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The Open Door. Richard C. Wender, MD Alumni Professor and Chair Department of Family & Community Medicine Thomas Jefferson University Philadelphia, PA Past President, American Cancer Society. The Health Care Financial Bubble. Health care may have been the first bubble, not the third.
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The Open Door Richard C. Wender, MD Alumni Professor and Chair Department of Family & Community Medicine Thomas Jefferson University Philadelphia, PA Past President, American Cancer Society
The Health Care Financial Bubble Health care may have been the first bubble, not the third
For years we managed to ignore the health care bubble for one reason – only lower income individuals were suffering
Medicare and Social Security are on Their Way to Bankruptcy Cost over next 25 years - $103.2 trillion Dedicated taxes and premiums - $57.4 trillion _____________ GAP: $45.8 trillion
“No provision exists under current law to address the projected financial imbalances.” The Medicare Report, Newsweek
1990 Medicare and Social Security represent 28% of federal spending 2019 This share will grow to 40%
Year of Exhaustion • Medicare Trust Fund • 2017 • Social Security Trust Fund • 2041
“We must save Social Security for the 21st century.” Bill Clinton
“The system…on its current path is headed toward bankruptcy.” George W. Bush
“What we have done is kicked this can down the road. We are now at the end of the road and are not in a position to kick it any further.” Barack Obama
“There have been legitimate apocalyptic cases to be made on U.S. financial markets during most of my career. They usually have not been realized” Michael Lewis – The Big Short …quoting a Wall Street investor
Most leaders of Academic Centers refuse to believe that Medicaid will cease or that Medicare will go bankrupt precisely because these events would have such far-reaching impact
In fact, without profound, rapid, disruptive change, these events are inevitable
The Academic Medical Center Gamble: • Pursue complex cases as an exclusive strategy • Pursue population management, relying on shared savings models • Do both
As much as 30% of health care costs (over $700 billion per year) could be eliminated without reducing quality. www.TheNationalCouncil.org
Components of the “Big Fix” Moving further upstream with prevention & early intervention services to prevent health conditions from becoming chronic health conditions
Dramatically improving the management of chronic health conditions for the 45% of Americans with one or more such conditions whose treatment draws down 75% of total medical costs.
Reducing Incentives for High Cost, Low Value, Procedure-based Care
But we have a problem …Academic Medical Centers are not well positioned to succeed in a value-driven world
Credit default swaps were one of the first bets against the housing bubble - fueled by sub-prime mortgage bonds – loans to people with no hope of paying them back ACO’s are our first bet against the healthcare insurance bubble
What Is An Accountable Care Organization? “The defining characteristic of an ACO is that a set of physicians and hospitals accept joint responsibility for the quality of care and the cost of care received by the ACO’s panel of patients.” Report to Congress, June 2009
Preventable Deaths* per 100,000 Population in 2002-2003 (19 Industrialized Nations, Commonwealth Fund) (* by conditions such as diabetes, epilepsy, stroke, influenza, ulcers, pneumonia, infant mortality and appendicitis) www.TheNationalCouncil.org
Only Two of Five Americans Are Very Satisfied with the Quality of Health Care Percent of adults ages 19–64 who are very satisfied Source: The Commonwealth Fund Biennial Health Insurance Survey (2005).
It is not possible to reduce the amount that we are spending on health care, and yet have all providers of health care services receive as much as they currently receive
Risks To Departments of Family Medicine in a Value-Based Payment Environment
Risk #1 Most academic health centers are not well positioned to become more efficient and affordable
ACO Readiness Rep Course AMC Grade Primary Care Orientation Network Building with D Community Primary Care Physicians Integration and Cooperation PreservingSpecialists’ Income Implementation Science
Risk #2 Transforming large practices staffed by transient and part-time clinicians, is difficult • Traditional FPC’s are just that
Risk #3 Quality is a competitive sport • Most P4P programs base payment on comparison to peers
Why Is This A Particular Risk To Departments? • Departments accept new patients and take care of many at-risk, disenfranchised people • Outpatient risk adjustment is in its infancy
Risk #4 • New incentives will discourage clinicians from taking care of the populations that need the most care • Patient satisfaction is lower in hospitals caring for underserved populations • To be in the top tier of quality performers, you might choose to: • Not accept new patients • Have a low threshold for dismissing non-adherent patients
The AMC Status Quo Cannot be Sustained “Like General Motors and Chrysler, we continue self-defeating habits because we can – temporarily.” www.newsweek.com/2009/05/22/let-them-go-bankrupt-soon.html
The Key Question Are Departments of Family Medicine up to the task of leading change?
The Chair’s Dilemma We have survived in the Academic Health Center In some cases, we have thrived
We Have Touched the Lives of Millions Students, residents, faculty, colleagues, patients, and communities Our work matters!
And to be sure, as we have become an incumbent, integrated, accepted, powerful force in AMCs, we have permanently altered them … for the better
We’ve learned to work in parallel if not in sync with the AMC core values
Some of our discipline’s strongest advocates for disruptive change cannot function as leaders of Academic Departments …and are working outside AMC’s
The Door Is Open a Crack Time to Kick it Open all the Way
