Health System Reform
By Ken Ortolon Texas Medicine June 2009

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Cover Story - June 2009  


Tex Med. 2009;105(6):14-19.  

By  Ken Ortolon
Senior Editor  

Candidate Barack Obama promised change. Now, President Barack Obama is preparing to bring on that change, at least in the health care system.

Political observers say President Obama and Democratic leaders in Congress have set an aggressive timetable to bring health system reform legislation to a vote as early as this summer. While the Democratic leadership appears ready to seize a window of opportunity to push through reform legislation before the next election, Texas Medical Association and American Medical Association leaders say very little is known about what that "reform" likely will look like.

"The details are very sketchy," said TMA Immediate Past President Josie R. Williams, MD. "I'm not sure we know what we know about that plan, at this point."

One thing, however, seems certain. The Obama administration learned a lesson from the failure of President Bill Clinton's efforts to reform the health system in the 1990s. President Clinton's health care team wrote its reform plan behind closed doors, with little input from physicians or other stakeholders. This time, the Obama administration brought in a wide group of stakeholders to be part of the process.

AMA President Nancy H. Nielson, MD, participated in at least two White House summits on reform. She said President Obama's "inclusion of physicians in the summit emphasizes the critical role those who provide health care play in the reform effort."        

Leaders from the American College of Physicians and the American Academy of Family Physicians also participated in the summits, but the American College of Emergency Physicians is angry that it was not invited to the first summit in early March.

AMA and TMA are prepared to seek change that is in the best interest of patients and their doctors. 

Setting the Agenda  

Political observers say there is considerable momentum for health care reform this time, partly because Sen. Edward M. Kennedy (D-Mass.) would like to accomplish major reforms as his legacy. Senator Kennedy is suffering from brain cancer.

But AMA officials also say congressional Democrats feel they have a window of opportunity that might close quickly if they cannot push a reform plan through this year. Those officials point out that 2010 is a congressional election year. Major legislation such as a health system overhaul is difficult to pass in an election year.

President Obama had an extensive health system reform proposal during the 2008 campaign, but it is unknown how much of that plan might be incorporated into actual legislation. (See " Health Care '08: Obama vs. McCain ," October 2008 Texas Medicine , pages 14-24.)

"The surprising thing is that we're now two months after the inauguration and we really haven't seen evidence of a concrete plan," U.S. Rep. Michael Burgess, MD (R-Texas), said in March. "The Senate appears to be working on two parallel tracks on the Democratic side, and I've not yet seen evidence of convergence. On the House side, there are a number of hearings going on, but as far as any concrete plans that have been laid out, if they are out there I'm not aware of them."

While the president convened the health system reform summit, Democratic leaders in the House and Senate are doing much of the work on drafting actual legislation. President Obama's first budget proposal included $634 billion over 10 years as a down payment on health system reform, but that proposal included few details of how the money would be spent.

Representative Burgess is pleased the president is leaving the details up to congressional committees. "The president did say it was up to the congressional committees to do the work, that he's simply going to offer guideposts and guidelines, which was starkly different from what he said during the campaign. What he said was good news for me, which means our committees are still relevant, the cake has not already been baked, and we are still in the process of developing the policy."

The first sketchy details of the plan began trickling out in early April when the New York Times reported that the chairs of five key congressional committees - including Senator Kennedy, chair of the Senate Health, Education, Labor, and Pensions Committee - had reached consensus on the main ingredients of the legislation.

According to the Times , the committee chairs have agreed the legislation would require everyone to purchase health insurance, require employers to help pay for it, and direct the government to offer a public health insurance plan as an alternative to private insurance. 

Public vs. Private  

While Democrats seem committed to the concept of a public insurance program, Sen. Charles Grassley (R-Iowa), the top Republican on the Senate Finance Committee, says that could be a deal-breaker for his fellow Republicans.

"If you're going to negotiate in good faith, everything's on the table," Senator Grassley told Congressional Quarterly in March. "But it's one of the most difficult things, and I don't see a compromise in that area."

Political observers say many Republicans see the public insurance plan as the first step toward a single-payer system, something they oppose.

"If they set up a public insurance program, that will be the impetus behind a single-payer system," said Darren Whitehurst, TMA vice president for advocacy. "It's likely that if this program is subsidized, people will be able to afford coverage at a cheaper rate than the private insurance market. I don't think that long-term the private companies can compete with a federally subsidized product."

Representative Burgess is afraid the government-run option would look too much like Medicare and Medicaid. "We know the problems we've had with physician reimbursement therein," he said.

While the debate over a public insurance option may be the thorniest issue, even some Democrats say the leadership has yet to provide any details on how they will handle other tough questions, including how to pay for coverage of the uninsured and what role state insurance regulators would play in a new system.

"There's too much happy talk," Sen. John D. Rockefeller IV (D-W. Va.) told the New York Times . "It's time to start thrashing out decisions on the tough issues."

Broken in Pieces  

Dr. Williams says Senator Kennedy's staff members did provide some idea of other areas that would be included, when physicians met with them earlier this year during AMA's National Advocacy Conference.

Dr. Williams says lawmakers likely will receive the proposals in sections rather than in one omnibus bill.

"What we've been told is that it will support significant and rapid transition to health information technology," Dr. Williams said. She adds that the proposal likely also will include significant funding for the National Institutes of Health to conduct comparative effectiveness research.

Some $1.1 billion for comparative effectiveness research was is in the $787 billion economic stimulus bill. (See " Electronic Medicine ," May 2009 Texas Medicine , pages 16-22.) White House Budget Director Peter Orszag says evidence-based medicine resulting from that research could be a financial incentive to guide physicians toward cost-effective care.

Those comments prompted some to complain the government is trying to dictate care and interfere with the patient-physician relationship. But Dr. Williams said physicians should be "very comfortable" with having more dollars for clinical effectiveness research if it leads to better approaches to care.

"There is so much that we do because it's the way we were taught rather than knowing whether it's good medicine," Dr. Williams said. "And we know that once we've had good studies looking at what is absolutely effective, we do a pretty good job of providing evidence-based medicine."

Dr. Williams also says Senator Kennedy's staff "made it extraordinarily clear" that fixing the flawed Medicare Sustainable Growth Rate (SGR) formula for setting physician payments is imperative.

While staffers said an SGR fix is not currently in the reform plan, President Obama has included $333 billion in his budget proposal to stop future Medicare payment cuts. "Looming physician shortages and aging baby boomers highlight the urgent need to permanently fix the Medicare physician payment system to preserve seniors' access to care," said the AMA's Dr. Nielson.

Unfortunately, Representative Burgess says the SGR fix is not likely to stay in the budget as it works its way through Congress.

Former TMA President Jim Rohack, MD, who becomes AMA president this month, says Medicare reform is one area he will focus on during his presidency. (See " Dr. Rohack Becomes President .")

"Luckily we've been talking about it long enough that the president put in his budget $333 billion specifically to fill the hole that the SGR has created," he said. "No other president has done that, so now the ball is back in Congress' court. It needs to fill the hole if we're going to move forward on Medicare."

The Guiding Light  

AMA officials say a reform plan could make it to the Senate floor for debate as early as June, while House Democratic leaders say they hope to act by mid-August. While some political observers doubt lawmakers could act that quickly, TMA and AMA have positioned themselves to take a major advocacy role in the debate.

Acting at the direction of the TMA House of Delegates, TMA's Select Committee on National Health System Reform in March adopted 17 guiding principles the association will follow in the health reform debate (see " TMA's Health Reform Guiding Principles "). Those principles were affirmed by the House of Delegates at TexMed 2009 in May.

Athens family physician Douglas Curran, MD, chaired the select committee. He says the goal was to build a framework for evaluating any reform legislation that moves forward.

"Our goal was to set aside some principles that we felt were essential for doctors to be able to function in a health care environment of the future," Dr. Curran said. "And we tried to put those in pretty broad, sweeping principles, rather than micromanagement of issues."

Dr. Curran says the committee felt it vital that physicians be involved in the decision-making about any standard setting, payment policies, and delivery system changes.

" Right now we have a system that's micromanaged by Congress and by health insurance companies," he said. "Physicians ought to be making those decisions. Patients will get a lot better care, I think, at a lot lower cost than what they are now dealing with."

Before leaving office, Dr. Williams appointed a Task Force on Health System Reform to evaluate how the anticipated reform proposals conform to the guiding principles.

Nancy W. Dickey, MD, vice chancellor for health affairs for the Texas A&M University System, chairs that task force. Her goal is to use the diversity of physician interests and commitment to patients that TMA represents to impact the "organization, breadth, and flexibility" of the reform proposal.

"One of the encouraging things I've heard this time is this administration said, 'Let's not let perfect be the enemy of good,'" Dr. Dickey said. "Let's get a start and then we can tweak as we go. Now, many of us are going to be a little anxious about that because we've been promised change in the past that has not always come about.

"But if we really believe that we can have an impact on where the starting gate is, then provide feedback about what's working and what's not, we might actually get down this pathway this time. In the past, fear of what might be around the next corner has kept us from going very far at all," she said.

Because there are so few details about the plan, it is hard to evaluate how preliminary proposals stack up against the TMA principles. Still, Dr. Dickey says there could be some common ground.

"The early public comments are not inconsistent with our principles," she said. "What these principles allow us to do, if you will, is nudge in one direction or push in another direction. For example, we've heard in some of the early discussions from this [task force] that there's likely to be some form of a public plan. If we can define what that means, what it covers, how much of the taxpayers' dollars might go into it, then it might fit with several of these principles. If, on the other hand, it's simply a kind way of saying this is Step 1 and Step 3 of a single-payer plan, I think we'd have far more concern."

Last fall, AMA joined 17 other organizations representing seniors, hospitals, nurses, health insurers, employers, the pharmaceutical industry, and other stakeholders in a series of meetings that produced a report called A Dialogue on U.S. Health Reform . That report makes several recommendations for increasing coverage and access, promoting wellness and prevention, and ensuring quality and value in the health care system. Among those recommendations are improving Medicaid and Children's Health Insurance Program outreach and enrollment, facilitating patient utilization of effective clinical preventive services, and developing infrastructure to close gaps in quality and outcomes.

Ken Ortolon can be reached by telephone at (800) 880-1300, ext. 1392, or (512) 370-1392; by fax at (512) 370-1629; or by e-mail at  Ken Ortolon .   


TMA's Health Reform Guiding Principles

Texas Medical Association's Select Committee on National Health System Reform developed 17 principles the association will use to review and evaluate proposals for national health system reform.

Athens family physician Douglas Curran, MD, says the committee proposed the principles as equally important characteristics of an ideally reformed system. The committee decided not to rank-order the list, given its premise that all were high priorities, but Dr. Curran says principles that directly affect patients are listed first because "the patient always comes first."

The TMA House of Delegates adopted the principles as official TMA policy in May. They include:

  • Promote portable and continuous health care coverage for all Americans using an affordable mix of public and private payer systems.
  • Promote patient safety as a top priority for reform, recognizing an effective mix of initiatives that combine evidence-based accountability standards, committed financial resources, and rewards for performance that incent and ensure patient safety.
  • Adopt physician-developed, evidence-based tools for use in scientifically valid quality/patient safety initiatives that incentivize and reward the physician-led health care delivery team, and include comparative effectiveness research used only to help patient-physician relationships choose the best care for patients.
  • Preserve patient and physician choice and the integrity of the patient-physician relationship.
  • Incorporate physician-developed, evidence-based measures and preventive health and wellness initiatives into any new or expanded health benefit package to promote a healthier citizenry.
  • Recognize and support the role of safety net and public health systems in delivering essential health care services within our communities to include essential prevention and health promotion public health services.
  • Support the development of a well-funded, nationwide emergency and trauma care system that provides appropriate emergency and trauma care for all Americans.   
  • Support public policy that fosters ethical and effective end-of-life care decisions, to include requiring all Medicare patients to have an advance directive that a Medicare enrollee can discuss as part of a covered Medicare visit with a physician.
  • Provide sustainable financing mechanisms that ensure the aforementioned affordable mix of services and create personal responsibility among all stakeholders for financing and appropriate utilization of the system.
  • Invest needed resources to expand the physician-led workforce to meet the health care needs of a growing and increasingly diverse and aging population.
  • Provide financial and technological support to implement physician-led, patient-centered medical homes for all Americans, including increased funding and compensation for services provided by primary care physicians   and the services provided by non-primary care, specialist physicians as part of the patient-centered medical home.
  • Through public policy enactments, require accountability and transparency among health insurers to disclose how their premium dollars are spent, eliminate preexisting condition exclusions, simplify administrative processes, and observe fair and competitive market practices.
  • Reform the national tort system to prevent nonmeritorious lawsuits, keeping Texas reforms in place.
  • Abolish the Medicare SGR annual update system and initiate a true cost-of-practice methodology that provides for annual updates in the Medicare Fee Schedule as determined by a credible, practice expense-based, medical economic index.
  • Support the implementation of an interoperable National Electronic Medical Records System, financed and implemented through federal funding.
  • Require payers to have a standard, transparent contract with providers that cannot be sold or leased for any other payer purposes without the express, written consent of the contracted physician. This principle, in effect, calls for a prohibition against so-called silent PPOs.
  • Support efforts to make health care financing and delivery decision-making more of a professionally advised function, with appropriate standard setting, payment policy, and delivery system decisions fashioned by physician-led deliberative bodies as authorized legislatively.

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January 27, 2016

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