Despite pockets of excellence, our nations health care system remains deeply flawed. In some hospitals, nearly 25 percent of hospital admissions result in an adverse patient safety event; the same condition produces up to three-fold differences in hospital mortality, and deaths from serious treatable conditions and there are large differences in outcomes of care by race/ethnicity and geography. The COVID-19 pandemic highlighted health care’s weaknesses—serving as a wake-up call for needed improvements.

Much remains to be done to ensure that all Americans have affordable health insurance coverage. But improving the health care we receive is an even larger challenge—involving fundamental changes in how we pay for care, provide care, and report on the safety and quality of care received. In the Better Care Plan, we suggested in Health Affairs Scholar that a certification process be established for provider organizations that meet specified criteria in these three areas of care delivery.


There is growing evidence that moving to risk-adjusted prospective payment is associated with higher quality of care and lower total cost of care than care paid for by fee-for-service. Risk-adjusted prospective payment creates a budget for provider organizations that incentivizes keeping people well by emphasizing disease prevention and health promotion, and by efficiently coordinating care for people with multiple chronic illnesses. It also provides a predictable revenue stream when faced with events such as the COVID-19 pandemic which resulted in fewer visits and, therefore, less fee-for-service revenue. All payers should follow the Centers for Medicare and Medicaid Services (CMS) and move more rapidly to risk-adjusted prospective payment as the norm, taking into account adjustments for the social determinants of health, and differences in the health status of disadvantaged groups. We suggest that provider organizations that meet, for example, at least 50 percent of their revenue from risk-adjusted prospective payments be certified, provided defined patient safety and quality standards are met.

Team-based Continuously Improving Care

Operating within a budget for a defined patient population gives providers the incentive to continuously improve care. To do so, they will need to form patient-centered, technology-enabled teams that have a strong primary care base. Some specific criteria that can be used in certifying provider organizations and their teams include:

  • Evidence of engaging patients in setting goals through motivational interviewing shared decision making and related methods.
  • Evidence of managing transitions in care – for behavioral and mental health, specialty care, and post hospital transitions.
  • Evidence of using feedback data on patient safety and care outcomes to continuously improve care.
  • Evidence that patients have ready access to their electronic health records.
  • In all of the above, evidence that care is tailored to meet the needs of patients of different race/ethnicity, gender preferences, disabilities and related characteristics.

Provider organizations should have an operational excellence management system based on the empowerment of front-line professionals and support staff to solve problems, eliminate waste, and provide error-free care on a daily basis. The majority of U.S. hospitals report being engaged in quality improvement projects but only a minority have implemented an enterprise-wide management system that is embedded in the organization’s culture. Examples include Lean, Lean plus Six Sigma, Robust Performance Improvement and related approaches. Evidence suggests that those who use such systems experience lower cost per adjusted inpatient admission, lower unplanned 30-day readmission rates, provide less low value care, and have higher patient experience scores.

Patient Safety and Outcomes Data Reporting

Changing how care is paid for and delivered is necessary but not sufficient to continuously improve care. Feedback is also needed to assess how well an organization is doing. We suggest that a national task force comprised of relevant expertise and representation be formed to develop standards and measures to be used by a National Patient Safety Board and a similar entity for other outcomes of care. CMS has made a good start with their building block approach to aligning quality measures across all of their payment programs. A balance should be struck between a relatively limited number of high priority clinically significant measures useful for patients and purchasers to select health plans and their associated provider organizations, and some high priority clinically significant condition-specific measures such as HbA1c levels. All measures should be risk-adjusted and stratified by race/ethnicity and related variables and digitally reported making use of AI technology to reduce the reporting burden on plans and provider organizations. An organization such as the Joint Commission on Accreditation of Healthcare Organizations could certify that the recommended patient safety practices are being implemented. A similar entity could do the same for other recommended patient outcome measures.


Key stakeholders including CMS, commercial health plans, employers, provider organizations, regulatory groups, consumer organizations, and policymakers need to be brought together to address the challenges involved in implementing the Better Care Plan. A portfolio of carrots and sticks undoubtedly will be needed. The pace of incremental changes now being undertaken by many of the stakeholders needs to be accelerated if the pockets of excellence that currently exist are to be extended so that all Americans can have continuously improving, affordable health care.


George C. Halvorson, Jon M.Kingsdale, Richard M. Scheffler, Allyson Y. Schwartz, John T. Toussaint, Peter A. Wadsworth helped contribute to this blog post.

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Author, Member

Stephen M. Shortell, Ph.D., M.P.H., M.B.A.

Distinguished Professor of Health Policy and Management Emeritus - School of Public Health and Haas School of Business at University of California-Berkeley

Stephen M. Shortell, Ph.D., M.P.H, MBA is the Blue Cross of California Distinguished Professor of Health Polic... Read Bio

Member, Presenter

Gail Wilensky, Ph.D.

Senior Fellow - Project HOPE

Gail R. Wilensky, Ph.D. is an economist and senior fellow at Project HOPE, an international health foundation. Read Bio

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