Productivity Measurement in the United States Health System

Policy Paper
Oct. 2, 2013

Improving productivity in health care is, unquestionably, among the most important challenges facing policy makers and health care systems. Advances in medicine have greatly improved lives over the last century and ideally will continue to do so in the future. However, medical care also consumes a rapidly increasing proportion of society’s time and resources. That trend has continued to the point that growth in health care spending is considered a drag on the remainder of the economy. By improving productivity, we can continue improving our health while not sacrificing too much of our material well-being in the process.

Current measurements of health care productivity are standing in the way of that improvement by presenting a false image of how the health care system creates value. Existing measurements tend to reflect the needs and incentives of health care providers in a fee-for-service world – not the interests of a broad population of patients, most of whom would prefer to stay out of the doctor’s office and away from the hospital as much as possible. Improving measurements of productivity will be a challenge, but it’s an important step toward a better health care system.

Read, "Productivity Measurement in the United States Health System," by Rick McKellar, Michael Chernew, and Joseph Colucci.

*This piece is a companion paper to "Productivity and the Health Care Workforce," by Shannon Brownlee, Joseph Colucci, and Thom Walsh. Read that paper here.