In the Aftermath of Trumpcare
Content warnings: 1)
Health/care/insurance 2) Long 3) Mostly
facts plus some opinions which are my own and not my employer’s.
In the past 48 hours I have been visited, called and
messaged by numerous friends, family and colleagues to discuss not only an autopsy
of the Trumpcare debacle but also, encouragingly, a desire to understand the complexity
and explore ideas on a way forward for
our country. One thing is for sure –
improving the health of America will not happen through sound bites from
anyone, even accurate ones. Critical
thinking and honest dialogue are our only hopes. Furthermore, we all come at this complicated
topic from the lens of our own life experience and values. My own career context includes studying the
science behind population health, the great privilege of providing hands-on
care to all ages as a family physician (and teaching others), helping to steer
and operate non-profit community health systems from both a business and
clinical view, working either across the fence from or side by side with or
inside the walls of those purchasing and paying for health care, developing and
selling technology aimed at enabling it, and now leading an organization
designed to get more value out of it.
Less known to others are my experiences as a mother, wife, and daughter
in a family who has consumed hundreds of thousands of dollars of (mostly)
someone else’s money in three very different situations in the past ten years, with
the only commonality that they were all indisputably unpreventable (at least not
due to “bad choices”) and life-saving – so thank you for that. We are also a highly non-average household as
healthcare consumers – with several Ivy League degrees including two MDs and a
JD, a buffer of high income, and very privileged never in the past half century
having to decide between purchasing health insurance at full cost or being
uninsured (relying on large employers, including ironically hospitals and the
Federal Government, plus Medicare). My
views are also guided by religious values of social justice,
interconnectedness, and the inherent worth and dignity of all.
The American health system has many virtues – I have three
loved ones alive to attest to that – but is held together behind the scenes by
good people and an astounding array of band-aids and workarounds caused by
inequity, holdovers of history, and layers of entrenched interests (aka the
medical-industrial complex). Throwing it all out and starting from a blank
slate is not a realistic option, but as we have now seen, neither is an attempt
to devise/improve solutions or debate the role of government versus markets
versus individual responsibility without stepping back to talk honestly about
principles and problems, so here’s my starting point to assist your
conversations:
1. What is health? It is not the same as healthcare
(though accessing high quality preventive, chronic, and acute services can
improve health) which is not the same as health insurance (though
having that can help access and pay for care).
Health can be defined as not only the absence of disease but also
multidimensional well-being. We tend to measure
health in terms of length (e.g. life expectancy, infant mortality) and quality
(e.g. burden of disease and disability).
The U.S. spends (from all sources, not just government) a lot more on
healthcare than all other developed nations, with the worst health status. But we also spend a lot less on other things
which influence health, such as education, food, environment, social supports
to the poor, etc. So we’ve effectively
substituted one kind of spending for the other, without as good an outcome. What’s more, we don’t always agree on what is
“in scope” of healthcare itself and, especially when potentially subsidized by
someone else (see Section 5 “Cost Shift Reality Check” below), things get
emotional
2. Is
healthcare something that society should provide at some basic level to all
(a.k.a. a right), as we do with
varying degrees of success for national defense, lower education, and other
infrastructure? If your answer is no,
then let me describe my recent travel in a country where healthcare is not a
right (and they spend 2% of their already small GDP on it, as opposed to our
nearly 20%). Health insurance does not
exist. Publicly operated healthcare barely exists. For almost everything, you
pay out of pocket (generally up front).
That is assuming it is even available -- since it is nearly all driven
by ability to pay, which most people don’t have (no different here as
explained below), there is accordingly little capacity or infrastructure. In the US we do provide acute emergency
care as our default definition of “basic” – putting us big step ahead of that
other country in which I was called upon to render emergency care to an
unfortunate fellow tourist using a stick, an umbrella, torn up clothing, a
Tylenol, and a recommendation for an immediate air evacuation if he could get
himself to the nearest airport 2 hours away by horse cart, then boat, then
traffic-snared road. If we can agree
that basic healthcare is a right, then we have the relatively easier task of
figuring out how to define basic, and how to deploy and fund it. Furthermore we may need to hash out whether
it is okay to be able to “buy more” than basic if you can afford to do so (which
we also do for education, housing, food, transportation, even roads).
3. Why do we need health insurance? Unless your
society/government owns and operates the entire healthcare infrastructure for
all (a.k.a. socialized medicine), health insurance is a necessary
vehicle through which risk is spread between those who aren’t using it and
those who are (see Section 6 “Cost Shift Reality #1” for why necessary). Insurance is now also the intermediary of the
business transaction itself between the consumer and the supplier, negotiating
the price through network contracts and paying the bill that is leftover after
the consumer pays their share that is set by the benefit design (the copay,
deductible, etc). Large employers and
other large purchasers such as the Medicare program don’t need the risk spread
part and just pay a health plan or other intermediary to handle the transactional
administration. We have an
employment-based health insurance system for those under 65 as a fluke of
history, and it has caused many unintended consequences. Under privatized Medicare, the government
does shift the risk to the insurance company, under the sometimes correct view
that this gives a market incentive for more efficient use of the funds (the
insurer gets to keep what is left over, or has to shell out extra and
eventually go bust if they spend more than they receive). Universal health insurance means
everyone is covered through one plan or another. A single payer system means that there
is only one, for example Medicare-for-all.
A story for another day is the time that I had the luxury of choosing
which employer-based health plan to pick out of five options, and with all my
degrees and experience (even running one of the plans!) and several hours put
to use with mad Excel skills, I ended up unable to make an informed choice.
4. Why is
health insurance so expensive in general?
Because a) without making everyone buy it, it is disproportionately
purchased by people who need to use it, b) when used it pays for expensive
healthcare (see Section 8), and c) to stay in business, insurance companies
make a profit (makes for snarky sound bites and memes but is dwarfed by the
first two). The Affordable Care Act
focused a lot on the first, dabbled in the second, and tried to put some caps
on the third.
5. Cost
Shift Reality Check: The essence of
the debate and the vitriol, some obvious but a lot not so obvious:
a.
From those who use care to those that do not via
insurance risk pools, stagnant wages, and other lost opportunities;
b.
From the poor to the rich, old to the young,
the non-employed to the employed, and veterans to non-veterans via tax-funded programs like deductions, subsidies, Medicare,
Medicaid, the VA;
c.
From those insured through their current work to
consumers via the price of goods and services;
d.
From those who picked the “right” health plan
for themselves to those who did not, via good timing, luck, and maybe smarts
e.
From employers offering low wages and no or
unaffordable insurance to taxpayers via their workers who qualify for Medicaid;
f.
From employers to employees via decreasing the
percent of the insurance cost which is subsidized
g.
From government employees to taxpayers via generally
generous work-based insurance;
h.
From the uninsured to the insured via providers
charging more in order to cover free care;
i.
From the insured in plans that pay providers
less to those in those in plans who pay providers more (since it costs the
provider the same to deliver the service);
j.
From insurers to those purchasing insurance the
next year, when losses are incurred or might be incurred due to increasing
prices of healthcare itself or the actuaries getting it wrong;
k.
From those who might use a certain service to
those who never will, due to (for example) gender or religion or marital or parenthood
status;
l.
From our present to our future, via lack of
prevention, pent up demand, and festering conditions becoming life threatening.
m.
Others that I don’t know or forgot!
6. Cost
Shift Reality #1: Why do we shift/spread
so much cost from the sick to the healthy, making insurance feel so unaffordable
to the healthy? (Note, we can debate elsewhere
what it means to “feel unaffordable”, ultimately we all make personal choices
about how much of our income after taxes we have to or want to spend on
everything else and what is essential versus discretionary. Also, if insurance does not feel unaffordable
to you, you are most likely benefitting from somebody else subsidizing most of
it, or you are really, really, rich – since the real cost of insuring a family
of 4 is around $25,000 per year).
7. Cost
Shift Reality #2: Why do we shift
cost from those with resources to those without (i.e. the wealthy to the poor –
regardless of health status) – refer to Section 2, “Is Healthcare a Right”.
8. Why is
healthcare so expensive, and what can be done about it? Which brings us to the most
challenging Cost Shift Reality #3: If we want to improve the value of
the money we spend on healthcare as country, that means we figure out how to
drive better health at lower cost (ideal), or at least the same
health at lower cost, or better health at the same cost. The elephant in the room is that all of these
require taking income away from someone who will fight that tooth and nail -
even in the case of an innovation which improves health at no net gain in cost
because it substitutes for someone’s job today.
This is not just about reducing some rich executive or doctor’s income,
it will take away jobs altogether, including a lot of middle class and service
jobs, in some cases even shut down the only reliable large employer in a
community. The challenge of the Affordable Care Act is that it focused
primarily on achieving better health by adding more users (i.e. cost) to the
existing system. In theory, adding more
users to the system would create a “backfill” to make up for losses of taking
waste out of the system, but that still requires massive changes in the day to
day mechanics of how a fifth of the economy operates, and it won’t be
undertaken at that scale either voluntarily or easily.
a.
We are privileged to have in our medical toolkit
here in the US and other developed nations some really impressive (and
increasingly mind-blowing) technology and tools that can do amazing things and
extend / improve our lives in good ways. This is great!
But even so, at some point it there is not enough money in the world to
pay for it, no matter how beneficial. This is especially true when research and
development is funded by private investment which justifiably needs to make
money on the successes to make up for the failed attempts, let alone a profit.
b.
Incentives (i.e., flow of money) are not only not
tightly linked to value, but sometimes the opposite. Long story.
A “fee for service” system which rewards doing more, even doing it badly
(because then more can be done). Lots of
hospital and specialty care infrastructure (because that’s where the money is),
and low primary care infrastructure despite the latter being directly
proportionate to health. (About 4% of
our healthcare dollars in the US go to primary care). We can all agree in principle that someone
with one year of training (and tuition expense and foregone income) beyond
college who works 40 hours per week should make not make the same annual income
as someone with 7 years of training who works 60 hours per week who should not
make the same as one with 11 years of training who works 80 hours per
week. But currently the market pays
sometimes about the same for the first and second, and a 20 fold difference
between the second and third. Consumers are shielded from actual cost or
often even relative cost of what they consume (because of insurance). Prices are negotiated through market and/or
marketing power, versus actual value to the consumer or cost of production. Good health status being an insufficient
incentive in and of itself to result in perfect behavior on the part of human
beings, especially with counterincentives all around, and direct financial
consequences mitigated through cost shift.
The profit chain – and remember this accounts for a fifth of our economy
– before you throw any stones at those looking to make money off healthcare,
consider this includes the investments in your pension fund and mutual funds
that likely hold stock in insurers, pharma, biotech, and for-profit providers.
c.
Supply creates demand, unlike a free market. We (even with completely good intent, which
is usually the case) provide services that people do not benefit from or want,
sometimes even things that have been proven to cause harm. We also allow this to happen with less good
intent, through marketing.
d.
The stakes are high (including life vs. death),
and we have not figured out a fair way to compensate and differentiate those
who are harmed through someone else’s gross negligence/incompetence (and to
provide a strong financial disincentive for doing that, in case a moral
incentive was insufficient), versus harm from a complicated system that has
holes in it, versus harm from known risks.
And (back to incentives) there are some powerful people who make money
(sometimes a lot) from the status quo.
1. We must
have an
informed debate about whether healthcare should be a right in this country (my
opinion = yes). Then the next debate is
how much of the economy are we willing to devote to it. At least we can say
“less than now”, “same as now”, or “more than now”. Achieving either less or same spend will
require tough choices with consequences, given the addition of new consumers
and aging consumers, plus advancing technology.
2. We need to find some better balance points in the inevitable cost shifts, because they are not working fairly as is.
3.
Phase change in over time – you cannot disrupt a
fifth of the economy without unintended consequences. This is particularly true for simply altering
incentives (relatively easy with political fortitude) without addressing the
need for deep changes in how care is delivered (slow and difficult to
accomplish, old habits are hard to break even when self destructive). Eventually incentive change in isolation would
drive care model change through market forces, but only after knocking a lot of
barely-getting-by yet critical providers out of business.
4.
Find the lowest hanging fruit of the most
obvious “right things to do” regardless of political philosophy and rally
people behind them both voluntarily and probably some involuntarily. For example, don’t provide “care” that recipients
don’t want (for example, aggressive and even futile interventions when death is
imminent and the person really wishes to die at home with minimal suffering).
That requires everyone to determine their wishes, communicate them,
advocate for them, and respect them.
Stop routinely paying for services which cause harm or little to no
value to health, especially NEW things (it is harder to take away than not give
in the first place). This sounds like a
no brainer but it not always easy to determine where there is an individual
situation where there is benefit, and we have a “more must be better” mentality
as consumers and demonize anyone who makes the "no pay" decision as rationing (even if provides no benefit or harm). On the flip side, do as
much as possible to make primary care as accessible as possible, including
capacity, convenience, cost, and scope.
This also requires expanding the definition of primary care from the
face to face, 1:1 visit to a team-based, technology enabled relationship that
is customized to your needs.
5.
There are some things in healthcare which are
priced (and paid) at astronomical amounts that are just completely
unjustifiable by any argument other than “we have figured out how to get away
with it”. Don’t let them get away with
it. This will require taking away some free passes (such as
not letting the largest purchaser of healthcare, i.e., the government, even negotiate
price of drugs) and looking hard at a variety of other laws which actually perpetuate price-gouging.
6. Eventually we are going to have to bite some bullets on the idea that the
free market really works for something that we treat as a right, where supply
can create its own demand as opposed to need/want, where a lot of important things
are necessarily REALLY expensive and thus cost shifted to non-consumers, where
competition can increase cost through complexity and redundancy, and where the
stakes are life and death. This does
not mean rationing and socialized medicine (which, by the way, is how we handle
education). It does not even mean a
single payer system, though that would accomplish much of the same and more with
one highly disruptive move (hint, maybe my opinion and one that is shared by a lot more of my colleagues than will admit). It does not
mean the end of employer-sponsored health insurance (which is
a historical fluke that causes us a lot of pain and workarounds, and we should talk
seriously about ripping that band-aid off ). It does not mean the federal government
taking away everything from the states, because healthcare is ultimately
delivered locally, but I believe the cost shift and value problems impact
us mostly across state lines and we need major solutions that apply across the
board. It does mean talking about regulation
(including of price, profits, and marketing) and less freedom for healthcare consumers
to do/have anything they want yet still be insulated from the cost of their
choices.
6. Those of you who know me won't be surprised that much of the above was the actual intent of the Affordable Care Act, aka Obamacare, and now we can get to work on making it work better.
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