Block grants: Untested territory

Not surprisingly, Donald M. Berwick, the former Boston pediatrician who now heads the Centers for Medicare and Medicaid Services, does not like the concept of Medicaid block grants now being bandied about Washington as part of the 2012 budget. 

The President, Donald M. Berwick said, is opposed to them. "That's been made clear and I am too," he told a room full of health care journalists gathered in Philadelphia last week for the Association of Health Care Journalists convention. "It's untested territory."

Don Berwick

Medicare and Medicaid together provide health care to one in three Americans, making the programs powerful potential sources of innovation and a major force in the health care arena. Berwick spent a lot of time talking about how, when hospitals, insurers and providers cooperate, dramatic improvements in patient care can be achieved by following already existing protocols. That kind of nationwide borrowing of best practices, he said, can be more easily facilitated in the current design.

On Friday, the House passed a 2012 budget that included the proposal for Medicaid block grants to the state. Next up is a go-round in the Senate. "Will there be block grants?" Berwick asked rhetorically. "I don't have a crystal ball, but I don't think there should be."

Berwick drew a comparison between health care and computers. Computers, he said, have gotten better and less expensive as the industry has learned more about lean manufacturing. It can be the same in health care. "Higher quality and lower cost go together," he said.

Of course, costs need to be removed from the system. "One way is to cut and the other is to improve. "You see a lot of talk about cutting," he said, which for Medicare and Medicaid means to "withdraw care from the vulnerable. I don't like cutting. I don't think cutting is the best way. I think improving is the best way."

A key, he said, is to focus on several key cost drivers, as has been done in several hospitals or health systems. Hospitals have been able to diminish bed sores and reduce certain kinds of infections by a huge percentage. "Over time, there are places have taken these on and knocked the socks off these problems."