How the G.O.P. Can Fix Health Care

Op-Ed Contributors – How the G.O.P. Can Fix Health Care –



In a bid to reopen the debate over health care reform, President Obama has arranged a televised bipartisan meeting this Thursday. Republican leaders in Congress have been invited to bring their best ideas for slowing the growth of health care expenditures and expanding the number of insured Americans. The Op-Ed editors asked five conservative thinkers to outline what they believe those ideas should be.

President Obama, Harry Reid and Nancy Pelosi have failed at health care reform. They have failed because they fundamentally don’t believe in markets, incentives and the power of hundreds of millions of people to make smart choices about their health. It’s just not in the Democratic leaders’ DNA.

Transforming health care to slow the growth of spending requires a radical restructuring of how health services are paid for. The most powerful way to reduce costs (and make room to expand coverage) is to shift away from “volume-based” reimbursement (the more you do, the more money you make) to “value-based” reimbursement.

Others will appropriately and wisely make the case for preventive care, chronic disease management, shopping for insurance across state lines, malpractice reform and the elimination of pre-existing conditions as exclusionary criteria for health insurance — all steps that I favor and that together would strengthen the health care system. But they won’t transform it. The only way to do that is to align the incentives of doctors, hospitals, pharmaceutical makers and other health care providers through value-based purchasing.

The Congressional plan to squeeze reimbursement to nurses, doctors and hospitals by imposing top-down budgeting in Washington won’t work. It won’t change anyone’s behavior, and it will eventually lead to rationing, which undercuts innovation and medical research.

This is not rocket science. You simply need to pay people to do a good job, demand measurable outcomes and adopt proven standards of practice and information technology. Reward value, not volume.

Medicare and private insurance companies should reimburse providers not for each discrete service they provide but for managing a patient’s condition over an entire episode of care. In my own field, transplantation, for example, a payer should not separately reimburse 56 different nurses, doctors, pharmacies, imaging centers and hospitals. Instead, it should pay a heart transplant team a fixed sum (adjusted for risk) based on the diagnosis of “heart failure requiring transplantation.” The disbursement of that payment would then be made at the local level, where value can be most accurately determined, and waste most likely eliminated.

Health care providers could then compete on the basis of efficiency and success. Markets work. We should use them to drive behavior toward the goals of sustainable value in medical treatment and affordable health care for all Americans.

— BILL FRIST, surgeon and former United States senator from Tennessee

Republicans can’t and won’t accept a simple combination of the Democratic health care bills that passed the House and Senate. But the country needs health care reform, and Republicans must engage in the process.

They should insist on adding reforms that would do more to reduce costs, in order to avoid higher income, payroll or similar taxes. (These taxes are different from the proposed excise tax on high-cost health insurance, which would actually reduce health-care spending.) Further cost-saving reforms could include meaningful changes in medical liability law; better opportunities for people to save money when they take steps to lower their health care costs; and Medicare savings from greater use of competitive bidding.

Some elements of the Democratic legislation could be part of a bipartisan agreement — for instance, help for people with limited means and/or high medical needs to buy insurance in a competitive marketplace. Such a market would let people easily compare a broad range of options and keep the savings if they chose a less costly plan.

Republicans should also build on proposals to enable health care providers to get higher Medicare payments when they deliver better care at less cost. For example, the Democratic bills would let providers share in Medicare savings if they can show that the way they prevent and manage illnesses reduces complications and costs Medicare less. Republicans should further propose that Medicare strengthen its capacity to provide data and measure patient outcomes — to help providers and to evaluate changes in care quickly.

This is desperately needed to help make Medicare sustainable while improving the quality of care. Currently, doctors lose money when they work with nurse practitioners, pharmacists or wellness programs to help patients avoid costly complications — because Medicare doesn’t pay for this, and it results in fewer billings for the visits, tests and procedures Medicare does pay for.

All these steps can add up to a health care system that does much more to support patients and health professionals in improving our health and saving money. That’s a bipartisan opportunity we can’t afford to miss — either because Democrats are unwilling to change or because Republicans insist on starting over.

— MARK McCLELLAN, director of the Engelberg Center for Health Care Reform at the Brookings Institution and former Medicare administrator in the George W. Bush administration

When Americans think about health care, they think first of health, not finance. They go to the doctor to get well, not to show off their government-issued insurance card. So President Obama’s health care reform plan was doomed from the moment the American people figured out that his goal was to spend less on health care.

While the president’s idea of “bending the curve” on health care means cuts in Medicare, to the American people bending the curve means living better and longer. To the folks on Main Street, it means not appointing Kafkaesque committees to measure “quality-adjusted life years” but fostering a vibrant climate of scientific research and opening a wider pipeline for new medicines.

Sixty-seven percent of Americans say they are not getting enough medical treatment, according to Kaiser Family Foundation data. But we want not just more care; we want better health. Thanks to the public-private effort that decades ago brought us the polio vaccine, we no longer spend money on wheelchairs and iron lungs. We could do the same today for other diseases. Finding a cure is cheaper than paying for care.

Our medical industries can improve our economy as well as our health. As Robert Fogel, the Nobel-winning economic historian, wrote last year, health care is “the growth industry of the 21st century.” We won’t escape from the recession by provoking a recession within the health care sector. When people are healthier and more productive, they will need less chronic care, and tax revenues will rise out of the expanding economic pie.

A “more health” plan is a win for individual health, a win for economic growth and, yes, a win for the cause of long-term health savings.

— JAMES P. PINKERTON, fellow at the New America Foundation and former domestic policy aide for Presidents Ronald Reagan and George H. W. Bush

Health care reform should have two critical goals: reducing costs and covering more people. To meet them, Democrats and Republicans must abandon simplistic, ideologically driven proposals that animate each party’s base. Liberals cannot insist on Medicare for all, and conservatives cannot insist on markets for all, plus tort reform. Neither approach will work.

Medicare is an inherently inflationary fee-for-service system that rewards volume, not value. Market-based strategies cannot cover the uninsured or prevent some insurance companies from covering only healthy Americans.

Our existing employer-sponsored system — a pre-World War II dinosaur awaiting extinction — offers most Americans little, if any, real choice among competing insurance plans. Both parties should jettison it in favor of giving Americans better health care choices.

To do this, Congress should not micromanage people’s health care decisions by imposing price controls or setting up more bureaucracy. Rather, it should introduce competition to the insurance market by creating a system of regional exchanges, similar to the one now operated by the federal government for its employees, to allow everyone the opportunity to choose an insurance plan. Then Americans would be able to shop for health insurance and pocket what they save by choosing lower-priced plans. Appropriate risk adjustment — a mechanism by which insurers who cover more sick people are compensated by insurers who cover fewer of them — could reduce the incentive of some insurance companies to sign up only the healthy.

Congress should also end the current tax exemption for employer-sponsored insurance coverage. This change would encourage people to pay more attention to the price of their health insurance. And it would provide the money that will be needed to help underwrite coverage for the uninsured.

Finally, no backroom deals — for pharmaceutical companies, individual members of Congress or anyone else.

We have a rare opportunity to lower America’s health care costs, extend coverage and provide better care. What’s uncertain is whether our bipartisan leadership is up to the task.

— CHARLES KOLB, former domestic policy adviser to President George H. W. Bush and president of the nonpartisan Committee for Economic Development

CAT scans, blood tests, ultrasounds, Caesarean sections — in many instances, these diagnostic tools and procedures are vital for treating patients. Too often, however, such procedures are ordered unnecessarily and drive up the cost of medicine for patients, taxpayers and insurance carriers.

A new Gallup poll, commissioned by Jackson Healthcare, indicates that doctors believe an astounding one in four health care dollars is now spent on unnecessary care.

Doctors order these procedures to protect against frivolous suits filed by trial lawyers seeking an easy payout, particularly after a doctor makes a simple mistake. Seventy-three percent of the doctors surveyed said they had practiced defensive medicine in the past year. As a result, American patients not only endure extra hours of tests and treatments but also pay more for health care.

If President Obama and Congress are serious about reducing health care costs, then the more than $600 billion a year in unnecessary care should be at the top of the list. Congress must give states the incentive to reform their civil justice systems so that lawyers will think twice before suing doctors for frivolous cases. There is a place for health courts that address only medical malpractice cases, and a need for caps on damages for “pain and suffering” that have nothing to do with lost wages or actual damages. Doctors who incorporate best medical practices should be protected from lawsuits altogether.

These reforms would allow doctors to stop playing defense, and make it possible for patients and taxpayers to better afford health care.

— NEWT GINGRICH, former speaker of the House of Representatives and founder of the Center for Health Transformation, a health-care policy consulting firm

Copyright 2010 The New York Times Company

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