Congress returns next week to address three key interrelated issues related to healthcare reform-accessibility, affordability and sustainability. How do we best expand coverage so that all Americans have financial access to needed care? How do we make sure such coverage is affordable? Finally, how do we control the greater than inflation rate of health care spending over time so that coverage can be sustained? These questions pose monumental challenges.
There are many areas of agreement on expanding health insurance coverage. These include eliminating pre-existing conditions that prevent people from obtaining coverage; insuring portability across states; mandating the purchase of insurance coverage; standardizing insurance claims to reduce paperwork and establishing health insurance exchanges that would provide relevant benefits and cost information for people to choose the plan that best serves their needs. Employers could continue to pay for their employees’ insurance coverage or pay into a pool of funds to be used by their employees for coverage.
Uninsured and low-income individuals would have their premiums subsidized up to potentially as high as 400 percent of the poverty level. The most controversial part of the health insurance dimension of reform is the idea of establishing a public option intended to provide competition to the private plans. The concern is that the public plan would have an “unfair” advantage in using its clout over suppliers and providers in negotiating lower prices than private carriers. Over time, more people would select the public plan resulting in a de facto single payer system. In response to this concern, consideration is being given to establishing not-for-profit cooperatives that could provide an alternative to private-for-profit carriers but without the formal government sponsorship and attendant concerns.
It is estimated that extending health insurance coverage to all Americans will cost at least $1 trillion over the next ten years and contribute over $200 billion to the deficit. Some of the leading ideas for raising revenues to cover these costs include: 1) taxing individuals making more than $250,000 a year and families making more than $350,000 a year; 2) increasing taxes on tobacco, alcohol and sugary soft drinks; and 3) capping the tax credit on employers’ health insurance premiums. However, even if all three of these were enacted, they would be insufficient to cover the entire cost.
This leaves the third issue of how can the country reduce the rate of increase in health spending over time? This perhaps is the most challenging aspect of health care reform because it involves addressing the fundamental underlying determinants of health care spending; namely, patient, hospital and physician behavior as they use available technologies and treatments. Evidence suggests that the largest impact on costs will come from lifestyle-related disease prevention and behavioral changes involving nutrition, exercise and tobacco cessation. These have the largest impact on the burden of disease particularly in regards to diabetes, cardiovascular disease and cancer. The federal government is proposing a $10 billion fund for disease prevention and health promotion to address these underlying issues.
Changing hospital and physician behavior to eliminate errors, duplicate testing and care that provides no patient benefit will primarily involve changes in payment combined with performance measurement and public reporting of cost and quality data. One idea is to pay bonuses to physicians to serve as care coordinators to reduce unnecessary hospital admissions and emergency room visits. Policy makers are considering means by which hospitals and physicians can create Accountable Care Organizations (ACOs) and Patient Centered Medical Homes (PCMHs) that would serve as the building blocks for responding to these new incentives.
Reforming our nation’s health care system is complex and touches on every human emotion. Compromise is necessary and, hopefully, this time inevitable. To maintain the status quo means that nearly 50 million Americans will remain without insurance coverage at the same time that we spend far more than any other developed country in the world and, yet, rank in the bottom quartile on almost any measure of health status available. To continue on this course will further weaken this country’s most important resource; its human capital. We must prevent its continued erosion and step up to the undeniably difficult and complex choices that must be made.
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