Thursday, September 17, 2009

Getting a Health Bill Done—Special Interest Politics Versus Public Support

It is becoming more and more clear to me that the White House health care strategy this fall is based upon a belief they have been very successful in neutralizing the health care special interests and have therefore prepared the way to a legislative victory.

Each of the key stakeholders—doctors, hospitals, drug companies, device makers, and insurers are in a terrific place should any of the health care bills pass without a public option.

Each has put a fairly small amount of “savings” on the table that amounts to only about 1% of what the group, as a whole, would have received over the next ten years.

In simple math, any of the Democratic health care bills will increase the aggregate revenue of the key stakeholders by almost twice what they would give up.

In the Baucus Senate Finance bill for example, there would be $463 billion in new spending on insurance subsidies and $287 billion for Medicaid. Another $24 billion would go to small businesses so they could buy insurance. That is a total of $774 billion in new revenue for the big stakeholders.

Health care reform will be very good for the health care business. Insurance companies would benefit from all of the new premiums and even some of the Medicaid money in states where they provide those benefits. Health care providers would receive most of this money as it was passed through by private insurance and Medicaid to pay the providers.

In turn, health care providers and insurers would give up $409 billion in Medicare and Medicaid savings. Insurance companies, drug companies, labs, and device makers would pay $88 billion in new taxes. Insurers would pay excise taxes on high cost health plans which would raise another $215 billion. Both the excise tax and stakeholder taxes would almost certainly be passed on to the customer as new premium or sales taxes. Penalties for employers who did not offer health insurance, and penalties for individuals who did not buy insurance, would add another $47 billion in federal revenue.

So, under the Finance draft, hospitals, doctors, drug companies, and medical device makers would benefit from $774 billion in new spending (less insurance company and Medicaid overhead) and only lose $409 billion in Medicare and Medicaid cuts.

Insurers would lose about $130 billion in “extra” Medicare Advantage payments but would gain $463 billion in new insurance business from federal premium subsidies, likely more than $100 billion from new premiums paid out of the pockets of these new customers now required to buy insurance, and some share in the new Medicaid expansion. Even in the Baucus bill, insurers would stand to gain something beyond $500 billion net of their Medicare Advantage cuts.

You have to give the White House and Democratic Congressional leaders credit—they have neutralized the powerful health care stakeholders.

This has to be a textbook example of smart special interest politics!

But the special interest deals had already been cut before the August recess and the uneasy public reaction to the Democratic health care bills. Those deals clearly didn’t help the Democrats last August.

The White House may have the big health care special interests onside but they cannot ram through anything so big as health care without public support.

It is clear that the recent Obama health care offensive has been aimed at turning around the public perception of the Democratic health care plans and lining up that support.

The problem the White House now has is that it is not working. While the snap polls in the wake of the speech to Congress looked good, they have not held.

As one person told me this week, “The President keeps saying the same things he’s been telling us all along as if we weren’t smart enough to get it the first one, two, or three times.”

In fact, the President’s approval ratings on health care are as bad as they have been all summer.

This from Thursday’s (September 17) Rasmussen Health Care Tracking Poll:
Just before President Obama gave his speech to Congress last week, 44% of voters nationwide supported his health care reform proposal and 53% were opposed. Today, eight days after the speech and a brief bounce, a new Rasmussen Reports national telephone survey finds that 44% support the health care plan and 53% are opposed. Absolutely no change.

It’s worth noting that support and opposition were at precisely the same levels in mid-July. In fact, other than brief blips following a nationally televised press conference by the president and his recent speech to Congress, opposition to the plan has been stable at 53% throughout July and August and now into September.

The latest figures show that 25% Strongly Favor the plan and 43% are Strongly Opposed. In late August, those figures were 23% and 43% respectively.

This suggests public opinion is hardening when it comes to the plan proposed by the president and congressional Democrats that is currently working its way through Congress.
The President and Democratic leaders have done a masterful job of managing special interest politics.

But they may have overlooked, or taken for granted, the most important special interest of all—the voter/patient.

Whether the Democrats can pass a bill or not will depend on whether wavering Democrats ultimately see voters back home for or against all of this.

One more time: You can’t ram anything through as important as health care with a 44% approval rating.

Wednesday, September 16, 2009

Health Care Outlook Not Improving

The next big test for a health care bill in 2009 (notice that I did not call it health care reform) will come in Senate Finance.

The final vote in that committee will tell us a lot about whether the Democrats have any chance for 60 votes in the full Senate. So far, it does not look good.

I have the greatest respect for Senators Baucus and Grassley and their good faith efforts to find a bipartisan health care solution. But I also think their efforts were fatally flawed from the beginning.

I think the problem is that Baucus and Grassley were trying to bridge the wide chasm between liberal and conservative ideas. Finding the fine balance necessary has created an unwieldy compromise—no one is happy. Most striking, the compromise reached between cost and premium subsidies has yielded an $880 billion bill that requires middle class people to buy health insurance they will in no way will be able to afford. On top of that, the policies have big deductibles and out-of-pocket costs.

As I have said on this blog before, we cannot do something as big as health care reform without bipartisanship. The American people will never be comfortable with one side’s proposals so long as the other side is taking shots.

Any successful health care effort will need political cover from at least some respected members of the minority party.

This health care effort has occurred on one side of the political spectrum. Grassley and Baucus tried to bridge a wide chasm between the conservative side and the liberal side and were only able to build a rickety bridge across it that, it would appear, Grassley can’t even sign onto.

To get this done, we will need to build a consensus on health care from the middle and then build out. We need to start with the things everyone can agree on and then push simultaneously as far right and left as we can go and still hold a consensus.

I know I have said this a few dozen times before on this blog, but Wyden-Bennett is an example of that middle-out model.

You might respond that Wyden-Bennett is off the table.

Have you noticed recently the growing number of times that name keeps coming up in media reports?

Recent post: "Please Don't Call It Health Reform"

Monday, September 14, 2009

The Proposed Health Insurance Company Taxes To Pay for Health Care––You Really Need to Know What “Loadings Available” Means

The Congress has investigated about every conceivable way to tax people to pay for the health care proposals—a millionaire’s tax, bigger taxes on home mortgages and charitable contributions, and a couple of dozen more ideas.

Now Congress looks to be the most interested in taxing insurance companies to pay for a big chunk of their health care proposals. The new taxes would come in two parts––a 35% excise tax on any health benefit cost above an $8,000 single and $21,000 family annual premium as well as a flat $6 billion annual tax on the industry to be allocated among the companies proportionate to their premium.

There is certain logic to this. Taxing high priced benefits could help deflate the health care economy. Taxing all of the health insurance companies that stand to get more than a $1 trillion in new business—most of it in the from new private insurance and Medicaid subsidies and the rest from the consumer’s share of those new private plan premiums—seems fair at one level.

Calling for a tax on that big rich insurance company also sounds a lot better to the politicians than looking voters straight in the eye and raising their taxes directly.

But what is really going on here is that proponents of these insurance company taxes would just turn the health insurance industry into a new division of the Internal Revenue Service.

To paraphrase Leona Helmsley, insurance companies don’t pay taxes—at least taxes that are directly related to their health insurance policies, as these would be.

I have run a health insurance business. The insurance companies already pay taxes much like the ones being proposed. They are called state premium taxes. They tend to run about 2% of premium on fully insured business.

Do you know what the insurance companies do with these taxes? Since they are tied to premiums they pass them through directly to the policyholder who pays these premiums.

And, speaking of Ms. Hemsley's famous statement that, "the rich do not pay taxes," I doubt this tax would ever be collected on the high-end benefits at places like the Wall Street firms the proponents talk about. If it became law, I can see the big Wall Street firms, and the like, going to their partners and telling them that because of the new tax partner benefits would be terminated and converted to cash, and the partners should then go to the market to buy their "gold plated policies." They would get away with that because, as it is now drafted, this tax would not apply to individual coverage and any existing individual policy would be grandfathered.

Will the 35% premium tax on high priced benefits apply only to very expensive policies? It will today but the caps would grow with inflation while health care premiums have been growing at about three times that. There is a reason this scheme develops far more revenue in the out-years—because more consumers will be trapped in the new tax not unlike what has happened to the Alternative Minimum Tax (AMT) over the years.

At any rate, whatever the tax, it will be passed through to those who pay the premiums. This is not a theoretical exercise. Taxes like this are what we call a premium load. You can load these costs as long as there are premiums available to load—loadings available.

What’s an “available loading?”


You are available, as the customer, to have these costs passed right straight through as a load on the premiums you already pay. And, that is what the insurance industry has been doing with premium taxes for decades.

And, that is what insurers would do with these taxes. Not like insurance premiums are affordable in the first place.

If this scheme survives, the insurance industry would be a very valuable division of the IRS!

Sunday, September 13, 2009

What Voters Really Think About Evidence-Based Health Care

I want to call you attention to an important survey done by the California-based Campaign for Effective Care. They surveyed California voters on their understanding of evidence-based medicine.

The bad news is that patients think their health care treatment is generally evidence-based even though that assumption is highly questionable. The good news is that patients want it to be evidence-based.

At a time when we hear anecdotal evidence, particularly from town hall meetings, that people don't want any "interference" between them and their doctors they do seem to appreciate the need to get all of the facts when making a treatment decision.

Here is the survey summary. You can access all of it here.
Quick Summary of Evidence-Based Medicine Poll Results

A Summer 2009 Lake Research Partners poll of 800 California voters released by the Campaign for Effective Patient Care brings a fresh perspective to the health care debate raging across the country.

Voter opinions about evidence-based medicine could not be more timely. The under- and over-use ofmedical treatment threatens patients’ well-being and wastes lives and resources. The prestigious Institute of Medicine reports that only about half of doctors’ treatment decisions are based on evidence.

The poll of California voter attitudes offers three important insights for policymakers:

Voters know that medical treatment should be based on solid evidence and they mistakenly believe that most of the care they are receiving is evidence based.
  • Most voters assume that medical decisions are guided by evidence. A larger percentage feels this way about their own treatment than about everyone else’s (65% vs. 51%).
  • 84% of voters are confident that they get the information they need to make informed medical decisions and are overly optimistic about the ability of the current system to put new evidence into practice.
When voters are educated about the failures in our system, they want reform.
  • 79% of voters believe that it is a serious problem when doctors fail to provide necessary treatment; 80% feel it is a serious problem when doctors provide unneeded medical treatment, and; 80% are more likely to support reforms when they learn about failures of the current system.
Voters are astute. They support specific and sensible evidence-based health-care reforms.
  • 88% of voters strongly support ensuring that doctors have access to scientific evidence.
  • 92% of those polled would require doctors to disclose the existence of scientific evidence supporting effective treatment. 90% would require disclosure of the absence of such evidence.
  • Additionally, 72% of voters want health care reform that ensures doctors are paid based on whether their treatment is supported by scientific evidence, and not solely on how much treatment doctors provide.

Saturday, September 12, 2009

"Please Don't Call It Health Reform"

Readers of this blog already know of my disappointment in what the White House and many in Congress are calling "health care reform."

So, I was happy to see Alain Enthoven's recent KHN op-ed.

Here is a small portion of it:
"Once again the President did not put forth serious proposals to reduce the growth rate in health expenditures in his speech last night. Obama likes to talk about the iconic systems: Mayo, Intermountain, Kaiser Permanente, and Geisinger, but the Democratic bills do practically nothing to promote their growth or systems like them.

"The House Tri-Committee and Senate HELP Committee bills offer none of the fundamental reforms that would be likely to change the system or significantly slow growth in expenditures. Rather, what they offer is continuation of our present traditional employer-based, non-competitive fee-for- service system. They don’t respond to the President’s call for reforms that would lower the growth trajectory, or even that would not add to the fiscal deficit."

I highly recommend your reading all of it here.

Friday, September 11, 2009

Curb Your Enthusiasm! Health Care Will Still Be Very Hard to Do

I guess all of us in the health care debate are a bit bipolar. From lots of folks thinking health care reform was in critical condition a couple weeks ago we’ve now gone to lots of reports extolling a newfound optimism in the wake of the President’s impressive speech this week.

Don’t interpret this post as my thinking health care reform is something we should be putting off—it’s already 20 years overdue.

But, I will suggest, we can’t begin to presume anything will be easier after a speech.

I thought Ceci Connolly’s article in today’s Washington Post set the proper tone:
"One day after President Obama pitched his plan for comprehensive health-care reform to a joint session of Congress, administration officials struggled Thursday to detail how he would achieve his goal of extending coverage to tens of millions of uninsured Americans without increasing the deficit.

"The 10-year, $900 billion proposal Obama envisions borrows heavily from concepts circulating on Capitol Hill, but there was little evidence that the broad ideas are sufficient to break a congressional logjam."
The issues ahead are still daunting. In health care, lofty rhetoric and big concepts have always been a lot easier than the thousand pages of detail that follow.

Let me give you an example.

The President said in his speech that his goal was a bill costing about $900 billion. Obviously, he is trying to keep the cost down under a trillion dollars. But to do so, lots of trade-offs have to be made—the old health care push it in here and it pops out there problem.

The recent Baucus Senate Finance draft also aims at a cost of between $800 billion and $900 billion. But to hit that number the authors have had to slim down the subsidies the uninsured would get and the value of the policy.

The Baucus draft would extend insurance subsidies (on a sliding scale) up to 300% of poverty—that is $66,150 for a family of four. The draft also says a family at 300% of poverty would be required to pay up to 13% of their income toward the cost of a policy—that would be $8,600 a year.

If they either lost their current employer coverage or didn’t have any in the first place, this family would be mandated to buy health insurance. If they did not, the fine would be $3,800 if their income was over 300% of poverty and $1,500 if it were below.

So, a middleclass family heard the President say that his plan would provide them with health care security. Under the Baucus plan, that means they would be expected to spend $8,600 for a health insurance plan that would likely have a $2,000 deducible. If they didn't buy it, they would have to pay a fine of $3,800.

Do you know many families making $66,000 a year that have an extra $8,600 in their checking account--much less for a health policy with big deductibles and out-of-pocket costs?

Explain this one to Harry and Louise.

The House bill isn’t much better in this regard.

Under the House Energy bill, a family making 250% of poverty ($55,125) would be required to pay 8% of their income up to $4,416 a year for a policy that could have a deductible of $1,000 and a $7,450 out-of-pocket cap.

At 300% of poverty ($66,150), the House Energy bill would limit a family’s insurance costs to $6,612 a year with a deductible of up to $2,400 and an annual cap of $8,520 in our-of-pocket costs.

A family making 400% of poverty ($88,200) would be expected to pay as much $10,584 a year for their insurance that could have a $3,000 deductible and a $10,000 annual out-of-pocket cap.

These are the kinds of details that inevitably follow the elegant rhetoric in health care.

Would access to insurance be a big improvement over what we have today. You bet.

Is this health care "security?" Ask Harry and Louise.

The Kaiser Health News website has a comprehensive article reviewing expected premiums and out-of-pocket costs for the House bills here.

Wednesday, September 2, 2009

The Obama Administration––What Will They Do Next?

How’d you like to be a fly on the wall in those White House health care meetings this week?

It looks to me like they have two choices—neither attractive to them:

1. Full Speed Ahead, Damn the Torpedoes – This might also be called the Pelosi Option for the Speaker’s intransigence for compromise. Just keep driving the existing Democratic bills through. This has the advantage of keeping the liberal wing of the Democratic Party happy but has some pretty tough potential negative consequences.

With a health care approval rating in the low 40s, this invites the continued strong opposition on the right and lots of continued middle-America nervousness over a “government takeover of the health care system” and “spending another trillion dollars when we can’t afford it.” Even if the public option is ditched, that means continuing to push a thousand page health care bill in an environment when the health care reform well has likely been poisoned.

This option includes the threats for using reconciliation rules. As I have said before, you don’t ram anything through with a 41% health care approval rating. And that presumes the reconciliation idea makes sense in the first place. I don’t think it does:
  • The Republicans have a ton of parliamentary maneuvers they can use to tie things up indefinitely.
  • The suggestion to “split” the bills into one unpopular bill and one popular bill––presuming moderate Democrats and some Republicans might be dumb enough to vote for one and pretend that second bill had nothing to do with the more problematic first one––is foolishness.
IF any of this did work and result in a very controversial bill you have to wonder just what the consequences would be come November 2010—or even 2012. You also have to wonder what the consequences would be for simply trying it.

2. Scale Health Care Reform Down to Something at Least Moderates in Both Parties Can Live With––This sounds easier than it really is.

As I have posted before, doing just health insurance reform would cost something close to a trillion dollars. Getting rid of pre-existing conditions provisions and medical underwriting requires getting about everyone in the health insurance pool to avoid the insurers getting stuck with only the sick. Health insurance subsidies to accomplish this are by far the most expensive part of the existing bills. In the House bills, the insurance subsides are worth almost $775 billion and the Medicaid expansion is worth almost $450 billion more. Scale those subsidies back and you are still in the $800 billion to $1 trillion range.

A bill that costs that much still scares those worried that this kind of entitlement expansion is too costly—particularly because the bills on the table so far have had little in the way of real cost containment.

An even more modest bill would likely be necessary to get moderates onside.

You could probably get a smaller cost bill—perhaps $250 billion over ten years—by targeting subsidies on the small employer market. Dollars could be targeted, limited in scope, and make a “down payment” toward covering at least a few million people. A targeted expansion of Medicaid could be part of such a package but nowhere near the 130% target in existing bills.

This has the advantage of creating a bill you could likely get moderate Democrats and even a lot of Republicans to support. It would settle down voter opposition.

But it would also constitute a “huge missed opportunity” to really create a universal health insurance system. Liberals would likely go ballistic believing the White House has abandoned the signature domestic promise of the campaign.

The Democrats are in a hell of a health care political hole.

Neither of these options is politically attractive--each has both extreme opportunity and consequences.

Sort of reminds me of what Stan told Ollie: “Well, here’s another nice [health care reform] mess you’ve gotten me into.”

Or, you could just hope for a miracle phone call:

Earlier post: There Will Not Be Health Care Reform in 2009 Without Republican Leadership

Tuesday, September 1, 2009

Will Republicans Be Spoilers Or Problem Solvers on Health Care Reform?


In theory Congress' return next week from recess could offer a new beginning to the health care reform process, giving everyone a chance to take a deep breath and recalibrate the components of change.

Nine months into the wrangling around a new Administration, the talk-show right has seemingly hijacked the discussion on health care, Democrats' signature issue, with the standard tools that demagogues have always used: leveraging popular prejudices with oversimplification, hyperbole, and distortion. The die-hard GOP faithful's leaders - Gingrich, Palin and others (see this off-the-deep-end speech by Rep. Mike Rogers (R-Mich)) - are of course playing spoilers, independent of the cost. They hope to goad centrist voters into abandoning the Democrats so they can retake power. Witness South Carolina Republican Jim DeMint's comment, "If we're able to defeat Obama on this, it will be his Waterloo. It will break him."

The problem with this approach is that we're still early on in our national discussion about change and about health care. An increasing number of Americans may be frustrated with Democrats, but after 10 years of Republican rule, few Americans see them as a party of fresh ideas or having an interest in helping anyone but the wealthy and powerful. Americans may have short memories, but they likely still recall that Republicans were just thrown out for a multitude of significant sins. So if everyone you know sends around Obama-as-Hitler arguments, heckling and hoping the Dems will quickly self-destruct may seem like a reasonable strategy. It is doubtful, however, that the other 75 percent of us buy that thinking.

Of course, the Democrats' health care reform offerings haven't particularly helped. As we recently pointed out, now that they're in power the Democrats have taken enormous contributions from the industry, and their health care proposals show it, dramatically expanding entitlements but conspicuously doing little to drive out waste and cost.

This has alarmed some influential groups that otherwise might be supportive. For example, the non-partisan Committee for Economic Development, a business collaboration focused on social issues, issued this July 20th press release excoriating the bills:

"The House of Representatives and the Senate HELP Committee proposals are unacceptable. They would expand coverage without controlling costs, leaving future generations with a system even worse than what we have today. We cannot afford the government and the health-care system we have now, much less this bloated alternative. Lawmakers have bowed to political pressure at the expense of sensible policy. The business and policy community cannot stand behind these bills," said W. Bowman Cutter, Managing Director, Warburg Pincus.

And the Mayo Clinic, often cited by President Obama as a national model for higher quality, more efficient care, issued this strongly-worded response* to the House Tri-Committee Bill:
Although there are some positive provisions in the current House Tri-Committee bill – including insurance for all and payment reform demonstration projects – the proposed legislation misses the opportunity to help create higher-quality, more affordable health care for patients. In fact, it will do the opposite.

In general, the proposals under discussion are not patient focused or results oriented. Lawmakers have failed to use a fundamental lever – a change in Medicare payment policy – to help drive necessary improvements in American health care. Unless legislators create payment systems that pay for good patient results at reasonable costs, the promise of transformation in American health care will wither. The real losers will be the citizens of the United States.
Over the weekend, Senator Mike Enzi (R-Wyoming), a staunch conservative and a member of the Senate's "Gang of Six" working on a health care bill, joined this chorus. He claimed that the Democrats' proposals "will actually make our nation's finances sicker without saving you money," would "raid Medicare" and intrude "in the relationship between a doctor and a patient."

It is important to distinguish this criticism from most of what we've previously heard from the right. Unlike many of his colleagues, and certainly contrary to conservative talking heads, Sen. Enzi's comments here are not so political as factual. They reflect the legitimate concerns of reasoning, mainstream conservatives who worry about simply throwing more money at health care without fixing anything.

Which constitutes the real health care reform opportunity for Republicans. The time could be right for centrist Republicans to pragmatically wrap their heads around this issue. After all, the approaches that are known to drive down costs and improve quality can easily be embraced by true conservatives who clamor for market-based solutions. Now, out of power and longing to demonstrate that they can produce substantive answers to our problems, the challenge will be to turn against their traditional industry benefactors and act on behalf of the American people.

On August 24th, Bob Laszewski posted an important column, There Will Not Be Health Care Reform in 2009 Without Republican Leadership, that listed four major areas of health care change that should come easily to centrist Republicans.
  • Bulletproof Health Care Security. This is the idea that everyone would have significantly improved access to care, that the employer-sponsored system would remain available for those who like it, and that Congress would be required to use the same system that they pass for the rest of us.
  • Medical Malpractice Reform. The Republicans have the Democrats where they want them on this one. There is no good reason why our current Med Mal system, as capricious and ineffectual as it has been, has not been revised with expert systems, except that the trial lawyers, in exchange for hefty financial support, have received protection from the Democrats. It's time to fix this problem that pervades our health care provider community.
  • Paying for It. This is acknowledging that subsidies will be required for those who can't afford health care at its current cost level, and that there are ways to structure the new cost that are more sensible. As Bob points out, the nearly forgotten Wyden-Bennett bill would be cost neutral in its second year.
  • Tough Cost Containment. As we said above, this has been the Congressional Democrats' proposals' most glaring and conflicted flaw. It is an area that, with a focus on primary care, paying for results instead of piecework, and cost/quality transparency, could dramatically drive down cost while improving quality, rightsizing our health system and going a long way toward ameliorating the most pernicious drag on our larger economy. Bob tackles cost control most effectively in his Health Care Affordability Model, a plan that would use tax incentives to encourage the industry to focus on driving out waste.

Collaborating with Democrats or, failing that, taking the lead to demand well-understood cost control mechanisms, would send a clear message that some Republicans are actually interested in problem-solving, not simply nay-saying.

It is possible that the health care reform issue has hardly begun, that the conventional back-room deals and horse-trading needed to be sorted through before the real work could begin. It is a profound truth that, town hall protests and nonsensical boasts about American health care notwithstanding, the middle class is terrified that their access to health care is slipping away. Both Democrats and Republicans have a large stake in visibly resolving this crisis. And, as Rahm Emanuel said, a crisis is a terrible thing to waste.`

The shame and danger of the health care reform proposals so far is that they would likely do little to actually address the crisis. The question now is whether lawmakers in either or both parties can put aside their partisanship, their petty grievances, and their special interest conflicts to do the people's work. Pursuing the structural solutions described here would get America's health care system headed in a new, far more positive direction.

And one thing is clear. The American people are desperate for meaningful health care change, and are watching this process very closely. Whoever takes the high road and achieves real reforms will win. The opposite is also true.

Brian Klepper
, PhD and David Kibbe MD MBA write together and consult on health care market dynamics, reform issues, and health IT. Their collected writings can be seen here.

*As of Aug 25 this is what Mayo says about the various health care bills:
August 25, 2009

We support President Obamas call for healthcare reform, and agree with his position that the status quo is the one option that is not on the table. With the President and Congress commitment to reform, we have a window of opportunity now to create bold policy that will translate into real change for patients. Mayo Clinic and the many organizations and individuals working with us in the Mayo linic Health Policy Center are strongly in favor of reform of both health care delivery and health insurance. True health care reform is getting better results for the money spent. Better results for money spent is what we mean by high value health care: better outcomes, safer care, better service and at lower costs over time. If we can accomplish this we will find better access for medical services as well. With many proposals and legislation in the mix, overall we believe there must be two key elements in any successful reform measure:
  • Insurance for all, so all Americans have access to health care.
  • Payment system reforms that reward value rather than penalizes those who provide high quality, affordable care. Mayo Clinic has laid out an overall Point of View to help guide lawmakers on the elements needed to deliver quality, affordable health care.
  • Paying for Value The Mayo Clinic Health Policy Center recommends that Congress focus on "paying for value as the fundamental step required to induce meaningful health care reform. If reforms can align the payment system to reward value, then doctors, nurses, hospitals and other providers will work together in appropriate ways to receive that reward. It may not take much to produce the changes needed to get high value care. Health care professionals have a true interest in providing the best quality care for their patients. If they are rewarded rather than punished as they are in today's system for providing high value care, the payment system will be aligned with their own professional instincts. Most importantly, paying for value will align with what people want: health care that provides good access, delivers quality utcomes, is performed safely, with compassion, and at affordable prices.
  • Using Medicare as a lever. We believe the House and Senate have made progress ‐‐especially with reported provisions in the House bill that will help ensure that Medicare pays for value. We are encouraged by reports of provisions to be added to the House bill that addresses both quality and regional variation through two Institute of Medicine (IOM) studies. We believe that provisions such as these must be part of final health care reform legislation.


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