Regina Herzlinger and Richard Boxer, MD, FACS, who identify themselves respectively as being “left and right of center,” hold out hope for bipartisan policy solutions to the challenges facing the nation’s healthcare system. Herzlinger is Nancy R. McPherson Professor of Business Administration at the Harvard Business School, and Boxer is founder and managing partner, Boxer Health Strategies, and clinical professor of urology and visiting scholar at the David Geffen School of Medicine at UCLA . Both Herzinger and Boxer believe the next administration will adopt a public option that will appeal to Republicans and Democrats because of its fiscal soundness from being operated on a pay-as-you-go basis, like a private-sector insurance plan.
In describing the benefits of such a plan, Herzlinger said, “Unlike Medicare, it does not charge current users about half the cost and pass the rest on for future generations to pay. Rather, its low costs come about because it takes advantage of Medicare’s massive administrative economies.”
Herzlinger suggested the public option would be lowerpriced than many traditional plans and thus enable more coverage of the uninsured. “But it will also be the domino that will cause the whole system to cascade,” she said.
“Private insurance plans will be forced to compete with the public option. They can do things that a public plan cannot, such as offer medical travel to high-quality, low-cost providers. So this is really bipartisan: low-cost, fiscally conservative and competitive for the Republicans, and a public plan that widens coverage for the Democrats.”
“What’s needed to make this happen is management of the plan by financially savvy people, like HFMA’s members, and oversight by healthcare accountants who would attest that it follows GAAP,” Herzlinger said.
Regarding the near future, Boxer added , “I think that, unfortunately, there is no question that nothing is going to get done. No one will be even thinking of the future because they're so completely immersed in the present. Hopefully, after the 2020 election, our national attention will turn toward improving healthcare delivery and the fiscal means and methods necessary to achieve the new goals.”
Richard Boxer underscored that the U.S. healthcare system is on an inexorable move toward profound change. “It is presently too unmanageable, too expensive, too unresponsive to the changing demographics of the nation, too dependent upon hospital-based bricks and mortar and too dependent upon magical accounting with financial gimmicks, which ultimately cause the system to be too dependent upon future generations paying for it.”
But the factors driving change represent not only megatrends but also mega-opportunities, he emphasized. He and
Regina Herzlinger cited three major innovation opportunities:
- Cutting costs by developing new sites for care and new types of workforces
- Empowering consumers with information and self-help capabilities through apps and wearable/implantable sensors
- Commercializing technology through personalization and telemedicine
Herzlinger suggested innovation would require a move away from some popular current solutions: “Sadly, the ACOs are destined to fail. Nowhere in the economy do you see vertically integrated organizations on the scale of the ACOs.
The activities in these kinds of organizations are simply too diverse to manage successfully.”
Other current solutions hold promise, she said, noting that bundles for procedures are simpler to execute and can cut costs by improving the quality of care. “But the 800-pound gorilla of the healthcare system — people with chronic diseases — is left untouched by the bundlers,” she said. “What we really need is bundled care for these diseases, such as diabetes and all its 34 common comorbidities.”
Boxer suggested it will be innovations in healthcare delivery, not new policies or planning around payment, that will help the nation reduce its costs of healthcare. “I think that in certain respects, we're going to cure our way out of some of the healthcare crises rather than centrally plan our way out. If, for example, you find a cure to a disease, you don't have toworry about that disease anymore,” he said. “There is no need for iron lungs for polio victims because of the vaccine.”
Focus on efficiency