06/27/2009 05:12 am ET Updated May 25, 2011

Looking Beyond the Public Plan Debate Toward Real Reform

Everyone agrees that the nation's health care system is broken. Our patchwork insurance system gives health care providers the wrong financial incentives. Meaningful reform requires a complete overhaul.

Many suggest the solution is as simple as crafting a public plan that competes with private insurers. While there are stark differences in how people envision a public plan, neither of the two major proposals goes far enough to transform the delivery system, improve quality of care, lower costs, and expand choice.

We should create a major risk pool that allows plans to seek out -- not avoid -- people with health problems. This will eliminate wasteful underwriting and selective marketing costs.

This risk pool should be publically chartered and operate independently, much like the Federal Reserve. It should be free from both the Congressional and Executive branch control so it is not influenced by special interest groups. Medicare's inability to do logical things ranging from competitive bidding for wheelchairs to increasing payments for primary care illustrates how vested interests can stymie change.

Pooling risk is necessary, but not sufficient to achieve meaningful health care reform. The risk pool will use new ways to pay the providers so the actual delivery of health care can be transformed. These new mechanisms do not merely cut costs, like capping fees. Instead, new payment approaches can improve health care quality by paying providers for engaging in team-based care or rewarding health care innovation on the ground.

More details on how a risk pool can transform the delivery of health through payment reform can be found in a blog post available now at Health Affairs. The complete white paper detailing this solution can be found here: "Beyond the Public Plan Debate: A Pathway to Transform the Delivery System."