America’s Health Insurance Plans (AHIP)
May 29, 2008
The U.S. could reduce total health care spending and improve the quality of patient care if the plan proposed today by America’s Health Insurance Plans (AHIP) was implemented. PricewaterhouseCoopers reviewed AHIP’s proposals and estimates and concluded that if these proposals are fully implemented, the nation’s total health care expenditures could be $145 billion lower than currently projected by the year 2015.
Principle #1: Patients and their doctors must have the information and tools they need to evaluate treatment options and make health care decisions on the basis of safety, quality and cost.
AHIP Proposal: Access to information that compares the effectiveness and cost of treatments: Give providers, patients and purchasers access to a trusted source where they can find up-to-date and objective information on which health care services are most effective and provide the best value.
Principle #2: Patients and doctors want an efficient, interconnected health care delivery system that reduces medical errors.
AHIP Proposal: Health information technology: Encourage widespread adoption of tools such as electronic health records (EHRs), personal health records (PHRs), secure e-visits with physicians, and e-prescribing.
Principle #3: Doctors and nurses need the freedom to practice medicine without worrying about frivolous lawsuits.
AHIP Proposal: Reforming the legal system: Replace the current medical liability system with a dispute resolution process consisting of an objective, independent administrative process to provide quick and fair resolution to disputes while promoting evidence-based medicine.
Principle #4: Health insurance plans are transitioning to a system that more closely aligns payments with the quality of care patients receive.
AHIP Proposal: Build health care reform around quality improvement by rewarding safety, value and effectiveness: Work for the broader adoption of value-based reimbursement mechanisms and provide consumers with more actionable information about health care value.
Principle #5: The nation must move towards a system of care that focuses on keeping people healthy, detects disease at the earliest possible stage and rewards chronic care management.
AHIP Proposal: Enhanced disease management, care coordination and prevention programs: Deploy a new generation of strategies that emphasize prevention, improve chronic care and tailor healthcare for patients to help them live longer and stay healthier.
AHIP press release
http://www.ahip.org/content/pressrelease.aspx?docid=23426
Full report: A Shared Responsibility: Advancing Toward a More Accessible, Safe, and Affordable Health Care System for America
http://www.ahip.org/content/default.aspx?docid=23427
Comment:
By Don McCanne, MD
Health care costs have become intolerable for most individuals, employers, and the government, and the prospect is that costs will continue to increase well in excess of the rate of inflation. Most current political proposals are focused on expanding coverage. Although the proposals include token programs for cost containment, most are not much more than rhetorical fluff except for the consumer-directed proposals that would make health care access even less affordable by shifting payment responsibility to patients in need of care. This is not the direction in which we should be headed.
The majority of Americans now receive their health care coverage through private health plans. While the private insurance industry has been in control for decades, they have been unable to restrain the escalation in health care costs. They understand that the viability of their industry is threatened if the issue of affordability is not adequately addressed. Let’s look at their proposal released today that theoretically would control health care spending.
Of their five proposals, the PricewaterhouseCoopers analysis shows that only three of them are projected to provide any significant savings: (2) Health information technology, (3) Medical liability reform, defensive medicine, and (5) Disease management, chronic care, prevention. How effective would these be?
Health information technology certainly can provide benefits such as increased efficiency and error reduction, but the problem of maintaining patient confidentiality within an integrated network has not been solved and may never be. Even if we did move forward with such a system, the private industry is poised to produce and control the technology for medical records and integrated systems. When you consider who the wealthiest person on earth is, it is difficult to imagine that such a system, which will certainly not be free, will reduce health care costs in the future. That technology will be expensive and it will be designed to continue to generate an enormous amount of user fees.
The direct costs of medical liability are only a very small part of our national health expenditures. If totally eliminated, it would have only a negligible impact on reducing spending. The important question is whether or not defensive medicine is wasting resources. When physicians decide to order tests to prevent lawsuits, they are not tests that couldn’t possibly provide any information that might help the patient. Most defensive medicine tests are ordered to be certain that a less likely but very real threat does not exist. These tests may be approaching the flat of the curve, but they are tests which occasionally do reveal a threat for which intervention can be effective, even life saving. Do we really want to abandon the use of lower-yield tests merely because they also happen to provide liability protection from having missed a serious disorder?
Substituting our current tort approach to malpractice with a dispute resolution process may be a good idea, but we should not expect major cost savings from that change. Currently, the overwhelming majority of medical-injury victims do not sue and never receive compensation for their injuries. If we were to establish a process in which medical injury is automatically compensated, it is likely that it would be considered to be an entitlement program, much like workers compensation. Imagine the costs of a program in which almost all medical injury is compensated. Even if it’s a good idea, based on the number of individuals to be compensated, it would increase rather than decrease health care costs.
Much has been written about disease management, chronic care, and prevention. Appropriate disease management and chronic care should be provided by our primary care professionals rather than by wasteful third-party administrators. An advantage of introducing processes that improve care is that ongoing needs for diagnostic and therapeutic interventions are more readily identified and acted upon. Prior studies have shown that even people with the best of care are not receiving all of the services that they should be. Improving care by providing these additional, appropriate services will not reduce costs, it will increase costs.
Prevention is important, but most important preventive measures fall outside of the realm of the health care delivery system. Even AHIP states that recommended steps include the “development of a national approach to consumer education and physical fitness, leading with a national discussion aiming to develop new strategies to promote early intervention of preventable disease.”
The insurance industry’s proposals to make health care affordable will more likely increase costs, so we should ask ourselves if they really provide us with any services that actually are of value. In this report they list services that they say are worth the extra cost that we pay over and above the publicly-administered Medicare program. According to AHIP, in contrast to Medicare, “private insurers develop a range of products, sell them to an under-65 population, develop and support provider networks, promote wellness and prevention, offer disease management services, access to health information, and offer consumer support services related to choice of providers and treatment plans.”
Well let’s break this out. They “develop a range of products,” which means that they market undesirable products that reduce benefits and increase cost sharing – measures that make access to health care less affordable. They sell their products to the “under-65 population,” certainly a healthier population than those over 65, but does that mean that we should be paying more for these marketing services that Medicare doesn’t face? They “develop and support provider networks,” which take away your freedom to choose your hospitals and health care professionals. They “promote wellness and prevention,” but who doesn’t? They “offer disease management services,” which are a costly administrative intrusion into primary care. They provide “access to health information,” as if they haven’t heard of the Internet. They “offer consumer support services related to choice of providers and treatment plans,” which are decisions to be made by patients and their health care professionals, not by an intrusive private bureaucracy.
So AHIP is attempting to legitimize the continued existence of the private health insurance industry by proposing cost containment measures that can’t work, and by trying to convince us that their expensive, detrimental administrative services are worth the extra we are paying. Why should we be paying extra for services that make affordability and access worse?
This report from AHIP is a desperate attempt to convince us that the worthless services of the private insurance industry somehow provide us with value. John Geyman is right. The insurance industry is in its death throes, and we should not attempt to resuscitate it.
John Geyman, “Do Not Resuscitate:”
http://www.commoncouragepress.com/index.cfm?action=book&bookid=396
