America’s Healthcare System – Part 13
Modest Ideas for Improving the US Healthcare System Right Now
This is the 13th essay in Civic Way’s series on the US healthcare sector. In this essay, we offer some modest short-term thoughts for improving American healthcare. The author, Bob Melville, is the founder of Civic Way, a nonprofit dedicated to good government, and a management consultant with over 45 years of experience improving public agencies.
Until we build a new US healthcare system de novo, we must continue to make modest improvements.
We must make Medicare and Medicaid more efficient and regulate private insurers more rigorously.
To improve outcomes and reduce healthcare costs we must expand public health, enforce anti-trust laws, and increase reimbursement for cost-effective services like telehealth and in-home services.
We must design a new primary care network, increase the availability of physicians and nonphysicians, and delegate more medical duties to nonphysicians.
We must recognize and restore the government’s critical role in spurring innovation.
To cut healthcare costs, we should start by ending pharmaceutical price gouging.
Every year, Americans pay twice as much for healthcare as citizens of other developed nations. Given how much we spend, we might expect far better health outcomes than other nations. Sadly, our outcomes are worse, and the gap between the US and our peers is worsening by the year.
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There are many reasons for this. Too little prevention (and public health capacity). Uneven care access and quality. Fragmented healthcare resources. An ill-conceived healthcare financing (insurance) system. Profit-driven (instead of people-driven) innovation. Antiquated administrative systems.
In this essay, we highlight some possible short-term measures. Not just to improve lives now, but to set the stage for transformative reform.
Where We Are
The American healthcare system is riddled with paradoxes. We suffer chronic diseases but refuse to exercise or eat healthy food. We complain about high healthcare costs but won’t support public health programs that would save money. We recognize primary care shortages (especially in remote areas) but idolize the specialists. We lament the greed of pharmaceuticals but back the politicians that do their bidding.
For nearly 100 years, the US has tried—and failed—to create a healthcare system worthy of its people. We have seen many healthcare initiatives, some modest, some bold. But we have never gotten it right. Instead, we have allowed insurers, physicians, hospitals, pharmaceuticals, manufacturers—and their lobbyists—to define the care we get. We have allowed others to put their interests ahead of ours.
The US healthcare system is irrevocably flawed. We should design a system de novo that produces great outcomes. That ensures affordable care for every American regardless of their job, status or locale. That blends the best of the public and private sectors. That inspires everyone to take their health seriously.
Since a clean slate is highly unlikely—at least without some historic disruption—we must pursue more feasible changes. Improvements that keep Medicare and Social Security afloat. Enhancements that, in today’s polarized political climate, could attract bipartisan support. Small steps that set the stage for sweeping reforms.
Averting a Fiscal Apocalypse
We should start with restoring the finances of Medicare and Social Security. There is a growing fear (if not consensus) that they are going broke. Both programs are indispensable to millions, and inextricably linked. And, with over 60 percent of the federal budget committed to such benefit programs, failing to put them on firm financial footing could destabilize other federal programs.
By 2028, Medicare Part A (the Medicare Hospital Insurance Trust Fund) will lack sufficient funds to pay full benefits. This could trigger ten percent benefit cuts. By 2035, Social Security (the Old-Age and Survivors Insurance and Disability Insurance trust funds) also could be insolvent. Without corrective action, benefit cuts of 20 percent or more could be necessary.
Our leaders must unite now to confront the looming crisis. First, create a bipartisan commission to assess the threat. Second, offer balanced measures for averting the threat (e.g., shift to income taxes, eliminate or raise the payroll tax cap, increase the eligibility age, reduce benefits for wealthy seniors and trim the most egregious payments). Third, tell the American people the truth, and what must be done to save the programs.
Making Health Insurance Work for People
Despite the ACA, our health insurance system—the way we finance healthcare—remains a mess. Until we dramatically reform health insurance, we should do what we can to refine our various health insurance offerings. Some ideas for improving the two largest public programs—Medicare and Medicaid—and making them more effective and efficient are summarized below.
Potential Short-Term Improvement Measures for Medicare
Expand role of Accountable Care Organizations (ACOs)
Link primary care reimbursement to healthy outcome measures
Simplify plans (e.g., integrate Part A, Part B and Part D plans or improve alignment)
Streamline benefits (e.g., standard core benefits plus range of supplemental plans and costs)
Update benefits to include cost-effective innovations and preventive services (e.g., telehealth)
Reduce prescription drug prices, expand generic drugs and promote preventive medications
Rebalance reimbursement policies (e.g., eliminate unreasonable pricing variances)
Reform MA plans (e.g., increase competitive bidding, minimize upcoding and lower prices)
Eliminate dubious reimbursements for bad debt write-offs
Invest in anti-fraud technology to reduce illicit provider reimbursements
Expand open enrollment period and improve digital marketing efforts
Potential Short-Term Improvement Measures for Medicaid
Expand to all 50 states or allow federal Medicaid and Local Choice Option in non-expansion states
Increase incentives for state Medicaid expansion (e.g., increase federal match)
Expand coverage of preventive or efficient services (e.g., home and community-based services, preventive clinical care, longer postpartum care and promising non-medical services)
Increase subsidies, decrease cost sharing and offer tax credits to increase enrollment
Strengthen regional insurance exchange marketplaces and increase eligibility (e.g.,underinsured)
Expedite enrollment (e.g., presumptive eligibility, automatic enrollment and longer sign-up periods)
There also are steps we can take to improve private health insurance plans.
One is to regulate insurers more rigorously. Designate one federal agency[i] to protect health insurance consumers. Adopt and enforce clear benefit and billing standards for private insurance plans. Establish and enforce cost sharing regulations governing premiums, deductibles and copayments. Accelerate the shift to capitation reimbursement (perhaps using Medicare and Medicare as drivers).
Another step is to foster competition among insurers. Strengthen the regional market exchanges. Offer a public option health insurance plan to spur more comprehensive, affordable private plans. As more businesses offer their employees defined contribution plans, help employees buy competitive private plans.
A third step is to help insurance firms more fully meet public needs. Improve benefits for the uninsured and underinsured. Reduce cost sharing and end rebate abuses. Offer subsidies to help COBRA participants buy new plans. Increase coverage for home-based, school-based, mobile and preventive services (e.g., exams and dietary plans). Reimburse nonphysicians for high-value, low-cost care (e.g., physical and occupational therapy).
Preventing Illness and Putting Patients First
The best way to improve outcomes and reduce healthcare costs is to expand public health—dramatically. First, the federal government should fund a collaborative federal, state and local effort to design a new public health model. It should include a new organizational structure—coupled with incentives—for more efficiently deploying and coordinating public health resources across 50 states and 3,100 localities.
The new public health model also should include more federal funding for public health programs. The expansion of proven prevention programs (e.g., exams, screenings, vaccines and counseling). Incentives for primary care portals and initiatives tackling social factors. Grants inspiring community partners to help clients make healthy choices. Bonuses (or discounts) for targeted clients achieving healthy lifestyle metrics.
The federal government must be a champion for consumers. Determine the core healthcare needed by every American[ii]. Enforce anti-trust laws and other regulations more rigorously. Help fund state pro-consumer programs. Authorize CMS to develop a national quality improvement program and monitor relevant standards (e.g., modern electronic health record systems).
The public sector should increase reimbursement for cost-effective services like telehealth. Relax licensing and registration rules to allow cross-state telehealth. Eliminate other outdated telehealth barriers (e.g., excessive copays). Increase telehealth for routine care, nutrition counseling and mental health services for public sector employees. Persuade providers to shift more care decisions to primary care practices, enhance services to underserved communities and high-risk groups, and increase at-home services.
Our nation allows pharmaceuticals to flood the airwaves with drug commercials that target consumers. Their aim is to encourage patients (or potential patients) to pressure their physicians to prescribe profitable drugs. Instead, we should require pharmaceuticals to allocate some advertising dollars to consumer education (e.g., the benefits of healthy lifestyles and cost-effective treatment and medications).
Realigning Healthcare Resources Around People
Since primary care is the key to a successful new healthcare model, federal and state governments should jointly fund the design of a community-based primary care network. One that serves as the portal to nonemergency healthcare. One that fully integrates community and individual health. One that strikes a balance between top-down bureaucratic and unregulated laissez faire approaches.
What are the building blocks of this network? A cooperative organization structure, such as the Accountable Care Organization (ACO). A siting plan for primary care centers that leverages existing primary care clinics and co-location opportunities (e.g., schools, senior centers, public housing, shelters and churches). A resource plan that calibrates staffing to community needs. A service plan with a standard menu of core primary care/public health services. A managed care model with fixed fees and performance bonuses (for improving outcomes).
To make the model work, we must increase and redistribute physicians. Expand medical school and residency slots. Accelerate credentialing. Revamp interstate licensing. Streamline cross-state practice rules. Offer provisional licensing to foreign-trained professionals. Modernize training methods (e.g., computer simulation). Expand bonuses for primary care physicians relocating to underserved areas.
We also must increase nonphysicians[iii] and their roles. Fund model curricula and the expansion of school, training and scholarship programs. Streamline accreditation and certification. Train and license non-physicians[iv] to diagnose patients and provide preventive and routine care. Promote cross-state licensing. Improve compensation and work standards for primary care staff. Hire more foreign professionals.
Supporting Innovations that Help Patients
One of the biggest myths is that pharmaceuticals and medical manufacturers need exorbitant prices to spur innovation. The reality is that the federal government, through its research funding, generates significant healthcare innovation—it should recoup a fair share of its investment.
The federal government should have an ownership interest in inventions derived from the labs they fund. At the very least, it should receive a fair share of profits from its research[v]. In turn, the government should invest its research proceeds in technologies that promise the biggest cost savings and healthiest outcomes. This could take the form of incentives for private investments in promising technologies.
The CMS should spearhead and coordinate federal efforts to spur innovation. It should make the Center for Medicare and Medicaid Innovation the force for healthcare innovation it was meant to be. It should design a formal, structured process for assessing and endorsing emerging technologies, especially those offering the broadest healthcare benefits[vi] and community impacts.
The Food and Drug Administration should relentlessly protect patients. It should minimize premarket review exemptions for new technologies (e.g., wearable monitoring devices, at-home diagnostics and portable hospital technologies). It should conduct more robust pre-market risk analyses of all new products and promptly order manufacturers to shelve inferior or risky products (and issue sanctions for those who don’t comply).
Lowering Costs and Improving Efficiency
It is time to make an example of scandalous drug costs. Until a new healthcare system is adopted, the federal government should impose caps on drug prices[vii]. It should make more drugs over the counter (e.g., Naloxone). It should promote generic drugs and make more drugs affordable (especially vital drugs like insulin).
Federal and state governments should compel newly merged hospital systems to eliminate redundancies. Close small, ineffective clinical services and specialty practices. Consolidate similar practices and clinics. Standardize hospital operations (e.g., consistent 24x7 staffing, services and discharge policies).
Modernize electronic records. Build an integrated national health data system around universal data standards. Expand the use of biometrics to verify patients and link records across facilities. Incorporate social determinants of health data. Require hospitals to transmit patient data to public health agencies in real time. Aggregate provider data to improve provider monitoring systems.
Require providers to simplify medical billing and debt management procedures. Screen all new patients for insurance, charity and discounted care eligibility. Notify patients of charity care and payment plans prior to collection. Require providers to issue one accurate, itemized bill for all related services. Eliminate surprise medical billing. Prohibit the selling of medical debt except to extinguish that debt. Ban onerous collection tools for medical debt during patient appeals or negotiations.
Fixing healthcare may be America’s most daunting challenge. The healthcare industry[viii] will fight any healthcare reform that might limit its profits—and likely succeed. In the absence of effective public regulation, private interests will move heaven and earth to curb competition and resist initiatives that benefit the public.
These fierce defenders of the status quo will have at the ready their hackneyed platitudes. Reforming healthcare is too disruptive. Restraining market forces is socialistic. Cutting costs impedes innovation. Empowering non-physicians threatens quality of care. And our fuming, fumbling political class will parrot these cliches.
US citizens must demand change, even if incremental. Modest improvements to our entitlement and healthcare programs will bring worthy benefits. Reliable Medicare and Social Security funding. Better insurance coverage. Better healthcare quality and access. Diminished medical debt. Vigorous provider competition. Lower costs. Better health outcomes.
Incremental measures may not give us the sweeping reform we seek, but they will give us the change we need.
[i] One option, if it survives Supreme Court overreaching, is the Consumer Financial Protection Bureau.
[ii] These core services should include preventive services for healthy citizens and medically necessary care for patients. Eventually, these services should be provided at no cost to all Americans.
[iii] Non-physicians include several professionals, including physician assistants, nurses, nurse practitioners and dental therapists.
[iv] The nation’s 159,000 physician assistants should have greater prescribing authority. Associate/physician ratios should be adjusted, and physician co-sign requirements eliminated. Nurse practitioners should be allowed to practice medicine based on their education and training.
[v] For example, the federal government should invoke US Code Title 28 to license generic competition in return for reasonable compensation for the patent holder or, per the Bayh-Dole Act’s public interest rules, ensure that the public receives a reasonable return on any publicly funded science.
[vi] The federal Health Technology Assessment (HTA) process is underfunded and undersized (e.g., excludes too many drugs, devices, tests and procedures).
[vii] The federal government should consider basing drug price caps on global market data (e.g., ither country drug prices).
[viii] The industry, comprising many powerful interests, is often coordinated by the Partnership for America’s Health Care Future (PAHCF).
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