Former head of Medicare, Medicaid deplores waste

Former head of Medicare, Medicaid deplores waste

Robert Pear
New York Times
December 3, 2011

WASHINGTON - The official in charge of Medicare and Medicaid for the past 17 months says that 20 percent to 30 percent of health spending is "waste" that yields no benefit to patients, and that some of the needless spending is a result of onerous, archaic regulations enforced by his agency.

The official, Dr. Donald Berwick, listed five reasons for what he described as the "extremely high level of waste." They are overtreatment of patients, the failure to coordinate care, the administrative complexity of the health care system, burdensome rules and fraud.

"Much is done that does not help patients at all," he said, "and many physicians know it."

'A complex, complicated law'

Berwick, who left his job last week, reflected on his successes, failures and frustrations in trying to engineer a rapid transformation of the health care system while beating back criticism from Republicans in Congress. President Obama gave him a temporary recess appointment, circumventing Congress. The appointment was due to expire at year's end.

Asked why Americans were still deeply divided over the new health care law, signed 20 months ago, Berwick said: "It's a complex, complicated law. To explain it takes a while. To understand it takes an investment that I'm not sure the man or woman in the street wants to make or ought to make."

But, Berwick said, just as Americans supported manned missions to the moon without knowing the details of rocket science, they ought to support the new law because of its ultimate destination. "We are a nation headed for justice, for fairness and justice in access to care," he said. "We are a nation headed for much more healing and much safer care. There is a moon shot here. But somehow we have not put together that story in a way that's compelling."

Berwick, a soft-spoken pediatrician, received his own Medicare card in September when he turned 65. As Medicare chief, he has pushed doctors and hospitals to adopt electronic health records, merge their operations and coordinate care to eliminate medical errors that kill thousands of patients each year.

If his estimate is right, Medicare and Medicaid could save $150 billion to $250 billion a year by eliminating waste, which he defines as "activities that don't have any value."

'Many internal stakeholders'

Berwick sounded like a professor of political science or a visitor from a foreign country when he recounted his efforts to fathom the inscrutable ways of Washington.

"Government is more complex than I had realized," he said. "Government decisions result from the interactions of many internal stakeholders -- different agencies and parts of government that, in many cases, have their own world views."

Before coming to Washington, Berwick was president of the Institute for Healthcare Improvement, a nonprofit group in Cambridge, Mass., that trains medical professionals. "I was used to moving very, very fast," he said. "I had 120 employees. We could decide on Monday to start a program and have it in existence on Wednesday."

As a federal official, Berwick was sometimes impatient with colleagues in the government and the health care industry. "I wish they could go faster," he said. But in some ways, the slower pace is appropriate, he said, adding: "I don't think you want government to be impulsive. You want it to be regulated, with just a tad of conservatism."