What if the government awarded X-prizes?

…of $1 billion to the company/town who can show that they can deliver healthcare at half the cost of today’s $8,000 per person price tag? I would think that would mobilize the positive outliers. Read this interview with Atul Gawande in it’s entirety (also listen to this interview with him on NPR about positive outliers)…but here’s a good snippet of what I’m talking about:

One thing that really struck me about your piece was that you focused much more on the question of care providers than insurance providers. The political conversation tends to do the opposite. Want to talk a bit about that distinction?

I had a hard time connecting the dots. My vantage point on the world is the operating room where I see my patients. And trying to think about whether a public option would change anything didn’t connect. I order more than $50,000 worth of health care in a day. Would a public or private option change that?

People say that the most expensive piece of medical equipment is the doctor’s pen. It’s not that we make all the money. It’s that we order all the money. We’re hoping that Medicare versus Aetna will be more effective at making me do my operations differently? I don’t get that. Neither one has been very effective thus far.

Do you think much that we’re hearing in the political conversation is responsive to the issues you pointed out?

Part of the difficulty is that it’s very hard. But you can learn from good hospitals. They do peer review, for instance, and that changes what doctors do in their offices. They blunt the financial incentives in various ways that we haven’t studied at all. It’s kind of ridiculous that there haven’t been very many people putting feet on the ground and studying what the positive deviants are doing. There are hundreds of examples out there. They’re not just the Mayo Clinic and not just Grand Junction. Go to Portland, Oregon; Temple, Texas; Pensacola, Florida. These are places that are doing something differently.

But getting there requires a change in local medical cultures and rebuilding local medical systems. All medicine is local just as all politics is local. But let’s create a cadre of researchers who go into these communities and figure out what’s going on and spread the word.

The Washington debate – there are smart reasons to think about including a public option in the mix, but we have not been thinking hard enough about how we control costs and make a better system. I think it’s achievable in about 10 to15 years, and maybe even faster. I can tell you three things that will transform McAllen overnight. But CBO doesn’t score them.

So what are the three?

First, they spend more than $3,500 per Medicare beneficiary on home visits. El Paso is around $800. McAllen is spending more than half what many communities spend on their entire health care expenditures. The doctors there have to disinvest from these home health agencies and come to agreement on when those visits are worth using.

At the end of life, McAllen spends $22 per person on hospice but more than $3,000 on ambulance rides. In a place like Portland it will be more than $400 on hospice and around $500 on ambulances. Increasing use of hospice, offering that as an option and working as a community on how to manage end of life, would be a smart move.

Work on basic cardiac prevention like getting people statin drugs. Most studies have shown you’ll lower the cardiovascular disease rate by 25 percent and lower the number of procedures ordered. This was done in by Kaiser of Northern California, and they became the first community I’ve ever heard of where heart disease stopped being the leading cause of death.

If you took those three things and worked on them for a year, you could go from $15,000 per person per year to less than $10,000.