Founder and former president and CEO of the Institute for Healthcare Improvement, Don Berwick served as administrator of the Centers for Medicare and Medicaid Services from July 2010 to December 2011. A few days after leaving that post, he spoke at IHI’s 23rd Annual National Forum. Below are excerpts of his remarks on how health care workers, managers and physicians can transform our health care system. For performance improvement tools and information for your team, and to find the full text of Berwick’s speech, visit www.ihi.org.

When I first got the [CMS] job, my brother, Bob, a retired middle school science teacher and a very wise man, gave me a sign to put on my desk. It read, “How will it help the patient?” It was there from the minute I arrived until the minute I left. [IHI President and CEO] Maureen Bisognano gave me the same sort of advice just before I left IHI. I asked her how I could succeed at CMS, and she said, “That’s easy; just mention a patient five times a day.”

Bob’s advice and Maureen’s was the best I got—hands down—from anyone else anywhere else. Remember the patient.

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And that brings me to the opportunity we now have, and a duty. A moral duty: To rescue American health care the only way it can be rescued—by improving it...

This is the threshold we have now come to, but not yet crossed—the threshold from the care we have to the care we need.

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The choice is stark—chop or improve. If we permit chopping, I assure you that the chopping block will get very full—first with cuts to the most voiceless and poorest us but, soon after, to more and more of us. Fewer health insurance benefits, declining access, more out-of-pocket burdens and growing delays. If we don’t improve, the cynics win.

That’s what passes the buck to us. If improvement is the plan, than we own the plan. Government can’t do it. Payers can’t do it. Regulators can’t do it. Only the people who give the care can improve the care.…

[T]he reduction of waste...is the quality dimension of our time. I would go so far as to say that, for the next three to five years at least, the credibility and leverage of the quality movement will rise or fall on its success in reducing the cost of health care—and, harder, returning that money to other uses while improving patient experience. “Value” improvement won’t be enough. It will take cost reduction to capture the flag. Otherwise, “cutting” wins….

[G]reat leverage in cost reduction comes directly—powerfully—exactly from focusing on meeting the needs of the person you serve. “Waste” is actually just a word that means, “Not helpful.” ... In very large measure, improving care and reducing waste are one and the same thing…. 

 [IHI’s] Andy Hackbarth and I…found six [sources of waste], for starters, and we estimated their size.

Overtreatment—The waste that comes from subjecting people to care that cannot possibly help them—care rooted in outmoded habits, supply-driven behaviors and ignoring science.

Failures of Coordination—The waste that comes when people—especially people with chronic illness—fall through the slats. They get lost, forgotten, confused. The result: Complications, decays in functional status, hospital readmissions and dependency.

Failures of Reliability—The waste that comes with poor execution of what we know to do. The result: Safety hazards and worse outcomes.

Administrative Complexity—The waste that comes when we create our own rules that force people to do things that make no sense—that converts valuable nursing time into meaningless charting rituals or limited physician time into nonsensical and complex billing procedures.

Pricing Failures—The waste that comes as prices migrate far from the actual costs of production plus fair profits.

Fraud and Abuse—The waste that comes as thieves steal what is not theirs, and also from the blunt procedures of inspection and regulation that infect everyone because of the misbehaviors of a very few.

We have estimated how big this waste is—from both the perspective of the federal payers, Medicare and Medicaid, and for all payers. Research and analytic literature contain a very wide range of estimates, but at the median, the total annual level of waste in just these six categories (and I am sure there are more) exceeds $1 trillion every year—perhaps a third of our total cost of production.

This is our task…if we are to help save health care from the cliff. To reduce costs, by reducing waste, at scale, everywhere, now.

I recommend five principles to guide that investment:

1. Put the patient first. Every single deed—every single change—should protect, preserve and enhance the well-being of the people who need us. That way—and only that way—we will know waste when we see it.

2. Among patients, put the poor and disadvantaged first—those in the beginning, the end and the shadows of life. Let us meet the moral test.

3. Start at scale. There is no more time left for timidity. Pilots will not suffice. The time has come, to use [Swedish health care leader] Göran Henrik’s scary phase, to do everything. In basketball, they call it “flooding the zone.” It’s time to flood the Triple Aim zone.

4. Return the money. This is the hardest principle of them all. Success will not be in our hands unless and until the parties burdened by health care costs feel that burden to be lighter. It is crucial that the employers and wage-earners and unions and states and taxpayers—those who actually pay the health care bill—see that bill fall.

5. Act locally. The moment has arrived for every state, community, organization and profession to act. We need mobilization—nothing less.