George C. Halvorson, CEO and chairman of Kaiser Permanente. Image source: Kaiser Permanente

Healthcare in the U.S. can only be reformed with standard computerization and systematic thinking, said George Halvorson, CEO of healthcare organization Kaiser Permanente, in a Web cast hosted by Palo Alto, Calif.-based HP last week.

Halvorson said he believes the heart of the issue is that Americans pay twice as much for healthcare than other countries because the U.S. healthcare system is piecemeal, separated and, from an economic standpoint, more profitable for organizations.

He noted it costs between $1,500-$4,000 to deliver a baby in the U.S. yet only $1,050 in Canada. “Premium is the total cost of care divided by the total number of people who have coverage,” stated Halvorson. Therefore, Halvorson said, because the U.S. rewards cost increases and other countries do not, “organizations in the U.S. can charge more because they can. In Canada, the doctors can’t increase the price.”

According to Halvorson, 75 percent of U.S. healthcare costs come from chronic conditions and 80 percent includes patients with multiple conditions. Patients with diseases such as asthma and congestive heart failure incur most of the costs, said Halvorson.

Additionally, Halvorson stated that 10 percent of the population accounts for 80 percent of healthcare costs.

The U.S. can make a huge difference in the cost of care, while improving the level of care, stated Halvorson. “The opportunity is to make care better by focusing on people who need team-care and doing it in a systematic way with computer-supported care that has all patients’ medical information available in real-time, all of time.”

Halvorson noted that Kaiser Permanente uses a vertical integrated system for EMRs. Kaiser’s entire database is computerized, according to Halvorson, so that physicians do not see paper reports but get results in real-time with data flowing from site to site.

Halvorson noted a recent study that quantified the difference between hospitals, pointing out that the study showed that patients admitted to a five-star hospital have a 52 percent less likely chance to die of anything compared with patients admitted to a three-star hospital.

A patient is 79 percent more likely to die if admitted to a one-star hospital instead of a five-star hospital, recalled Halvorson. “We should have an agenda to have nothing but five-star hospitals and we have to think systematically to do this,” stated Halvorson.

“We need to make hospitals safer in this country,” concluded Halvorson.