The State of Healthcare

1. The State of Healthcare Tea Party of Manatee Richard Conard, M.D.

2. Agenda • Introduction • Historical Events • What Caused the Crisis? • Present Status • Defining Health Delivery System • Action Plan • Interesting Facts & Figures

3. Introduction • Present Healthcare System has Problems • Tipping Point in Healthcare • Paradigm Shift in the Wings • Expanded Vertically-Integrated System • Horizontal Total Health Delivery System

4. Historical Events • National • 1965 – Medicare & Medicaid Legislation • 1970 & 80’s – Transition Underway • Holistic Healthcare • Primary Care Physician = Gatekeeper • Specialized Healthcare • Specialist of One Disease Process or Organ System = No Gatekeeper • Employers Initiate Cost Shifting • Living the “Good Life” • Fee-for-Service Pay Basis – Physicians

5. Historical Events • National (continued) • 2010 – Passage of PPACA • 2011 – Accountable Care Organizations • 2012 – PPACA Found Constitutional as a Tax • 2014 – 30,000,000 New Patients Enter Medicaid

6. Historical Events • Manatee County • 1983 – Manatee Memorial Hospital • Decision to Sell • MCG Ordinance 84-16 • Late 1990’s – Corpus of Fund Begins Depletion • 2008 – Fund Earnings Not Meeting Needs • County Administrator defined Two Options • Increase Taxes • Deplete Fund, Incorporate ½ Cent Sales Tax • MCG Ordinance 8-26 • MCG Resolution R-08-134

7. Historical Events • Manatee County (continued) • 2008 – 2010 - Manatee Chamber of Commerce Study Allocation • 2011 – Acceleration of Trust Fund Depletion • 2012 – Board Supports ½ Cent Sales Tax • 2013 – ½ Cent Sales Tax Referendum Fails • Conclusions

8. What Caused the Crisis? • Healthcare Unique Structure • Hospitals Have a Monopoly and Basically Unaccountable • Pharmaceuticals Have a Monopoly on Drugs via Patents • System Managers Function Without Transparency

9. What Caused the Crisis? • Contributing Factors to Crisis: • Aging Population • Payment for Procedures Not Outcomes • Proliferation Employer Provided Healthcare • Employer Cost Shifting • Poor Measurement of Costs and Outcomes • Little to No Transparency in Costs • Patients Not Accountable • Evolution from PCP to Specialty

10. Interesting Facts & Figures • 1/2 of Health Cost Due to Waste • $210B Defensive Medicine • $ 25B Hospital Readmission • $ 22B Poorly Managed Diabetes • $ 17B Medical Errors • $ 14B Unnecessary ER Visits • $ 10B Treatment Variations • $ 3B Hospital Acquired Infections • $ 1B Overprescribing Antibiotics

11. Interesting Facts & Figures • Pricing Transparency Examples: • Colonoscopy Market Analysis • Chest X-Ray Market Analysis

12. Interesting Facts & Figures • Healthcare Cost Comparisons Lipitor • US $124 • New Zealand $ 6 Nasonex • US $108 • Spain $ 21 MRI Scan • US $1121 • Netherlands $ 319 Angiogram • US $914 • Canada $ 35 Colonoscopy • US $1145 • Switzerland $ 655 Hip Replacement • US $40,336 • Spain $ 7,731

13. Interesting Facts & Figures • Determinants of Health • Healthcare 10 – 25% • Genetics up to 30% • Health Behaviors 30 – 50% • Social & Economic 15 – 40% • Environmental 5 – 10%

14. Present Status

15. Present Status • National • 19% of GDP Spent on Healthcare (2.9 trillion) • Increase with PPACA (+1.4 trillion) • 2008 National Study - ~50% Waste • Defensive Medicine ($210 billion) • Inefficient Claims Processed ($210 billion) • Preventable Diseases ($200 billion) • Behavioral/Mental Health • American Health Status Diminishing • PPACS – Flawed Piece of Legislation

16. Present Status • As a Result of the PPACA • Insurance Costs Escalating • Essential Benefits Requirements • Reinsurance Program • Risk Corridors • Independent Payment Advisory Board • Death Panel • Refusal of Services After Age 76

17. Present Status • Manatee County • Leading Cause of Death – Heart Disease, cancer, Respiratory, Stroke, Motor Vehicle • Rate Increases in: • Obesity • Tuberculosis • Breast Cancer • Syphilis • Small Decreases in Other Areas • 17.3% with NO Healthcare Coverage in 2010

18. Looking Forward

19. Defining the Health Delivery System • Six Aims for 21st Century System • SAFE – avoids injury from care administered • EFFECTIVE – avoids underuse and overuse • TIMELY – reduces waits and delays • PATIENT-CENTERED – provides care that is respectful and responsive for individual need and ensures that the patient’s values guide clinical decisions • EFFICIENT – avoids waste • EQUITABLE – provides quality care to all without prejudice

20. Healthcare Goals 1. Decrease Burden of Disease 75% of all disease is preventable 2. Effective Healthcare Management of Chronic Conditions 75% Healthcare spend is for chronic care 50% US population has at least 1 chronic illness 18% US population > 65 increasing to 20% by 2020 3. Concierge Assist Through Fragmented Healthcare System Available to us are: Best practices, evidence based concierge practices and practices identifiable for immediate use

21. Healthcare Goals As Easy as One, Two, Three 1. Decrease Burden of Disease 2. Effective Healthcare for Chronic Conditions 3. Concierge Assist Through Fragmented Healthcare System + + = A. Quality, Safe, Cost Effective, Health & Wellness Program B. Healthy, Productive, Satisfied Workforce with Less Disability and Lost Work Time Accomplished By: Proper Incentives Engagement Compliance

22. Healthcare Tomorrow(The Government Program) A Two-Tier System • Employers will no longer provide healthcare for employees, either fully-insured or self-insured * US Government Private Fee for Service Concierge **Healthcare Exchanges * The goal of the US Government is to have Single Payer, federally controlled healthcare in America ** The goal is for all individuals to go into fully insured exchanges with individual contracts. They will be subsidized by: governments, employers & self. Public Private State Insurance Company Brokers Federal

23. Care Model

24. Total Healthcare Delivery System • This Model conceptualized n 1974 and followed for the creation of the Blake Medical Campus

25. Action Plan • Life is a Journey – So is Healthcare • Where We’ve Been: • 31 years of evolution • Sold Community Hospital • Spend ~$87,160,010.00 Taxpayer Funds Annually • Were We’re Going • Create 21st Century Healthcare System • What’s Needed for Success?

26. Action Plan • Success Depends On: • Define Government’s Role in Healthcare • “A” Political Environment • Freedom of “Conflicts of Interest” • Collaborative Alliances • Vision & Structure of Healthcare System • Identification of Key Principles • Identification of Key Components

27. Action Plan • Success Depends On: (continued) • Must Make Available to Individuals & Small Business • Evidence-based Outcome Analysis Tools • Continuous Monitoring and Updating • HOSPITALS MUST STEP UP • Payment on Value not Volume • Payment Discussions Must Define Case Rate & Bundled Services • Be More Accountable • Be More Transparent • Assist County with Work-Through

28. Steps to Accomplish Action Plan • County Government Must Define Responsibility • Immediately Establish Oversight Committee of Non-Conflicted Business Industry, Government, and Healthcare Stakeholders • By Accomplishing #2, Gain a Vision of Our 21st Century Delivery System • By Accomplishing #3, Define Short, Medium, Long Range Goals and Objectives • By Accomplishing #4, Define a Budget

29. Steps to Accomplish Action Plan • All the Above Must Accomplished by March 31, 2015 • Until all Six of the Above are Accomplished “We the People” Should be VERY Vocal About What County Government Spends on Healthcare