Care of the rapidly growing segment of older adults living longer with complex health and social needs remains fragmented, costly, and, at times, harmful. A high proportion of the total health care dollars consumed by this group is the result of preventable breakdowns in care experienced during frequent episodes of acute illness. Major changes in health and social systems are urgently needed to improve the quality of care delivered to these patients and control growth in health care spending. Widespread implementation of evidence-based transitional care interventions represents an immediate opportunity to better align care with older adults’ preferences and needs, enhance their health and quality of life, and reduce their use of high-cost services. Transitional care encompasses a time-limited, broad range of services to support patients at high risk for poor outcomes, and their families as they move between levels and settings of care.1

Uneven distribution of income, education, and wealth in the United States combined with racism and class discrimination result in parts of the population having worse health outcomes than others. Such disparities have been the focus of much talk and many serious efforts at documentation, but (as will be shown in this chapter) very little effective action to change them – both because of lack of evidence for change that is effective and lack of implementation of evidence-based changes. Although everyone knows that medical care alone cannot alter all of the disparities in observed health outcomes caused by centuries of discrimination, sometimes it can make a difference. To what extent could evidence about effective programs help health care managers or policymakers take a leadership role in reducing disparities for disadvantaged populations?1 Is it possible at least to identify actions that would help, and then implement them? The need to convert evidence-based management from an aspiration into reality is especially acute for this problem.

“Fragmentation” – the breakdown in communication among many providers treating a single patient, such that multiple decision makers make a set of health care decisions that would be made better through unified decision-making1 – is frequently cited as a major problem in the US health care system.2 It plagues both the payment system (which has multiple payers) as well as the delivery system (which has siloed providers). This chapter focuses on the latter problem of fragmentation among care providers and calls to correct it via “care coordination.” The problem is not just provider fragmentation, however. It is also the lack of clarity regarding what care coordination (the proposed solution) means, what benefits it confers, and how to do it.

There has been growing interest in the vertical integration of physicians and hospitals during the past decade, as evidenced by multiple literature reviews and research investigations.1 Historically, physicians operated small firms that provided “physicians’ services” to patients who sometimes used facilities provided by separate hospital firms at which many physicians would have “privileges.” This interest in combining the two types of organizations culminated in a December 2020 issue of Health Services Research devoted to the topic that expressed surprise (and disappointment) that integration is not “a miracle cure”.2 Just months earlier, two of the major proponents of vertical integration published a study in the August issue of Health Affairs that came to a similar, “startling” conclusion: the financial integration of physicians and hospitals (e.g., via employment) had no impact on their clinical integration (and perhaps none on quality).

Over the last 40 years, spending on both hospital and physician services in the United States has inexorably increased, often faster than gross domestic product (GDP) or any other aggregate measure. In contrast to industries such as computer software, hospitality, sports and recreation – where spending has also grown faster than the economy – health care spending growth is not thought to be matched by increased customer or patient satisfaction or improved outcomes. For some groups, especially those that are socially disadvantaged or lower income, measures of health have remained stubbornly lower relative to the rest of the population. Despite continuous criticism of the status quo and calls for transformation, little has changed. Why has this sector of the economy uniquely resisted changes in products, productivity, and services aimed at improving consumer satisfaction or reducing spending growth?

One striking feature of the US health system, for people like us who are interested in evidence on how improvements in the way medical care is provided and financed affect its outcomes and costs, is that we have a pluralistic, not to say fragmented, medical care payment system. What is wrong with fragmentation? Think of a restaurant dinner for a large party of people. Usually they would order salads, main dishes, and desserts from a menu, and might be expected to ask the waiter to calculate the part of the check that represents their dishes – they would pay fee for service – and one could describe the pattern as fragmented. However, what if the group wants to divide the check equally? What if wine is cheaper by the large bottle but diners ordering different entrees want different wines, raising the bar tab? What if it is a restaurant where at least some dishes are better shared than on individual plates? Then a more integrated approach to dining and payment may lower cost may be better – at least for many. Many experts judge an arrangement in which health care is divided individually into different courses and ordered and paid a la carte as a system that is fragmented and ultimately costly to administer and inefficient. That is the challenge for payment reform – to move away from itemized “fee for service” (FFS) pricing to combined payment for a set menu or meal plan, and to do so in a way that will do more good than harm.

In this book we have provided information on how evidence is used or ignored in decisions about innovations by leaders of health systems and health insurers and by public health policymakers. This “evidence on evidence” – information about the use of evidence on nonclinical interventions – is voluminous, but with many gaps. Sometimes the evidence is encouraging about effective interventions, but often it is discouraging with nothing new found, and it is always suggestive but certainly not conclusive on processes, methods, rules, and policy interventions that might lead to health care improvement from the status quo. We are honest about this ambiguity because this study of evidence revealed the lack of rigor in health care managers’ decision-making – but it also revealed some unavoidable costs and delays of seeking perfect evidence. The book, then, is not only a wake-up call, but also a call to action toward a culture of change in how health care and health insurance leadership deal with the science that supports innovation.

Medical care is a service, which means that its supply depends on the characteristics of the person receiving it as well as the characteristics of the person furnishing it; medical care requires participation by the customer in the process of producing the service. A good comparison is with automobile repair and maintenance services: when you have to bring your car in, you often do not know what is wrong or what it will take to fix it, and even after you pay for preventive care for your brakes or oil you cannot tell if it made a difference in outcomes.

Telehealth and telemedicine refer to the exchange of medical information from one location to another using telecommunication technology. Both have the goal of improving how and when people receive care. Telehealth broadly encompasses virtual services that support remote interactions using technology. Telemedicine is specific to the provision of clinical services when providers and patients are not in the same location.1 In this chapter, we discuss the complexity of generating evidence for telehealth, how to contextualize that evidence, and the current state of the evidence.

It seems so obvious that good decisions on innovations in medical and hospital management – or on anything – should be based on good evidence. Decision-makers are advised by business school professors (and their mothers) that decisions should be based on the best available evidence – and who could argue against that? However, despite the general reverence for evidence in medical practice and drug approval, there is a consensus (discussed later in this chapter) that decision-making on medical delivery or insurance innovations – which also can have effects on health, life, death, and spending – is often not evidence-based, sometimes contradictory to evidence, and surely not as evidence-based as it could be. In this introductory chapter we explore two related questions: (1) what is the value of evidence for these decisions, and (2) where in health care management is evidence not being generated or used as it should be? This chapter will in a sense discuss “evidence on evidence,” and ask when and what kind of evidence is needed to improve not only decision-making, but also final outcomes in terms of spending and quality.

A trite, if apt, metaphor for the American health care and insurance system is a battleship that has been sailing in a particular direction for many years, with many of us as free riders in a direction we do not prefer. That direction is characterized by spending growth that outpaces virtually any other sectoral trend in the economy, and by quality and outcome measures that, at best, improve little and, at worst, deteriorate. The battleship takes up 18 percent of gross domestic product (GDP), furnishes employment to nearly 15 percent of the workforce, and consumes a large share of federal and state governmental budgets (Figure 2.1). Even if we could figure out how to cut the power, this dreadnought would continue to coast in the same direction for the foreseeable future. The obvious conclusion is that it has been and will continue to be hard to turn the vessel to go in a different direction. As of this writing, the novel coronavirus pandemic has affected the use of care as well, putting many “normal” services on hold to accommodate sick patients. And while it is too early to conclusively confirm the effect of the pandemic on spending trends, there is likely to be an effect (although even the direction is not known). Once the pandemic stabilizes, consumption of health care services will probably not return exactly to past behaviors, but there will be a strong tendency to slide back. What might help to avoid doing so, and most importantly, what evidence can be currently offered or generated to support efforts to change course?