Transformation is the buzzword in health care as the state gears up for sweeping changes across the medical industry intended to improve patient care while decreasing costs.

Efforts to reform health care under the federal Affordable Care Act has shaken up the medical field and driven the industry to find a way to control escalating costs. Hawaii’s health expenditures totaled $8.8 billion in 2009, according to the Kaiser Family Foundation.

Among the most significant changes is a payment system tied to improved patient outcomes rather than volume, overhauling the way medicine is practiced throughout the islands.

The pay-for-performance model that has been adopted by the state’s dominant health insurer, Hawaii Medical Service Association, and its largest hospital systems, the Queen’s Medical Center and Hawaii Pacific Health, is viewed as a solution to rapidly rising medical costs.

"The former system was based on volume rather than outcome, and that just drove costs and that was not sustainable," said George Greene, president and CEO of Healthcare Association of Hawaii. "Because we’re no longer paying for volume and quantity … we have opportunities to improve our reimbursement rates here. Compared to other states we haven’t been a high-volume state. We’re already positioned to improve reimbursement rates as long as outcomes are good."

Gov. Neil Abercrombie identified health care as a priority of his administration, launching the Hawaii Healthcare Transformation Initiative, a project that explores strategies to improve quality care, value and the overall health of the population through better care coordination. The initiative will also study how to improve the use of health information technology to reduce medical errors and increase efficiency.

The state also has established a nonprofit Hawaii Health Connector, an online health insurance exchange designed to provide residents access to affordable coverage as a one-stop shop where individuals and businesses can purchase insurance through a variety of health plans.

"Our goal is to create a seamless system of health care with the foundation of primary care," said Beth Giesting, the state’s health care transformation coordinator. "We want it to be patient-focused and really looking at quality. This is not just something that government is trying to mandate to get people interested. There is a lot of movement, leadership and enthusiasm throughout the health care sector in working together to transform our health care system."

Separately, the Hawaii Health Information Exchange, a nonprofit organization, is making strides to connect medical providers statewide through electronic health records. The organization, established in 2006 by health care providers, consumers and insurers, recently launched a secure direct messaging and patient referral system in a first step to link the health care industry.

The service allows providers to send and receive direct messages and patient referrals including lab results and prog­­ress notes on a secure network that will soon connect patient records electronically.

The exchange will make it possible for doctors, hospitals, laboratories, health plans and pharmacies statewide to share lab results, radiology reports and discharge summaries to reduce duplicate procedures and medical errors.

Besides administrative prog­ress, Hawaii’s medical community has made significant scientific gains with new minimally invasive procedures for patients ineligible for traditional surgery.

The Queen’s Medical Center recently began the state’s first heart valve replacements via catheter through the groin for heart disease patients previously deemed inoperable.

The cardiac procedure for aortic stenosis, a severe narrowing of a heart valve, makes it possible for patients too ill to tolerate the standard valve replacement via open-heart surgery.

In addition, the hospital recently launched a surgical radiation procedure for liver cancer patients who have stopped responding to chemotherapy.

The surgery, which had only been available at large mainland academic medical centers before its launch several months ago at the Queen’s Medical Center, involves tiny incisions in the hip for a catheter — smaller than a spaghetti noodle — to inject radiation particles into an artery that feeds the liver tumor.

Queen’s and other hospitals, including Tripler Army Medical Center, have begun using surgical robots for everything from head and neck surgeries to prostate and urological procedures, lung and gastrointestinal operations, heart valve repairs and weight loss surgery.