2. Eliminate wasteful and inappropriate care. Irrespective of financial incentives, providers should strive to reduce wasteful and inappropriate care. Reducing waste is more than a matter of saving money; it's good medicine.[23], [24], [25]

The challenge is that one person's idea of "waste" in health care is another person's revenue. The best prospects for success are likely to come through the leadership of medical specialty societies, which can bring their members together to identify ways to reduce waste without compromising care. The Choosing Wisely campaign, now endorsed by 31 specialty societies and more than a dozen consumer-oriented organizations, represents a promising start.[26]

3. Identify and apply the best available evidence. A rigorously structured process that draws from comparative effectiveness reviews of the best evidence and employs a validated technique to harness expert opinion could generate guidance that physicians can use to determine which procedures are necessary, appropriate, equivocal, or inappropriate in various situations. The most widely accepted technique is the RAND/UCLA Appropriateness Method (see sidebar).[27], [28]

When the appropriateness method was first employed 20 years ago, it found that a substantial percentage of the procedures that patients received were not needed.[30] Using updated evidence, specialty societies could use the method to reduce waste and improve care.

4. Enhance patient safety. Medical errors cause needless complications, injuries, readmissions, and deaths.[31] They also increase providers' liability. A RAND study found that reducing the number of preventable patient injuries in California hospitals from 2001 to 2005 was associated with a drop in malpractice claims against physicians.[32]

Measures to enhance patient safety and improve quality must be tailored to specific patients and settings. To improve the care delivered to senior citizens, RAND developed the Assessing Care of Vulnerable Elders (ACOVE) indicators.[33] ACOVE has been successfully applied to dementia, end-of-life care, urinary incontinence, and falls. To improve care delivered in hospitals, RAND researchers produced a toolkit to help hospitals strengthen their quality improvement capabilities.[34] The toolkit is available on the website of the Agency for Healthcare Research and Quality.[35]

5. Strengthen primary care. Demand for primary care is growing, but the number of medical school graduates opting for careers in primary care is dropping, in large part because primary care physicians are paid substantially less than specialists.[36] Narrowing this differential could attract more medical students into primary care. Currently, Medicare does not pay for care coordination and maintaining stable patient-doctor relationships, although both are valued within HMOs and ACOs. Strengthening primary care could help reorient our health care system from episodic treatment to keeping patients out of the hospital, thereby lowering costs and improving care.[37]

As useful as these efforts may be, they are unlikely to fully close the primary care gap. In the meantime, the market is responding by creating alternate delivery models to meet specific types of demand, such as acute illness care.[38] RAND has extensively studied one such innovation, nurse practitioner–staffed retail clinics, and found that the treatment they provide is of comparable quality and significantly lower cost than treatment of the same condition in an emergency department or doctor's office.[39] As time goes on, it is likely that a growing share of primary care services will be provided by nonphysicians, either working independently (e.g., nurse practitioners) or as an extension of a primary care practice. A RAND-led assessment in Massachusetts after the state implemented comprehensive health care reform determined that providers responded to growing demand by hiring more clerical and other support personnel to extend the work of health care professionals, rather than adding more professional-level staff.[40]

Engage and Empower Consumers

In most sectors of the economy, competition drives efforts to enhance quality and tends to keep prices low. But health care does not behave like a normal market.[41], [42] One of the biggest reasons is that consumers currently play a limited role.

Because health insurance shields many consumers from the financial consequences of their health care decisions, they are less concerned about the cost of care. One study found that in two-thirds of cases, patients were not aware of treatment cost until they received the bill.[43] Because consumers are unable to judge the relative merits of different treatment options, they typically defer health care purchasing decisions to their providers.

Five percent of Americans — those with the most serious health problems — drive nearly half of health care spending.[44] Many in this group are too ill or too overwhelmed by the complexity of our delivery system to shop around for a better deal.

The 70–90 million Americans who are uninsured or underinsured have little to bargain with. In fact, the uninsured are often charged higher prices than everyone else because they do not have an insurance plan to bargain on their behalf.[45]

To level the playing field, two things must happen: First, to be motivated to be more conscious about costs, patients need to have a financial interest in the outcome — "skin in the game."[46] The RAND Health Insurance Experiment, completed 30 years ago, demonstrated that when health care is free, more is used, whether it benefits the patient or not. Cost-sharing reduced use, but patients tended to reduce use of appropriate as well as inappropriate services. Therefore, the size and structure of co-payments must be carefully designed to encourage prudent choices.[47] Value-based benefits, which reduce or even eliminate co-payments for high-value health services and certain chronic disease medications but impose higher cost-sharing on costly services of marginal value, may work better than a one-size-fits-all approach.[48]

To effectively function in a marketplace, consumers not only need to be engaged; they need to be informed. Today, many consumers cannot easily access the information they need to make important decisions about care, such as picking a health care provider.[49] Public cost and quality reports, such as the Five-Star Quality Ratings for Medicare Advantage programs,[50] are intended to meet this need. In order to have their desired effect, the information they convey must be valid,[51] easy to read,[52] and presented in a way that is meaningful to consumers.[53]

Promote Population Health

In 2000, an Institute of Medicine committee noted that the majority of premature deaths in the United States were due to behavioral or environmental causes.[54], [55] It concluded that initiatives to develop and implement effective interventions to reduce risk behaviors could improve the nation's health and possibly help lower health care costs.[56]

RAND Health has focused on two of the most important causes of preventable deaths and chronic diseases in the United States — obesity and smoking.[57], [58] Researchers have studied how peers, coworkers, and environmental cues influence individual decisions to consume too many calories, take up smoking, and make other choices that increase an individual's risk of developing a costly chronic disease. In many instances, these cues can be modified in subtle ways to discourage youth from starting to smoke and to encourage the general population to make healthier choices about diet and exercise.

Communities and workplaces can be valuable arenas for promoting health. To help communities reduce substance use among their youth, RAND and the University of South Carolina developed Getting To Outcomes™ (GTO),[59] a toolkit designed to help local organizations develop and strengthen programs. Although GTO was originally aimed at preventing drug and tobacco use, it has also been successfully used to target juvenile crime, teen pregnancy, delinquency, intimate partner violence, and sexual violence.[60]

Employers are also taking action by implementing workplace wellness programs to reduce health care costs and decrease absenteeism. Evidence of the effectiveness of these programs is mixed, but interest in them is growing.[61] Since employers are concerned about rising health care costs, it is likely that more programs of this sort will be offered in the coming years.

Facilitate High-Value Innovation

The United States has long been a world leader in the development and swift adoption of innovative technology, and health care is no exception. The challenge in health care, however, is that existing economic, regulatory, and legal incentives are aligned in a manner that promotes rapid adoption and diffusion of expensive technologies, irrespective of cost. In fact, because of the way health care is paid for today, developers have little reason to create health care technologies for the U.S. market that offer the prospect of providing effective care at substantially lower cost. Recently, a group of RAND researchers outlined challenges to value-enhancing innovation in health care delivery.[62]

In the final brief in this series, we describe potential steps policymakers could take to realign existing incentives, including identifying changes to existing laws and regulations that could facilitate high-value innovation, enhancing the efficiency of federally sponsored research,[63], [64], [65] more effectively harnessing the potential of health information technology,[66] and using states' experiences to assess innovative health policies.

Conclusion

Health care spending is outpacing our economy because providers are financially incentivized to do more, and face both loss of income and heightened legal liability if they do less. Many consumers assume, unwisely, that more care is always better than less. Public health is given short shrift, and innovators are rewarded for producing technologies that command high prices, rather than generate high value.

The strategies outlined in this brief and the accompanying documents are intended to alter the dynamics that drive spending growth. The shift from FFS reimbursement is intended to motivate providers to reduce waste and improve efficiency. Cost-sharing, combined with access to useful information about provider cost, quality, and performance, should encourage consumers to play a more active role in the health care marketplace. A renewed emphasis on population health could reduce the need for costly care. Incentivizing high-value innovation could spark the sort of creative thinking that spawned the modern computer industry and dramatically improved the efficiency of American manufacturing. Together, these strategies could transform our nation's increasingly costly health care system into a functional market and provide Americans with better care at lower cost.

Notes

[1] Fuchs VR, "Major Trends in the U.S. Health Economy Since 1950," New England Journal of Medicine, Vol. 366, March 15, 2012, pp. 973–977.

[2] The Commonwealth Fund, "International Comparison of Spending on Health, 1980–2009," chart, 2011.

[3] Congressional Budget Office, The Long-Term Budget Outlook: Federal Debt Held by the Public Under Two Budget Scenarios, June 2010.

[4] Orszag P, "How Health Care Can Save or Sink America: The Case for Reform and Fiscal Sustainability," Foreign Affairs, Vol. 90, No. 4, 2011, pp. 42–57.

[5] Kaiser Family Foundation, Health Care Costs: A Primer, Menlo Park, Calif., May 2012.

[6] Pew Center on the States, "State Health Care Spending Project," 2012.

[7] Kaiser Family Foundation and Health Research and Educational Trust, "Employer Health Benefits—2012 Summary of Findings," Menlo Park, Calif.: Kaiser Family Foundation, and Chicago, Ill.: Health Research and Educational Trust, 2012.

[8] Sood N, Ghosh A, and Escarce J, "Employer-Sponsored Insurance, Health Care Cost Growth, and the Economic Performance of U.S. Industries," Health Services Research, Vol. 44, No. 5, October 2009, pp. 1449–1464.

[9] Auerbach DI and Kellermann AL, "How Does Growth in Health Care Costs Affect the American Family?" Santa Monica, Calif.: RAND Corporation, RB-9605, 2011.

[10] Kolata G, "Knotty Challenges in Health Care Costs," New York Times, March 5, 2012.

[11] Emanuel E et al., "A Systemic Approach to Containing Health Care Spending," New England Journal of Medicine, Vol. 367, No. 10, September 6, 2012, pp. 949–954.

[12] Antos JR, Pauly MV, and Wilensky GR, "Bending the Cost Curve Through Market-Based Incentives," New England Journal of Medicine, Vol. 367, No. 10, September 6, 2012, pp. 954–958.

[13] Kellermann AL, "A Cure for Overtreatment: RAND Guidelines for Appropriate Care," The RAND Blog, August 9, 2012.

[14] Hussey PS et al., "Controlling U.S. Health Care Spending—Separating Promising from Unpromising Approaches," New England Journal of Medicine, Vol. 361, No. 22, November 26, 2009, pp. 2109–2111.

[15] Damberg CL et al., "Taking Stock of Pay-for-Performance: A Candid Assessment from the Front Lines," Health Affairs, Vol. 28, No. 2, March/April 2009, pp. 517–525.

[16] Miller HD, "From Volume to Value: Better Ways to Pay for Health Care," Health Affairs (Millwood), Vol. 28, No. 5, September–October 2009, pp. 1418–1428.

[17] Agency for Healthcare Research and Quality, Effective Health Care Program, "Closing the Quality Gap Series: Bundled Payment: Effects on Health Care Spending and Quality," final research review, August 24, 2012.

[18] Hussey PS, Ridgely MS, and Rosenthal MB, "The PROMETHEUS Bundled Payment Experiment: Slow Start Shows Problems in Implementing New Payment Models," Health Affairs, Vol. 30, No. 11, November 2011, pp. 2116–2124.

[19] Agency for Healthcare Research and Quality, Effective Health Care Program, "Closing the Quality Gap Series: Bundled Payment: Effects on Health Care Spending and Quality," final research review, August 24, 2012.

[20] Hussey PS, Ridgely MS, and Rosenthal MB, "The PROMETHEUS Bundled Payment Experiment: Slow Start Shows Problems in Implementing New Payment Models," Health Affairs, Vol. 30, No. 11, November 2011, pp. 2116–2124.

[21] American Hospital Association Resource Center blog, "2012 Update on Growth and Dispersion of ACOs," June 5, 2012.

[22] The Advisory Board Company, "Accountable Care Roundup: Blue Shield of California Doles Out Millions for ACOs," daily briefing, October 20, 2011.

[23] Bentley TGK et al., "Waste in the U.S. Health Care System: A Conceptual Framework," The Milbank Quarterly, Vol. 86, No. 4, December 2008, pp. 629–659.

[24] Berwick DM and Hackbarth AD, "Eliminating Waste in U.S. Health Care," Journal of the American Medical Association, Vol. 307, No. 14, April 11, 2012, pp. 1513–1516.

[25] Brook RH, "The Role of Physicians in Controlling Medical Care Costs and Reducing Waste," Journal of the American Medical Association, Vol. 306, No. 6, August 2011, Commentary, pp. 650–651.

[26] Choosing Wisely, home page, 2012.

[27] RAND Health, "RAND/UCLA Appropriateness Method," last modified December 2, 2010.

[28] Fitch K et al., The RAND/UCLA Appropriateness Method User's Manual, Santa Monica, Calif.: RAND Corporation, MR-1269-DG-XII/RE, 2001.

[29] Fitch K et al., The RAND/UCLA Appropriateness Method User's Manual, Santa Monica, Calif.: RAND Corporation, MR-1269-DG-XII/RE, 2001.

[30] Brook RH, "Assessing the Appropriateness of Care: Its Time Has Come," Journal of the American Medical Association, Vol. 302, No. 9, September 2, 2009, pp. 997–998.

[31] Institute of Medicine, To Err Is Human: Building a Safer Health System, Washington, D.C.: The National Academies Press, 2000.

[32] Greenberg MD et al., Is Better Patient Safety Associated with Less Malpractice Activity? Evidence from California, Santa Monica, Calif.: RAND Corporation, TR-824-ICJ, 2010.

[33] RAND Corporation, "Assessing Care of Vulnerable Elders (ACOVE)," 2012.

[34] Farley DO et al., "Helping Hospitals Deliver Better Care: A New Toolkit for Quality Improvement," Santa Monica, Calif.: RAND Corporation, RB-9669, 2012.

[35] Agency for Healthcare Research and Quality, "AHRQ Quality Indicators™ Toolkit for Hospitals," July 2012.

[36] Brook RH and Young RT, "The Primary Care Physician and Health Care Reform," Journal of the American Medical Association, Vol. 303, No. 15, April 21, 2010, pp. 1535–1536.

[37] Friedberg MW, Hussey PS, and Schneider EC, "Primary Care: A Critical Review of the Evidence on the Quality and Costs of Health Care," Health Affairs, Vol. 29, No. 5, May 2010, pp. 766–772.

[38] Pitts SR et al., "Where Americans Get Acute Care: Increasingly, It's Not at Their Doctor's Office," Health Affairs, Vol. 29, No. 9, September 2010, pp. 1620–1629.

[39] Mehrotra A et al., "Health Care on Aisle 7: The Growing Phenomenon of Retail Clinics," Santa Monica, Calif.: RAND Corporation, RB-9491-1, 2010.

[40] Staiger DO, Auerbach DI, and Buerhaus PI, "Health Care Reform and the Health Care Workforce—The Massachusetts Experience," New England Journal of Medicine, Vol. 365, No. 12, September 2011, pp. e24(1)–e24(3).

[41] Arrow KJ, "Uncertainty and the Welfare Economics of Medical Care," American Economic Review, Vol. 53, No. 5, 1963, pp. 941–973.

[42] Newhouse JP, "Why Is There a Quality Chasm?" Health Affairs, Vol. 21, No. 4, July 2002, pp. 13–25.

[43] Institute of Medicine, "Infographic: What's Possible for Health Care?" Washington, D.C.: The National Academies Press, September 6, 2012.

[44] National Institute for Health Care Management (NIHCM) Foundation, "Understanding U.S. Health Care Spending," NIHCM Foundation Data Brief, Washington, D.C., July 2011.

[45] Institute of Medicine Committee on the Consequences of Uninsurance, Care Without Coverage: Too Little, Too Late, Washington, D.C.: The National Academies Press, 2002.

[46] Haviland AM et al., "Skin in the Game: How Consumer-Directed Plans Affect the Cost and Use of Health Care," Santa Monica, Calif.: RAND Corporation, RB-9672, 2012.

[47] Brook RH et al., "The Health Insurance Experiment: A Classic RAND Study Speaks to the Current Health Care Reform Debate," Santa Monica, Calif.: RAND Corporation, RB-9174-HHS, 2006.

[48] Goldman DP et al., "Prescription Drug Cost Sharing: A Powerful Policy Lever to Use with Care," Santa Monica, Calif.: RAND Corporation, RB-9474, 2009.

[49] Mehrotra A et al., "Which Path Leads to Health Care Cost Containment: Selection or Reputation?" Santa Monica, Calif.: RAND Corporation, RB-9663, 2012.

[50] Medicare.gov, "Medicare Plan Finder," undated.

[51] U.S. Government Accountability Office, "Medicare Advantage: Quality Bonus Payment Demonstration Undermined by High Estimated Costs and Design Shortcomings," presentation to staff of the Senate Committee on Finance, GAO-12-409-R, November 18, 2011.

[52] Martin LT and Parker RM, "Insurance Expansion and Health Literacy," Journal of the American Medical Association, Vol. 306, No. 8, August 24/31, 2011, pp. 874–875.

[53] Mehrotra A et al., "Which Path Leads to Health Care Cost Containment: Selection or Reputation?" Santa Monica, Calif.: RAND Corporation, RB-9663, 2012.

[54] Centers for Disease Control and Prevention, "Ten Great Public Health Achievements—United States, 2001–2010," Morbidity and Mortality Weekly Report, Vol. 60, No. 19, May 20, 2011, pp. 619–623.

[55] Institute of Medicine, Promoting Health: Intervention Strategies from Social and Behavioral Research, June 25, 2000.

[56] Institute of Medicine, Promoting Health: Intervention Strategies from Social and Behavioral Research, June 25, 2000.

[57] Sturm R, "The Effects of Obesity, Smoking, and Drinking on Medical Problems and Costs," Health Affairs, Vol. 21, No. 2, March/April 2002, pp. 245–253.

[58] Centers for Disease Control and Prevention, "Health Effects of Cigarette Smoking," fact sheet, January 10, 2012.

[59] RAND Corporation, "GTO Manuals and Summaries," 2012.

[60] Chinman M et al., "Getting To Outcomes™: Improving Community-Based Substance-Use Prevention," Santa Monica, Calif.: RAND Corporation, RB-9172, 2006.

[61] Osilla KC et al., "Systematic Review of the Impact of Worksite Wellness Programs," American Journal of Managed Care, Vol. 18, No. 2, February 2012, pp. e68–e81.

[62] Garber S et al., Challenges to Value-Enhancing Innovation in Health Care Delivery: Commonalities and Contrasts with Innovation in Drugs and Devices, Santa Monica, Calif.: RAND Corporation, OP-341-EMKF, 2011.

[63] Ismail S, Farrands A, and Wooding S, Evaluating Grant Peer Review in the Health Sciences: A Review of the Literature, Santa Monica, Calif.: RAND Corporation, TR-742-DH, 2009.

[64] Wu H et al., Alternatives to Peer Review in Research Project Funding, Santa Monica, Calif.: RAND Corporation, TR-1010-DH, 2011.

[65] van Leeuwen T, Grant J, and Ni Chonaill S, "Bibliometric Analysis of Highly Cited Publications of Health Research in England, 2002–2006," Santa Monica, Calif.: RAND Corporation, WR-829-DH, 2011.

[66] Jones SS et al., "Unraveling the IT Productivity Paradox—Lessons for Health Care," New England Journal of Medicine, Vol. 366, No. 24, June 2012, Perspective, pp. 2243–2245.


This series of research briefs presents insights from RAND Health research about the effectiveness of strategies to constrain growth in health care spending. A summary brief synthesizes findings from more-detailed discussions focusing on four broad categories of policy options: (1) foster efficient and accountable providers, (2) engage and empower consumers, (3) promote population health, and (4) facilitate high-value innovation.

This research brief was written by Arthur L. Kellermann, Mary E. Vaiana, Peter S. Hussey, Ramya Chari, David Lowsky, and Andrew Mulcahy.

This product is part of the RAND Corporation research brief series. RAND research briefs present policy-oriented summaries of individual published, peer-reviewed documents or of a body of published work.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.

RB-9690/1 (2012)

Copyright © 2012 RAND Corporation