Porter’s HealthCare Solutions

Michael Porter has some ideas about how to fix healthcare.

In a healthy system, competition at the level of diseases or treatments becomes the engine of progress and reform. Improvement feeds on itself. For that process to begin, however, the locus of competition has to shift from "Who pays?" to "Who provides the best value?" Getting there will require changes in the strategies of providers and payers and in the behaviors of employers purchasing health plans. In addition, some important system infrastructure needs to be put in place—rules and regulations that shift the incentives and create the right types of information. Let's look at each needed reform in turn.

Health care is one of those fields where the incentives are skewed. Entrepreneurs are always taught to look for inefficient markets and capitalize on them to pull out some above average returns. Healthcare is ripe for someone with a good idea. From the government side, I'll stand by what I always say – more information and more transparency, but not more regulation.

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