FACT VERSUS FICTION:
KEY ISSUES IN HEALTH
REFORM
August 20, 2009
National Press Club
Introductory Remarks
Susan Dentzer, Editor-in-Chief,
Health Affairs
Health Affairs gratefully acknowledges the
generosity
of the following organizations
for support of this conference:
Our premise:
A serious health reform effort warrants a
serious national discussion
.
“Protester,” New Hampshire Health Care Event, August 2009
C. Everett Koop,
MD
Former Surgeon
General
Richard Carmona,
MD, MPH
-17th Surgeon General of the
United States of America
-Vice Chairman Canyon Ranch
-CEO Canyon Ranch Health
-President Canyon Ranch
Institute
-Distinguished Professor of Public
Health, Mel and Enid Zuckerman
College of Public Health,
University of Arizona
David Colby, PhD
Vice President, Research
Robert Wood Johnson Foundation
Fear of “government takeover”
Roll Call, Aug. 13, 2009, 10:29 a.m.
AFTON, Iowa — “Peggy Erskine used a
half-day of her vacation time to give Sen.
Chuck Grassley (R) a piece of her mind
on health care reform; and she wasn’t
alone.
“Erskine, a 61-year-old factory worker,
was one of about 2,000 people who
showed up Wednesday at one of four of
Grassley’s town-hall meetings across
central Iowa farm country.
“And like many of her counterparts,
Erskine had a message for the Iowa
Republican, a key health care negotiator:
Stop President Barack Obama and
Congressional Democrats from enacting
their health care plans.”
Fear of “government takeover”
Roll Call, Aug. 13, 2009, 10:29 a.m.
AFTON, Iowa – Peggy Erskine
“When 9/11 happened, I was very
terrified. But I honestly am more
terrified now. Then, I thought my
government was going to protect me,
and now I’m afraid of my government.
“We have the car industry [being] taken over, the banks were taken over,
and now I feel our health care. And I think we have — we’re leaning toward
socialism, and that scares me to death,” Erskine told Grassley to
enthusiastic applause from most of the 300 who packed the
Methodist church in Afton, after the large turnout forced the event to move
from the town’s small City Hall.”
Panel #1
What exactly is the role of
the U.S. government today
in paying for and/or
providing health care?
How might this change
under leading health
reform bills now in
Congress?
Len Nichols, PhD
Director, Health Policy
New America Foundation
Gail Wilensky, PhD
Senior Fellow, Project HOPE
Former Administrator,
Health Care Financing
Administration
(now CMS), 1990-92
Len Nichols, PhD
Director, Health Policy Program
New America Foundation
Overview
Role of Government in a Free
Society
Health Care Roles of
Government
Research
Regulation
Delivery
Financing
New America Foundation ♦ Health Policy Program
Roles for Government in a Free Society
Public Goods
Externalities
Promote Competitive Markets
Redistribution of Market Rewards
Macroeconomic stabilization
New America Foundation ♦ Health Policy Program
Public Goods In Health
Knowledge  Research +
Dissemination
National Institutes of Health
$30B
Agency for Health Research and Quality
$372m, $50m for comparative effectiveness
Center for Disease Control
$9B, $1.4B for terrorism, $1.9B infectious diseases
Health Information Infrastructure
$20B in Recovery Act of 2009
New America Foundation ♦ Health Policy Program
Externalities in Health
Public Safety Regulation
Food and Drug Administration
Professional licensure
Second hand smoke laws
States and locales regulate restaurants etc.
Federal law governs interstate transportation
New America Foundation ♦ Health Policy Program
Promoting Competition in Health
Markets
Insurance Market Regulation
McCarran-Ferguson Act (1944)
Antitrust enforcement
HMO Act (1973)
Medicare Advantage Plans (1982)
Medicare Modernization Act (2003)
New America Foundation ♦ Health Policy Program
Redistribution of Access to Health
Through Government
Direct Provision
Veterans Administration ($39B, 5m patients)
Indian Health Service ($3.3B, 1.9m eligible)
State and local public hospitals
1,111 hospitals, 23% of total, 15% of beds
(Non-profit 60% of hospitals, 67% of beds)
Grants to community health centers
($2B federal, $500m S&L, 18m patients)
Insurance for poor, disabled, and elderly
New America Foundation ♦ Health Policy Program
Medicare and Medicaid (2007)
Medicare
$418B
Medicaid + SCHIP
$340B
Federal share of Medicaid $192
Total federal public insurance
payments = $610B
New America Foundation ♦ Health Policy Program
Historical Health Spending
Table 1: Historical Health
Spending
1960
2007
Health Spending/GDP
5%
16%
Out of Pocket Spending/Health
Spending
47%
12%
Private Health Insurance/Health
Spending
21%
35%
All Private Spending/Health
Spending
75%
54%
All Public Spending/Health
Spending
25%
46%
New America Foundation ♦ Health Policy Program
Source: CMS Office of the Actuary, National Health Expenditures Historical
Tables
Personal Care Spending by Payer
Other
11%
Medicare
22%
Out of Pocket
14%
Medicaid/SCHIP
17%
Private Health
Insurance
36%
Source: CMS Office of the Actuary, National Health Expenditures Historical Tables, 2007.
New America Foundation ♦ Health Policy Program
Who Pays for Hospital Care?
Other
14%
Out of Pocket
3%
Private Health
Insurance
38%
Medicare
28%
Medicaid/
SCHIP
17%
Source: CMS Office of the Actuary, National Health Expenditures Historical Tables, 2007.
New America Foundation ♦ Health Policy Program
Who Pays for Doctors Visits?
Other
13%
Medicare
20%
Out of Pocket
10%
Medicaid/SCHIP
7%
Private Health
Insurance
50%
Source: CMS Office of the Actuary, National Health Expenditures Historical Tables, 2007.
Public Payment Rates
2/3 of Hospitals have negative
Medicare margins
Medicaid pays differently and less
than Medicare
Both pay less than private payers to
hospitals and physicians
Who are the Uninsured?
<100% FPL
100-199% FPL
200-299% FPL
300-399% FPL
400+% FPL
Uninsured Rate
35%
29%
18%
10%
4.9%
Source: Kaiser Family Foundation Analysis of CPS Data, 2007.
Percent of
Uninsured
36.5%
28.8%
16.5%
7.8%
10.3%
Cost of Health Insurance
Percent of Income
Cost / Value in
to Purchase
2008 Health Insurance
Price of a Family
Policy
$12,680
200% FPL (family of 3)
$35,200
36.02%
300% FPL (family of 3)
$52,800
24.02%
Source: Kaiser Family Foundation/HRET Analysis of Employer Benefits; Department of HHS Poverty Guidelines.
Contact Information
Len Nichols, Ph.D.
Director, Health Policy Program
New America Foundation
(202) 986-2700
Nichols@newamerica.net
New America Foundation ♦ Health Policy Program
Gail Wilensky, PhD
Senior Fellow, Project HOPE and
former Administrator, Health Care
Financing Administration
How Will the Role of Gov’t
Change in Healthcare
Reform?
Hard Question to
Answer!
• Don’t know the specifics of reform
-- The focus seems to have changed:
Health care reform has become health
insurance reform
• Which bill?
House bill? President’s “proposal?”
Senate HELP bill? Senate Finance bill?
Need to Distinguish the
Level and Branch of Gov’t
Not always more gov’t
-- Some changes are state to federal
-- Some changes are legislative branch
to executive branch
But clearly more gov’t regulation
Some Changes Seem
Clear
•
(assuming any legislation is
passed)
increased spending on healthcare by Federal
gov’t
-- Increased subsidies for low income population
-- Increased federal spending on Medicaid
• Total cost is unclear
$1 trillion? $900 billion? $600 billion???
• Savings from Medicare also unclear
$500 billion? $600 billion?
Insurance
•
Increased insurance role for Federal gov’t
-- More federal regulation of insurance
individual/small group requirements
consumer protections
-- Insurance exchange?
unclear if Federal, regional or state gov’t?
-- Public plan???
CMS style agency to operate/manage
Public plan now less likely but not dead
Other Federal Gov’t
Changes
•“MedPAC on steroids,” or “IMAC”?
-- Major shift of power from legislative
branch to executive branch
•Individual mandate
Who enforces? Penalty?
•“Pay or play”
Minimum benefit?; tax penalty?
All represent new or shifting roles for gov’t
Bottom Line
(assuming legislation is passed)
• Significant
•
in gov’t spending
in gov’t power – especially at Federal level
•Significant
in people insured
But health care reform?
Spending slowed?? Outcomes improved??
(tbd…)
Fear of “Medicare Massacre”
Politico, By Victoria McGrane
& Chris Frates, 8/12/09
“Frustrated older Americans
are packing the town halls on
health care. They are
incredibly passionate about
their Medicare benefits.
“Polls show senior citizens
largely disapprove of health
care reform ideas so far.
“And of course, they vote —
in larger numbers than any
other demographic.”
Source: http://www.politico.com/news/stories/0809/26027.html#ixzz0Ods4P7g1
Fear of “Medicare Massacre”?
Politico, by Victoria McGrane &
Chris Frates, 8/12/09
“ At his Tuesday [8/11/09] town
hall event in New Hampshire,
President Barack Obama made a
point to reach out to seniors,
noting the low support in polls for
his health care proposals.
“’We are not talking about cutting
Medicare benefits,’ Obama said,
trying to assuage the audience.
“But Obama is talking about
hundreds of billions in savings
from Medicare — cuts supporters
say will trim fat from the program
— including slashing $156 billion
in subsidies to Medicare
Advantage, a privately
administered Medicare program.”
Panel #2
“What are the
implications of
slowing the rate of
growth in Medicare
spending and what if
any impact would this
have on
beneficiaries?”
C. Eugene Steuerle, PhD,
Vice President,
Peter G. Peterson Foundation
Darrell G. Kirch, MD,
President and CEO,
Association of American
Medical Colleges
Maulik Joshi, Dr.P.H.,
President, Health Research
and Educational Trust and
Senior Vice President of
Research, American
Hospital Association
Let’s Talk Like Adults About
Health Reform & Medicare
Spending
C. Eugene Steuerle
Vice President, Peter G. Peterson Foundation
Former Deputy Assistant Secretary of the Treasury
for Tax
Analysis
Former Senior Fellow, the Urban Institute
To Receive Gene’s column,
e-mail Steuerle@comcast.net
Fiction
Congress should keep its hands
off Medicare
Fact
Medicare & health spending are
unsustainable
Spending Per Capita
1995-2035
$25,000
$20,000
2009 Dollars
$15,000
Non-Health Spending
Health Spending
$10,000
$5,000
$0
Source: Congressional Budget Office
Fiction
2009 will see real Medicare
reform
Fact
Today’s Medicare debate is a
minor prelude
20
President Obama's Budget Squeeze
19
18
17
% of GDP
16
Revenue as a % of GDP
15
Social Security, Medicare,Medicaid,
Defense and Interest
14
13
12
11
10
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Source: Gene Steuerle and Tim Roeper based on A Preliminary Analysis of the President’s Budget and Update of CBO’s
Budget and Economic Outlook CBO (March 2009)
44
Fiction
You can’t reform Medicare by
itself
Fact
Medicare is like the line in
football: it leads
2009
2011
2013
2015
2017
2019
2021
2023
2025
2027
2029
2031
2033
2035
2037
2039
2041
2043
2045
2047
2049
2051
2053
2055
2057
2059
2061
2063
2065
2067
2069
2071
2073
2075
2077
2079
2081
2083
% of GDP
Projected National Spending on Health Care
50
45
40
35
30
25
20
All Other
Medicaid
Medicare
15
10
5
0
Source: Congressional Budget Office
Fiction
Medicare shouldn’t regulate prices &
services
Facts
Medicare already sets prices & limits
services
Favoring specialization over primary
care
Favoring chronic care over cures
Favoring acute care over prevention
Fiction
Reform should avoid creating any
“losers”
Fact
The only policy with no “losers” is
the status quo
Average Health Costs Per
Household
2008
Average Costs
$ 21,000
Paid Through:
Taxes (& Deficits) $ 12,000
Other
$ 9,000
Approximate Tax Rate to Support Medicare
Alone:
1975
2%
1990
4%
2010
7%
2030
14%
Maulik Joshi, PhD
President, Health Research and
Educational Trust and
SVP of Research, American Hospital
Association
Bending the Cost Curve
Maulik Joshi, Dr.P.H.
Senior Vice President of Research, AHA
President, Health Research & Educational Trust
Phone: 312-422-2622
Email: mjoshi@aha.org
AHA Commitment
Shared Responsibility: Contribute $155
billion in savings over 10 years
Lower payment rates
Less money to care for the uninsured (DSH payments)
LINKED to expansion in coverage
Reduction in readmissions
Implement Hospitals in Pursuit of
Excellence (HPOE) campaign to improve
quality and efficiency
Hospitals in Pursuit of
Excellence (HPOE) Pledge
Immediate Initiatives:
• Reduce surgical infections and complications
• Reduce central line-associated blood stream infections
(CLABSI)
• Reduce methicillin-resistant Staphylococcus aureus
(MRSA)
• Reduce clostridium difficile infections (c diff)
• Reduce ventilator-associated pneumonia (VAP)
• Reduce catheter-associated urinary tract infections
• Reduce adverse drug events from high-hazard
medications (e.g., anticoagulants, narcotics, opiates,
insulin, sedatives)
• Reduce pressure ulcers
Hospitals in Pursuit of
Excellence (HPOE) Pledge
Longer-term Initiatives
•Improving Care Coordination – Focus in particular on the
discharge process and care transitions.
•Implementing Health Information Technology (HIT) – Focus on
leadership and clinical strategies to effectively implement HIT.
•Preventing Patient Falls – Further the implementation of
effective fall prevention programs and use of fall risk assessment
tools.
•Improving Perinatal Care – Promote best practices
to improve perinatal care and reduce
birth complications.
Need to Test and Learn
•Voluntary Demonstration Projects
•Bundled Payments
•Accountable Care Organizations
Impact
Impact on Beneficiaries
Improved quality of care – preventing
infections, avoidable readmissions
Impact on Healthcare System
More efficient
Reducing the rate of cost growth
Darrell G. Kirch, MD
President and CEO
Association of American Medical
Colleges
Panel #3
HR 3200, SEC. 1233:
ADVANCE CARE PLANNING
CONSULTATION.
“The term ‘advance care planning consultation’ means a
consultation between the individual and a practitioner… Such
consultation shall include the following:
‘‘(A) An explanation by the practitioner of advance care planning,
including key questions and considerations, important steps, and
suggested people to talk to.
‘‘(B) An explanation by the practitioner of advance directives,
including living wills and durable powers of attorney, and their uses.
‘‘(C) An explanation by the practitioner of the
role and responsibilities of a health care proxy.
‘‘(D) The provision by the practitioner of a list
of national and State-specific resources to assist consumers and
their families with advance care planning, including the national tollfree hotline, the advance care planning clearinghouses, and State
legal service organizations (including those funded through the
Older Americans Act of 1965)…
HR 3200, SEC. 1233:
ADVANCE CARE PLANNING
CONSULTATION.
‘‘(II) the information needed for an individual or legal surrogate
to make informed decisions regarding the completion of such an
order; and (III) the identification of resources that
an individual may use to determine the requirements of the State in
which such individual resides so that the treatment wishes of that
individual will be carried out if the individual is unable to
communicate those wishes, including requirements regarding the
designation of a surrogate decision maker (also known as a health
care proxy).
‘‘(ii) The Secretary shall limit the requirement
for explanations under clause (i) to consultations
furnished in a State—
‘‘(I) in which all legal barriers have been
addressed for enabling orders for life sustaining
treatment to constitute a set of medical orders
respected across all care settings; and
‘‘(II) that has in effect a program for orders for life sustaining
treatment described in clause (iii).
“Death panels”?
ABC News, Kate Snow,
August 10, 2009
“At a health care town hall
with Obama hosted by the
AARP, a man said, ‘This is
being read as saying, ‘every
five years, you’ll be told
how you can die’.”
Panel #3
“End of life issues and why it
might or might not be important
to address them in health
reform through HR 3200’
proposal to pay practitioners
under Medicare to
conduct advance-planning
Christine Cassel, MD
President,
American Board
of Internal Medicine
Diane Meier, MD
Center for Palliative Care
Mt. Sinai School of Medicine
consultations with patients.”
Jerald Winakur, MD,
Center for Medical
Humanities and Ethics,
University of Texas
Health Science Center
at San Antonio
Christine Cassel, MD
President
American Board of Internal Medicine
Patient Centered?
What Do Patients with Serious
Illness Want?
Pain and symptom control
Avoid painful prolongation of the dying
process
Achieve a sense of control and dignity
Relieve burdens on family
Strengthen relationships with loved ones
Singer et al. JAMA 1999;281(2):163-168.
And What They Get: Suffering in U.S. Hospitals
National Data on the Experience of Advanced
Illness
in 5 Tertiary Care Teaching Hospitals
9,000 patients with life-threatening illness, 50% died within
six months of entry
Half of patients had moderate-severe pain >50% of last
three days of life.
38% of those who died spent >10 days in ICU, in coma, or
on a ventilator.
JAMA 1995;274:1591-98
Patient Centered?
What Do Family Caregivers Want?
Study of 475 family members 1-2 years
after bereavement
•Loved one’s wishes honored
•Inclusion in decision processes
•Support/assistance at home
•Practical help (transportation, medicines, equipment)
•Personal care needs (bathing, feeding, toileting)
•Honest information
•24/7 access
•To be listened to
•Privacy
•To be remembered and contacted after the death
Tolle et al. Oregon report card.1999 www.ohsu.edu/ethics
And What They Get: Family
Satisfaction with Hospitals as the Last
Place of Care
2000 Mortality follow-back survey,
n=1578 decedents
•Not enough contact with MD: 78%
•Not enough emotional support (patient): 51%
•Not enough information about what to expect with the the
dying process: 50%
•Not enough emotional support (family): 38%
•Not enough help with pain: 19%
Teno et al. JAMA 2004;291:88-93.
Medicare Spending by Sector in
Last Two Years of Life
Source: The Dartmouth Atlas of Health Care 2008
Available at: http://www.dartmouthatlas.org/atlases/2008_Chronic_Care_Atlas.pdf
Association between cost and quality of death in
the final week of life (adjusted P = .006)
Zhang, B. et al. Arch Intern Med 2009;169:480-488.
Copyright restrictions may apply.
Advance Directive
Advance health care directives, also known as
advance directives or advance decisions, are
instructions given by individuals specifying what actions
should be taken for their health in the event that they are
no longer able to make decisions due to illness or
incapacity.
A living will is one form of advance directive, leaving
instructions for treatment. Another form authorizes a
specific type of power of attorney or health care proxy,
where someone is appointed by the individual to make
decisions on their behalf when they are incapacitated.
People may also have a combination of both.
-- Wikipedia
Medical Care Received in the Last
Week of Life
by End-of-Life Discussion
Copyright restrictions may apply.
Wright, A. A. et al. JAMA 2008;300:1665-1673.
Policy – House Tri-Committee Bill
Provides Medicare coverage for voluntary
Advance Care Planning Consultations at least
every five years.
Requires quality measures in PQRI on end-oflife care and advanced care planning.
Other legislative proposals not included are
related to education, workforce, quality and
research.
Diane E. Meier, MD
Director, Center to Advance Palliative
Care
Mount Sinai School of Medicine
A Tale of Two Patients:
Elaine G. and Judy F.
Diane E. Meier, MD
Professor
Mount Sinai School of Medicine
August 20, 2009
Elaine G., 82 year old nursing
home resident with dementia and
recurrent pneumonia
Business as usual
Multiple admissions for recurrent pneumonia
No prior evidence of her wishes
Prolonged critical care
Hospital complications
Pain
Angry, guilty adult son
Judy F., 65 year old with
metastatic lung cancer seeking
guidance
Diagnosed age 59
No smoking history
Given prognosis of 6-12 months
With expert oncologist, lived 6 years
Sought palliative care as symptoms worsened
for pain, insomnia, fatigue, questions about the
future and what to expect
Received simultaneous palliative and cancer
care for a year
When cancer Rx no longer helpful, referred to
hospice for 3 weeks, died peacefully at home
surrounded by family
Conceptual Shift for Palliative Care
Life Prolonging Care
Life Prolonging
Care
Medicare
Hospice
Benefit
Hospice Care
Palliative Care
Dx
Death
Old
New
Implications and Lessons: Match
the Care to the Patient’s Needs
We don’t know who is at the end of life until
weeks-days before death
Advance care planning necessary from point of
diagnosis of advanced progressive illness
regardless of prognosis- not at “end of life”
Non hospice palliative care appropriate whenever
symptom, function, and family burden regardless
of prognosis, and in combination with all other
appropriate life prolonging treatment
Hospice when life prolonging treatment no longer
effective or burden>benefit.
Result is genuinely patient-centered care,
markedly lower costs
Art Buchwald, Whose Humor Poked the
Powerful, Dies at 81
By RICHARD SEVERO
Published: January 19, 2007, New York Times
As he continued to write his column, he found
material in his own survival. “So far things are
going my way,” he wrote in March. “I am known in
the hospice as The Man Who Wouldn’t Die. How
long they allow me to stay here is another
problem. I don’t know where I’d go now, or if
people would still want to see me if I weren’t in a
hospice. But in case you’re wondering, I’m having
a swell time — the best time of my life.”
Life is pleasant. Death is
peaceful. It's the transition that's
troublesome.
Isaac Asimov
US science fiction novelist & scholar (1920 - 1992)
Although the world is full of
suffering, it is also full of the
overcoming of it.
Helen Keller
Optimism, 1903
In loving memory
Jerald Winakur, MD
Center for Medical Humanities and
Ethics
University of Texas Health Science
Center at San Antonio
MEMORY LESSONS:
A GERIATRICIAN’S TALE
JERALD WINAKUR, M.D., F.A.C.P., C.M.D.
The Center for Medical Humanities and Ethics
The University of Texas Health Science Center
at San Antonio
AMERICA’S AGING
SOCIETY
--Over 65: 72 million people, 20% of our
populace in the next 23 years
--Over 85: 18 million by 2050
--Only 20% are fully mobile
--50% have some degree of dementia
The “State of Collapse” in
America’s Primary Care/Geriatric
Workforce
--50% decline in students choosing primary care as a
career since the late nineties
--20% decline in the number of certified geriatricians
practicing in the last 10 years
--7000 geriatricians in America today
The “State of Collapse” in
America’s Primary
Care/Geriatric Workforce
--300 new geriatricians entering the workforce yearly
does not replace those retiring
--Only 2% of residents in training choose Geriatrics as a
career
--2008: only one geriatrician per 8000 patients
--Current deficit of 14,000 geriatricians will grow to
34,000 by 2030
A HELPFUL WEBSITE:
texaslivingwills.org
by Craig Klugman, PhD
Health Affairs gratefully acknowledges the
generosity
of the following organizations
for support of this conference:
The End