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09/15/2009

Real Healthcare System Development

by Richard G. Stefanacci, DO, MGH, MBA, AGSF, CMD

Despite all the talk about healthcare reform the only thing being talked about is insurance reform. President Obama’s speech to Congress on Sept. 9 highlighted only improvements to insurance coverage and cost reductions primarily through reductions in waste and abuse in the Medicare system.

As a practicing geriatrician, former CMS Health Policy Scholar, and associate professor at the University of the Sciences, I can tell you what is needed is real healthcare reform which involves a total change of our current delivery model.

Notice I said “current delivery” model and not “healthcare system” because for most us delivering care the thought is that we are not operating in a system. Rather, healthcare in the United States is delivered through fragmented silos focused on specialty procedures used to treat episodes of acute illnesses.

Instead what is needed is a true system of care that is built upon:

1. Integrated payment model
2. Support for a primary care focus
3. Early preventive care

Many of the elements exist in part in the health systems that are tattered as best practices such as Kaiser Permante and PACE (Program for All-inclusive Care for the Elderly).

What was probably more telling is what was not mentioned in the President’s speech. For example there was no mention to quality, improvements in access to primary care services or cost reductions focused on system improvement or factors that could really improve the health of Americans such as those that would reduce the rate of obesity.

There does appear to be some clear winners and losers in the current healthcare reform movement. Those benefiting most include:
- Those currently uninsured but moving to government subsidized insurance coverage
- Those individuals that are high risk and either insured or uninsured as the insurance reform would likely lower their premiums
- Those paying high premiums currently that move to a lower cost Public Option or Co-op.

Those likely to be made worst off from where they are today include the following:
- Those that are healthy either with or without insurance as they will be forced to pay more for coverage
- Insurance companies who would face greater regulations and decreased reimbursement
- Uninsured businesses as they would be forced to cover their employees.
- And through the Public Option providers as a result of a decrease in reimbursement. In addition because of a Public Option insurance companies would also experience a decrease in enrollment.

In the end what is needed is to focus our attention on development of a US system of healthcare that again is primary care focused and patient centered with a heavy emphasis on preventive practices such as reduction in our obesity rate. Through this type of focus we can begin to realize true and sustainable reductions in our healthcare costs, improvements in our quality of life and the ability to provide coverage for all Americans.

Dr. Richard G. Stefanacci is the executive director of the Institute for Geriatric Studies at Mayes College of Healthcare Business & Policy at University of the Sciences in Philadelphia.

When one examines the President’s speech to Congress the following points fall out:

Three basic goals:

ACCESS (COVERAGE) 1. INSURED - It will provide more security and stability to those who have health insurance.

  1. against the law for insurance companies to deny you coverage because of a pre-existing condition
  2. against the law for insurance companies to drop your coverage when you get sick or water it down when you need it most
  3. arbitrary cap on the amount of coverage you can receive in a given year or a lifetime
  4. limit on how much you can be charged for out-of-pocket expenses
  5. required to cover, with no extra charge, routine checkups and preventive care, like mammograms and colonoscopies - because there's no reason we shouldn't be catching diseases like breast cancer and colon cancer

This could be cured through simple legislation that insurance companies can’t drop someone if they complete insurance applications based on their best understanding of their health – applicants for insurance can’t lie about something of material substances but not penalized for failing to mention something insignificant Also, one should note that by forcing insurance companies to provide more coverage and cover high risk member at lower rates will result in increased payment on others in that plan.

2. UNINSURED - It will provide insurance to those who don't.

  1. creating a new insurance exchange -- a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices. Insurance companies will have an incentive to participate in this exchange because it lets them compete for millions of new customers. As one big group, these customers will have greater leverage to bargain with the insurance companies for better prices and quality coverage.
  2. exchange will take effect in four years
  3. making a not-for-profit public option available in the insurance exchange.
  4. tax credits, the size of which will be based on your need
  5. the public insurance option would have to be self-sufficient and rely on the premiums it collects. But by avoiding some of the overhead that gets eaten up at private companies by profits, excessive administrative costs and executive salaries, it could provide a good deal for consumers. It would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities. (College example is not entirely accurate because of the heavy subsidies applied within)
  6. For example, some have suggested that that the public option go into effect only in those markets where insurance companies are not providing affordable policies. Others propose a co-op or another non-profit entity to administer the plan. These are all constructive ideas worth exploring. But I will not back down on the basic principle that if Americans can't find affordable coverage, we will provide you with a choice. And I will make sure that no government bureaucrat or insurance company bureaucrat gets between you and the care that you need. (This last statement is already untrue – Medicare will not pay for IV therapy for a nursing home resident unless they first go to the hospital for 3 days)
  7. In the meantime, for those Americans who can't get insurance today because they have pre-existing medical conditions, we will immediately offer low-cost coverage that will protect you against financial ruin if you become seriously ill.
  8. individuals will be required to carry basic health insurance

COST 3. And it will slow the growth of health care costs for our families, our businesses, and our government.

  1. more spending cuts if the savings we promised don't materialize
  2. savings within the existing health care system -- a system that is currently full of waste and abuse.
  3. unwarranted subsidies in Medicare that go to insurance companies- subsidies that do everything to pad their profits and nothing to improve your care.
  4. create an independent commission of doctors and medical experts charged with identifying more waste in the years ahead.
  5. common-sense best practices by doctors and medical professionals throughout the system - everything from reducing hospital infection rates to encouraging better coordination between teams of doctors
  6. insurance companies a fee for their most expensive policies,
  7. Malpractice reform: put patient safety first and let doctors focus on practicing medicine

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