Prospects for Health Care Reform

1. Prospects for Health Care Reform Nora O�Sullivan Mayo Clinic Health Policy Center

2. Mayo Clinic Health Policy Center Goal Influence stakeholders to implementsubstantive health care reform before 2011that will enhance quality and availabilityof health care for all patients Convener 1,000 thought leaders 1,400 patients 1,000 surveyed 400 on 9-city tour

3. Scope of Participation 10 sectors Providers Patients/families Employers Insurers Government Media Academia Medical device and pharmaceutical companies Special interest advocates (i.e. unions and patient advocates) Medical and health care education 10 sectors Providers Patients/families Employers Insurers Government Media Academia Medical device and pharmaceutical companies Special interest advocates (i.e. unions and patient advocates) Medical and health care education

4. Patient Engagement InitiativeYour Voice, New Vision Listening Tour Nine city tour to collect letters and film/record �woman/man on the street� views Focus groups Survey Focus Groups: Six sessions in Atlanta, Cincinnati, and Los Angeles with chronic disease patients Reviewed MCHPC recommendations without identifying them with Mayo Clinic Cornerstones endorsed when explained� they were not self evident When changing delivery system, concerned about major shifts; recommended a phased approach People fear that change could make things worse Survey Methodology 1,018 online surveys U.S. residents, ages 25-75 All health care decision makers  Frustrated with health care Happy with personal provider Want tools and information to get more involved in their own care Distressed with the high cost of health care Opposed to new taxes and more government involvement Believe quality, coordination and access can be improved Are pessimistic about prospects for health care reform within the next 10 years Focus Groups: Six sessions in Atlanta, Cincinnati, and Los Angeles with chronic disease patients Reviewed MCHPC recommendations without identifying them with Mayo Clinic Cornerstones endorsed when explained� they were not self evident When changing delivery system, concerned about major shifts; recommended a phased approach People fear that change could make things worse Survey Methodology 1,018 online surveys U.S. residents, ages 25-75 All health care decision makers Frustrated with health care Happy with personal provider Want tools and information to get more involved in their own care Distressed with the high cost of health care Opposed to new taxes and more government involvement Believe quality, coordination and access can be improved Are pessimistic about prospects for health care reform within the next 10 years

5. MCHPC Cornerstones Created over a three-year period. Includes two symposia and numerous forums and discussion groups� Note the alignment with Mayo�s strategic plan Quality� part of creating value Integration � coordinating care Insuring everyone and reforming the payment system require government leadership.Created over a three-year period. Includes two symposia and numerous forums and discussion groups� Note the alignment with Mayo�s strategic plan Quality� part of creating value Integration � coordinating care Insuring everyone and reforming the payment system require government leadership.

6. Create Value Improve outcomes and satisfaction with U.S. health care. Decrease medical errors and waste. Develop a common definition of value: Outcomes + Safety + Service Cost of care over time Publicly display outcomes and aggregate prices Support health care delivery science Synthesize medical information

7. Coordinate Care Coordinate patient services across people, functions, locations and time to increase value. Form coordinated systems Center care around the needs of patients and families Identify and pay for a local care coordinator Use a common, interoperable medical record Pay for delivering the desired outcome End-of-life issues: Build public awareness; Use shared decision-making tools to guide discussions

8. Coordinate Care Provide complete, accurate information to patients Leverage health information technology (HIT) Provide information access to stakeholders with appropriate privacy safeguards for patients Build/support interoperable, standards-based HIT networks Establish a voluntary patient identifier Construct critical data elements (identity, medications, etc.) Demonstrate the business case for interoperable HIT Align incentives for widespread adoption Make implementation simpler

9. Reform the Payment System Change the way providers are paid in order to improve health and minimize waste. Pay providers based on value Create and test payment systems that provide incentives for providers to: Coordinate care Improve care Support informed patient decision-making

10. Provide Health Insurance for All Provide guaranteed, portable health insurance for all citizens. Require adults to purchase private insurance No pre-existing condition exclusions Provide sliding-scale government subsidies Employers can continue to participate Allow individuals to purchase more services or insurance Appoint an independent body (U.S. Health Board) to provide a simple coordinating mechanism for individuals to select a private insurance option

11. The President�s Vision for Health Care Reform Reduce costs for families, businesses and government Premiums doubled from 2000-2008 Health care is an economic issue People voted based on health care issues Ensure affordable, quality health care for all Americans 57M Americans having problems paying for health care 50% of people in foreclosure cite health care as issue Highest cost of any nation by any measure Infant mortality 29th; outcomes, errors not good Provide choice of doctors, plans and hospitals

12. Is Reform Possible in 2009? President and Congressional leadership have made it a top priority A filibuster-proof majority Specter, Franken �Reconciliation� � after Sept. 30 Numerous coalitions still standing (but some are getting shakier) Everyone wants to stay at the table to ensure they are not on the menu No one admits that the status quo is a viable option (yet) The �Public Plan� � a potential deal breaker From WSJ blog Sen. Arlen Specter said his switch to the Democratic Party doesn�t mean he will automatically vote for legislation to overhaul health care. He�ll take the proposals piece by piece. Specter also said he would be �very reluctant� to tax employer-based health insurance. But he said he doesn�t accept a main Democratic proposal: a public health plan that would compete with private insurers. -------------------------------------------------------------------------------------------------------- Budget conference committee negotiators reached an agreement on a $3.5 trillion fiscal year 2010 budget resolution that includes budget reconciliation as a means of passing health reform legislation. Under the agreement, Congress would have until Oct. 15 to pass deficit-neutral health care reform legislation. If no measure is passed, deficit-neutral health care overhaul legislation could be attached to the budget reconciliation bill. Senate Budget Committee Chair Kent Conrad (D-N.D.) said that he "sincerely" believes Democrats will use reconciliation only as a last resort. Reconciliation is a legislative process of the United States Senate intended to allow a contentious budget bill to be considered without being subject to filibuster. From WSJ blog Sen. Arlen Specter said his switch to the Democratic Party doesn�t mean he will automatically vote for legislation to overhaul health care. He�ll take the proposals piece by piece. Specter also said he would be �very reluctant� to tax employer-based health insurance. But he said he doesn�t accept a main Democratic proposal: a public health plan that would compete with private insurers. -------------------------------------------------------------------------------------------------------- Budget conference committee negotiators reached an agreement on a $3.5 trillion fiscal year 2010 budget resolution that includes budget reconciliation as a means of passing health reform legislation. Under the agreement, Congress would have until Oct. 15 to pass deficit-neutral health care reform legislation. If no measure is passed, deficit-neutral health care overhaul legislation could be attached to the budget reconciliation bill. Senate Budget Committee Chair Kent Conrad (D-N.D.) said that he "sincerely" believes Democrats will use reconciliation only as a last resort. Reconciliation is a legislative process of the United States Senate intended to allow a contentious budget bill to be considered without being subject to filibuster.

13. Major Issue #1Insurance for All � Public Plan Option Will it be government run with government price controls? Will there be an unfair advantage over private plans?

14. Current Public Plan Options The Schumer Plan or the Modest Public Plan A government plan subject to the same rules as private insurance Medicare-like Plan A variant was in the draft of the House Tri-Committee approach The Co-op Public Plan State/regional consumer health cooperatives would provide a non-profit, non-government, consumer-driven coverage option The �Trigger� Plan A public plan would be �triggered� into existence if the private insurance market didn�t provide enough options or cost control Senate HELP Committee and Senate Finance Committee (?) The Schumer Plan or the Modest Public Plan: Sen. Charles Schumer (D-N.Y.) proposed that any public health insurance option developed as part of comprehensive health care reform legislation be subject to the same rules and standards as private insurance. This is the plan that is often referred to as �leveling the playing field.� Medicare-like Plan Medicare for the rest of us. The Commonwealth Fund estimate that it would save the average consumer 20 percent to 30 percent. That would give it a massive competitive advantage over private insurers, and would probably result in tens of millions of Americans dropping their current coverage and entering the public plan to save money. A variant of this was in the draft of Ted Kennedy's HELP bill and the House Tri-Committee approach. House Tri-Committee (House Ways and Means, Energy and Commerce and Education and Labor Committee ) A Medicare-like model would pay Medicare rates for 3 years (or Medicare + 5% for physicians who agree to participate in both Medicare and the new public plan). After 3 years, the new �Health Choices Commissioner� would set the rates. The Schumer Plan or the Modest Public Plan: Sen. Charles Schumer (D-N.Y.) proposed that any public health insurance option developed as part of comprehensive health care reform legislation be subject to the same rules and standards as private insurance. This is the plan that is often referred to as �leveling the playing field.� Medicare-like Plan Medicare for the rest of us. The Commonwealth Fund estimate that it would save the average consumer 20 percent to 30 percent. That would give it a massive competitive advantage over private insurers, and would probably result in tens of millions of Americans dropping their current coverage and entering the public plan to save money. A variant of this was in the draft of Ted Kennedy's HELP bill and the House Tri-Committee approach. House Tri-Committee (House Ways and Means, Energy and Commerce and Education and Labor Committee ) A Medicare-like model would pay Medicare rates for 3 years (or Medicare + 5% for physicians who agree to participate in both Medicare and the new public plan). After 3 years, the new �Health Choices Commissioner� would set the rates.

15. Government-run (�Public�) Plan: Concerns Present Value of Unfunded Liability 75-Year Model Social Security $ 6.6 trillion Medicare $ 36.3 trillion Source: 2008 Report of Social Security and Medicare Trustees, March 26, 2008 Present Value of Unfunded Liability 75-Year Model Social Security $ 6.6 trillion Medicare $ 36.3 trillion Source: 2008 Report of Social Security and Medicare Trustees, March 26, 2008

16. Government-run (�Public�) Plan: Concerns

17. Making Private Insurance Work for AllInsurance Market Reforms Require Americans to purchase health insurance Provide sliding scale subsidies to those in need Prohibit pre-existing condition exclusions Define a minimum health benefit package or actuarial equivalent Adjust risk-level among enrollees

18. Major Issue #2Pay for Value Current payment models reward volume instead of value Dartmouth Atlas data show huge regional variation in costs of treating the same types of patients Low-value regions are paid more; high-value regions are penalized

19. MCHPC: Pay-for-Value Recommendations Value indexing using current Medicare payment system Bundling payments for expensive acute care conditions Demonstration/pilot projects to generate long-term recommendations

20. Pay-for-Value Provisions in Current Bills House Tri-Committee Bill No value indexing yet (perhaps during mark-up) Pilot projects that pay for care coordination, including Accountable Care Organizations and Medical Homes Payment bonuses for physicians in the lowest cost areas of the country HELP Committee Bill None Senate Finance Committee Bill (?)

21. Advocating for Payment Reform Leadership Perspectives E-newsletter to Congress Chicago Tribune op/ed Statement on Tri-Committee bill Wall Street Journal editorial �Oh, and the Mayo Clinic � upheld by President Obama and other Democrats as a model for reform � also weighed in on the House bill Thursday, though without the AMA's fanfare. While noting "some positive provisions," it "misses the opportunity to help create higher-quality, more affordable health care for patients. In fact, it will do the opposite."

22. Advocating for Payment Reform Media coverage Charlie Rose Washington Post Time Magazine The New Yorker Modern Healthcare Open letter in Roll Call Conversations with members of Congress and the Administration Zeke Emanuel, Peter Orzsag, Nancy Ann DeParle Senator Max Baucus Speaker Nancy Pelosi

23. What�s Next? House markups in July House vote on Tri-Committee bill New Senate Finance Committee draft Senate will need to merge two separate bills Target for floor votes after the August recess Conference committee in August Bill to President in the Fall Still reconciliation option after Sept. 30 BRUCE�S COMMENT: These proposals are a small step in the right direction � They begin to differentiate payment based upon how a provider performs. In general, these proposals are aimed at saving Medicare money� giving incentives for poor performers to improve� NOT rewarding providers that are currently providing high-value care. Most of the payment options presented base a portion of payment on a quality score, which overwhelmingly relies on process indicators (i.e. administering aspirin for potential heart attack patients) Under value-based purchasing, Medicare would provide new payment incentives for care that contributes to positive patient outcomes. Create short Medicare pilot programs to test patient-centered care coordination models for patients with chronic diseases Establish a value-based purchasing program for hospitals starting in FY 2012 Strengthen and expand programs that extend value-based purchasing to doctors Promote primary care Provide primary care practitioners and targeted general surgeons with a Medicare bonus of at least five percent for five years Provide payments to primary care providers that offer specific transitional care services for patients with chronic conditions. Care coordination/collaboration/accountability Medicare payment incentives to hospitals that reduce preventable hospital readmissions Single bundled Medicare hospital payment for acute and post-acute episodes of care Allow high-quality, collaborative providers to share up to 50 percent of the savings they achieve for Medicare BRUCE�S COMMENT: These proposals are a small step in the right direction � They begin to differentiate payment based upon how a provider performs. In general, these proposals are aimed at saving Medicare money� giving incentives for poor performers to improve� NOT rewarding providers that are currently providing high-value care. Most of the payment options presented base a portion of payment on a quality score, which overwhelmingly relies on process indicators (i.e. administering aspirin for potential heart attack patients) Under value-based purchasing, Medicare would provide new payment incentives for care that contributes to positive patient outcomes. Create short Medicare pilot programs to test patient-centered care coordination models for patients with chronic diseases Establish a value-based purchasing program for hospitals starting in FY 2012 Strengthen and expand programs that extend value-based purchasing to doctors Promote primary care Provide primary care practitioners and targeted general surgeons with a Medicare bonus of at least five percent for five years Provide payments to primary care providers that offer specific transitional care services for patients with chronic conditions. Care coordination/collaboration/accountability Medicare payment incentives to hospitals that reduce preventable hospital readmissions Single bundled Medicare hospital payment for acute and post-acute episodes of care Allow high-quality, collaborative providers to share up to 50 percent of the savings they achieve for Medicare

24. How You Can Help Influence leaders during August Recess Health Care Repair (www.healthcarerepair.org) Contact elected officials Host/attend events Blog/write letters to the editor

25. Why do we needto make these changes?