By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Why Pilot Programs are a Waste of Time and Money
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Policy & Law > Health Reform > Why Pilot Programs are a Waste of Time and Money
BusinessHealth ReformPolicy & Law

Why Pilot Programs are a Waste of Time and Money

JohnCGoodman
JohnCGoodman
Share
6 Min Read
SHARE

President Obama has repeatedly given us his vision of how to lower the cost of health care and raise its quality: Find out what works; then get everyone else to copy it. Toward that end, the administration is making millions of dollars available for pilot programs and demonstration projects. Will any of this work? Ask yourself this question: Can you think of any other industry where low-cost, high-quality production has been achieved by the government running pilot programs? No? Well, if that approach doesn’t work anywhere else, why would you expect health care to be different?

Testing the Waters:

Put your right toe in.
Take your right toe out.
Put your right toe in.
And shake it all about.

As I have previously noted, President Obama’s approach to health care is exactly the same as his approach to education. The only difference is that in education we have been trying to find out what works and then copy it with no success for decades. Here’s the problem. Both in health care and in education we have lots of examples of low-cost, high quality service. As in other bureaucratic systems around the world, excellence exists, and it’s often known about, acknowledged and even studied. It also tends to have three characteristics: (1) islands of excellence spring up in a sea of mediocrity and they tend to be distributed randomly—they’re not correlated with anything; (2) they almost always exist because of the effort, ingenuity, enthusiasm, energy, and vision of a few people involved in actual production, and almost never are the result of anything that’s happening on the demand side of the market; and (3) (most importantly) they tend not to have any objective characteristics that anyone else can copy. A study of high-performing hospital regions (by researchers connected to the Brookings Institution) was unable to find any characteristics that could be replicated in a straightforward manner. Some had doctors on staff and paid them a salary. Some paid fee-for-service. Some had electronic medical records. Some did not. Another study, reported at the Health Affairs Blog, looked at 12 multispecialty group practices including such high-performing practices as the Cleveland Clinic, the Geisinger Clinic, the Intermountain Medical Group, the Mayo Clinic and the Virginia Mason Clinic. Of those practices, only two employed physicians directly and the other ten paid fee-for-service. Conclusion: There is no relationship between high-quality, low-cost care and the way physicians are paid. A third study by the Commonwealth Fund examined five high-performing health plans. The only commonalities researchers could find were subjective and qualitative (e.g., “forging and maintaining a strong relationship with physicians,” plus that same idea expressed three or four different ways). Not the sort of things you can put in an operations manual and refer to as “marching orders.” Instead of a pilot-program approach, at this blog we have consistently argued for an economic approach. Start paying more to the islands of excellence that are higher performers. Start paying less to the low performers. Eventually, stop dealing with the low performers altogether. Encourage every doctor, every hospital administrator and every other provider to come forward and propose different ways of being paid. As long as quality doesn’t suffer, be prepared to pay 50 cents for every dollar the provider saves Medicare. Finally, search for ways to empower patients — give them control over their own health care dollars and give providers the freedom to repackage and reprice their services in patient-pleasing ways in order to compete for patients and their dollars. Although I have called this approach the “economic approach,” it is actually little more than common sense. There is an academic defender of the idea that pilot programs are the key to health reform, however. Writing in The New Yorker, Atul Gawande argued that in the first half of the 20th century, pilot programs run by the Agriculture Extension Service helped spark an agricultural revolution in the United States. Writing at the Health Affairs Blog, Alain Enthoven showed why Gawande’s analysis was “deeply flawed.” First, the Agriculture Extension Service was working with the winds of the market at its back — helping agriculture go where it was going any way. Second, the pilot program results helped farmers do what they wanted to do anyway. Third, the entire enterprise took decades to achieve. By contrast, the Obama pilot programs hope to show bureaucrats how to force nonmarket solutions on a resistant medical community in the context of a cost trend that will have disastrous consequences if we wait several decades. Am I right about this? Leave your thoughts in the comments.

More Read

Does Shorter LOS Cause a Higher Readmission Rate?
Revenue Cycle Integrity Must Precede Data Analytics
Are Medical Misdiagnoses Common & How Bad Are They?
Academic Medical Center Advertising: Pump Up the Volume
5 Ways Functional Medicine Is Transforming Healthcare
TAGGED:health care businesshealth care reform
Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

dental care
Importance of Good Dental Care for Health and Confidence
Dental health Specialties
October 2, 2025
AI in Healthcare
AI in Healthcare: Technology is Transforming the Global Landscape
Global Healthcare Policy & Law Technology
October 1, 2025
Choosing the Right Swimwear for Health and Safety
News
September 30, 2025
sports concussions
Concussion In Sports: How Common They Are And What You Need To Know
Infographics
September 28, 2025

You Might also Like

ACOs in 2014
BusinessHealth ReformPolicy & Law

Studies Show ACOs Are Succeeding in 2014

August 3, 2014
tips for getting drugs from an online pharmacy
Global HealthcareHealthHealth care

How to Get Prescriptions Online Reliably and Cost-Effectively

November 8, 2022
BusinessMedical InnovationsTechnology

Startups:Digital Health Accelerator Program Accepting Applications

May 2, 2012
uninsured
BusinessFinance

Who’s Paying the Chargemaster Rate? Not Just the Uninsured

October 10, 2014
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?