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Click here to visit C-SPAN’s website pertaining to Oral Arguments regarding Health Care:  http://www.c-span.org/HealthCare/

Oral Arguments . . . Transcript . . . Day 1

Click here to access a copy of the Oral Argument Transcript (Monday):  http://www.c-span.org/uploadedFiles/Content/The_Courts/11-398-Monday.pdf

March 23rd . . a Special Anniversary

Today marks the 2-year anniversary of the enactment of the Affordable Care Act (www.healthcare.gov).

Today also marks the 14-year anniversary of my authorization to act in the following capacity:  Life, Accident and Health Agent (State of CA). 

AIA OBSERVATION:

The Affordable Care Act is the LAW OF THE LAND…despite the ongoing “DEBATE”.

The Supreme Court is hearing Oral Arguments pertaining to specific provisions within the law, chief among these being the INDIVIDUAL MANDATE, and whether it falls within or outside of the Federal Government’s scope to impose a ”purchase or penalty” requirement on free citizens. 

Whatever the outcome of this debate, the Affordable Care Act is likely to be a force to reckon with for the forseeable future. 

STAY TUNED . . .

Roundtable discussion (continued)…

Goal: to revamp the tax-treatment of healthcare premiums.

The following observations are offered for your possible consideration, unedited and in no particular order.

Health Care Legislation
Senate Finance Committee

Robert Greenstein
Center on Budget & Policy Priorities
Executive Director

Single National Cap tied to actual costs tied to different regional differences — ideally, the variations from region to region should unify

Sen. Olympia Stone R-Maine

Jonathan Gruber
Massachusetts Inst. of Technology
Economics Professor

Sen. Orrin Hatch R-Utah — asked if capping the employer exclusion would be unconstitutional.. Re: uniformity clause — it was proposed that regional caps could be implemented

Edward Kleinbard
Joint Committee on Taxation
Chief of Staff

Problem: how to reasonably account for regional (geographic) variations

The Tax Code does not account for regional variation specifically tied to cost of living

Solution: The IRS does not care where you live — the IRS does not police regional variations James Klein American Benefits Council President

NOTE: agreed with Senator Baucus’s assertion that physician reimbursement should tie to outcomes

Senator Maria Cantwell
D-Washington
NOTE: The Senator from Washington State suggested that systems already exist that work and can be applied across the country without having to raise taxes on employers or members.

Gail Wilensky
Former Medicaid & Medicare Administrator, 1990-92
NOTE: took issue with Senator Cantwell’s assertion that best practices already exist on which to model the proposed reform. She went on to address how costs of care, data tied to expectations and outcomes, and specifically end of life treatment must be acknowledged.

John Sheils
Levin Group Health Care Consultants
Senior Vice President
NOTE: made reference to studies that highlight the link between incentives (reimbursement) that could alter a physician’s behavior

Note: Mr. Sheils suggested that Agents/Brokers should be presenting multi-plan options. AIA Note: We have been proposing such products for several years.

Katherine Baicker
Harvard University
Health Economics Professor
IMPORTANT contribution to discussion by encouraging the implementation of reimbursements for quality care, not quantity of care.

Additional comment: should the tax code be subsidizing areas where the quality of care is lower..

Several speakers made reference to the Dartmouth Research

Stuart Altman
Brandeis University (MA)
Health Policy Professor
Move away from fee for services - penalize practioners that offer low quality services. Disagrees with the notion of applying a cap to employer exclusions as the primary vehicle to effect desired outcomes.

Joseph Antos
American Enterprise Institute
Health Care Policy Scholar

Sen. Blanche Lincoln
D-Arkansas
Reminded participants that regional variation is not necessarily tied to actual performance. She is concerned that States with lower wages and cost of living, and lower cost plans, should be expected to subsidize, through higher taxes, other States that do not have the same regional circumstances.

Note: there are no Insurance Commissioners involved in these discussions. Why not? We need to move away from a federal approach, and bring the States back into the discussion.

Leonard Burman
Urban Institute
Tax Policy Director

Sen. Jeff Bingaman
D-New Mexico
Assumes that much of the increase in costs are tied to improvements in technology.. Comparative effectiveness should be the basis on which reform is driven.

Gerald Shei
AFL-CIO, Assistant to the President of Governmental Affairs
Note: critical of the “competitive” component

Steve Wolcik
National Business Group on Health Public Policy Vice President Endorses the need for a strong comparitive analysis. Observed that the proposed tax exclusion has major implications for employers (particularly self-insured employers).

Senator Baucus observed that providers within the same geographic area provide care on significantly variable costs structures. Note (AIA): outcome should be the key… Providers should not be required to charge consistent with a national guideline. Variations result from best practices, investment in equipment and technology, staffing, overhead, etc. It’s just business!

Important: James Klein proposed that healthcare is sought and provided in connection with ethics, values, faith, etc., and fall outside of the “norms”. Therefore, the discussion must broaden to acknowledge that investments in technology should be encouraged.

Sen. Tom Carper
D-Delaware
Critical of the lack of communication - proposed the use of stimulus $$ to developing information technology.

Example: KATRINA - the ability to access data using IT was critical in the delivery of healthcare under extremely difficult circumstances. This was presented as an argument to move toward the development of IT so that records are easily referencible so as to avoid redundant or duplicate services….and reduce costs as well.

Doctors and Hospitals should be encouraged to cooperate. However, there is a strong argument to avoid cooperation on the basis of sound business reasons. Kaiser Permanente was cited as an example of the benefits of cooperation among providers, but there was agreement that Kaiser was not the greatest example since the physician’s are employees of the company.

Mr. Gruber inferred that we are moving toward a rationalization of healthcare…..! I take issue with this inference.

Mr. Greenstein criticized the tax-shelter incentive included in an HSA.

Sen. Ron Wyden D-Oregon
Observed that choice is expanded or restricted based on regions.

The Democratic Senator from Michigan offered an observation that employer’s want to be in the healthcare business. Despite competitive pressure coming from international competitors, employers want to continue offering coverage. There was agreement that any reform should acknowledge and build upon the employer-sponsored approach to healthcare distribution.

Mr. Burman acknowledged the employer component, but suggested that larger employers are in a better position to leverage the advantages inherent in the current systems, and that smaller employers simply cannot afford to offer coverage.

AIA Note: Small employers have many options.

Mr. Shea (AFL-CIO) proposed the Public Health System. Senator Schumer (D-NY) jumped into the discussion and enthusiastically endorsed the idea of a public health system.

Sen. Baucus then asked Mr. Shea to offer some suggestions on “bending the cost curve”.. He was asking for 2 or 3 suggestions that acknowledged quality, cost containment, etc.

The program stopped…..(Really, stopped!)

We did not request transcripts of the remainder of the session, but remain encouraged and optimistic by the generally positive tone of the discussion. Certainly, there dissenting opinions, but the core ideas are making it through the clutter.

C-SPAN……full disclosure

On Tuesday, April 21st, 2009, the Senate Finance Committee held a roundtable discussion on “Reforming America’s Health Care Delivery System“.

Senate Finance Committee Chairman: Senator Baucus http://baucus.senate.gov

Additional Reference: http://baucus.senate.gov/newsroom/details.cfm?id=311800

The Chairman opened the meeting by quoting Hubert Humphrey… “Freedom is hammered out on the anvil of discussion, dissent, and debate.“

We watched the entire discussion (on your behalf), unedited, and offer the following observations for your consideration (duration 3 hours):

* Geisinger Health System (http://www.geisinger.org/about/index.html), founded in 1915; a physician-led health care system

STATED OBJECTIVE:

• Cost and Quality Improvements

OBSERVATION:

• Any reference to the manner in which healthcare is currently distributed was largely cynical. There is general agreement that the system is broken! We take issue with this assumption, as did several of the contributors to this discussion.

Side note: Interestingly, the Chairman (Senator Baucus) interrupted the meeting to vote on the confirmation of Kansas Governor, Kathleen Sebelius, as the Health and Human Services secretary-designate. The panel voted in favor of the nomination of 15 to 8. The call to vote was hasty, and there was some dissent. In particular, the Minority Whip opposed the nomination because of the Governor’s unwillingness to directly acknowledge and oppose any effort to use collected PHI and clinical data to DENY COVERAGE. This has serious implications! Nobody on the panel or otherwise acknowledged this concern for the duration of the session.

As previously indicated, the Geisinger Method (the “System”) would prove to be a dominant and recurring point of reference throughout the discussion. Most speakers referred to the “Geisinger Method” in one way or another. It was as if the group was predisposed to accepting the System as an example of a Best Practice.

Dr. Korn, on behalf of the “Blue’s” offered a balanced and positive perspective underscored by a willingness on the part of his organization to promote a cooperative, non-partisan spirit. Further, he proposed that the panel go to the communities to emulate best practices that are already in place. He, on behalf of his organization, offered to share such practices with the hope that a vigorous and active debate could yield favorable results. Note: Ron Williams (Aetna) – echoed Dr. Korn’s perspective, but warned that the country would be better served by a thoughtful and predictable course of action, rather than moving too quickly in an attempt to sweep the current system out. He echoed Dr. Korn’s willingness to share ideas and remain legitimately open to suggestions. Further, Mr. Williams emphasized the importance of implementing corrective action that is predictable.

During Mr. William’s testimony, a Senator interrupted and asked if Mr. Williams was supportive of a competitive bidding process, to which Mr. Williams admitted that he is unclear as to precisely what is meant by competitive bidding. The Senator replied that competitive bidding would be based on the actual cost of health care distribution and not some government-mandated rate. He responded by returning to the need for predictability, whatever the course of action. Mr. Williams very clearly stated that the employer-based system is both innovative and progressive. Note: Peter Lee also acknowledged the strength and innovation inherent in the employer-based system.

There was acknowledgement that the United States leads in the category of ‘rescue care”….they are second to none, and the margin is wide. Senator Hatch posed a reasonable question; how can the United States translate the disproportionate leadership in the “rescue care” category to the “primary care” category. Dr. Frank Opelka replied by talking about the attrition in the healthcare workforce, and the grave risk to our country if medical school enrollments continue to drop. He considered this too be critically important, and inferred that unless medical school enrollments increase, then the discussion is largely moot. After all, unless there is a skilled and competent primary care physician, then any effort to improve the system would be accomplished at the expense of the citizen that has a reasonable expectation of care administered by competent care givers.

Debra Ness effectively articulated her conviction that the effectiveness of any solution that is ultimately applied must be evaluated through the prism of patient value and patient need, and even suggested that a patient “voice” must be invited to the meeting. She emphasized the importance of freedom in provider selection, and reiterated the need to make certain that physicians are competent and well trained.

There was an appropriate focus on senior citizens (elders) and other patients that are at greater risk of being underserved. Mary Naylor offered some very specific input on a variety of categories. She was obviously well rehearsed and interestingly hand-picked by the presiding Senator. She acknowledged coordinated efforts with Aetna and Kaiser Permanente specifically, while joining the parade of fans touting the effectiveness of the Geisinger method.

Appropriately, Ms. Naylor’s comments were followed by an inquiry by Senator Chuck Grassley (R – Iowa – Finance Committee Ranking Member) that re-introduced balance to the discussion (obtain a copy of the transcript for possible future reference).

Note: Dr. Glenn Steele was very assertive and seemed emboldened by the prominence that he was given by the Senators, as well as some of the panel participants. He repeatedly made reference to a ‘Plan B’, but acknowledged that Plan A which combined innovation and technology is the preferred route. When pressed to provide additional details on Plan B, he inferred that it would be unpleasant, and refused to elaborate beyond that. He did this several times throughout the discussion, without objection. It was as if there was some unwritten agreement that only certain members had knowledge of.

Senator Tom Carper (D – Delaware) suggested the need to offer a “Safe Harbor” to healthcare providers that are operating as required; performing more tests and procedures designed to promote wellness in an effort to avoid catastrophic or chronic conditions and poor outcomes. Goal: Prevent avoidable hospital re-admissions. This is fine if the reduction in re-entry into the healthcare system is based on positive outcomes and reduced need, as opposed to government decisions regarding ongoing care.

Senator John Ensign (R-Nevada) – proposed that the patient needs to have “skin in the game” – putting the patient into the accountability loop. He was really just promoting the “consumer-directed” approach to funding and utilizing. He proposed a patient-protected approach that demands accountability on the part of the patient. Overweight people should slim down, smokers should quit, etc.). Nothing new….

Debra Ness promoted the idea of patient-engagement, and then rattled off a bunch of assumptions about what “they” need (”they” being the American citizens that utilize healthcare). She was assertive but not compelling. This was in contrast to Lewis Morris, on behalf of law enforcement, who felt it appropriate to remind the government of its obligation and ultimate accountability to the Taxpayer. Good!

The dialogue was vigorous and largely positive in tone. The loyal opposition was mostly quiet, but their influence was evident throughout the entire discussion resulting in a soft push-back from several panelists and committee members. DOWNSIDE: Everybody seemed ready, eager and willing to use OUR money to tackle the challenge of reforming our healthcare distribution system. Look out!

WARNING!

Dr. Glenn Steele was assertively instructing the panel on how Government, by defining “best practices” and any myriad of topics related to the distribution of health care, and then developing a mechanism to deliver these best practices, could really make a lot of progress. He then suggested the value of engaging the services of somebody like him (inferred) to oversee such an undertaking. He was clearly the prominent panel member, and obviously inclined toward the implementation of a government approach modeled after the System that he oversees.

Senator Ron Wyden (D-Oregon) criticized the employer-based system of healthcare distribution, suggesting that this approach limits choice. He then praised the System (Geisinger method) and claimed that the American people want to be able to choose this kind of approach to healthcare.

Glenn Hackbarth, eager to join Senator Wyden’s criticism of the employer-based system offered his unsubstantiated opinion that employer’s have traditionally restricted choice, while keeping the best (or savings) for themselves. This is not an appropriate characterization, and does little to promote the type of dialogue that can lead to a positive outcome.

PUSH-BACK (Restored a positive tone)

Dr. Korn suggested that representatives from the CMS (http://www.cms.hhs.gov/default.asp?) should be present for any future discussion. He reiterated his organizations’ willingness to come to the discussion open and eager to find solutions. His timing was right, and seemed to inspire a flurry of artificially-contrived contributions to the discussion. However, the positive tone was quickly mitigated by comments from Mr. Steele. OBSERVATION: every contribution offered by Mr. Steele was warmly received by Senator Baucus. In fact, we observed that their exchanges were so familiar that one could not help but wonder if they had agreed beforehand to present a coordinated message, as compared to participants in an open discussion, committed to finding real solutions to tough issues.

Ron Williams (Aetna) managed to squeeze a commercial into his testimony by highlighting the contributions that Aetna has made by using technology and innovation to raise the level of transparency and choice. As insurance experts, we applaud his effort to offer reasonable assessments to a panel which was obviously predisposed to the “America hate’s the greedy corporations” mindset.

Not surprisingly, Senator Charles Schumer (D-New York) politicized the discussion by reminding everybody of the distinction between the conservative and liberal approach. He prefaced his commentary with an apology for not being able to attend the entire session, but pompously indicated that he had been monitoring the discussion in his office. He suggested that a “Public Plan Option” may be the solution and then directed some loaded questions toward Dr. Korn (Blue Cross Blue Shield). He questioned why the Blue Cross Blue Shield organization was “standing in the way” of real progress, and wondered if the carrier’s main concern was simply an effort to leave well enough alone, restrict choice and protect their monopoly. To his credit, Dr. Korn responded by asking the Senator what he wished to accomplish by pitting the government against the private insurance industry. He argued that doing so would erode the level playing field that is so critically important in a free-market.

Senator Max Baucus very appropriately pushed back at Senator Schumer’s attempt to politicize the issue, and reminded everybody that this session’s discussion was focused on healthcare distribution, and that a follow up session would focus on plan specifics. Senator Schumer persisted and then invited Mr. Williams (Aetna) to respond to his comments. Mr. Williams acknowledged the Chairman’s reminder and simply stated that “everything is on the table”. Although Schumer attempted to discredit him, the approach failed (for now)!

Dr. Glenn Steele continued to press for an integrated approach similar to the “System”, rolled out in a limited way, in conjunction with community based organizations, and then based on the outcome, to expand in a scalable manner throughout the country.

CONCLUSION:

Senator Baucus was a very competent moderator, and effectively established the groundwork for a bi-partisan approach to dealing with healthcare. We are hopeful, optimistic and looking forward to positive outcomes.

What’s next…?

May 5: Roundtable Discussion #2 on expanding health care to all Americans

May 14: Roundtable Discussion #3 on financing health care reform

Stay tuned!

Now Healthcare?

As the postman walked away, I offered up some unsolicited input. He was receptive, so I commented that this is one of the few things the Government does right…. He paused, stepped forward and said, actually we don’t always do things well.

He shared a few other things that really got me to thinking…

As delivery personnel retire, their routes are re-distributed. Their positions are not filled.

There are reports that the Government has suspended capital investments for five (5) years…

Office personnel with “time on their hands” are shadowing delivery personnel to see how long they are taking delivering the mail.

Working conditions are not particularly favorable…

It was eye-opening on many levels.

Now they want to tackle HealthCare.

stay tuned!

Let’s get on with this…

We are not naive… this past year was brutal for many, many people.

Our agency is privileged to be serving businesses across a variety of industries.  Doing so places us in a unique position to observe the processes and systems that our clients use to achieve organizational objectives under a great deal of pressure… unprecedented in many respects.

Some choose to stay the course, not blindly, but firmly committed to long term objectives set into motion well before the current economic downturn, while others are forced by circumstances beyond their control, to make quick, sober assessments of the state of their businesses, and to make tough decisions as a result of the challenges they face.

Our nation has exercised its prerogative and “change” is upon us.  Given a clear choice between the familiar and the possible, America has chosen a promise, even if the definition of her objective remains ambiguous.  It is this exercise of our distinct freedom that renews our enthusiasm and compels us to reach for the stars!

We hope that you will feel free to jump into the dialogue, but whether or not you choose to do so, we trust that you will drop by from time to time just because…

Happy New Year!