HFMA VIEWS

President Obama took another step forward in his healthcare reform agenda this week, formally establishing the White House Office of Health Reform by executive order. Nancy-Ann DeParle was nominated early last month to direct this office, which is to coordinate efforts closely with the Department of Health and Human Services. Kansas Gov. Kathleen Sebelius, the secretary-nominee for HHS, testified before the Senate last week, but a vote has yet to be scheduled on her confirmation.

While the offices of the administration’s healthcare team slowly fill, others are examining the implications of some of the reform proposals currently on the table. A major emphasis in health care in recent years has been improving the quality of patient outcomes, and “pay for performance” is one of the ways in which the president’s proposed budget for FY2010 hopes to contain healthcare costs. But in an op-ed in this week’s Wall Street Journal titled “Why Quality Care Is Dangerous,” two physicians on the staff of Beth Israel Deaconess Medical Center in Boston caution against the hasty adoption of quality measures. Pointing to the example of quality measures for blood sugar levels in ICU patients, which have recently been called into question by major research studies, the authors call for “a national time-out in the rush to mandate what policy makers term quality care to prevent doing more harm than good.” 

Also under the microscope this week were plans to develop a public health insurance plan that would compete against private plans. An analysis of the public plan proposal by the Lewin Group held both good and bad news for hospitals, depending on how the plan sets eligibility levels and reimbursement rates. For example, if all individuals and employers were eligible for the plan and it reimbursed at Medicare rates, the Lewin Group estimates that net hospital revenues would fall by 4.6 percent, even after accounting for reduced uncompensated care and increased utilization by the newly insured. But if eligibility were restricted to individuals and small employers only, hospitals could see an increase in net revenues.

These discussions suggest the complexities of the tasks facing policymakers and legislators as they work on healthcare reform. They also recommend a degree of caution and flexibility in navigating the thickets of reform.