May 23,2012

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Baucus Says Innovation in Health Care Delivery Will Mean Higher Quality, More Affordable Care

As prepared for delivery

Albert Einstein once said “If you always do what you always did, you will always get what you always got.”

As health care premiums were doubling from 2000 to 2010, it was clear we could no longer do what we always did.  We could no longer tolerate what we always got when it came to our nation’s health care.

We all have common goals: to reduce health care costs and improve health care quality. How do we do that?  Innovation plays a key role.  That’s the focus of our hearing today.

It’s not the type of innovation we normally think about in the health care industry.  It’s not developing a new drug or device in a laboratory.

The innovation we’re talking about transforms the way providers deliver care to patients.  This innovation means patients spend more time with their doctors, rather than talking to insurance companies.

This innovation encourages doctors and nurses to communicate more with their patients and with each other about patient care.  And it makes us spend our scarce health care dollars more wisely.

The private sector has always been at the forefront creating innovative ideas, and now the entire health care community is involved.  Employers, health plans, Medicare and Medicaid are committed to innovation, and providers of all kinds are engaged to improve the way health care is delivered.

We’ll hear about this innovation from our four witnesses today.  We will hear about how they are working individually and working together to lower costs and improve quality.

Health reform encouraged this innovation, and we must continue to build on this progress.

Medicare and private payers are together sending one message to providers: From now on, we will pay for quality, not quantity.  It is a message that providers have already begun to hear and respond to.

Starting in October, Medicare will start paying hospitals more money when they produce better results for patients.  Hospitals that produce poor outcomes will get less money.

And, for the first time, hospitals will be penalized if patients are readmitted too often.  Almost one in five Medicare beneficiaries is readmitted to a hospital within 30 days of discharge.  We need to encourage providers to do the job right the first time. 

I am encouraged to see the private sector aligning with this effort.  This year, the insurance company WellPoint will require all hospitals it contracts with to be subject to similar programs.  These incentives provide a common-sense foundation to change behavior.

The private sector cannot do it alone, nor can Medicare and Medicaid.   The only path forward is through partnerships between the public and private sectors.

That’s why we created the Center for Medicare and Medicaid Innovation, known as the Innovation Center.  Medicare and Medicaid are now engaged on the front lines and working with the private sector to find new models of payment and delivery of care.

The concept is simple: Find the best ideas. Test them.  If they work, expand them.  If they don’t, move on to new ideas.

Already, the Innovation Center has launched more than a dozen new projects.  These projects involve more than 50,000 providers and almost every state in the country.  They try out new payment models to reduce costs and make patients healthier.

We know there can’t be a one-size-fits-all solution.  Health care in Missoula, Montana is different than health care in McAllen, Texas.

I look forward to hearing about the innovative models our four witnesses are developing.  Their experience pioneering new approaches, and in partnering with Medicare and Medicaid, should be instructive to all of us.

So let us embrace innovation as an opportunity to change things for the better.  Let us encourage public-private partnerships.  Let us do this to lower health care costs for consumers and for taxpayers.  Let us do this to improve patient care.  And as Mr. Einstein advised, let us not always do what we always did.