The morning after the election, I posted a speculative blog in Health Affairs on three possible scenarios for President-elect Obama’s implementing health reform: folding it into a bold, ambitious emergency legislative package (Complete the New Deal), carving funding out of the current $2.5 trillion national health spend (Braveheart), and postponing implementation until the economy recovers but taking steps now to prepare for it (Wait/Lay the Groundwork).
At the time, the Wait/Lay the Groundwork option seemed 70 percent likely. But with economic conditions worsening, I’m now convinced Obama will probably opt instead for the Complete the New Deal option, and try to implement health reform in the first 120 days of his Presidency, before the health care industry “dragon” can even stir from its cave.
Let’s call Obama’s program The Real Deal. We can already see its contours: an economic stimulus program including highway construction and other state-directed public works, a green energy spending initiative, emergency housing assistance including a foreclosure prevention measure, an auto industry bailout, labor law reform and income supports through tax credits for low income people.
I’ve got news for the folks doing the International Foundation of Employee Benefit Plans’ survey: Smaller businesses, especially those defined as true small businesses with two to 50 full-time employees, are strapped beyond belief when it comes to paying ever-higher premiums for health care.
Across the board, the 100+ businesses I represent, all of them two to 50 full-time employees, have received increases between 13 percent and 75 percent this year. The average has been around 20 to 24 percent. That’s on top of more than 15 percent average increases last year, the year before, and the year before.
If the burst of new Democratic health care reform proposals is any indication, a fresh breeze of the Obama campaign’s "Yes We Can" optimism is blowing across the nation. Mr. Obama’s team is expected to make health care one of its priorities. First out, though, was Senate Finance Committee Chair Baucus (D-MT), who introduced an aggressive health care reform package that builds on Mr. Obama’s campaign platform of cost controls and extended coverage. Senator Kennedy (D-MA) and Representatives Dingell (D-MI) and Stark (D-CA) are expected to offer proposals soon, and undoubtedly there will be others.
The rub is that Congress’ old-guard lobbying system remains in place. Congress is awash in special interest contributions – $2.8 billion from 15,500 lobbyists in 2007 – that exchange money for influence over policy. When the Democrats retook Congress two years ago, they did not substantively change the lobbying rules.
So it is reasonable to ask whether a new day of governance in the common interest is possible. Can we make progress on health care or on any significant problem – climate change, education, energy policy, finance, the social safety net – without addressing the underlying problem of Congress’ receptiveness to special interest influence?
In this interview on “The Business Case for Health 2.0,” Ken Shachmut,
Senior VP Strategic Initiatives, Health Initiatives, and Health
Re-engineering at Safeway, shares is thoughts on some of the highly
impressive results that the company has obtained by introducing market-based
SS: Ken, thanks for making time today. Tell me a little about your background?
KS: I have been active as an executive and
management consultant for over 30 years. I graduated from Princeton in
Engineering and later obtained my MBA from Stanford. In consulting, I
worked first with McKinsey & Company,
later at Booz Allen Hamilton, and for awhile independently. I had done
some consulting for Safeway. I later joined Safeway and have been there
the last 15 years in various capacities.
Due to my consulting background and analytical focus, I am
frequently asked to look at new challenges and opportunities for the
organization. As health care costs continued to rise, we started
looking at ways that we could engage our employees or work with the
unions to control costs. The process has been highly successful, and we
now have broad participation in “market-based health care” (MBHC) plans
– starting with our non-union population and evolving into our union
plans currently. In consequence, our employees are now much more
actively involved in their health care and are making better choices
that improve their health. As a result of our learning and success, we
have helped to create the Coalition to Advance Health Care Reform
(CAHR) which is led by our CEO Steve Burd. CAHR now has over 60
companies as members.
The Los Angeles Times ran a great series last week called "Shedding Risk" in which it detailed through compelling human stories the erosion of the health insurance market. It’s definitely worth finding the time to read.
Matthew has talked about this eroding model for a while, including in a speech about three inconvenient truths that he gave to health plan executives in March.
Here are four key paragraphs from the first article in TheTimes‘ series to give you a sense of the articles:
At the heart of the problem is the clash between the cost of medical care and insurers’ need to turn a profit.Today, four publicly traded corporations — WellPoint Inc., UnitedHealth Group, Aetna Inc. and Cigna Corp. — dominate the market, covering more than 85 million people, or almost half of all Americans with private insurance.On Wall Street, they showcase their efforts to hold down expenses and maximize shareholder returns by excluding customers likely to need expensive care, including those with chronic diseases such as asthma and diabetes. The companies lobby governments to take over responsibility for their sickest customers so they can reserve the healthiest (and most profitable) for themselves.Meanwhile, insurance premiums are becoming a heavier burden on employers, many of which say that rising healthcare costs cut into their ability to compete and, in some cases, to survive.
Here are Matthew’s three inconvenient truths to the insurance execs:
Over at the Huffington Post, Michael Millenson walks us through McCain’s plan to end employer sponsored coverage, noting that it would apply faith-based economics to one seventh of the US economy, and pointing out that its as radical a ploy to foist on the innocent bystander American people as any bomb-thrower ever cooked up.
It’s vintage Millenson: erudite, an airtight argument, gleefully presented, and making no apologies for its partisanship. A fun and informative read.
See also: An analysis of the about-face the McCain camp made suddenly regarding funding for his health plan. He’ll now keep the payroll exemption and cut $1.3 trillion from Medicare and Medicaid to pay for his tax subsidies.
Note: Amy Tenderich, who writes and maintains the wonderful Diabetes Mine,
just did this very illuminating interview with Google Health’s Missy
Krassner. As you’ll see, she doesn’t slow-pitch to Missy. This is a
sure-footed, tough-minded exchange about the real issues that are on
the table now in Health 2.0. – Brian Klepper
Slowly but surely, using the Internet for your health needs is
becoming as mainstream as shopping on the web: no longer futuristic,
but is it for everyone? And perhaps more importantly, are mainstream
commercial health platforms from companies like Google and Microsoft
really useful for people with specific chronic illnesses? I thought it
would be interesting to hear their side of the story.
So please welcome Missy Krasner, Product Marketing Manager for Google Health, whom I was lucky enough to catch up with for an interview last week.
Missy, shortly after Google Health launched last Spring, David Kibbe, former Director of Health IT for the AAFP, noted
that most of its services were “only mildly useful and sort of
‘toyish.’” How have these services evolved to be more useful to people
with health conditions?
What do we do with people who are uninsurable because they have a pre-existing medical condition?
That is a particularly important question as both McCain and Obama propose reforming American health care by building on the private health insurance system.
One of the solutions being discussed–by McCain among others–is to use state-based risk pools. Under McCain’s plan heavily dependent on an individual platform, people who don’t have employer-based coverage and healthy enough to qualify for individual health insurance could get a private mainstream plan and people who do not qualify for a standard individual plan could buy into a state-run high risk pool for the uninsurable.
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.”
Several months ago, I mentioned the large sum of money being spent by SEIU on political races throughout the country. Now, an editorial in the Wall Street Journal questions the legality of the manner the SEIU is collecting these funds from its members. (By the way, the sum I mentioned was $75 million. The WSJ raises this to $150 million.)
I am not qualified to make a judgment on the legal issues raised by the Journal’s editorial writer, but I want to raise a related political issue. SEIU concludes one of its publications with the following depiction of the future:
SEIU’s health care profile — and power — will only continue to grow. After we help elect a pro-worker president and stronger pro-worker majorities in Congress, we will take all our energy, idea, organizing strength, grassroots lobbying and political muscle and make it happen. Next year, 2009, we — all of us — will make history. We will achieve quality affordable health care for every man, woman, and child in America.