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Tommy G. Thompson

Tommy G. Thompson

Posted: October 13, 2009 07:02 PM

A Business Lesson for Health Care Reform

What's Your Reaction?

In the often contentious but vital debate over health care reform, one issue unites patients, doctors, business owners and workers alike: the need to reduce how much Americans pay for the care they receive.

As our nation's population ages, staggering increases in the cost of providing health care threatens to bust budgets from Main Street to Wall Street, killing jobs and sapping the strength of our economy. Far too many hard working families are priced out of the health insurance market and driven into bankruptcy. Businesses' health costs, in particular, are skyrocketing, meaning impaired bottom lines and depressed wages for workers.

Among the biggest cost-drivers in health care today is treating chronic illness, including heart disease, cancer and diabetes. The Centers for Disease Control reports that: chronic disease treatment accounts for 75 percent of all health care spending in America and 99 percent of Medicare spending. More than half of Medicare beneficiaries are treated for five or more chronic conditions annually. And yet patients who suffer from these conditions still aren't receiving all the treatments that are recommended. A RAND study found that patients typically receive only half of the clinically recommended treatments for their chronic disease conditions.

We can do better. We can no longer afford not to.

The closest thing to a silver bullet to improving efficiency in health care delivery is to focus on disease prevention and management. This requires incentives to control risk factors like smoking and lack of exercise, and to support a more holistic notion of health care delivery. Rather than waiting for people to get sick before paying for their health care, we need to make more up-front expenditures to prevent down-the-line costs.

For example, IBM sponsors an innovative employee wellness program that relies on incentives and care coordination to improve the health of its workforce. Their employees are given access to at least one health plan at no cost. This plan includes coverage for preventive service, as well as a "Healthy Living Rebate" that gives $300 to employees for participating in healthy activities. A Children's Health Rebate program gives IBM families similar incentives.

The result? Between 2004 and 2007, the reduction in employee health risks alone resulted in an estimated health cost savings of $79 million. Meanwhile, employees benefit from improved access to health care leading to more productive and healthier lives.

There are other good examples of the value of prevention and care coordination in catching problems early and thereby helping to reduce long-term costs.

For instance, many states employ a comprehensive care model to cover Medicaid patients. Vermont, North Carolina, Colorado, Pennsylvania, and other states fund Community Health Teams (CHTs), which work with patients to improve their overall health and reduce costly trips to the hospital. Members of a CHT serve as advisers on healthy living and work hand-in-hand with a patient's doctors and hospital to coordinate care. Vermont has seen amazing results with a 30% decrease in emergency room visits in the first year of the program.

The federal health reform legislation winding through Congress offers a big opportunity to lower our nation's health costs by expanding the use of CHTs. Most Medicare patients receive health care through a fee-for-service model, which provides payments to doctors and hospitals based on the number and type of services they provide. If a patient comes back six times for the same problem, the doctor or hospital gets paid six times.

Medicare offers no incentives to prevent over-use of health care services or to coordinate care among a patient's doctors and hospital. Medicare pays for people who are sick, but doesn't do much to keep them healthy.

Community health teams will make the primary care provider the patient's essential quarterback in coordinating delivery of quality care. An abundance of evidence shows that the kind of care coordination that physician-managed community health teams provide for patients improves their health outcomes, while reducing health costs over the long run.

According to a recent survey commissioned by America's Agenda: Health Care for All, 75 percent of voters support reform that will give their primary care or family doctor the support of a coordinated team. We should amend the bill in the Senate to move Medicare in this direction, provide increased support for CHTs and encourage businesses to offer more wellness and prevention services.

Whether it is the amount we pay in premiums or the total contribution made by employer to the company health plan, America must begin to focus this debate where it belongs: on the bottom line. American taxpayers, from consumers to large businesses, cannot and should not be forced to shoulder the burden of a failed system that only accelerates cost and benefits a handful of insurance companies and investment bankers.

It's time for Congress to enact a reform package that provides all Americans with quality, affordable health care for years to come.

 
 
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HUFFPOST SUPER USER
Cyndy Keith
04:07 PM on 10/14/2009
This article is a perfect explanation of the phrase 'throwing good money after bad'. We do not need more agencies to oversee wellness, or any of the things TT wrote about. Those are just programs that also cost and over time their costs will rise, until someone comes up with another agency to find a way to battle those costs... and it goes on and on. All programs need to be scrapped, and a single-payer program needs to be put in place. No business will have to provide health insurance, and no individual will have to pay more than their fair share for healthcare. The only downside would be that insurance industries will have to start competing in specialized areas and they would not be among the richest corporations in America anymore. Did I say down-side?
06:04 PM on 10/14/2009
Health care has got to be made not-for-profit. In the post-Reaganomics culture we live in, no one one wants to admit that; but a for-profit healthcare industry, let alone a for-profit health insurance industry, is fundamentally ruinous, immoral, and unjust.
Public option would be a start - and in the post-Reagan era, it may well end there; but ideally, the goal would be a healthcare system not dependent on economics.
We hang together - stick together as a community - or we hang separately - by our own greedy nooses.
02:22 PM on 10/14/2009
I've notice for years, now, that bottom-line thinking is the major cause of bottoming out.
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GrumpyOldGeek
My micro-bio is empty
02:19 PM on 10/14/2009
I had the IBM plan once upon a time. IBM is self-insured. So is Microsoft. The company pays the claims, not the insurance company they hire to administer the plan. Any comparison to the average employer-provided plan or any private plan is completely invalid. The ONLY way to get the IBM plan is to work for IBM. If you or your spouse or child has a long-term medical condition, the IBM plan essentially prevents you from changing jobs. This, in fact, is the reason that large companies provide such benefits. We all know that the benefit package is part of the decision process for hiring new employees. Once you get the benefits, you now have strong reasons not to leave or to work for a customer or competitor. Yep, 50% of the Fortune 100. What about the non-Fortune 50 million?
The wish list presented by TT here is about a year behind current legislative reality.
01:08 PM on 10/14/2009
I recently saw Orren Hatch speaking on a CNN segment stating that accepting a public option would incrementally make it grow until America has "socialized medicine". Not a single reporter challenged this comment. The truth is that accepting a public option will incremenatally lead to socialized INSURANCE, not socialized medicine. None of Congress is looking for any reform to result in socilized medicine. Democrats want socialized insurance for the good of America's future, not to put government in the health care business. Fox News online has a section that purports to define Single Payer, Public Option, and Socialized Medicine. It does a good job defining Single Payer and Public Option. This makes Fox look credible and legitimate. Then the truth goes right out the window under the definition of Socialized Medicine. Where it should define the term as a system wherein hospitals are owned by the government and health care workers and doctors are employees of the government, it instead sneakily defines Socialized Medicine as Obama's health care plan. Wow! And yet other news media are not countering this. Why? Because even Democrats tippy-toe around the word "socialized". This is an appropriate term to use, but only when placed in front of the word INSURANCE. While Republicans openly talk about "socialized medicine" we do nothing to counter the lies. Let's quit tippy-toeing around it. We have socialized insurance right now. It's called Medicare Insurance. Democrats want more socialized insurance, not socialized medicine.
11:51 AM on 10/14/2009
"The closest thing to a silver bullet to improving efficiency in health care delivery is to focus on disease prevention and management."

Uh no, single payer is the closest thing to your silver bullet but as we all know, he/she who controls the conversation, controls the outcome.

Blue Cross controls the political prostitutes and the political prostitutes control the conversation.
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HUFFPOST SUPER USER
blueken
Finger Picking blues man
09:58 AM on 10/14/2009
I still can't figure out why America's small business hasn't been more vocal in the need for health care reform. There are only 2 sectors of the economy that are robust at this time, the health care insurance industry and the drug industry. Does it take an Einstien to connect the dots? We are the only modern industrial nation that does not have a comprehensive health care system in place. It's not a stretch to draw the conclusion that this has a major impact on exports.
09:21 AM on 10/14/2009
Governor Thompson: A pilot program in your own state is making tremendous strides in this area. Please see the Wisconsin Initiative to Promote Healthy Lifestyles, www.wiphl.com.
schatsie
Wall Street is Worse than Vegas
08:16 AM on 10/14/2009
IBM got screwed by Empire Blue Cross a few years ago...they had an ASO contract (administrative services only) and they would pay Empire the amount of the claims plus some sort of premium....Most companies have this now, at least 50% of the fortune 500... Well Empire ratchetted up the hospital charges by I think it was 2%....and this was when Empire was a not for profit insurer....

If IBM cannot get the straight skinny from Empire, what makes anyone think that we will as consumers...There is just too darn much temptation and it works.... Read the latest in Rolling Stone by Tabii...

Anyway, think about this, hospitals are charging over 100,000 for a 3 day stay and less than 5% of that goes to the nursing staff.....and you will get separate bills for the doctors.... 100,000 for 3 days and that is why we did not get the OLYMPICS, because nobody could afford the travel health insurance to come to this country.....
09:46 AM on 10/14/2009
And the government run medicaare and medicaid are better? NO.
12:10 PM on 10/14/2009
Link please........ Man, I always wanted to do that....

My wife had Cancer surgery back in june.....3 days stay at Hospital, less than 60,000...... Actually 58,000 and some change..... A lot of money yes, but still no where near 100,000.... Actually it was 2 and a half days but since she left after 11:00 am it was billed as a full day....... This was at Hurley Medical Center in Flint Mi. if anyone cares......
07:03 AM on 10/14/2009
The insurance companies are pricing themselves out of the market. More and more people will continue dropping their health insurance due to the overwhelming price hikes. As they do so, the price for coverage will keep spiraling out of control. It's a vicious cycle they've created due to nothing more than greed. If we don't fix it soon, we're going to see health insurance companies begging for a bailout in the near future. If they do, let them fail. It's their own doing. They sure don't seem interested in fixing it. When the right starts having to pay out of their own pocket for health care like so many others are doing now, even many of their own, they'll finally get it.
HUFFPOST SUPER USER
MacTheBlogger
I used to be disgusted...
07:17 AM on 10/14/2009
You choose to ignore the fact that the increase in insurance premiums, for the last two decades, has mirrored the cost of care. I remain amazed that so many Americans continue to think the two are the same.

Our top priority should have been controlling costs, but we chose instead to focus on boogeymen. This allowed those who want more and more bureaucratic control to get their way.

You're going to get want you want - much more government contol and influence. More bureaucracy, bloat, waste and fraud than you could ever imagine, a trillion dollars worth. Good luck with that.
schatsie
Wall Street is Worse than Vegas
08:19 AM on 10/14/2009
Did you ever think that the socalled Cost of Care was driven by the hungry CEOs whose justification for their god awful salaries, pensions, bonuses and business expenses was the amount of premiums and claims processed.....
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DickTater
American Livestock
09:43 AM on 10/14/2009
fool
07:01 AM on 10/14/2009
While much of what you say is true and appreciated, you leave out one factor: companies charge what they do because they can. No one begrudes a company making a profit, but when that profit in in the 100s of percent it's way off base.

There's no reason for a hospital to charge $20 for a box of Kleenex, though they did rename it mucous removal devices. We, as a society, must agree that profit is good, profiteering is bad.

We've been sold the lie, among others, that prices are so high to cover the uninusured. It that were true then why are so many people being sued for medical debt and winding up in the bankruptcy courts?

Healthcare in this country is expensive because capitalism has run amok.
10:53 AM on 10/14/2009
Generally hospitals sell their debt to third party collection agencies. They can get as much as 40 cents on the dollar for this. If they do keep the debt, and sue someone into bankruptcy, they don't get much money for it (squeezing a turnip for blood comes to mind).
And part of the reason they charge $20 for kleenex is to cover the cost of the billing staff they have to hire to deal with the insurance companies!
06:51 AM on 10/14/2009
We'd love to focus it on our bottomlines. Just how much is a mandated policy going to cost each individual annually, and what is included as a covered services by that policy. Will this include dental and visual coverage? Will policy prices be regulated so that we aren't looking at 50 to 100 percent increases every year? Will these policies include deductibles and co-pays? Will we have to use only doctors on a certain list? Will we have to wait for insurance industry approval before we receive care or procedures the doctor deems necessary? Will drug prices be regulated, will other health care expenses be regulated?

Will the Amish be forced to purchase insurance?
04:11 AM on 10/14/2009
Change we can believe in is too important for business considerations.

Oh, and that includes health care reform.

I get that right, DNC?
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HUFFPOST SUPER USER
Dynamohum
09:13 AM on 10/14/2009
EAT IT.
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DickTater
American Livestock
03:01 AM on 10/14/2009
I am from Wisconsin and I was all ready to lambaste Tommy Thompson for his bad ideas as just reflective of his Corporate obsessed governance.

However, I detect a lot of compassion and urgency in his post. Not too many great ideas, and some real misguided thinking, but at least he is not toe-ing the normal republican line of obstruction and defeatism.

I agree with most of these other posters....what we have is an abomination and nothing short of burning it down and prosecuting these monsters is going to really change anything. NOTHING in washington gets 'watered up' it is only going to be 'watered down' from here out, unless something truly unique and historic happens. Not holding my breath.

But to disagree with Thompson on one main point....we cannot spend a lot of time bringing focus to living more healthy as our basis for helping healthcare. We have to deal with the folks and problems we have, as they are. Anything else is rationing care and criminalizing the ill. I am actually sympathetic to Social Darwinism, or at least Natural Selection....but I cannot blame the people for the poisonous, stress-drenched, corporate polluted mess of a world we have foisted upon them....and how it afflicts them. Personal responsibility takes a big hit when the whole system is stacked against you and designed to brainwash you and push all your buttons.
schatsie
Wall Street is Worse than Vegas
08:17 AM on 10/14/2009
yes and Bush as one of us and see how much damage he did....
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HUFFPOST SUPER USER
mickthebiologist
Field ecologist
10:17 AM on 10/14/2009
Dick - with all due respect, i believe you are missing one point. I haven't been to a doctor, had a test, taken a drug or missed a day of work (when i have work) for many years, and i have coronary artery disease and a zipper on my chest.

The ONLY facet of this debacle that we as individuals and families can control is our own NUTRITION.

I have worked in this area for two decades and i can tell you, for real, that everyone's health will dramatically improve, visits to doctors will go down a lot, tests will virtually be unnecessary, most annoying sickness will dwindle to a trickle or less, energy and strength will increase if we spend a bit more money and time on NUTRITION and exercise.

Chronic sickness will improve in almost every case. You are correct that this systems dumbs us down, stresses us out, drugs us up and malnourishes us. But that is not a good excuse for futility. It is a personal call to action, and if i can do it, anyone can.

Raw foods, organic foods, pesticide-free foods, high-quality herbs, proper food combining, knowledge of what foods are toxic or just food artifacts, techniques on how to break addictions to food artifacts, simple exercise, yoga, stretching, walking in sunlight for a hour a day, and the literature to find out how and when to use these things is virtually free and readily available, and there are millions of professionals.
10:57 AM on 10/14/2009
I went to my doctor a few days ago, and asked "While I am here, can I ask a dumb question?"
It was kind of like that Marx Bros skit, "Doctor, it hurts when I do this," "Well, don't do that, that will be $50."
When I don't take my vitimins for a while, I get these weird foot problems (cracked feet, to the point that the cracks cause pain and bleed). When I take my vitimins, I don't have problems. I wanted to make sure it wasn't some deeper problem. The doc said "You probably are low on zinc, and the vitimins are providing it."
A vitimin a day keeps the doctor away?
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HUFFPOST SUPER USER
TrekBear
This space is intentionally left blank
11:41 AM on 10/14/2009
You can eat as healthily as you like, but if you're genetically pre-disposed to an illness like hypothyroidism or another auto-immune disease, all the free-range, gluten and lactose free products aren't going to help.
01:53 AM on 10/14/2009
It is true that we need to redirect our consumer-culture into a culture of personal responsibility -but of course then the profitc of luxury commodity providers will go down and our general economy will be weakened. No, that's not going to happen any time soon.
Greed has altered America for the worse, but our responsibilities as a community remain unchanging.
The bottom-line of health care is healthcare, not money. Not only do we ned to regulate the insurance industry, but the healthcae industry itself - a for-profit health care system is immoral.
If we can change the healthcare game to non-profit status, perhaps then we can actively work towards a culture of personal responsibility, by insisting that people live better with less - and corporations, too.
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E4B32787
US Gov: The best that money can buy.
12:25 AM on 10/14/2009
"This requires incentives to control risk factors like smoking and lack of exercise..."

Essentially, that means charging more for certain pre-existing conditions, such as obesity. I do think in the case of "controllable" per-existing conditions, that it will be necessary to charge for these conditions to provide incentives to reverse these conditions. However, I don't know how that would work with those with low incomes, that would be exempt from paying any premiums.
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HUFFPOST COMMUNITY MODERATOR
austin4
BANNED.... 4.. LIFE
01:01 AM on 10/14/2009
Your ideas are fruitless, at best . There is a better way of doing this.
07:02 AM on 10/14/2009
Why not just arrest them and have the state control their lifestyles, through an enforced regime of diet and exercise.