by Steve ErkenBrack, President and CEO of Rocky Mountain Health Plans
“When you’re up to your neck in alligators, it’s hard to remember your original goal was to drain the swamp.”
Finally, the election is over. For more than 2½ years, health care has been bogged down in politics and court fights. The President, the Congress, the Supreme Court … they have all weighed in on how Americans should receive health care. And now we know the Affordable Care Act (ACA) will move forward. The Supreme Court has ruled. The President has been re-elected. Congress has returned with the same composition: Republicans in charge of the House and Democrats in charge of the Senate.
It’s time now to roll up our sleeves, and forge ahead. The Affordable Care Act is the law of the land, and its key effective date is January 1, 2014, when any Individual may get health insurance through an Insurance Exchange, and when every Individual is required to have it. To make it affordable, premium subsidies will be available in the Exchange for persons making up to four times the federal poverty level ($88,000 for a family of four).
That effective date of the ACA is more than a year away, but we will begin to see a flurry of health care activity beginning immediately. In the weeks ahead, states will have to tell Washington if they want to build their own Insurance Exchange, or have Washington do it for them. By January 1, 2013, Health and Human Services (HHS) will decide which states have made sufficient progress in establishing an Exchange. If they have not, a Federal Exchange will be implemented. In the months ahead, we will be seeing dozens of regulations coming out of Washington. There are many local decisions to make. Employers will need to decide whether to continue coverage for their employees, or to end coverage when the Exchange is available. States are going to decide whether to expand Medicaid eligibility.
In this cacophony of health care activity, it might be good to remember what we are trying to achieve, to re-focus on the original goal of the law. The ACA was not intended to invest more power in Washington. It was not to punish or enrich health plans and drug companies. It was not to transform hospitals and physicians. And it certainly was not to create a toxic political divide between Republicans and Democrats.
The goal was – and is – to get health insurance premiums under control by lowering the costs of health care.
This goal has been pursued for years. There have been three schools of thought as to how best to lower costs. One group believes government is the problem. If government simply got out of health care, competition in the private market would lower costs. Another group contends government is the solution; expand government programs like Medicare or Medicaid to everyone, and everyone will have lower-cost care.
The ACA took a middle course. The government should work within markets to create a sustainable solution using public funds within the private sector. The ACA theory is a two-step process: give everyone access to health care, and, with more people covered, the cost of maintaining the health of the population will improve.
It’s a good theory, but it won’t happen by itself. You may notice that Medicaid and Medicare are costing us more, not less, when more people get covered. The key to making the ACA successful is a collective understanding that coverage alone won’t create healthier people and lower costs. It takes coverage PLUS affordable access to care. If we don’t build a better system, not just a broader system, costs will rise. This challenge – and this opportunity – requires us to move beyond politics and into focused action.
There are at least 15 different factors that drive increases in health care costs. Left unchecked, costs will continue to climb, consuming more and more of a family’s income. These costs can be controlled, but we must face and address them.
That’s not easy, but let me point to one way we could start. First, focus on the right problem. The healthiest 50% of a community’s population incurs less than 3% of its health care costs. The sickest 5% of a community’s population incurs almost 50% of its health care costs. In other words, my 28-year-old son does not have the same health issues as his 60-year-old father. He probably won’t see a doctor in any given year; I probably will. He should have coverage in case he skids through a stop sign or skis into a tree, but he doesn’t need to pay for the same things that I do, and he will not have the same costs as me, so he doesn’t need to be the focus of our efforts.
It is a better use of our resources to target our efforts to improve the health of “hotspotters”, the 10% of the population that drives 70% of the costs. This is best done through a more collaborative model in which doctors, nurses, health plans, and hospitals all focus on patients before profits. Finding better ways to integrate our efforts in physical health, behavioral health and dental health will build a healthier community. And, guess what? The healthier we are, the lower our costs will be.
Collaboration, then, is the next step. We don’t need Washington to do more; they have created the construct, and it is now up to the communities of this country to implement it. At the end of the day, Washington has written a law that – while flawed – creates the underpinning to work together to get healthier. This is best done through communities working together, as we see in high-performing local health systems throughout the country. Rocky Mountain Health Plans in Colorado is one example of systems that provide higher quality at lower costs, as are Geisinger in Pennsylvania, Group Health in Washington State, and Care Oregon. And all of these models strive to learn from each other and work with their communities. Get engaged, and support the model you believe works best for your community. It is up to each of us to rise to the challenge, to transform practices and improve the care for patients in our communities.