Two veteran healthcare experts….

Stark and Durenberger agree that bipartisanship has gone, because there is an effort to dismantle Medicare. “If god had to make Republicans, he should make them all like Dave Durenberger”.

Stark: Hubbard says that well informed consumers will be shopping for the best deal. But in California was it cheaper in Tenet’s Redding hospital? But it killed alot of people. We spend the least on IT usage and the least information. Doctors cant be ranked and rated, and wont do it amongst themselves. Thinks that HSA’s will just shift the cost to poor and an sicker.

What’s the democratic position. Jesse Jackson and Pete have a constitutional mandate to give a right to health care. Only Americans who have that right are prisoners. Stark-“If it’s good enough for Rostenkowski and Martha Stewart, it’s good enough for me!”

Durenberger: the challenge with Hubbard’s position is that the difference between what we need and what we want. May be able to effect the price of what you want. But his secretary had a heart attack, got a bill for $4,500 from her CDHP because her anesthesiologist was out of network. She never knew who the anesthesiologist was , of course!

Stark: If you allowing people to get in the game late because you don’t insist on universal coverage, then we all pay the cost.

Durenberger—the challenge of the HSA/HDHP is that we are disintegrating the coordinated care of Kaiser, Group Health, etc.

Stark—in my county 600K are members of Kaiser Permanente. It’s attracting docs, and that’s the way more are choosing,

Why would it be such a bad idea to move coverage to CMS, where cost to deliver service is 6% over actual costs, rather than 3rd party providers that need to make at least 15-30% margin. if we can control the marginal cost to deliver reimbursement, why would we not want to take these quick dollars out of the system?

That’s not the real problem. the problem is the Berwick/Wennberg data showing that low cost high quality care is in some places, and that sends money to other places with worse value.

Are there any portions of the Bush health agenda that are unlikely to pass this year?

Stark-No substantive parts will pass this year. But we (the Dems) dont even know where the committees meet anymore. The divisions within the Repubs in the house will prevent anything.

Will this be a big issue in the next presidential election?

Durenberger—we have a governor who wants to make this an issue and both Romney and Huckabee (Arkansas) will make that an issue.Stark—but it’s a major issue for Dems too, as people are losing their insurance via their employers. people are scared…

What about  outcomes/quality research?

We do have some research but not definition of what is quality for doctors and consumers.

Not just the price but what you’re getting for it.

How do we really determine the price? 

Durenberger—No one can give accurate pricing as someone is subsidizing something else. Unless we deal with that, which gets us to the point of universal coverage. We’re all Americans, and if we get to universal coverage, then there’ll be lots of incentives to drive efficiencies.

Stark—Cross subsidization goes on all the time in hospitals and probably cant identify it

If we have price transparency without solving the uninsured problem, wont this make that worse

Stark — Yes and transparency it a myth. He’s trying to get a price for a colonoscopy in DC hospitals. He cant even get a price per procedure let alone a cost accounting breakdown as to why this is cheaper in Rochester MN.

(Note-I moved this to the correct sequence in the WHCC Conference)

Allan Hubbard is Bush’s health care guy. Here’s what he had to say (my comments are in parens)

Primary reason for health care costs being so high is third party pay. When we consume healthcare we don’t ask the price, so we treat it if it’s free. And out of pocket costs have been declining over the last twenty years (Ed notes—although not the last five). And therefore price pressure being absent prices go up, and efficiency goes down.

There are three visions—status quo but that’s not sustainable

Single payer, expand Medicare a la Ted Kennedy, which will lead to rationing.

Or we can go to consumer directed health care where consumer picks amongst transparent options.

(He seems to have missed all the other universal coverage options—never heard of Enthoven, Fuchs, et al?)

The HSA is the solution, and a portable HDHP will not be underwritten for health reasons, so that’ll reduce job lock. But there;s still one problem that exists, and there’s not good information about pricing. Right now providers do to make that information available. He asked for people who disagreed, and then picked on a doctor who said no.  The physician said that he doesn’t know what the “best heart surgery” meant, so how could a consumer? (And Hubbard will probably join Beth McGynn on the AMA’s contract hit list should the news about his plans get out).

You talked about consumerism as a way to reduce prices and increase efficiency. What about the medical/emergency situations when the patient doesn’t have a choice about when, where and what type of care takes place?

Doesn’t work in emergencies…but that’s rare

Do you think HSAs could make the problem worse by driving the young, healthy or wealthy into these plans leaving the sicker in traditional plans which will drive up the cost of health care for the most vulnerable part of society?

Hubbard says that its not for the wealthy, as 40% of people getting them earn less than $50,000 (of course that means that 60% earn well more than the average, but lets leave that aside!)  For the chronically ill—he says 2–5% of population—this doesn’t work so well. so Administration wants to allow employers to put a bigger amount in the HSA for the chronically ill. But thats the problematic part. (Yup he admits it!)

(THCB readers know what I think about this, but after all you’ll comment here. )

John Snow, Treasury Secretary, never realized that he’d be spending so much time on health care, but it’s the elephant in the room of the fiscal future of the United States. Medicare could end up at 20% of GDP of health spending, and that will take all of the US budget if not stopped. Secondly, this hits at competitiveness for US business. And of course wages becoming a smaller part of total compensation.

Health care produces the most new products and probably best doctors in the world. But there;s a breakdown between all of that excellence and all that money and its outcomes. HC is way behind the times, especially in use of IT.

Too many people uncovered, too many small businesses uncovered. Too expensive and rising at too fast a rate.

So the Administration has an agenda, etc, etc. Of course he starts on the junk lawsuits issue, and gets a smattering of applause. He says HSAs are a promise, not a panacea. But he says (after a lot of well known rhetoric about HSAs) that there’ll be 20m Americans in HSAs, and many of those will be previously uninsured.

Most of health $ spent in last months of life and 5 percent of population drive over 50 percent of cost. When will we begin discussing end of life policy?

The idea is to have a refundable $3,000 HSA for that part of the population.

Should employers be in the business of providing health coverage?

It’s an accident that we’re there in the first place (price controls in the war). Best way to organize health care? No, but it’s what we’ve got. We wont get rid of it but the market is leading to major changes.

79% of the audience says that the percentage of health insurance coming from employers will be lower than it is today. And Snow agrees.

Michael Millenson, moderator—Intro—consumerism is a legacy of the Clinton health plan and the backlash against managed care

Bill McGuire, UnitedHealth Group— Health care system doesn’t work well—doesn’t work in any country, so it doesn’t matter who pays for it. It is time to drive for change, and consumerism can advance it on behalf of everyone.

We’ve got a problems and every constituent has got a problem—wont get better with fundamental change. United thinks that trend is slowing but Wall Street thinks that’s a problem as they wont be able to charge so much. Left to the system that we have, all use will be inappropriate. We need to re-use re-design what we have to make use of new tech, need to help individual anticipate those needs. Need to build (what looks like a damn complex system in his slide) an inter-operable system around the consumer.

He believes that personal coaching will help consumers. And that this series of problems can be solved across the continuum. Where benefits change matter— the important thing is what tools are there to make this consumer care work? The results so far: Discretionary use in outpatient services is down, apparently no evidence of diminished use of necessary services (although that’s not what the RAND experiment said). But we need to add the support to the system, and also get consumer credit into the health system.

Meanwhile I am also at the same time running the questions from the audience which are delivered over wireless devices and laptops by a clever little company called VisionTree. You can guess what they’re about today! But the moderator is keeping the subject on the one at hand, despite the frenzied concern of the United PR flack who appeared over my shoulder.

Overall I have a limited understanding what he means by his explanation of the universal consumer-focused system. His slide is called “A modern vision for the integration of Comprehensive Assets focused on the individual” —  I think he needs a new copywriter. But the key idea is the main hope that consumer directed care will work. 

On the other hand, despite the criticism of United and McGuire in today’s news, at least compared to may corporate CEOs of late who also have huge paydays he at least has led a company that has consistently increased earnings. And frankly it’s not exactly his fault (or that of other insurers) if their customers have let them get away with lowering their medical loss ratios year after year.

John Brennan,Vanguard Chairman & CEO,—  believes that the consumer is smart. The defined contribution market  has grown and they’ve grown with it. There are 4 main needs to serve consumers. 1) Effective candid communication and education…keep it simple. 2) Technology (especially real time information) 3) Providing choices 4) Willingness to adapt and evolve.

Jim Guest, Consumers Union—test products, get it out to consumers in plain English.  They’re pushing for that in health care. what have they learned? Give the public a consistent format so that they can compare one to another to another. Like a nutrition content guide on the back of food products, and the same template on credit cards. they are starting to do that with drugs, at bestbuydrugs.org Insurance institute for highway safety crash test cars and gives that information out—in the mid 1990’s half the side crashed vehicles ended up in marginal category, now it’s barely any 10 years later. Finally lets get Medicare data about physicians out. Business Roundtable, consumer groups and others all want to get that information out.

Michael asks….

Should you move to consumer directed health plan?

John Brennan—We offer consumer plans, but not very popular.Need to do a better job explaining it. Only 10% at Vanguard have chosen it so far. He talked to a lawyer/accountant this morning who couldn’t understand what the option meant.

Jim Guest—Consumer’s union supports consumer informed health care—consumer driven healthcare seems to mean a different thing. The consumer voice hasn’t been strongly heard. more driven by industry than by consumers. They don’t offer a consumer driven option

Why do I need a HDHP to take part in this wonderful consumer information?

McGuire—you don’t need one. We need a system that people can access. But some of these elements have no applicability for some portions of the population. and it’s a disservice to put the wrong people into that situation. But the consumer support is necessary for everyone.

McGuire—Price alone is not a good guide, Need the cost over a population over time….

Are we going to have another panel in 5 years with another buzzword like we did with managed care/capitation?

McGuire—managed care advocates weren’t very insightful! I would never had said that! this time there are fundamental issues that will be long lasting —information is fundamental, technology will be fundamental, so its a different situation.

Guest—whatever direction this goes, consumers will have to be put in the legislation/business forefront. that genii is not going back in the bottle.