How can government encourage value-based competition?
The government has an important role to play in enabling value-based competition at the right levels. First and foremost, government needs to require the universal collection and dissemination of the risk-adjusted outcome and price information at the medical condition level. Second, government should eliminate artificial impediments to value-based competition such as state level licensing, the Stark laws, specialty hospital restrictions, and corporate practice of medicine laws. Third, government also should modify pricing practices and lead the move to care cycle pricing to align prices with value. Finally, government can play an important role in developing information technology standards to ensure interoperability of systems and information sharing. Chapter 8 discusses these and other needed policy changes in detail, as well as new directions for Medicare.
