National Health Care Reform: The Odds, the Players and the Issues

National Health Care Reform: The Odds, the Players and the Issues

Peter V. Lee, Executive Director for National Health PolicyPacific Business Group on Health

Consumer-Purchaser Disclosure Project Policy BriefingJanuary 12, 2009

© Consumer-Purchaser Disclosure Project, 2009 2

The Odds – Will “Big Reform” Occur?

• Health care IS a core economic issue • President-elect Obama said so • More than Congressional interest -- we

have thoughtful Congressional leadership.

• Reform interest is bipartisan. • Proposals have low “fright factor” for

existing insureds • Coverage expansion is framed as BOTH

about the “right thing to do” and addressing cost.

• Bigger is often more doable than smaller. • Special interests recognize the need for

reform.

Over ($) 2 trillion reasons say no… but:


National Reform Opportunities: The Process and the Players


Health Reform Elements

1. Coverage expansion and Financing– Affordable coverage/Universal access

• Expanding public programs (Medicaid, SCHIP, Medicare)• Connector/Exchange

– Subsidies for low-income– Public plan option

• Small business tax credits– Shared Responsibility

• Individual mandate• Employer mandate (play or pay)

– Insurance market reforms• Guaranteed issue• Rating reforms

– Tax code changes (eliminating or modifying tax exclusion for ESI)– Individual out-of-pocket contributions

2. Benefits– Minimum, standard benefit package– Specified in statue or delegated to outside entity?– Value based insurance design– Long term care


Health Reform Elements3. System Reforms

– Quality improvement• Measurement and Reporting (transparency) • Address disparities• Promote primary care and chronic care management

– Wellness/Prevention– Payment reform

• Promote primary care, collaboration/integration and paying for “Value” – Medical home– Revised RBRVS– Episodes, bundles– Gain-sharing, accountable entities– Payment/non-payment based on quality/outcomes

4. Infrastructure – Oversight: Health Fed/Independent Health Coverage Council– Health Information Technology– Comparative effectiveness research– Workforce– Medical malpractice reform


The Legislative Process: Clean & Simple

Measure introduced into the House

Measure referred to committee

House Committee on Ways and

Means

House Committeeon Energy and

Commerce House passes measure

Measure introduced in the Senate

Measure referred to committeeSenate Health,

Education, Labor and Pension (HELP)

Committee

Senate Committee on

Finance

Legislation may begin in either chamber or proposed by the committee.Similar proposals are often introduced by both chambers

One Chamber agrees to the other’s version

House and Senate exchange amendments and agree

Signs or Vetoes

Or OrConference Committee

Senate approves conference report

Measures must pass both the House and the Senatein identical form before being presented to the President.

House approves conference report

President/Executive BranchAdministers Laws; Adopts Regulations

Legislation presented to the President

Senate passes measure


The Political Players

Henry WaxmanChair, Committee on Energy

and Commerce

The Obama

All-Stars

Tom Daschle: Sec. HHSDirector, White House Office of Health Reform

Timothy GeithnerTreasury Secretary

Peter OrszagDir. Office Management

and Budget

Rahm EmanuelWhite House Chief of Staff

Senator KennedyChair, HELP

Pete StarkChair, Ways & Means Comm.,

Subcommittee on Health

Senator GrassleyRanking Min., Sen. Fin.

Senator BaucusChair, Finance Committee

The Senators

The House Reps

Senator HatchRanking Min., Sen. HELP

Nancy PelosiHouse Majority Leader

John Dingell Jr., Chair Emeritus, Committee on Energy and Commerce


The Obama All-StarsBarak ObamaPosition: Team Owner of the Obama All-Stars Factoid: Spent over $100 million in campaign saying he’d change health care and 77% of Americans said health care was a “decisive concern” in their voteIn his words: “The time has come this year in this new administration to modernize our health care system for the 21st century, to reduce costs for families and businesses, and to finally provide affordable, accessible health care for every single American.” (“The market will work only where it has good information…If you can compare quality and price of an automobile, you should be able to compare quality and price of a heart surgery.” (in 2003 as chair of Illinois Senate Health and Human Services Committee)

Tom Daschle

Position: Team Captain -- Secretary HHS and Director of White House Office on Health Reform

Factoid: Co-authored “Critical” (with Jeanne Lambrew), calls for Health Fed

In his words: “We have the most expensive health care system in the world, but are not the healthiest nation in the world. Our growing costs are unsustainable, and the plight of the uninsured is unconscionable. Addressing our health care challenges will not only mean healthier and longer lives for millions; it will also make American companies more competitive, address the cause of half of all of our personal bankruptcies and foreclosures, and help pull our economy out of its current tailspin.”


The Obama All-Stars: The Money GuysPeter Orszag

Position: The Banker -- Director of Office of Management and Budget (“OMB”)

Factoid: Former head of Congressional Budget Office

In his words:“Two complementary approaches to reducing total health care spending involve generating more information about the relative effectiveness of medical treatments and changing incentives for providers and consumers of health care…. [The] relatively small investment in research focused on the mechanics of restructuring the delivery of and payments for health care to reduce inefficiency [is striking].”

Timothy Geithner

Position: Treasury Secretary

In his words: “[W]e’re seeing a welcome wave of attention in the business community to the broader economic imperative of health care reform. The U.S. system has compelling strengths in the quality of care and the choices available to much of the population. But our system is also remarkable for the magnitude of the costs, the incidence of those costs across the economy, the number of uninsured, and our poor performance on health outcomes even compared with less wealthy economies.”


The Obama All-Stars: Key PlayersRahm Emanuel

Position: Enforcer -- White House Chief of Staff

Factoids: Knows health care, served on Ways & Means Health Subcommittee, brother Ezekiel Emanuel, bioethicist at NIH, authored “Healthcare, Guaranteed”

Additional Key Positions:• Administrator of CMS (oversees Medicare and Medicaid)• Administrator of FDA• Director Centers for Disease Control• Director Agency for Healthcare Research and Quality • Surgeon General• Director National Institutes of Health• Senior Staff: White House Office of Health Reform, HHS, etc


The SenatorsLeadership & Key

Committees

Senator KennedyChair, HELP

Senator BaucusChair, Finance Committee

Senator HatchRanking Min., Sen.

HELPSenator Grassley

Ranking Min., Sen. Fin.

Senator Harry Reid Majority Leader, 111TH Congress

Senator McConnell Min. Leader, 111TH Congress


The House of Reps: Leadership & Key Committees

Nancy PelosiHouse Majority Leader

Henry WaxmanChair, Committee on Energy

and Commerce Pete StarkChair, Ways & Means


John Dingell Jr.Chair Emeritus, Committee on Energy

and Commerce

Joe Barton (R-TX)Ranking Minority, Committee on Energy

and Commerce Dave Lee Camp (R-MI)Ranking Minority, Ways & Means


John Boehner House Min. Leader


Legislative Process – The Reality: Chutes and Ladders with Trillions at Play

The Players: Senate House of Reps White House

Chutes or Ladders – those who can move reform forward or back (and their ten year lobbying + federal contributions to Congress):• Clinicians -- $980 million• Hospitals -- $752 million • Pharma -- $1.6 BILLION• Insurers -- $555 million

AND…if we play our cards right: • Labor• Consumers• Employers

Why have we failed to do health care reform: “…the power of the interest groups – doctors, hospitals, insurers, drug companies, researchers, and even patient advocates – that have a direct stake.” Tom Daschle, 2008


First Rule of Politics: Follow the MoneyFunds Flow 2006: $2,105.5 Billion


Chute or Ladder: CliniciansMajor Players: AMA, specialty societies, medical colleges, nurses, physical therapists, chiropractors

Pro: DEPENDS – differing issues if specialists “versus” primary care; support for primary care generally strong and cross-cutting

Concerns: rapid change to status quo

Lobbying 2007: $71.8 million

Federal Contributions: $86.6 million


Chute or Ladder: HospitalsMajor Players: AHA, FHA, Premier

Pro: Incremental reform; increasing Medicaid payments

Concerns: Rapid and disruptive change

Lobbying 2007: $91.7 million



Chute or Ladder: Pharma and DevicesMajor Players: PHARMA, AdvaMed, Individual RX companies, specialty developers, generic makers

Pro: generally “reality based” advocacy – recognize future of lower margins

Concerns: importation, Medicare negotiating, comparative effectiveness (especially with cost)

Lobbying 2007: $226 million



Chute or Ladder: Insurers

Major Players: AHIP, BC/BS, individual plans

Pro: expansion of coverage, maintaining and expanding private plan options

Concerns: MLR cap, Medicare Advantage payment reform, public plan expansion




Chutes or Ladders: Other Wild CardsLawyers

IT Vendors

Banks

Pharmacies (on-line or old-school)

States

Ideologues

…


Chute or Ladder: LaborMajor Players: AFL-CIO, SEIU, many others

Pro: patient-centered reform

Concerns: mix of protecting benefits and/or expanding coverage to low income



BUT…relatively little contributions focused specifically on health care


Chute or Ladder: Consumer GroupsMajor Players: AARP, Consumers Union, NPWF, disease groups, access/coverage groups

Pro: coverage expansion; patient-centered care; “their” condition

Concerns: group/issue specific


Chute or Ladder: Employers

Major Players: US Chamber, BRT, NFIB, individual employers that “step up”

Pro: malpractice reform, increasingly for value and reform (but historically, relatively little Concerns: protecting national consistency (hence, protective of ERISA)

Lobbying 2007: $87 million (but tiny on health care)


Health Reform Elements

1. Coverage expansion and Financing– Affordable coverage/Universal access

• Expanding public programs (Medicaid, SCHIP, Medicare)• Connector/Exchange

– Subsidies for low-income– Public plan option

• Small business tax credits– Shared Responsibility

• Individual mandate• Employer mandate (play or pay)

– Insurance market reforms• Guaranteed issue• Rating reforms

– Tax code changes (eliminating or modifying tax exclusion for ESI)– Individual out-of-pocket contributions

2. Benefits– Minimum, standard benefit package– Specified in statue or delegated to outside entity?– Value based insurance design– Long term care


Health Reform Elements3. System Reforms

– Quality improvement• Measurement and Reporting (transparency) • Address disparities• Promote primary care and chronic care management

– Wellness/Prevention– Payment reform

• Promote primary care, collaboration/integration and paying for “Value” – Medical home– Revised RBRVS– Episodes, bundles– Gain-sharing, accountable entities– Payment/non-payment based on quality/outcomes

4. Infrastructure – Oversight: Health Fed/Independent Health Coverage Council– Health Information Technology– Comparative effectiveness research– Workforce– Medical malpractice reform


The Consumer-Purchaser Disclosure Project is an initiative that is improving health care quality and affordability by advancing public reporting of provider performance information so it can be used for improvement, consumer choice, and as part of payment reform. The Project is a collaboration of leading national and local employer, consumer, and labor organizations whose shared vision is for Americans to be able to select hospitals, physicians, and treatments based on nationally standardized measures for clinical quality, consumer experience, equity, and efficiency. The Project is funded by the Robert Wood Johnson Foundation along with support from participating organizations.

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Jennifer Eames, MPH Tanya Alteras, MPPAssociate Director Associate DirectorConsumer-Purchaser Disclosure Project Consumer-Purchaser Disclosure [email protected] [email protected] 202-238-4820

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National Health Care Reform: The Odds, the Players and the Issues