He is saying that treatment needs to be decided based on what is effective, not what is going to put the most money in the doctor's pocket. Doctors right now are compensated based on services rendered, so the incentive is for operations and procedures and tests that may or may not be totally medically necessary. What he was speaking about (in context) was precisely that - finding ways to fix the incentives to be conducive to better care which would also help lower prices by eliminating payments for unnecessary procedures.