Health Care Reform Memo: August 17, 2009

A Deloitte Center for Health Solutions publication

Health Care Reform Memo: August 17, 2009 The health care reform memos are issued on a weekly basis, highlighting news from the previous week's activities in the new administration and implications for the C-suite and various stakeholder groups.

Town hall meetings get TV attention; White House willing to compromise on public option

Objections to “government-run health care” and concerns about end-of-life counseling for seniors were the focus of town hall meetings and media coverage last week.

The Senate recessed August 7^th, joining House members for August recess, without forwarding the much-anticipated bipartisan Senate Finance Committee bill. Many senators hosted town hall meetings with Democrats facing boisterous voters about the version of HR 3200 “America’s Affordable Health Choices Act of 2009” that cleared the House Energy and Commerce Committee by a 31-28 vote.

At home, television coverage caught testy exchanges between opponents of reform and Members presumed to be supportive. That HR 3200 is one of several major bills that will ultimately make its way to full floor debate and then a final bill was seemingly missing in the exchanges.

Two contentious items in the HR 3200 debate are (1) the scope of the public option and (2) the end-of-life counseling provision. In HR 3200, the public option is a new public plan accessible to Americans (not illegal immigrants) with subsidies to assist the uninsured in purchasing coverage. Its premiums would be set by the Secretary of Health and Human Services and not be tied to Medicare—the major concern to Blue Dogs. According to the Congressional Budget Office (CBO), it might insure an additional 35 million people. Opponents believe it is a first step to a government-run system; many supporters including the White House consider it necessary to facilitate access to affordable coverage for individuals and small businesses priced out of the market. The Senate Health Education, Labor and Pensions Committee proposal includes the public option; the Senate Finance bill will likely not include a public option. However, in a round of Sunday news shows, administration spokespersons made clear yesterday the public option was not necessary to health reform if an alternative was proposed that meets three criteria: (1) covers the uninsured, (2) facilitates insurance market competition and reforms, and (3) is budget neutral. Notably, front page coverage in today’s leading dailies signals a key change in the White House strategy…

“Chances Dim for U.S. Public Health Plan” (Wall Street Journal)
“‘Public Option’ in Health Plan May be Dropped” (New York Times)
“Public Option May Be Vulnerable” (Washington Post)

The end-of-life counseling provision in HR 3200 (Section 1233) may be the most controversial, as opponents have referred to it as a government-sponsored rationing program overseen by an appointed “death panel”. Current law requires doctors to advise new Medicare enrollees about living wills and advance directives. And since 1992, hospitals and nursing homes have been required to assist seniors with legal documents if requested. HR 3200 includes a provision requiring physicians to counsel seniors once every five years about end-of-life decisions, i.e. setting up a living will, obtaining hospice care, establishing a proxy to make their health decisions when they are unable to do so, etc.

President stumping for health reform

Hoping to gain momentum for health reform, President Obama announced plans to participate in several town hall meetings. Last week, he stumped in New Hampshire. Among the more intriguing venues on the President’s calendar in coming days is Grand Junction, Colorado, the sixth most cost-effective community in the U.S., and a stop in Montana, home to Senate Finance Chairman Max Baucus.

Quotable

"There is some fear because in the House bill, there is counseling for end-of-life. You shouldn't have counseling at the end-of-life. You ought to have counseling 20 years before you're going to die. And I don't have any problem with things like living wills. But they ought to be done within the family."

– Friday, August 14^th: Senate Finance Ranking Member Charles Grassley (R-IA), suggesting he would not support inclusion of the end-of-life counseling provision included in HR 3200 in the forthcoming Senate Finance bill.

CCHIT to certify “meaningful use” starting in October 2009

Tuesday, the Certification Commission for Health IT (CCHIT) announced its plans to launch its meaningful use certification program inclusive of criteria required for providers to demonstrate meaningful use of their electronic health records by 2011. In its communiqué to David Blumenthal, Director of ONC, CCHIT also provided a spreadsheet illustrating how its certification program corresponds to current recommendations on meaningful use being developed by the ONC’s Health IT Policy Committee.

Friday, the Health IT Policy Committee met to review recommendations for meaningful use criteria and certification of health IT systems. At a previous meeting, a committee workgroup recommended that there should be multiple certification groups in addition to CCHIT.

The role CCHIT plays as one of the certification programs, or as the exclusive certification entity remains unknown.

Fact file

3,300 registered lobbyists currently working on health care representing 1,200 different organizations
27 percent of all Medicare expenditures are spent in the last year of a senior’s life
AMA membership is 245,000 physicians—less than one-third of physicians in the U.S.
Study results: 3 percent savings per year ($60 billion per year) through intensified fraud detection (“Finding Money for Health Care Reform—Rooting out Waste, Fraud and Abuse,” John Iglehart, New England Journal of Medicine, July 16^th, 2009 (1613: 229-231). The study noted $73 billion paid out for inappropriate claims by providers in 2008.

C-Suite action items

During the Congressional recess, all stakeholders should take advantage of the opportunity to meet members of their delegation to discuss prospects for reform. In the heat of the rancorous public debate, key questions should be addressed to members—

How is delivery system reform anticipated as a means of reducing costs without compromising care? How do coordination of care, value-based purchasing, episode-based payments, outcomes-based payments, price transparency, and adherence to evidence-based care by clinicians relate to reforms necessary to the system?
How is the insurance industry reform anticipated to improve access to affordable coverage? How do industry concessions to national insurance exchanges, waiver of pre-existing conditions, regulatory overhauls, administrative simplification and value-based purchasing models relate to desired features of the new insurance system? And how will the government implement a public option that competes fairly?
How is health reform to address personal health and individual responsibility? How do preventive health, nutrition and exercise factor into long-term reform of the system?
How can innovation be stimulated in the U.S. system in such a way as to maintain U.S. leadership in the discovery of technologies, drugs and devices that improve care? What is the roadmap to a system of care that rewards innovation rather than undermining it?
And how is reform to be paid for, to bend the curve from its forecasted 6.2 percent compound growth rate to less than 5 percent?

Beneath the sound bites, members should have thoughtful answers to these five questions.