Charlie Baker is the president and CEO of Harvard Pilgrim Health
Care, Inc., a nonprofit health plan that covers more than 1 million New
Englanders. Baker blogs regularly at Let’s Talk Health Care.
I was in a meeting the other day when someone said — mostly in exasperation — "Everyone’s for affordable health care for everyone, but no one cares very much about dealing with the cost of health care.”
I’m sure that truer words have been spoken, but I can’t think of any off the top of my head. It’s too bad. Somehow, we’ve divorced the coverage/affordability question from the cost question, and we pay for it – everyday.
In a recent article in the Journal of the American Medical Association (JAMA), bio-ethicist Zeke Emanuel from the National Institutes of Health, put it pretty well — “Without controlling health care cost, any attempt at universal coverage will be transient. Sustainable expansion of coverage to all Americans requires credible changes in the rate of health care inflation. In the strange calculus that is American politics, the more politically salient issue of costs may provide a better way to achieve the comprehensive reforms necessary to cover the uninsured that the hitherto futile direct moral appeal.”
It shouldn’t be that hard to accept the notion that it’s easier to
cover more people if health care costs are under control – and harder
to cover more people when they are not. But, most of the time, the
coverage debate has been only about coverage – and not about cost.
pretty sure there’s a morality play in here somewhere — that covering
people is a moral issue, while controlling the increase in health care
costs is an economic one. For some, arguing the rightness of providing
coverage is more compelling than engaging in the grind that comes with
discussing what to do about health care cost increases. But, the
simple fact remains that covering more people is intrinsically linked
to health care costs. If costs go up, coverage goes down – and vice
Two years ago, Massachusetts enacted major health care coverage expansion legislation, which did very little to deal with health care costs. As the cost of implementing the new law became clearer (and higher), everyone began discussing how hard people would need to work on the health care cost issue to preserve and expand on the gains made under health care reform. Yet here we are in 2008, there are significant pieces of health care legislation under discussion in the closing days of this legislative session. Unfortunately, some of the proposals being considered would raise health care costs if passed – a big step backward in efforts to reduce the increase in health care costs.
Why? Because it’s easier to talk about doing more things for more people than it is to talk about taking costs out of the system.
Two people in Massachusetts who’ve been willing to discuss both issues at the same time are Alan Sager and Deborah Socolar from the Boston University School of Public Health. Sager and Socolar have maintained – for a long time – that there is no answer to the coverage question that can work without fundamental reform of the delivery and payment systems. They offered up an op-ed in the Boston Globe the other day that basically said health care reform — and the ongoing expansion of coverage – cannot be maintained without a major change in the payment system. In this case, they recommend moving away from fee-for-service, which pays for volume, but not outcome – to something more like – GASP – capitation – in which physicians would receive monthly payments in exchange for managing all of the care someone requires.
Many people may recall that capitation failed in the 1990s, mostly because most physicians rejected it – and once they rejected it, patients and policymakers rejected it, too. Health plans also did a mediocre job of incorporating the risk inherent in serving people requiring different levels of care into the payments they made to physicians thereby speeding up physician dissatisfaction with the whole concept. After all, should someone who’s taking care of three patients with cancer and two with HIV get paid the same budgeted amount as someone who’s taking care of five healthy 25 year-olds? To solve this issue, Sager and Socolar suggest using risk-adjusted payments that account for the relative health of each group of patients served by a physician and his or her practice, and they propose to only include those physicians who are willing to try this approach. This idea may work for some, but I don’t think capitation – even if it’s risk-based – is going to bring too many physicians back into a financial risk arrangement.
Still, I share their larger perspective that coverage and cost have to be discussed together, and that our chances for sustaining health care reform improve the more we do to lower the increase in health care spending. Unfortunately, the discussion in Massachusetts this year has been mostly about expanding mandated health benefits, reducing coverage options for employers and individuals by increasing minimum benefit requirements, and collecting more money from participants – health plans, employers, providers and consumers – to fund unanticipated expenses.
Health care reform will not succeed if this keeps up. People who care about health care coverage need to engage as aggressively on the cost question as they do on the coverage question. Otherwise, the ongoing expansion in coverage that they fought for and care about will not be sustainable.