Health Care Reform: Some Random Observations
Medical Staff Affairs Monthly, May 13, 2009
There is a general restlessness and dissatisfaction with the current state of affairs in the United States healthcare sector. First, physicians are positively angered by declining reimbursements and frustrated by increased hassles just to get paid. Second, hospitals are straining under the weight of the regulatory and accreditation requirements that multiply exponentially while payment changes fractionally, if at all. Third, employers are dismayed by a never-ending cycle of upward spikes in healthcare premiums, which render them increasingly uncompetitive in a world economy (even such as it is at present). Fourth, the beneficiaries of healthcare coverage, the consumers, are tired of paying more out-of-pocket expense for less and less benefit each succeeding year. Fifth, there is a concern about the relentless growth in the numbers of uninsured and underinsured, all exacerbated by the recent downturn in the economy leaving many previously covered employees now unemployed.
Some of the detritus of this situation includes increasing unwillingness among providers to have to provide services for which there is little or no reimbursement. Physicians try to remove themselves from emergency department coverage or make requests/demands for compensation to provide such coverage. Hospitals, obligated under EMTALA to stabilize and treat anyone who presents to them, are increasingly demanding their fair share for uncompensated or charity care. Even the government is exhausted from its rising healthcare bills because of costs that simply seem incapable of being controlled. Given all this, it is likely that some type of healthcare reform is on a plane about to take off from somewhere. Whether the reforms will be meaningful and thoughtfully address current challenges in a prioritized manner remains to be determined.
Scanning the environment, several peeks at trends that are emerging are enlightening:
- The first is the slowly growing and incessant drumbeat to put better coverage—indeed, universal coverage—and more choice in the direct hands of the consumer of healthcare services. A recent iteration of this theme can be found in the Healthy Americans Act being sponsored by Sens. Robert Bennett (R-UT) and Ron Wyden (D-OR). Under this plan, every American citizen, unless covered by Medicare or a military policy, would be required to acquire a healthcare coverage policy for themselves and their dependents. For those with jobs, employers would help pay but would not be the primary procurers of health insurance coverage. Employees would do that for themselves with pretax dollars provided by the employer. Further, it would offer government assistance to many families to help buy such a policy. Families at or below the poverty line would have the full cost of their policies covered by the government. Those above the poverty line would get a partial subsidy that would totally phase out at 400% above the poverty line. States would create a pool of healthcare policies from which to choose. The essence of this plan is to utilize the power of the government to guarantee healthcare coverage but put individuals in charge of their own health plans. By having universal coverage with individual choice, the theory goes that this would inject competition into the healthcare delivery system, which in turn would cut costs and drive improved quality. But will it?
- The second is the intense debate brewing under this or any other proposal as to whether all the options available are from private insurance companies or whether there would also be a public (read government assisted and controlled) option. Republicans argue that the private options are sufficient and to offer a public government option will render this reform dead on arrival. Democrats argue vociferously that a government-sponsored option is critical as a low-cost option for Americans who are having trouble purchasing insurance in the private market. Further, it would not need to make a profit or pay large executive salaries, an area of some recent scrutiny in our nation. Republicans argue back that any program modeled after Medicare with its power to set prices would have an unfair advantage over private-sector insurance companies and force some out of business. This potentially could attract more consumers away from private insurers and open the door to universal government healthcare. Democrats counter that the well-funded lobbyists of the private insurance companies will carry out deals behind closed doors with no room for consumer advocates. And on and on it goes. Interestingly, recent press coverage of this debate describes it as "cordial" in comparison to the vitriol of the 1993 Clinton plan (The Washington Post, April 21) and characterized by "finesse" that might be able to clear a lot of hurdles (The Wall Street Journal, April 10). But will it stay this way?
- The third and possibly rate-limiting step to all the above is present and commented on occasionally in the healthcare literature but, for the most part, flying under the radar of general public awareness. To ignore it would be foolhardy because it is a fundamental brick in this whole house of cards. The question is: What happens if you indeed compromise and make all these changes—insurance coverage for all, choice placed in the hands of the consumers, public/private options agreed upon—but the providers fail to show at the dance? Increasingly, many physicians are opting out of participating in insurance plans, including Medicare, because of declining reimbursements and increasing bureaucracy and mandates. Likewise, hospitals are dropping coverage with certain payers after inability to reach acceptable contract rates for services provided. Will participation of providers be mandatory?
Healthcare reform is a complex and serious business. The debate at present is appropriately focused on fundamental issues such as access, choice, and private/public options. There is little doubt that there are many moving parts and challenges requiring thoughtful analysis, deliberation, and generation of options. It would be foolhardy to conduct this process without serious input up front from the individuals and organizations that will actually provide the care because, short of mandating their participation, many may just say no. And mandating their participation will lead to another cascade of unintended consequences.
Until next time, be the best that you can be.
William K. Cors, MD, MMM, FACPE, CMSL
Vice President, The Greeley Company
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