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Is Our Health System Limping Along or in the ICU?

September 29, 2017
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At Mayo Clinic, healthcare luminaries debate state of health reform
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Is the U.S. healthcare system like a patient in the intensive care unit battling sepsis? Or is it more like someone in a skilled nursing facility recovering from a stroke? That may be a disheartening choice of metaphors, but that was basically the setup for a fascinating Sept. 28 debate held at the Mayo Clinic's Transform conference, and put on by Intelligence Squared U.S.

Arguing that the U.S. healthcare system is terminally broken were Shannon Brownlee, senior vice president of the Lown Institute and a visiting scientist at the Harvard T.H. Chan School of Public Health, and Robert Pearl, M.D., former CEO of the nation's largest medical group, The Permanente Medical Group.

Making the case that the system is indeed in trouble but gradually improving were Ezekiel Emanuel, M.D., chair of the Department of Medical Ethics and Health Policy at the University of Pennsylvania, and David Feinberg, M.D., M.B.A., president and CEO of Geisinger, one of the nation's largest health services organizations.

Brownlee painted a dire picture of costs that are out of control because prices are out of control.  Beyond the price of pharmaceuticals, she said, “costs are also out of control because of how much we waste on fraud, on administration, on inefficiency. We spend about $300 billion a year on services that patients don't need, and when you add it all up the waste is about $1 trillion Costs are also out of control because we have massively overinvested in the hospital sector and underinvested in primary care and community based care.”

Pearl admitted that there are “points of light” such as integrated health systems Kaiser and Geisinger, where a combination of capitation and digital innovation have transformed care, but he made the case that the business interests in healthcare are too entrenched to allow those models to be successfully scaled across the country. He said the ACO movement, bundled payments and MACRA were efforts that are too small to fix what ails the system.

“What's in place today is a compromise, a political compromise to get the Congressional votes and to avoid the ire of the hospital systems, the health plan systems, and the drug industry,” Pearl said. “It is simply inadequate to be able to overcome the shortcomings — shortcomings that led to the premature death of my father.” (Earlier Pearl had explained how miscommunication between providers had led to his father dying unnecessarily of pneumococcal septicemia.)

“We’ve got to change all of American medicine — how it is organized, how it’s reimbursed, how it is led, how it is technologically supported, Pearl said.  When hospitals and doctors consolidate, they don't use it to improve efficiency and effectiveness of care, he noted. “They use it to raise the price by controlling the marketplace. And the alphabet soup of current Medicare, MACRA and MIPS and APMs — doctors don't even understand this.  Yes, they'll meet the requirements to get paid, but they will never change the way they provide care under the current rules.”

In talking about his father’s case, Pearl said one of the problems was that his doctors didn't have the information they needed. “Every American needs to have the totality of the medical information available to every physician, hospital at every point of contact,” he said.  “It can be done. It's called ATMs. But it won't get done.  Why is that?  Because the people who manufacture and sell the electronic health records are not going to open up what's called APIs, the application processing software that's necessary for third-party developers to come in, because they know it will break the stranglehold they have on those who have purchased the systems already.”

Geisinger’s Feinberg stressed that reform is coming from the bottom up, rather than from regulators. “Healthcare reform does not start in Washington, D.C.,” he said. “It starts in communities that are committed to the people that are living there, that understand the problems, and engage in creative, innovative solutions to make things better, so that every patient gets care that's compassionate, safe, dignified, and low cost.”

Emanuel gave some positive examples where health systems and communities are improving quality and reducing costs.  He said the key to scaling them up is behavior change of doctors and patients.  “We have to change the financial and nonfinancial incentives… The question is, can we move off the fee-for-service system?  He said we are well on our way already. “Today there are 32 million Americans in ACOs through Medicare and commercial plans. We have Medicare bundles, we have private insurance bundles, and we have states like Arkansas and Tennessee introducing bundles broadly. They are going to expand because they actually bring returns relatively quickly.  And most importantly, we have MACRA, which is a a bipartisan bill passed, and it is financially incentivizing doctors.”

Emanuel said it is possible to transform the American system, and that it is not terminally ill.  “But we need to be careful about the timeline. We are not going to transform it overnight. It takes four years before you begin to see change, and then 10 years before change sets in.” He said the year 2030 is the right time scale.  “This is not like flipping the switch,” he said. “This is change over time of a $3.4 trillion industry. We can save the American healthcare system.”

Perhaps there was less disagreement among the debaters than expected. Both sides pointed out the downside of the fee-for-service system we live under, and other perverse incentives built into the system. They just disagreed over how likely the success of the current reform efforts might be.

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