From the C Suite

IDN execs weigh in on the potential healthcare reform

Almost everyone agrees: The healthcare system needs to be fixed. What’s up for debate is whether that means fine-tuning or a huge makeover. The Journal of Healthcare Contracting interviewed several IDN C-suite executives to get their perspective on the challenges ahead and how best to meet them. Here’s what they had to say.

A threefold approach
Mike Rowe, CFO, Sisters of Charity Leavenworth Health System (Lenexa, Kan.) says it’s important to focus on healthcare issues, but only in the context of larger societal problems, such as poverty. “You can’t isolate healthcare problems from those of society,” he says. Rowe cites two primary healthcare challenges: encouraging people to make healthy choices so as to avoid illness, and reaching out to the poor and uninsured populations, particularly when they don’t have a telephone or lack transportation, etc. “We don’t know exactly what healthcare reform is at this point,” he points out. “There is nothing sufficiently tangible yet, so we can’t say for certain whether it will [address these challenges].

“Most of the healthcare reform proposals focus on insurance,” he continues. “And, there is no question in my mind that health insurance in this country needs reform.” But, the solution involves more than handing everyone an insurance card, he adds. “How will giving people an insurance card help if they still face language and transportation barriers?” Instead, he recommends a threefold approach that focuses on healthcare financing, the patient and the provider. “In order to address problems in healthcare, we must address the way we finance it, what it is and how we go about providing care,” he explains. “If we focus exclusively on just one of these aspects of healthcare reform, we will have serious problems with the other two.”

As often is the case, the key to reform is education, in Rowe’s opinion. That means changing people’s behavior. For one, “impoverished people or those living on the fringe of society need to be better informed,” he says. And, individuals who have been relying on the current system may have to be retrained. “We have seen people who are dealing with major trauma go to an urgent care center rather than the hospital emergency room, simply because the co-pay is less,” he says. “We need to think about what types of behavior we want to see and how to establish a healthcare system that addresses these behaviors.”

Anything is possible
Rowe has little doubt that successful reform is possible, although he questions government involvement. “Healthcare is not their area of expertise,” he says. “But, I believe anything is possible if we can come together and discuss the issues.” Still, a successful program will require the government to “put out incentives for providers and patients, yet respect people’s dignity.” Medicare reimbursement for providers is inadequate, yet no consequences are in place for individuals who make poor healthcare or lifestyle choices, he points out.

“I personally believe it is morally objectionable that we don’t provide healthcare to everyone,” he says. “Providing healthcare doesn’t mean we are obligated to provide everything to everyone. For instance, if we say to everyone that they all have the right to drive a car, what kind of car do you think they’ll want?” We can’t afford a system where everyone drives a sports car, he notes. “Everyone may have a right to transportation, but not everyone necessarily has a right to any car they desire.

“We have to agree on what our social [responsibility] is to one another,” Rowe continues. “Giving a 95-year-old nursing home resident with advanced dementia a titanium hip replacement certainly seems inappropriate. On the other hand, there is no question that we should provide vaccines for all children.” And, if a family chooses to pay for a titanium hip for its elderly relative, they should not be prevented from making such a choice, even though it may not support “our common goal as a community,” he adds.

There’s no telling when healthcare reform will take place and what the final proposal will look like, notes Rowe. “There are people left in the lurch every day, especially the marginalized,” he says. “How long can we do that? Unfortunately, probably for a very long time. The current system won’t run out of steam tomorrow.” But, more and more people will continue to be left behind, he adds.

Spread too thin
Sooner or later, some form of healthcare reform will be imminent, says Edward Anderson, CEO, CGH Medical Center (Sterling, Ill). “We can’t continue to sustain the current system for long,” he says. Costs will inevitably continue to escalate, the uninsured population will continue to grow and Medicare will inevitably collapse, he points out. The question is, how will new programs be funded and who will be served?

One of the biggest challenges today is coming up with funding to cover healthcare services, he says. “With less money coming from Medicare and Medicaid, we must squeeze more out of the private insurance companies,” he says. If, by healthcare reform, the current administration intends to extend coverage to the uninsured population, insurance companies won’t be at risk, he notes. Hospitals today only collect 5 or 6 percent of bills from uninsured patients, he adds, and this needs to change.

“Limiting [a government insurance program] to the uninsured should not be a threat to insurance companies, because these people are not buying insurance now,” says Anderson. “But, if [such a program] is expanded to others who already have insurance, there can be negative consequences. This, coupled with the current shortage of physicians, could lead to a major problem.”

Cost containment
There are a number of options for reforming the current healthcare system, says Anderson. But, foremost, he believes “we need to address tort reform and defensive medicine.” Without tort reform, it is difficult for anyone, except lawyers, to come out a winner, he says.

If the current administration is making a mistake in its campaign for healthcare reform, it is in focusing almost exclusively on insuring the uninsured, not containing costs, says Anderson. “We must focus on both in one way or another,” he says, even if this means developing two different programs.

It is possible to ensure that all Americans are insured and drive down the cost of healthcare, says Anderson. But that calls for some “defensive medicine,” he says. “In the United States, we tend to consume a lot,” he points out. “I’d like to see us take a more thoughtful approach to healthcare.” In a reformed system, patients wouldn’t necessarily get an MRI the first time they come to the hospital with a sore back, and hospitals would refrain from ordering CT scans for patients with the first sign of a headache, he adds. “And, we’ll have to ask ourselves if we are really going to give a 90-year-old patient a new hip,” he says.

Hand in hand with cost containment comes efficiency, Anderson points out. “To date, we haven’t come up with sophisticated ways to address inefficiencies in healthcare,” he says. But without taking steps to become more efficient, hospitals see a negative impact on their staffs’ ability to care for patients.

It is important that healthcare and government leaders come to some agreement on healthcare reform soon, says Anderson. “Years ago, if someone told me that healthcare would consume 15 or 16 percent of the gross domestic product, I never would have believed them,” he says. “Sooner or later, we are going to need some sort of reform.”

Something has to change
For Bill Leaver, president and CEO of Iowa Health System (Des Moines, Iowa), the worst news on the healthcare front is no news at all. “My greatest fear is that healthcare reform doesn’t happen,” he says. “Without reform, costs will continue to rise and people will continue not to receive the care they need.” Physicians and hospitals will continue to incur reimbursement cuts, leading them to focus on generating more volume, he points out. This, in turn, will continue to drive healthcare costs. “Then, in three to five years, we will be having this same debate [about healthcare reform] we are having today.”

The country’s 47 million uninsured people present a major challenge for the current system, he continues. In fact, one of the biggest challenges we face is the buried cost of providing healthcare to the uninsured, he explains. “People are thinking about [providing care to] uninsured patients, but they aren’t thinking about the economic impact on their own health insurance bill,” he says. And, in many cases, the uninsured population faces some specific issues, he adds. Often, they do not have a regular physician who has known them over a period of time and can prescribe the best line of care. In many cases, these individuals must choose between paying their rent, buying food and paying for a doctor visit. “The way our current healthcare system is set up is not the most efficient way of caring for them,” says Leaver.

At what cost?
It is possible to provide healthcare reform, notes Leaver, but at what cost? “This is a legitimate concern,” he says. “If we say that everyone will be covered, [exactly] what will they be covered for? And, from a provider standpoint, at what rate will we get paid?” Medicaid rates won’t sustain the system, he points out.

“The big issue will be paying providers enough to do what they are supposed to do,” Leaver continues. That said, he is not sure whether or not the answer is to provide a public insurance system. One solution might be for the government to provide insurance to only the uninsured, he notes. “But, then, do we mandate that everyone has [some form of] insurance?” Indeed, doing so would help to more evenly spread the cost of healthcare, he says. “But, what do we do if someone does not have insurance in spite of a government mandate?” If that individual is injured in a car accident, he or she will receive hospital care regardless, he adds.

No revolution
Leaver is relatively confident that some degree of healthcare reform will take place soon. But, he believes such reform will be incremental rather than revolutionary, particularly given the U.S. government’s historical approach to such matters. “I wouldn’t want to bet on the outcome, but I think there is an understanding on the part of government leaders and [healthcare] leaders that we need to do something different,” he says. “The current system is no longer sustainable.

“The current healthcare system rewards volume,” he continues. “It does not differentiate for value. We must figure out what is true value in healthcare and reward physicians for providing that. Physicians should be paid for better outcomes.” The country needs a system that supports physicians who take a holistic approach to patient care, he says. “Physicians are paid for procedures, not for thinking about what each patient needs.” Often, this means the patient must navigate the system on his own, he points out. “We have some great technology, but we don’t always leverage it very well.”

End-of-life care is one example of how physicians must take a holistic approach to medicine, explains Leaver. “End-of-life care presents a very emotionally charged debate,” he says. “We can keep patients alive, but at what cost? We tend to use and misuse resources at the end of the patient’s life because we don’t communicate [his or her] options very well.” Legislation has been proposed to pay physicians to counsel families on the patient’s options, he adds. Labeling the legislation so as to play on people’s fears will not lead to a reformed health system that fully addresses each patient’s needs.

About the Author

Laura Thill

Laura Thill is a contributing editor for The Journal of Healthcare Contracting.