by Mike Huntington M.D.
I was a radiation oncologist for 32 years, I enjoyed helping people through rough times and using the latest in technology to cure or alleviate cancer. But what made me particularly sad, and I mean right here,… was having patients come to us with advanced cancers after suffering symptoms but avoiding medical care for months or years because they could not afford or qualify for insurance or health care. Every time this happened, and it was way too often, I thought surely we could do better. I found out that most other developed countries did not let this happen to their people. Cover Oregon slide: In 2008 I served on the Federal Laws Committee of the Oregon Health Fund Board and had a close look at how legislation and policy are created. I was very impressed with the abilities and dedication of the hundreds of volunteers and staff working on health care reform then and since then with the Oregon Health Policy Board and the CCO process. But, how did we do?
Race: The three panelists have been asked to help you wager on whether the healthcare reforms resulting from years of planning here in Oregon and nationally will win, place, or show.
Success: First, we need to agree on the location of the finish line. An accepted and reasonable definition of success is: the best healthcare for the most people at the least cost. This definition, also known as the Triple Aim, has been an underlying theme used world-wide for health care improvement over the past several decades.
Detours: Detours can be tempting. How much should government be involved, what are rights and how do my rights balance with the right of a society to determine a public good and to provide it for all. Should anyone profit from or pay for another person’s illness? What about birth control or abortion? It will take discipline and focus to bring the discussion back to the real goal: the best health care for the most people at the least overall cost. As a matter of compassion, common sense, national security, and protecting the freedoms of all who are now shackled by illness or inability to afford care, we must eliminate these detours that continue to isolate millions of Americans from health care.
Converging lines: What will the ACA, Cover Oregon, and Coordinated Care Organizations accomplish? Some good things. They will increase the number of insured Oregonians and may reduce government spending eventually. But they will reduce spending mainly by shifting costs from insurance companies and government to providers and patients rather than controlling the exorbitant pricing of our health care. What they will not change is the appearance of this graph: family premiums eclipsing total family incomes by 2033. What this slide really says is that we probably can’t afford to take a breather and wait to see how the market, the ACA, and CCOs will do. You can see how they are trending. By 2021 premiums are projected to equal half the average family income. In a few minutes I will suggest how we can avert this catastrophe.
What is…1: One of your handouts is the first page of a 7 page assessment of the Affordable Care Act and how well it serves the principles of an effective health care system. The principles were published by the Institute of Medicine in 2004. Please see or email me for the full document.
The IOM principles are these: healthcare is available to everyone. There is good continuity of care. Health care is affordable to individuals and families. What is…2: The health insurance strategy is affordable and sustainable for society. Health insurance enhances the health and well-being of the population: allows access to high-quality care that is effective and efficient save timely patient centered and equitable.
So how does the ACA measure up? The ACA has allowed many people their first chance to have at least nominal insurance and protection from medical bankruptcy, but it has many adverse features that will in the long run undermine these benefits. The most notable of these are listed on one of your handouts.
Coordinated Care Organizations are designed to improve the delivery of care through changes in how we pay providers and using innovations in delivery such as the the patient centered medical home. I think that CCOs will provide us a valuable research tool, have a place in our health care system, and may show us better ways to deliver care… but not win the race. Competing with and undermining these noble efforts of the ACA and our CCOs is the very fragmented private insurance system in which companies survive only by avoiding the unhealthy, the very people who need care, and dumping them onto their competitors, or more likely, onto public programs like CCOs. It’s called cherry picking and lemon dropping. To stay in business US insurance companies learn to be superb at this kind of orchard husbandry. We really can’t blame them for trying to keep their companies solvent. But we must blame ourselves if we do not make our government create a system that prohibits this behavior of cherry picking and lemon dropping. Insurance companies have already adapted this behavior to the ACA. Although they can no longer deny an applicant because of a preexisting condition, they can drop hospitals, drugs, and services that people with expensive preexisting conditions use. We cannot improve the health of our population if we systematically exclude those most in need.
Sally and Kelly: Now some stories that will personalize what we are talking about. Sally et. al.: On the left is a veterinarian from Monroe, Oregon, and on the right is a young mother and artist from Lincoln City. What these individuals and many others have experienced with our health care system is likely to continue in spite of the ACA, Cover Oregon, and CCOs.
In the mid-1990s Sally had a stroke which left her unable to fully attend her practice and maintain her income. She then developed uterine cancer. By the time she completed paying for the second illness she had taken a mortgage out on her small farm, spent that money on health care and by July 2011 her farm was up for auction. She was just one of 750 Oregonians who file for bankruptcy each month. Most of them had health insurance.
The young artist has two children and last year paid $451 a month for a $15,000 family deductible. She had “insurance” but could not afford the deductibles to obtain healthcare. She basically was purchasing ransom on her house so that she would not lose it if she had a serious illness. It’s possible that through Cover Oregon or Medicaid she will have easier access to healthcare and because of new caps on out-of-pocket expenses, she has less risk of losing her home. But even with increased Medicaid coverage this young woman may not be able to find a physician, particularly a specialist, who accepts Medicaid patients. If her income qualifies her for a private plan through Cover Oregon, she may still have difficulty affording healthcare with or without and subsidies. The ACA gives her a buffer for now but bankruptcy remains one accident or illness away. No other developed country allows this to happen to their people.
Grieving slide: click 1 Each month 750 Oregonians die because they could not afford health insurance or health care. Will the recent legislation change this? I don’t know, but I suspect that deaths due to lack of insurance will parallel the medical bankruptcy rate and remain unchanged or worsen.
This Time Magazine article you may have read is entitled, Why Medical Bills Are Killing Us. Just about all healthcare services cost Americans two to 10 times as much as they do in other countries. We have let this happen because we have avoided public policy that effectively pursues the best care for the most people at the least cost. We have been too easily distracted by the detours mentioned earlier.
The exceptionally high cost of health care in this country is the prime reason that about a third of our population is excluded from care and therefore a hazard to our entire population and its economy. Does the ACA and Cover Oregon decrease overall cost? No. The Center for Medicare and Medicaid Services (CMS) projects a 13% increase in administrative costs from 2013 to 2014 due to the administrative complexity of the ACA. Will the CCO’s decrease costs? Yes, for government, but only when expenses reach the capitated limit and then are shifted back to providers or patients.
Our system is uniquely expensive for another reason. We are inundated with advertisements and courted with technology and pharmaceuticals. We are offered what might appear to be the best and latest treatment, but 30% of our medical treatments now are either ineffective or even dangerous to us. By overusing technology we create risk for ourselves, high cost to the system, and diversion of money from services that can produce better care for more people at less cost. The ACA, Cover Oregon will have little effect on this phenomenon.
31% overhead: Finally the administrative costs in of dealing with hundreds of insurance companies and their plans and all of the eligibilities and exclusions naturally result in high administrative costs and will not go away under the ACA and Cover Oregon. In the US we have a 31% administrative overhead including not just the usually quoted administrative costs to insurance companies or governments, but also the costs of dealing with multiple insurances to employers, hospitals, nursing homes, practitioners, and home care agencies. This 31% is likely an understatement because it does not include marketing costs of pharmaceutical firms, value of patients time spent on paperwork and on the phone…
MODA slide: …most of the costs of advertising by providers click x 12, (20 seconds) healthcare industry profits, and lobbying and political contributions. It takes multiple billing clerks and $60-$80,000 per Dr. per year to deal with this chaotic system of insurances.
Single Payer slide: The ACA, Cover Oregon, and the CCOs will not relieve this chaos or prevent this eclipse. Other countries have one half to a third of our administrative costs because they have a single unified system and a fiscally responsible method for choosing what services will produce the best health care for the most people at the least cost. Such a system will be good for individuals, big business, small business, families, and governments. Vermont has passed legislation that has set a course for a single unified health care system in Vermont by 2019. A similar bill will be introduced in the 2015 Oregon Legislature and be referred to the voters in 2016. Please see me after the panel if you want to help this happen.
Massachusetts’ equivalent of the ACA over the past 7 years has increased the number of insured but has neither increased health care benefits nor reduced overall costs or the medical bankruptcy rate.
Slide: (the red line) increasing annually at 6% or more rising at an optimistic 3% annually (blue line)
Insurance companies are not bad, they’re just trying to remain solvent like any business must, it’s just that we’re expecting them to do something we should not expect any private business to do: provide a public good while competitors .
We have not yet decided that the public needs to make its governments negotiate price with the pharmaceutical and medical device industries and with providers. Successful healthcare systems in other countries have done this for decades and do not leave the price of health care to whatever the market will bear. Providers and medical companies have thrived in these countries.
Instead this legislation reinforces an opaque collusion among the insurance and medical industries in which we finance our hospitals and clinics by extracting income from the ill and walking wounded or worried.
The CCO’s will incorporate capitation, global budgets, and emphasis on primary care for the Medicaid population which may be able to reduce costs and improve care.
But as an article in last week’s Journal of the American Medical Association pointed out, favorable results from CCO type innovations may be restricted to certain patients populations and not generalizable.
The ACA and therefore Cover Oregon do not honor these principles of the IOM and will not achieve the best care for the most people at the least cost.
Currently there are single payer bills introduced in Congress by Representative John Conyers of Michigan and Senator Bernie Sanders of Vermont (like shifting from fee-for-service payments to bundling of payments, capitation of payments, salaried providers, and using pay-for-performance)
But I was also impressed with the great power that is wielded by organizations and individuals who didn’t understand the concept of the best care for the most people at the least cost. (Upton Sinclair said, 'It is difficult to get a man to understand something, when his salary depends on his not understanding it.')
Since 2007 I have studied many reports about healthcare systems and talked to others from the US and around the world. I became convinced that health care and healthy living conditions for everyone are essential elements of a happy, healthy, and productive society and that achieving those goals should be the central focus of my activities as a citizen.
We have not yet figured out how to prospectively finance healthcare services that we all need and expect to be available at any time.
Two of these triple aims are relatively easy to quantify (most people and least overall cost). Best care is a tougher because it’s harder to define and measure. But around the world there are accepted definitions and measurable criteria we can use to judge our success. These have been established and reported by organizations such as the World Health Organization, the Organization for Economic Cooperation and Development, the Commonwealth Fund, within our own country, the Kaiser Family Foundation and the Institute of Medicine.
But a study published last week in the JAMA shows that the key health care delivery concept in CCOs the PCMH, results in limited improvements in quality and no reductions in use of the ER or hospital. The article concludes that the PCMH may be suited to the 20% of patients who generate 80% of the cost but not effectively applicable to a general patient population.
Click here to view the MS Power Point Presentation from the talk.