Payment transformation is the second key component of healthcare improvement. The present payment system, which rewards providers for over-utilization, is seriously flawed. The more procedures we do or patients we see, the more we get paid. There is no consideration for quality or overall health outcomes.
If we had a payment system that rewarded health outcomes, the delivery of care would radically shift our emphasis to prevention instead of sickness care. There would be intense efforts to prevent hospitalizations and focus on educating patients about health risk and self-care.