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It's a fairly easy fix - but requires a more coordinated payment model around payment and delivery.They are called integrated delivery networks (IDN's) and two of the best examples are Kaiser Permanente (about 8 million members) and Intermountain Healthcare (provides healthcare to about 40% of the State of Utah). The concept basically compresses payment with delivery.By compressing payment with delivery - perverse incentives are mitigated (if not removed entirely) and it looks a lot like a commercial version of a single-payer system.Ultimately, that alignment is better suited for acting together in the patients best interest - rather than separately (in the best interest of either the payer or the delivery network).The business tension is already evident - and an extreme version of this tension is evident in Pennsylvania - between Highmark (states largest payer) and University of Pittsburgh Medical Center (UPMC - the states largest healthcare delivery network).I wrote about this exact tension last year here:Tort Reform Arrives to Healthcare - Sue the PatientBasically, Highmark is working to get into the delivery business - and UPMC is working to get into the payment (payer) business. It's a conflict for both sides - and while PA is an extreme - the new business tension is evident Nationally.The end result is more patient-centered, coordinated and collaborative care.Footnote: The ACA actually starts us on this path by addressing 2 big issues:New Medical Loss Ratios (MLR's) that effectively "cap" the amount of money payers can make. The new MLR's are set at either 80% or 85% (depending on size of payer). This effectively says that for every $1 a payer collects in premiums - they are required (by law) to spend either 80 or 85 cents on actual healthcare delivery. Contrary to popular myth - most big insurers don't make money on underwriting (95%+ of large employers are self-insured) - so they are on the hunt for new/different margins. Another myth is that payers make big profits. They don't. The industry average (among the bigger payers) is somewhere around 5% (net profit margin) and many don't make that.Unhook the historic accident of providing health care coverage through employment. Over time - more and more healthcare will be purchased on either private exchanges (employer based) or public exchanges (individuals) - but in both cases - insurance itself will be more "portable" - tied to the individual - not through the employer. Employers have already started (en masse) to treat the healthcare as a "defined contribution" and they are turning away from the historic model of providing healthcare as a "defined benefit."Today, it's hard to see these changes as seismic - because they will take time. Most realistic timelines I've seen suggest 10 years (to see/feel the effects at scale), but they are the first steps on a long and bumpy road out of the healthcare wilderness we're in. Ultimately, that goal is a more "patient-centered," model of coordinated care. The ACA isn't "it," but for all of it's challenges (and there are many), it is a start.

A2A:This is actually pretty easy because we already have the solutions - at scale.They're called integrated delivery networks - and Kaiser Permanente is (arguably) the largest in the U.S.Basically, the model "compresses" insurance & healthcare delivery into one cohesive solution. It's preferred because then you have common alignment around the best possible outcome - for the patient.There are other examples too - but KP has about 8 million members - so it's the defacto reference model (for here in the U.S).The alternative is what's playing out in Pennsylvania between Highmark (insurance carrier) and UPMC (delivery network). The fight has been bitter - is ongoing - and wreaks havoc directly on what is supposed to be the primary objective - patient care. I wrote about last year here:When Healthcare Titans Compete - Patients LoseThis highlights the business tension borne out of big revenue - and not what's in the best interest of patients. In the end - both sides realize the benefit of owning the other - but in many cases - neither side can agree (or afford) the enormous valuation of the other.If there's an industry that could generate a "trillion" dollar merger - healthcare is it. But it's also why Rick Scott - Governor of Florida - gave us this gem of a quote - which I also used in a year-end piece last year:Top Ten Healthcare Quotes for 2012#2: How many businesses do you know that want to cut their revenue in half? That's why the healthcare industry won't change the healthcare industry.