A Big Day For Health Care Reform

Yesterday was a big day for health care reform because the US Senate Finance Committee voted and approved its version of a health care bill, proposed by committee chairman Sen. Max Baucus. In a final vote of 14 to 9, all committee Democrats and one Republican – Senator Olympia Snowe – approved the bill. This was a nearly one sided vote, but the key point is that a major proposal is now formally on the table for much wider debate. This said I expect many changes are still to come in relation to health care reform legislation. However, for any meaningful change to occur, the topic must move from closed meeting rooms to a more open debate beyond simple media-based exchanges.

The Congressional Budget Office says this bill will cost $829 billion over 10 years, reportedly making it the least costly of all bills proposed by Democratic lawmakers (in comparison to the $1 trillion plus price tag on some of the other bills.) The Senate bill is considered “bi-partisan” by many observers, but based on the media coverage this morning it is still hard to consider discussions in Washington as anything approaching bi-partisan. There are some good elements to the current bill, but there are also many issues that still need to be addressed.

For example, the bill includes a mandate that “all” individuals have insurance coverage, along with subsidies for individuals who fall below a certain income level.  But the American Hospital Association (of which WakeMed is an active member) and many other health care organizations are concerned that the proposed penalty for not obtaining insurance – which would equal about 15% of the cost of the required coverage – is too low to actually impact anyone’s decision about obtaining the “mandatory” coverage. In other words, many people may simply take the risk of incurring a small penalty as opposed to spending the higher price necessary to obtain coverage.  And while this may seem like a personal decision, it has a widespread impact. Currently, and perhaps into the future, we all help pay for the care provided to most people who are uninsured or underinsured. Basically, their care is covered through shifting the cost of their care to anyone else who is paying into the system – insured patients, taxpayers and companies. Additionally, safety net organizations like WakeMed often end up absorbing the cost of care into their already limited budgets.  So even if you don’t think you have an “interest” in the health care reform debate, I can assure you that all of us do – directly or indirectly.  Decisions made in DC have a real impact throughout the country and here at home.

Another dilemma: the bill’s financing is largely based on concessions agreed upon with the White House by pharmaceutical companies, physicians, hospitals and other advocacy groups. But the current bill will not meet coverage goals outlined in these agreements.  For example, the American Hospital Association agreed to a $150 billion reduction in reimbursement over the next 10 years if health care reform would insure 94 percent of Americans. The current proposals only insure 91 percent of individuals (at best) and this figure does not include undocumented aliens who would remain uninsured (but will still present to emergency departments, hospitals and physicians when care is needed).  That begs the questions, “Are these deals null and void because the government may not deliver on their end?”  And “With a relatively large number of Americans remaining uninsured won’t cost shifting still be an issue?” The answers to such questions are very important, but for now are unanswered.

One extremely important element of this current bill is that formal results are not reported to Congress until 2016, rendering many changes experimental until that time.   I believe doctors, hospitals, nursing homes, home health, etc. will need to adopt these changes almost immediately in order to positively shift the direction of health care availability and delivery in America.  This said, the United States already has some of the best elements of health care and medical education in the world. But if people are not able to access that care and knowledge, its “availability” is only in word and not deed.

Because of many clinical and process practices at the Mayo Clinic and other leading-edge providers, we already know that some of these proposed changes work. An example is payment bundling where all health care providers receive one payment for treatment instead of every doctor and hospital sending separate bills.  This change in payment structure will be a major political and process challenge for nearly all health care providers and hospitals, including WakeMed. But we are already making plans and adjusting strategies to better understand and respond to the types of changes which appear to be on the horizon.   

Finally, the bill does not include substantial changes to liability reform, even though it is a major issue for health care providers throughout the country.  I heard a story recently on NPR discussing how the cost of health care is driven up by consumer expectations. Physicians in the interview noted that they often order tests and sometimes procedures that are not clearly indicated because of consumer demand and the fear of liability that could result from inaction.  I have received the same exact feedback face-to- face from some members of our own medical staffs at WakeMed. While patients and their families should be appropriately compensated for avoidable medical errors, the current model does not accomplish this. The fear of medical liability results in defensive medicine – complicating the ability of physicians to provide quality, affordable health care.  Somehow, we need to find a middle ground  and perhaps a completely different approach to addressing such matters on behalf of patients, families, physicians and health care facilities.

Despite these challenges, there are many elements in the Senate Finance bill that are positive and need to happen.  For example, there is a provision – the Prudent Layperson Standard— that requires insurance companies to cover emergency department visits if the average person would consider it to be a medical emergency.  We’ve had a similar law on North Carolina’s books for years, but I believe this is an important step forward for the rest of the country.  This provision also demonstrates that emergency departments are going to continue to be the front door for health care delivery in this country.  As I’ve discussed before, we need to find a way to use this front door as appropriately as possible so we can find medical homes for patients without primary care and direct patients to the right place for care right then and there.  Currently, there are many barriers to accomplishing that goal – barriers primarily surrounding Federal (EMTALA) restrictions.

I am pleased that the health care debate has started meaningful conversation about the issues that surround health care delivery in America.  The bill that passed out of committee yesterday is a step in the right direction, but I believe everyone will agree that there is still much work to be done.