The healthcare industry has struggled for years to cut excesses amid the $3.2 trillion spent annually on healthcare, but it’s time to get serious.
Incremental cuts on the order of 5% won’t make a real difference, especially given that so many have fallen well short of even that modest goal. The industry must target transformational cost cutting, on the order of 20% or more over the next five years, or struggle amid the coming dislocation.
The good news is that transformational cost cutting, while maintaining safety, quality and patient satisfaction, can regenerate a health system and empower it with a new cost-conscience mindset that can help it thrive. But from where will these cuts originate?