The way we pay for health care in the U.S. is irrational

July 7, 2021 / By L. Gordon Moore, MD

Podcast Listen ButtonAs early as 1992, JAMA published a randomized control trial (gold standard for studies of impact) of telephone care. Patients liked it, doctors liked it, outcomes improved and costs went down.[1] The week after March 12, 2020, medical practices pivoted the overwhelming majority of their patient interaction to telemedicine and payers finally opened up to paying for this service. It took 29 years and a global pandemic to align financing with the evidence.

Now let’s look at behavioral health. Even before COVID-19 we had a supply problem: Not enough behavioral health workforce capacity compared to the need.[2] This Government Accountability Report to Congress from March 31, 2021 says it all:

Longstanding Unmet Needs for Behavioral Health Services Persist and Were Worsened by New Challenges Associated with the COVID-19 Pandemic[3]

We can go back to 2010 and find another randomized control trial demonstrating the positive impact of using telepsychiatry, where the psychiatrist reviewed up to four patients an hour, providing a diagnosis and treatment plan.[4] That is a four-fold increase in supply. The problem is that payers don’t think it is their problem to pay for. Payers aren’t responsible for paying for a proven method addressing a critical need? That is irrational.

These are just two minor examples of our massively irrational system. We seem to be absolutely willing to throw billions of dollars at questionable services and drugs,[5] but not willing to shift resources to implement high quality primary care that could absolutely improve outcomes and lower costs.[6]

We need a more rational health care system. We need a health care system that is more affordable and delivers higher quality. We need to implement high quality primary care and public health so we can help people avoid chronic conditions. This would allow us to focus more on health and wellbeing and less on the newest device, app or drug to (maybe) mitigate a problem that might have been prevented in the first place.

Listen to Elizabeth Mitchell, president and CEO of the Purchaser’s Business Group on Health, describe her member’s frustration with the current health care system. Cisco, Microsoft, Intel, Walmart and the rest of the members are fed up with the status quo and are looking to hospitals, health systems and health plans to move faster and be more innovative.

Dr. Gordon Moore is Senior Medical Director, Clinical Strategy and Value-based Care for 3M Health Information Systems.

[1] Wasson, John, Catherine Gaudette, Fredrick Whaley, Arthur Sauvigne, Priscilla Baribeau, and H. Gilbert Welch. “Telephone Care as a Substitute for Routine Clinic Follow-Up.” JAMA 267, no. 13 (April 1, 1992): 1788–93.

[2] Accessed 7/1/21


[4] Yellowlees, Peter M, Alberto Odor, Michelle Burke Parish, Ana-Maria Iosif, Karen Haught, and Donald Hilty. “A Feasibility Study of the Use of Asynchronous Telepsychiatry for Psychiatric Consultations.” Psychiatric Services (Washington, D.C.) 61, no. 8 (August 2010): 838–40.