Rural Pennsylvania Health System Points the Way to Innovation

In the Geisinger Health System of Danville, Pennsylvania, about 150 miles northwest of Philadelphia, primary-care doctors are assigned a nurse who oversees the most chronically ill patients. By closely monitoring such measures as blood sugar levels, the nurses keep emergency-room visits – and costs – down. Another Geisinger program guarantees the price of heart surgery, recovery and therapy from the day of diagnosis until 90 days after the operation, giving doctors and other providers incentives to avoid errors.

Such innovations, according to an article in The Philadelphia Inquirer, have won national accolades for Geisinger, including a mention by President Obama. But other innovations have not come cheaply. At a recent conference covered by the newspaper, Howard R. Grant, Geisinger's chief medical officer, said the health system's electronic-records system, which helps the health system keep tabs on every aspect of patient care, costs tens of millions per year. "We believe it's valuable. We believe it leads to better care, but people need to understand the size of that investment as well."

Indeed, the application of medical information technology has had mixed results as a cost-cutter for health care. "No one has done the careful research to indicate that if one health care system has information technology and the other doesn't, then the care is different. There are no controlled trials," Mark Pauly, a health care management professor at Wharton, told Knowledge at Wharton in an article titled, "Information Technology: Not a Cure for the High Cost of Health Care." Information technology could actually raise costs because of culture clashes, training, the implementation of the systems and the labor required to maintain the new technology, he suggested. "The best-case scenario is that information technology will improve quality but not lower costs. The worst case is that there's no difference at all."

Fore more on healthcare costs from Knowledge at Wharton, see:

Another Hurdle to Health Care Reform: Too Few General Practice Doctors

One Way to Lower Health Costs: Pay People to Be Healthy

Why Consumers — Not Companies — Should Make Health Care Decisions