This is the Cato Daily Podcast for Friday, June 26, 2009. I'm Caleb Brown.

It's widely believed that coordinated health care is essential to fostering better health outcomes, but that means flexibility.

It's not clear that current regulations would allow for the broadening of what Regina Herslinger

calls Focus Factories.

Herslinger holds the Nancy McPherson professor of

business administration chair at the Harvard Business School.

He was also a senior fellow at the Manhattan Institute. We spoke at the Cato

Institute's Conference on Health Care, June 17th.

You mentioned in your talk how we measure all the things that we go out and buy in our lives by the output the thing that we are

provided and in health care the way our system of buying health care services it's almost focused exclusively on inputs.

And I guess the short question is so what? what's the big deal about the difference between

outputs and inputs so if I had diabetes I would like to know how good the people

I'm dealing with are in treating my diabetes.

I'd like to know if I have surgery for my diabetes and diabetics need a lot of heart surgery.

What is the risk adjusted?

Mortality, right?

How many people do they kill?

How many people do they maim?

How many people get an infection?

How many people come back within 30 days. What do I know about that? I know Nada about that. The most

I could know is whether some endocrinologist is following somebody's idea about how health care should be practiced.

I don't give a darn about that.

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