The problems that every hospital executive has been worrying about for years—healthcare costs, insurance, access, quality of care, and patient safety—have gone mainstream. The American people—that is to say, hospital customers—have become scared and seek solutions, forcing U.S. presidential candidates to put healthcare reform proposals near the top of their campaign platforms.
Some of health care’s most influential thinkers share their perspectives on the policy changes most likely to occur in the foreseeable future.
By Lola Butcher
Roundtable Participants:
Helen Darling, president, National Business Group on Health, which represents employers’ perspectives on national health policy issues. Sheserves on the Committee on Performance Measurement of the National Committee for Quality Assurance, the Institute of Medicine’s Roundtable on Evidence-Based Medicine, the National Quality Forum board, and the Medicare Coverage Advisory Committee.
Karen Davis, president of The Commonwealth Fund, a national philanthropy that researches health and social policy issues. Current appointments include the Geisinger Health System board of directors, the Kaiser Commission on Medicaid and the Uninsured, and the Panel of Health Advisors for the Congressional Budget Office.
Lloyd H. Dean, president and CEO, Catholic Healthcare West, the eighth largest hospital system in the nation with 42 hospitals and medical centers in California, Arizona, and Nevada. He co–chairs Healthy San Francisco, a program designed to make health care accessible and affordable to uninsured residents, and serves on the board of the Catholic Health Association of the USA and Governor Schwarzenegger’s California Commission for Jobs and Economic Growth.
David B. Nash, the Dr. Raymond C. and Doris N. Grandon Professor and Chairman of the Department of Health Policy at Jefferson Medical College, part of Thomas Jefferson University in Philadelphia. He serves on board of trustees of Catholic Healthcare Partners, a 29-hospital system; the Joint Commission’s Advisory Committee on Performance Measurement; the Disease Management Association of America board; and the Technical Advisory Group of the Pennsylvania Health Care Cost Containment Council.
Gail Wilensky, senior fellow at Project HOPE, an organization that works to make health care available around the world. The former top administrator of the Health Care Financing Administration, she serves on the World Health Organization’s Commission on the Social Determinants of Health as well as the Maryland Health Care Commission.
The next U.S. president will be inaugurated one year from now. Regardless of which candidate parades down Pennsylvania Avenue in 2009, what reform do you consider most likely to be enacted under the new administration—and how will it affect hospitals?
Lloyd H. Dean: We believe this is a moment in time when bold solutions can be advanced, particularly with universal coverage. And the first natural place to start is to expand the State Children’s Health Insurance Plan.
The public is signaling its readiness for healthcare reform. Major polls show that Americans favor reform now more than ever. Catholic Healthcare West’s own 2007 Health Security Index shows that 83 percent of Americans feel Congress should make affordable health care a top priority and that 63 percent favor universal coverage, even if it means increasing taxes. We now have a real opportunity to achieve a consensus for change that transcends normal political boundaries, and our leaders should seize the momentum.
Karen Davis: Building on existing group coverage—employer coverage, Medicare, Medicaid, and the State Children’s Health Insurance Plan—is the most feasible approach to covering everyone. In addition, an insurance purchasing pool, building on Medicare, the federal employees’ health benefits program, or state connectors, needs to be established to ensure affordable coverage for small businesses and individuals not covered through employer plans.
I am an optimist, so I do think health insurance for all by building on current programs is feasible—perhaps phased in over several years.
David B. Nash: We’re not going to see a single payer, and we’re not going to see dramatic government intervention. But we’re probably going to see mandated coverage, expansion of Medicare, and expansion of Medicaid.
That sounds like a consensus that reducing the uninsured rate is the first order of business.
Helen Darling: In addition to an expansion of the State Children’s Health Insurance Program that would extend coverage to millions of additional kids, the most feasible changes will be incremental improvements that give the uninsured access to affordable healthcare coverage. Many stakeholder groups are working for more comprehensive plans, some of which are very appealing, but I don’t think that any new president or any new Congress will be able to enact sweeping changes within the first two years, mainly because of the high costs of coverage and the painful fiscal realities that the Congress will have to face.
Gail Wilensky: We are on an unsustainable spending track, so that, to me, is the number one priority. Two other issues are related to that: serious quality problems in both patient safety and appropriateness, and the problems of the uninsured and access to health care for them and for others who do have insurance. But it will be more difficult to fix the uninsured issue unless we find ways to moderate the rate of spending.
The Centers for Medicare & Medicaid Services has many experiments under way to change the payment system. Are these changes on the right track?
Nash: If a presidential candidate called me, I would say ‘You’ve got to completely realign the incentives in thesystem.’ Everything flows, in my view, from a realignment of the incentives. Let’s transform the system from an individual illness-based system to a population-based wellness system. And whatever economically will work to accomplish that mission, that’s what we’ve got to do.
For example, we ought to focus on primary and secondary prevention as a way to reduce costs and reform the system. So we could give tax rebates to companies that promote no smoking, exercise on the job, reducing obesity, wearing seatbelts, treating hypertension—in other words, align incentives for people to participate in their own health care.
If Medicare tomorrow decided to link ambulatory and inpatient performance to the payment process, you would transform the system overnight. Look what Medicare has done by declaring no payment for never events and no payment for hospital-acquired infections and no payment for hospital-acquired skin breakdown (beginning in 2008). Well, we’re changing all of our processes to comply with this new economic reality.
Darling: Everyone agrees our payment system is completely dysfunctional. But it will be very hard to dramatically change the details of the payment system, so incrementalism is more likely, satisfying no one. Ideally, we will begin a process of more basic reforms that will bear fruit and change the incentives in the system to do a better job of paying for primary care and other services, such as e-visits and group visits that are not now eligible benefits.
Wilensky: We need to reward more on a group basis—hospitals and clinicians—for something that looks more like an episode of care.
It’s not easy, and it’s not likely to happen quickly. Some House Democrats are more into the “give me good old price regulations.” But, in the Senate and among some of the candidates, there is interest in developing a more accountable system for the future.
Can pay-for-performance programs wring out enough extra money so that insurance can be extended to all?
Darling: Covering 47 million uninsured will require new money [to be infused] into the system. While there are certainly savings to be found in the current spend, it is not nearly enough to cover all who currently lack insurance. Also, research shows that those newly eligible for Medicare who were previously uninsured have a two- to three-year uptick in healthcare use because of pent-up demand. There may be downstream savings from reducing the uninsured numbers, but that would come later.
More Americans insured and more Americans with access to health care—that sounds like a sure win for U.S. hospitals.
Davis: Hospitals stand to benefit greatly from extending health insurance to all. They would be able to focus on providing high-quality care rather than covering bad debt.
Nash: Hospitals could be busier and bigger than ever with more people having access to coverage. I don’t see dramatic changes in our margin. I think our margin will probably be pretty comparable, but we’ll be asked to do more for less and probably have a higher throughput—in other words, more patients per unit time.
Darling: Congress will have its hands tied by uncontrollable costs—war, Social Security, Medicare, Medicaid—and public (and politician) resistance to more taxes. Congress will return to trying to limit Medicare expenditures by capping or even rolling back what it pays to hospitals. The political battles will be fierce. We know that people want more health care, not less, so bringing the public into the debates will help hospitals, doctors, and nurses. Whether the public will pay more for more services is less clear, although they often tell pollsters they will pay more.
What new initiatives do you expect to see from the next administration?
Wilensky: There seems to be a consensus that we need better information on comparative clinical effectiveness and best practices. The idea is not without its challenges or challengers, but support is relatively widespread.
Darling: It would be possible to enact into law programs that improve safety and quality but do not require substantial government outlays. Advancing health information technology through incentives, continued relaxation of Stark rules, uniform standards for interoperability, and a single personal identifier are all possible without large investments, especially if the federal government uses its power as a purchaser, not as a regulator, to drive change.
Which state healthcare reform program is the most intriguing? Which state programs are good models for federal adoption?
Davis: The Massachusetts plan for universal coverage is a very promising model. The Commonwealth Health Insurance Connector, which helps connect employers and individuals with affordable sources of coverage, is an innovation that bears watching, as well as the Health Care Quality and Cost Council, which coordinates policies and practices to lower costs while improving quality.
Darling: The Massachusetts plan is the most promising state healthcare reform in the past 40 years. It was enacted into law for some reasons that are specific to Massachusetts: a low uninsured rate, an existing uncompensated care pool to help pay for covering the uninsured, a willingness by Massachusetts citizens to provide services to those without means, and a group of leaders that did the hard work to make it happen.
Massachusetts’ relative success should give ideas to candidates for what might work best for the nation. Large employers support a national solution for covering the uninsured, including workers who do not have employer–based coverage. All U.S. residents should be required to have a core insurance plan with evidence-based preventive benefits, hospitalization, and reasonable cost-sharing.
State reforms that include overly rich mandated benefits will just exacerbate the healthcare cost problems. We have to worry about affordability with exactly the same commitment and energy as we have for universal coverage. They are inextricably linked.
Davis: Maine’s Dirigo Plan, which aims to cover all uninsured residents by 2009, is an important effort because it also seeks to control costs and improve quality. Although Maine already has one of the lowest uninsured rates in the country, its experiences in working to cover all its residents can provide valuable lessons to other states—and the federal government—on ensuring that health care coverage is affordable.
Other states provide examples of quality improvement and cost-control strategies. New York’s Medicaid managed care program provides incentives for plans with high quality ratings. In Iowa, a Medicaid primary care case management program has shown promising results, including substantial cost savings.
The Wisconsin Collaborative for Healthcare Quality is a public/private collaboration among physician groups, hospitals, health plans, employers, and labor organizations to enhance transparency and promote quality in the healthcare system.
In Kansas, the Health Information Exchange Commission is a public/private effort to promote cost-effective care delivery through information technology. There are many other promising models in other states, and it is encouraging to see action in many areas. However, ultimately we will need a national solution to the problem of rising numbers of uninsured.
How can healthcare provider executives become active participants and consensus-builders in achieving a sustainable healthcare system?
Wilensky: Hospital leaders can help shape the reimbursement system of the future so that if they provide efficient, high-quality care, they are not hurt financially, but rather rewarded. Are hospital executives going to just fight for the highest reimbursement they can get for today and tomorrow—or do they really want to proactively get in and redesign the system themselves? Because the fact is, we have an unsustainable healthcare spending situation.
Darling: Employers, CMS, and other purchasers are deeply concerned about patient safety and preventable medical errors, including hospital-acquired infections. Providers, starting with trustee boards and senior leadership, should lead this movement and make safety the highest priority. Everyone will benefit, and significant costs will be reduced through lower lengths-of-stays, fewer readmissions, and improved productivity.
In addition, provider executives can work with employers, insurers, consumers and other purchasers, including government, to take the burden off emergency rooms, where the costs of care and the likelihood of duplicative or inappropriate care are the highest. For example, hospitals might partner with convenient care clinics to provide urgent care for minor problems.
Dean: Leadership takes action. We encourage hospital leaders to remember that the hospital is integral to the community and exists to provide an extraordinary service at all hours of the day. Healthcare and hospital executives must take steps to protect that community resource by engaging with their political leaders. For example, CHW is a co-architect of San Francisco’s new plan that offers insurance to all 82,000 uninsured residents. We also are co-founders and active participants in several statewide and federal coalitions that are actively seeking reform. In California, we are in daily discussions with Gov. Schwarzenegger, the Speaker of the California Assembly and the Senate President Pro-Tem about healthcare reform. We are encouraged by the progress made to date. We live in a democracy in which you must get involved if you want change, and we encourage others to do the same.