[Obesity Discussion]

Here is the executive summary:


HealthCast 2020: Creating a Sustainable Future*
Executive Summary
Look out. Better yet, look outward.
There is growing evidence that the current health systems of nations around the world will be unsustainable if unchanged over the next 15 years. Globally, healthcare is threatened by a confluence of powerful trends – increasing demand, rising costs, uneven quality, misaligned incentives. If ignored, they will overwhelm health systems, creating massive financial burdens for individual countries and devastating health problems for the individuals who live in them.
*connectedthinking
It is time to look outward. The attitude that all healthcare should be local is dangerously provincial and, in extreme cases, xenophobic. The days when healthcare sectors operate in silos must end. New solutions are emerging from beyond traditional boundaries and innovative business models are being formed as healthcare becomes globalized. These solutions are changing the way the Chinese think about financing hospitals, Americans recruit physicians, Australians reimburse providers for care, Europeans embrace competition, and Middle Eastern governments build for future generations.
In a world in which economies are globally interdependent and the productivity of nations relies on the health of its citizens, the sustainability of the world’s health systems is a national competitive issue and a global economic imperative. Moreover, there is a moral obligation to create a global sustainable health system. The stakes could not be higher.
The idea of sustainability is subject to many interpretations. It is often used in the context of environmental protection and renewal of natural resources. One comprehensive definition can be found in Paul Hawkin’s book, The Ecology of Commerce: “Sustainability is an economic state where the demands placed upon the environment by people and commerce can be met without reducing the capacity to provide for future generations.” This definition applies in profound ways to healthcare. At the current rate of consumption and at the current level of thinking, the healthcare organizations of today will be unable to meet demand in the future. Our health systems will be unsustainable.
Beginning in 1997, health spending has been accelerating as a percent of Gross Domestic Product (GDP) among Organisation for Economic Co-operation and Development (OECD) countries. In 2002, the cumulative health spending of 24 OECD countries was $2.7 trillion. PricewaterhouseCoopers estimates that health spending for OECD countries will more than triple to $10 trillion by 2020.
Healthcare organizations and governments around the world are urgently seeking solutions to temper costs while balancing the need to provide access to safe, quality care. Yet, conventional approaches are failing, even in the most advanced nations of the world – throughout Europe, Asia, the Middle East, Australia, Canada and the United States.
Because they are often viewed as a local industry, healthcare organizations haven’t exchanged ideas globally as much as other industries such as manufacturing and services. While each country faces unique hurdles – regulatory, economic, cultural – the challenges they face are remarkably similar. In their responses, common themes are emerging.
Despite the complexity of the challenges that the healthcare industry faces, successful initiatives – often involving technological innovation, preventive care and consumer-focused business models – are occurring in many places. These are efforts that have improved health outcomes while also saving money.
In this, the third edition of HealthCast, PricewaterhouseCoopers looks at the responses around the world to the globalization of healthcare and efforts to create a sustainable health system. It highlights best practices in innovation and shares insight and lessons learned from around the world. Specifically, the report has four goals:
• Provide a context for understanding global healthcare trends
• Compile a rich variety of “transferable lessons” from the around the world on what’s working in a converging global health market
• Identify “solution drivers” within the control of executives and administrators, where health leaders can take action and effect change
• Serve as a call to action for healthcare organizations to look beyond their own boundaries to tackle the complex challenges of sustainability
Our research included a survey of more than 580 executives of hospitals and hospital systems, physician groups, payers, governments, medical supply companies and employers from around the world in 27 countries. In addition, PricewaterhouseCoopers conducted in-depth interviews with more than 120 healthcare thought leaders in 16 countries. They included policy makers, employee benefit managers and top executives of health organizations in Australia, Canada, Europe, India, the Middle East, Japan, Singapore, South Africa, the United Kingdom and the United States.
This extensive study identified several specific findings:
• Future health spending is expected to increase at a much higher level of growth than in the past. By 2020, healthcare spending is projected to triple in real dollars, consuming 21% of GDP in the U.S. and 16% of GDP in other OECD countries. PricewaterhouseCoopers’ HealthCast 2020 survey showed that nearly half of healthcare executives from 26 countries believe healthcare costs will increase at a higher rate of growth than in the past. Executives in areas with high population growth (e.g., Middle East and Asia) were more likely to say that healthcare costs would accelerate, but more than half of U.S. and Australian executives also said that costs would exceed previous growth rates. Governments, hospitals and physicians are seen as having the greatest opportunity to eliminate wasteful spending in healthcare.
• There is wide support for a health system with shared financial risks and responsibility among private and public payers versus the historic cost-shifting approach. Only a minority of industry leaders in the U.S., Canada and Europe think that a sustainable system is one that is mostly tax-funded. More than 75% of HealthCast 2020 survey respondents believe that financial responsibility should be shared. Even in systems where healthcare is primarily tax-funded, such as in Europe and Canada, only 20% of respondents favored that approach. More than 50% of respondents said competition, taxpayer funding of some or all of healthcare, regulated cost controls, and cost sharing by patients were important.
• Universally, health systems face challenges to sustainability around cost, quality and consumer trust. Transparency in quality and pricing was identified by more than 80% of HealthCast 2020 survey respondents as a contributor to sustainability. Respondents’ opinions regarding who is making the most progress in improving quality vary by locale. In the U.S., patient advocacy groups rated first, while in Europe and Canada, physicians ranked highest. In the Middle East, Australia and Asia, government was viewed as making the most progress.
• Preventive care and disease management programs have untapped potential to enhance health status and reduce costs, but require support and integration across the industry for their benefits to be realized. The most effective means of demand management, according to the HealthCast 2020 survey, are wellness, immunization and disease management programs. The vast majority (75%) of respondents viewed queues (waiting lists) as an ineffective way to manage demand. Yet only 26% of respondents thought government and private initiatives promoting better health had been effective and only 33% thought educational and awareness campaigns had been effective. More than 80% of respondents identified lack of care integration as a major problem facing the health delivery system.
• In support of more empowered consumers, interest in pay-for-performance and increased cost sharing is soaring. Industry leaders expect tremendous growth in consumer-oriented programs. Only 35% of respondents in the HealthCast 2020 survey said hospital systems are prepared to meet the demands of empowered consumers. But a large majority (85%) of organizations surveyed has initiated pay-for-performance initiatives, above the 70% who had started such programs in 2002. Forty-three percent of respondents said that direct cost sharing by patients is an effective or very effective method to manage demand for healthcare services.
• Information technology (IT) is an important enabler in resolving healthcare issues when there is systemwide and organizational commitment and investment. The vast majority of HealthCast 2020 survey respondents viewed IT as important or very important to integrate care (73%) and improve information sharing (78%). But IT is not a solution in and of itself. A smaller percentage saw IT as important or very important for improving patient safety (54%) or restoring patient trust (35%).
Global and industrywide convergence is occurring as best practices are shared and the lines become blurred among pharmaceuticals, life sciences, providers, clinicians and payers in the provision of care, access and safety. It is time that health systems – hospitals and physicians, public sector agencies, governments and other commercial health-related entities – view the benefits of working together and connect by formal partnership or informal business affiliations to deliver health services to consumers.