Annals of Health Law
VALUE BASED PURCHASING
care costs. 43 As a result, longer-term projections “work from the other
direction, [by] considering how much health spending growth society will
tolerate.” 44 As such, the forecasters conclude that both private and public
sectors will eventually take more aggressive actions to control spending
than has been the experience to date. 45 The Congressional Budget Office
(CBO) recently published a forecast also questioning the long-term
sustainability of the upward trend in health care spending. Under the CBO
predictions, health care spending will reach “forty-nine percent of GDP in
2082. This implies that between 2018 and 2082, health spending would
increase only 1 percentage point,” 46—quite a shift from the current trend.
The rising cost in health care is understandably a significant cause for
concern for all health care payers, but more so for the federal government,
as Medicare is the largest single payer of health care services in the
country. 47 With spending projections forecasting rising costs without an
end in sight, there has been added pressure to find a way to stunt the growth
in spending. As will be discussed in the next section, an added layer to this
concern is the increase in costs has not seen a subsequent increase in quality
of care received by patients.
C. Concerns about Quality
While rising health care costs are a significant part of the health care
conundrum, just as important, if not more important, are concerns about the
quality of health care being provided in the United States. As mentioned in
the introduction, the United States has a mortality rate higher than other
developed countries. This is especially surprising when considering that the
Unites States also spends significantly more on health care than these other
developed countries. 48 At the beginning of the new millennium, the World
Health Organization ranked the health systems of close to 200 nations. 49
France and Italy ranked first and second while the United States ranked
43. DEMYSTIFYING, supra note 20 at 5.
44. Id.
45. Id.
46. Id.
47. Stuart Guterman et al., Using Medicare Payment Policy to Transform the Health
System: A Framework for Improving Performance, 28 HEALTH AFFAIRS 238, 238 (2009),
available at http://content.healthaffairs.org/content/28/2/w238.full.pdf+html.
48. Health Care Spending in the United States and Selected OECD Countries, KAISER
FAMILY FOUNDATION (Apr. 2011), http://www.kff.org/insurance/snapshot/
OECD042111.cfm.
49. AJAY TANDON, ET AL., MEASURING OVERALL HEALTH SYSTEM PERFORMANCE FOR
191 COUNTRIES, WORLD HEALTH ORG. (2000), available at www.who.int/
healthinfo/paper30.pdf (cluster on Evidence and Information for Policy/Global Programme
on Evidence for Health Policy).
