At a very high level, the problems of the American healthcare system are:

The US spends a lot more money than it takes in from tax revenue, quite a bit of which is on healthcare either through government funded programs or “tax expenditures” like the tax exclusion for employer sponsored programs
Like most services oriented professions, healthcare is subject to Baumol’s cost disease: “There is no technological change which can make an orchestra take less time to play a symphony - service industries don’t have the same productivity improvements as manufacturing industries” yet healthcare provider salaries need to rise despite the lack of productivity gains.
The American public isn’t inclined to pay more taxes or reduce service consumption or pay its healthcare providers less.

CMMI which was created by the Affordable Care Act to try and engineer some other, more palatable solution to this trilemma: i.e. “test innovative payment and service delivery models to reduce program expenditures under the applicable titles while preserving or enhancing the quality of care furnished to individuals under such titles.”

It would be charitable to call its record mixed with its portfolio netting out to cost the taxpayers much more money than it has saved. A few weeks ago, former CMMI senior adviser Ankit Patel wrote an article in Out Of Pocket called How to Fix CMMI Models which I thought was very good, and I was excited to welcome him to HTN radio to talk about it.

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