Cold War Veterans Blog

Replicate the military healthcare system to reduce healthcare costs?

The CEO of the Cleveland Clinic says it works there

One Great Idea for Reducing Health Care Costs: Replicate the...

Ninety years ago, four Cleveland physicians had a great idea for providing more efficient health care. They planned a group practice where physicians from many specialties would collaborate for the practice of medicine.


The physician founders of Cleveland Clinic served in World War One and hoped to replicate the organizational efficiency of military medicine. They established Cleveland Clinic as a not-for-profit group practice with a mission of patient care, research and education. Their great idea is still growing strong.

Cleveland Clinic has a main campus, eight community hospitals, 18 family health centers, and facilities in Florida, Nevada, Toronto and Abu Dhabi. Our locations are linked by electronic medical records, expediting care and avoiding duplicative activity. Critical care transport moves patients to the right facility, at the right time, for the right care. Our integrated structure enables us to control costs, measure and improve quality, and provide access to high-quality healthcare services across a broad regional system.



All Cleveland Clinic staff physicians receive a salary with no bonuses or other financial incentives. Physicians get no financial benefit from ordering unnecessary tests or expensive devices. The hospital and physicians share an interest in controlling costs. Additionally, each physician undergoes an annual professional review, the results of which are used to determine future salary and reappointment. This is integral to assuring quality performance.

Some of the most perplexing cost issues can be solved by answering a simple question: What’s best for the patient?

Cost savings begin by preventing disease by eliminating smoking, and encouraging exercise and weight reduction. A comprehensive program has bent the inflation curve of health care costs of our 40,000 employees and reduced the smoking incidence in our community by 50%.

Cleveland Clinic is organized into patient-centered institutes based around single diseases or organ systems. Each institute combines medical and surgical services at the same location, providing a multidisciplinary approach to care.

Each institute has established benchmarks and quality improvement programs. Institutes are required to publish annual outcomes guides showing volumes, results, and innovations relevant to patients and referring physicians.

This integrated model has made it possible for us to achieve cost savings on a vast scale. We were able to mobilize physicians and employees into hundreds of teams to address specific expenses. These teams cut costs from the operating room to the store room.