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St. Luke’s Blogs

St. Luke’s Dr. David Pate: The Programs Work. It's Fee for Service That Doesn't.

By Dr. David C. Pate, News and Community
July 28, 2015

When St. Luke’s Health System made our strategic framework available to the public a couple of years ago, we indicated that the transformation of health care we are seeking to achieve for the benefit of our communities will require three transformations – transformation of the clinical model, transformation of the patient experience, and a business model transformation to support the transformation of the clinical model.

Since then, St. Luke’s has been piloting new programs that improve health, but we have seen over and over again that even though the programs have been successful, they are not financially feasible or sustainable under the traditional fee-for-service reimbursement model.

Today, blog editor Roya Camp reports on the results we have achieved with our pilot programs directed at treating metabolic syndrome. The perverse thing about the American healthcare delivery system is that St. Luke’s would actually do financially better if patients’ metabolic syndrome was not controlled and patients were to require ongoing medical services to treat their complications.

When St. Luke’s makes the significant investments that we make in these programs, the cost is unreimbursed, and when patients’ health improves, we lose future revenues related to treatment of complications that now will not occur.

It is a perverse reimbursement system, one that St. Luke’s is seeking to change. It is the current reimbursement system that limits the United States’ healthcare delivery entities in their ability to control healthcare spending and costs, and in part explains why healthcare spending per capita in the U.S. is at least double what it is in most other industrialized nations.

Roya's article highlights this issue, and looks at the results of our two metabolic syndrome pilots.

About The Author

David C. Pate, M.D., J.D., previously served as president and CEO of St. Luke's Health System, based in Boise, Idaho. Dr. Pate joined the System in 2009 and retired in 2020. He received his medical degree from Baylor College of Medicine in Houston and his law degree from the University of Houston Law Center.