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UNIVERSITY OF WISCONSIN HEALTH POLICY SYMPOSIUM

UNIVERSITY OF WISCONSIN HEALTH POLICY SYMPOSIUM. Physician Accountability in Health Care Reform. T. A. Brennan Harvard Medical School Harvard School of Public Health. November 17, 2005. Outline. Diagnosis of next 15 years of health policy developments

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UNIVERSITY OF WISCONSIN HEALTH POLICY SYMPOSIUM

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  1. UNIVERSITY OF WISCONSINHEALTH POLICY SYMPOSIUM Physician Accountability in Health Care Reform T. A. Brennan Harvard Medical School Harvard School of Public Health November 17, 2005

  2. Outline • Diagnosis of next 15 years of health policy developments • Discussion of medical professionalism and medical ethics • Accountable Physician: Three examples

  3. Health Policy 2005-2020 • Cost is the overriding issue • Quality will continue to be discussed and discussed… • Access will suffer

  4. GPD and Health Care Spending Health Expenditures per Capita, $ USA Switzerland  Norway  Germany  France  Sweden   Japan Spain  Hungary  GDP per Capita, $

  5. Uninsured Workers and Health Care Spending 0.110 0.102 0.094 0.086 0.078 0.070 0.062 0.054 0.046 0.038 0.030 Percent Uninsured Percent uninsured among workers Per capita health spending divided by median income Sources: Authors’ analysis of Current Population Survey (CPS), March supplements, Annual Demographics Files, 1980-2003, except 1981; and Centers for Medicare and Medicaid Services, National Health Accounts, 1979-2002. Notes: Percentage uninsured (solid line) is scaled on the left axis, and per capita health spending divided by median income (dashed line) is scaled on the right axis. Results for 1979-1999 have been adjusted to make them consistent with the insurance verification question that was added to the CPS in 2001. The series for workers is restricted to those not covered as a dependent or by a public program

  6. Millions Uninsured Projection of Number of Uninsured 3% 2% 1% 10- Year projected uninsured for different rates of premium growth (% points): Uninsured increase from premium growth Uninsured increase from other factors

  7. MEDICARE SPENDING AND QUALITY Overall quality ranking 1 11 21 31 41 51 3,000 4,000 5,000 6,000 7,000 8,000 Annual Medicare spending per beneficiary (dollars) NH VT ND ME IA UT CO WI CT MN OR NE MT DE MA  HI WA RI SD VA ID WY NC NY MD IN MI MO AZ KS PA SC AK NM WV NV OH TN KY FL AL NU CA IL OK GA AR TX MS LA Baicker and Chandra, “Medicare Spending, The Physician Workforce, And Beneficiaries’ Quality of Care,” Health Affairs Web Exclusive, April 7, 2004

  8. The Difficult Facts • The population will age, driving costs • The working population will be unable to subsidize the system • Doctors and hospitals will continue to import technology to increase income, increasing costs • Many entrepreneurs will attempt to disaggregate the hospital • Hospitals will struggle to maintain positive margins • The will in turn negatively impact quality and access

  9. U.S. Population of Persons age 65 and Older: 1990 - 2050 Millions SOURCE: US Census Bureau, Statistical Abstract of the United States, 1996.

  10. The Shrinking Financial Base for Medicare Ratio of working age to elderly Americans RATIO YEAR Source: U.S. Bureau of the Census

  11. Inpatient Demand Rising As Population Ages Inpatient Days/1,000 population (2002) (By age cohort) Pop. Cohort Growth 1970-2002 2% 50% 50% 53% 105% 245% Sources: CDC, National Center for Health Studies

  12. Projected Medicare Spending under Bush Administration Budget, FY 2001-2011 Billions of Dollars (Projected annual increase of 6.6%) (~$110 billion, 2005-2011) Note: Numbers for proposed reform do not add to $110 billion due to rounding. SOURCE: OMB, April 2001.

  13. Federal Medicaid Spending is Expected to Increase Over Next 10 Years Billions of Dollars SOURCE: OMB, April 2001

  14. Annual Change in U.S. Per Capita Health Spending by Service: 2001-2004 +60% +50% +45% +32% +31% Source: Center for Studying Health System Change, June 2005, Data Bulletin No. 29

  15. Change in Premium Costs and Earnings, 2000 to 2005 Source: KFF/HRET Survey of Employer-Sponsored Health Benefits, 2000 and 2005; earnings growth from Kaiser Family Foundation calculations based on Bureau of Labor Statistics data assuming 2080 hours worked per year

  16. 2005 Annual Premiums for Individual Health Insurance as Percent of Median Family Income in Massachusetts Source: Division of Insurance and US Census Bureau. 2004 median income =$68,700

  17. The percentage of US firms offering health coverage has fallen significantly over the last five years. Coverage offered Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 2000-2005

  18. How Will We Control Costs? • Manage care: Doctor-based rationing • Restrict technology: System-based rationing • Under-insure: Patient-based rationing • Pay for performance: Weak doctor-based rationing

  19. Managed Care • Market incentives in the doctor/patient relationship • It appears to have worked in the mid 1990s • But consumer backlash/tort litigation led to a historic retreat

  20. Change in Health Plan Type Percent

  21. Increases in Health Insurance Premiums Compared to Other Indicators, 1988-2002 * * * * SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits: 1999, 2000, 2001, 2002 … * Estimate is statistically different from the previous year shown: 1996-2000, 2000-2001, 2001-2002. Note: Data on premium increases reflect the cost of health insurance premiums for a family of four.

  22. Backlash Against Insurers Intense Good Job Minus Bad Job, 1997-2005 by Industry Positive Rating Negative Rating Source: Harris Interactive, Vol. 5 Issue 4, May 11, 2005

  23. All Care Became Managed Inpatient utilization, 1,000 lives/year “Unmanaged” Used to fund richer outpatient benefits “Tightly Managed” Souree: Milliman, Inc.

  24. Restrict Technology • Very difficult in United States • Industry influence is deep • Tide has been in the direction of weaker CON laws • Rhetoric of market competition is high: need technology to compete

  25. Costs Related to Hospital Capacity and Medical Specialists Dollars per enrollee (thousands) Quintile of medical specialist supply 1.34 1.30 1.09 1.18 1.10 1.00 1.00 1.07 1.00 Lowest quintiles Middle quintiles Highest quintiles Quintiles of per capita hospital bed supply

  26. Under Insure: Patient-Based Rationing • Occurs under the guise of consumerism claims • But presumes that patient/consumer has real choice and that costs of health care are within reach of average family income • Nonetheless, represents an easy choice

  27. Employer Interest in Cost Reduction Measures(5=Very Interested, 1=Not Interested At All) Sources: Milliman USA 2002 HMO Intercompany Rate Survey

  28. “Consumer-Driven Health Plans” A Smokescreen • Shifting costs, not influencing demand, is the real motive • Current copayments already have consumer’s attention—additional elasticity of demand diminishing • Real quality measures too complex for typical consumer…rational choice an unrealistic expectation • Actuaries credit consumer plans with very little utilization saving • Contributions to HSAs now under employer’s control • Risk for inflation shifts to consumer • Moves market away from unsustainable entitlement view • Softens consumers for further benefit retrenchment

  29. Percentage of Workers with Health Insurance (by firm size) Large firms (200 or more workers) All firms Smallest firms (3-9 workers)

  30. New Arrival: “Underinsurance Plans” Increasingly common benefit plans that look normal on the surface, but have extraordinarily low internal limits that expose covered individuals to catastrophic losses From Florida: • $100 deductible • 80% of “covered services” in excess of deductible • Maximum out-of-pocket for “covered services” = $2,000/year “Covered Services” Limits Patient is uninsured for • $600/day inpatient R&B hospital costs in excess • $1,200/day ICU R&B of R & B per diem plus • $2,000/year everything else $2,000/year for all other charges Nominal Benefit Provisions (on the surface) Internal Limits (the fine print)

  31. Americans Are Living On The Edge Personal income is up… $29,372 $8,822 …but savings are down 10.0% 1.2% Source: U.S. Bureau of Economic Analysis

  32. Community Response: Cherry Picking Percent Change in Transfer Patients Medicare vs. Non-Medicare, 2001-2003 (52 UHC Members) 41% Soutce: UHC Clinical Data Base

  33. Consumer-driven products are poised for growth CDHC Market Share 2004 2006 2008 2010 Source: Forrester Research, 2003

  34. Pay for Performance • At present, it is characterized primarily as a quality issue • But in the future, will likely be combined with price tiering to reward cost-effective doctors and hospitals • Yet, who exactly will do this management

  35. Are Consumers Sensitive to Quality Information? Awareness and Use of Quality Ratings among the General Public Lee, T. H. et al. N Engl J Med 2005;353:1202-1204

  36. All primary care residents 5.6% decrease 64.3% 1995-96 43,760 total 58.7% 2004-05 44,668 total U.S. MD U.S. DO U.S. IMA No U.S. IMA Other

  37. Family medicine residents 22.5% decrease 74.2% 1995-96 9,261 total 51.7% 2004-05 9,373 total Internal medicine residents 0.3% decrease 53.1% 1995-96 21,071 total 52.8% 2004-05 21,332 total U.S. MD U.S. DO U.S. IMA No U.S. IMA Other

  38. Physician Pay In 2004, median compensation for primary physicians grew at a faster rate than specialist pay for the first time in five years, according to a survey by the Medical Group Management Association

  39. Summary Diagnoses • Costs continue to rise due to demographics • Managed Care (MD-based) rationing is out • Market rhetoric overwhelms technology regulation • Underinsurance simply decreases access • Hospital impoverishment negatively affects quality and access • Physicians who might socially progressively compete under P4P are disappearing

  40. Presumptuous Medical Ethics • Doctor patient relationship is different than more commercial relationship • Doctor owes duty to patient that is not defined by rights on contract • That duty is based in altruism • Physicians have to construct the institutions for medical care that promote this dutiful relationship

  41. Medical Morality, Ethics and Professionalism • Moral theory provides the basis for the relationship of duty and trust • Morality is translated into principles by ethical reasoning • Ethical principles are institutionalized by professional codes • So… professionalism should reflect a moral view

  42. Traditional Conception of Professionalism (Brandeis) • Control over recondite area of knowledge • Responsible for training of next generation of profession • Responsible for promotion of growth of knowledge • Accountable to society for use of professional advantages • Therefore, a strong sense of social contract

  43. The (Overlooked) Structural Aspect of Professionalism • Knowledge cannot be increased, and students cannot be trained in the absence of institutions • Nor can care of patients occur in an isolation from institutions • Therefore, professional principles must imbue and be reflected in the structure of care • And, justice as the morality of institutions plays a role

  44. Market Imperatives vs. Professionalism • Emphasis on efficiency • Competition tends to drown out other values • Markets foment inequality • Professional virtues rendered anachronistic

  45. New View of Professionalism • Must be tied to other-regarding values • Morality gives rise to ethics give rise to professionalism • Emphasis on market in managed care has largely evaporated professional qualities • Do something now or you risk losing any value from professionalism

  46. Traditional Professionalism Stewardship of: Knowledge Education Doctor-Patient Relationship Regulation

  47. Civic Professionalism Stewardship of: Knowledge Education Doctor-Patient Relationship Organization of Health Care Recognition of: Monopoly power Responsibility for social contract

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