Innovation in the U.S. Health Care System’s Organization and Delivery

Abstract

Over the past decades, the U.S. has attempted a wide array of innovations in the areas of health care organization and delivery. Canadian policy makers may be interested in some of the successes and failures in the United States health care system. This briefing summarizes recent trends in six areas: fiscal federalism, expanding benefits, payment reform, virtual and digital health, supply chain reforms and healthcare workforce. The federal government allocates money to the states based on per capita income in that state to support state health care programs such as the Medicaid program and Children’s Health Insurance Program. Additional fiscal transfers are also used to incentivize states to provide other services. Benefit expansion currently focuses on expanding Medicare to include hearing care, broadening the benefits covered by Medicare Advantage (managed care plans) plans, and using Medicaid waiver programs to expand eligibility and benefits for low-income individuals. Alternative Payment Models and expanding Medicare Advantage are transforming the system from fee-for-service toward a value-based system. Accelerated use of digital and virtual care is being promoted by waiving restrictions on coverage of telehealth services for acute and chronic conditions and primary care. Shortages of health care inputs, especially pharmaceuticals, were a chronic problem exacerbated by COVID-19. In response, onshoring of pharmaceutical production and expanding drug shortage surveillance and transparency in the drug supply chain is starting. Finally, the federal government has established research centers to track the number of primary care doctors and improve the distribution of physicians in the most disadvantaged areas.