FAIR Health




  • Q&A: Stephen Warnke, Esq.
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    As the founding Chair of FAIR Health, Stephen Warnke has been at the helm of its  Board of Directors even before the organization was officially established in 2009.  As Co-Chair of the Health Care Group at Ropes and Gray, LLC, Stephen and his  firm represent a wide range of healthcare stakeholders. Mr. Warnke recently spoke  withFAIR Health Access about the rewards and challenges of being a healthcare  lawyer, the changing conversation in healthcare, and FAIR Health’s role in bringing  cost transparency to an ever-evolving healthcare industry.
    BA: How did healthcare become the focus of your work as an attorney?
    SW: I’ve been a healthcare lawyer in New York since 1991, and previously worked in the administration of then-Mayor David Dinkins on Medicaid and drug abuse issues. What drew me to the healthcare bar was that it’s an area of private practice in which I, as a lawyer, can be intimately involved in matters of pressing policy significance, representing private clients but doing so in a way that advances the public good. The healthcare industry is in a state of perpetual flux and perpetual crisis, so there is never a moment when you can profess to have complete command of all the technical details. The challenge for lawyers who represent healthcare clients is therefore constantly evolving, and of course, always fascinating.
    BA: You were asked to serve as Chair of FAIR Health following the settlement between then-Attorney General Cuomo and the insurance companies in New York State. What were your thoughts about a settlement agreement that provided for the establishment of a new organization rather than a settlement agreement that simply provided for the payment of a specific sum?
    SW: The Cuomo Settlement Agreement was farseeing in several respects. First of all, the Attorney General understood that to capitalize and make possible the kind of venture that he had in mind for FAIR Health would require a substantial commitment of upfront dollars. By settling with over 12 insurers, both regional and national, he was able to raise the funds dedicated to that important mission. Second, he recognized that the organization responsible for validating and publishing healthcare pricing data should be completely disinterested and mission-driven -- not a subsidiary of any sector of the industry with a stake in the pricing data but also not pursuing profit or any narrow, parochial set of interests. And so, the second innovation of the settlement agreement was to provide for the launch of a new business that would function as the successor to Ingenix but be neutral, dispassionate, and committed to charitable purposes. Third, the Attorney General recognized that there was substantial complexity to taking over the Ingenix benchmarking business lock, stock, and barrel, and doing so in a way that preserved Ingenix’s role in disseminating data releases in a timely manner for use in adjudicating and paying out-of-network claims. So, he recognized that was an important commercial function but nonetheless a commercial function that could be effectively discharged by a mission-driven non-profit.
    BA: Looking back on how far FAIR Health has come since its founding in 2009, is it what you had imagined it would be?
    SW: It is remarkable how far FAIR Health has come, but I’m not that surprised given the talent that we’ve been lucky to recruit – from president Robin Gelburd and on through the ranks of what has become an extraordinary organization. FAIR Health’s progress is deeply gratifying but it’s a testament to what energetic, well-led, and dedicated people can do.
    BA: The FAIR Health Board members are drawn from many different corners of the healthcare industry. How does that impact Board dynamics and deliberations?
    SW: FAIR Health has a small but hardworking and diverse Board with individuals who have worked with major health plans, consumer organizations, physician organizations, and hospital systems. We all understand, however, that when we deliberate as a Board our overarching obligation is to promote the mission of FAIR Health. So, we bring our varying perspectives and experiences to the common activity of using our asset – a vast reservoir of claims data – to promote accessibility and transparency in the healthcare arena.
    BA: How is the conversation in the healthcare industry changing? What is FAIR Health’s role in this change?
    SW: With the enactment of the Affordable Care Act, there are two imperatives in healthcare that must be managed well in order to promote positive change. One is to expand access to care for populations that previously have had to rely on emergency rooms and have been without comprehensive health benefits. The other is to control costs. The risk certainly exists that, as more people gain access to health insurance, our society will spend an even higher percentage of our gross domestic product on healthcare. By contributing objective, reliable data to the national conversation on healthcare spending, FAIR Health informs the dialogue on how to ensure high quality care at an affordable price. FAIR Health will play, I believe, a key role in assisting both industry participants and policymakers to figure out how to price care in ways that depart from the traditional fee-for-service paradigm through episode of care payments, through bundled payments, and other mechanisms that are likely to prove much more effective in delivering quality while controlling cost.
    BA: Why is cost transparency so important in the healthcare industry?
    SW: There’s virtually universal consensus in the industry that payment has to reward efficiency and quality. FAIR Health’s data repository – its ability to show costs of various care interventions on a micro basis, not just by region but by zip code – will be extraordinarily useful as we seek to match payment to performance. FAIR Health’s neutrality and agnostic posture afford access for all healthcare stakeholders – from consumers to providers to payors – to data that are free from any bias, thus fostering informed public debate and innovation.
    This interview appeared in the January 2013 issue of FAIR Health Access.

  • Q&A: NancyMarie Bergman

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    As a wife, mother, business owner and breast cancer survivor, NancyMarie Bergman learned first-hand the importance of cost information in healthcare decision making.  Diagnosed with breast cancer in 2008, Ms. Bergman made a critical decision about her treatment: after interviewing in-network and out-of-network specialists, she ultimately decided to undergo treatment that was out-of-network given her particular medical circumstances. While Ms. Bergman’s treatment was successful, it led to another, unexpected outcome: large bills that she had not planned for and could not afford. Since that time, Ms. Bergman has staunchly advocated for cost transparency to help consumers with similar experiences make more informed healthcare decisions.  In addition to serving as an important consumer voice on the Board of Directors of FAIR Health, Ms. Bergman also is a Board liaison to FAIR Health’s Consumer Advisory Board, which advises the organization on its consumer-oriented mission and initiatives.  
    Together with her husband, Ms. Bergman runs Bells Nurses Registry and Employment Agency, Inc., which provides temporary medical staffing for hospitals in the New York metropolitan area.  A former member of the Board of Trustees for the Long Island Alzheimer’s Foundation and for the Advancement for Commerce and Technology on Long Island, Ms. Bergman also has held positions with BDO Seidman, the international accounting and consulting firm.  In recognition of October as National Breast Cancer Awareness Month, NancyMarie Bergman spoke with FAIR Health Access about her experience as a breast cancer patient navigating the healthcare system and the importance of having access to cost information when making decisions about treatment. 
    BA: How did you become involved with FAIR Health?  What has been the most rewarding aspect of your participation? 
    NMB: Following my breast cancer diagnosis in 2008, I interviewed different specialists – both in-network and out-of-network – before deciding who would provide my treatment. I eventually chose to undergo treatment by a team of doctors who had expertise with my particular cancer even though they did not participate in my plan’s network. I did my due diligence and tried to research in advance how much the cost of my care would be, how much I would be reimbursed, and how much I would be responsible for paying out-of-pocket, but I had no way of knowing what my out-of-pocket responsibility would ultimately be. Because I did not know how much I would be asked to pay for the cost of my care, I debated whether to have the last of my surgeries. At a time when my decision making should have been focused on my medical needs, it instead became focused on my finances. Thankfully, I did have both surgeries. However, I was responsible for paying over half of the cost of the procedures – this translated into thousands of dollars in medical bills. 
    It was then that I reached out for assistance to the New York State Office of the Attorney General (OAG), directed by then-Attorney General Andrew Cuomo. I learned that I wasn’t the only consumer to have this experience and I was asked by the OAG to share my story and experiences with other New York consumers.  Shortly thereafter, when FAIR Health was created in 2009, Attorney General Cuomo asked if I would join its diverse Board of Directors as the voice of the consumers.
    What is most rewarding about being involved with FAIR Health is being able to contribute to the Board as a voice that represents the consumer.  It gives me a great deal of satisfaction to be part of an organization that is impacting millions of individuals by providing tools and education to help them make wise, informed healthcare choices – not only from a medical standpoint but from a financial one as well. 
    BA: How have your interactions with the healthcare system shaped your view of its strengths and weaknesses? 
    NMB: The healthcare system is still evolving, but I still believe we have the finest medical facilities, treatment centers, technologies and innovations in the world.  And thanks to not-for-profit organizations like FAIR Health, consumers are becoming real copilots in navigating the healthcare environment and in understanding the costs of treatments and the impact of their healthcare decisions. Through the business I run with my husband in the nursing field, we have seen tremendous growth and new employment opportunities in the healthcare arena. It’s true that, as a nation, we still pay more for healthcare than any other modern-day society.  We still fall short in preventative medicine. But I believe that we are moving forward to correct the gaps and weaknesses in the system; the Affordable Care Act is one such step forward. So I’m hopeful and optimistic about the future of our healthcare system. 
    BA: In the Summer 2012 issue of FAIR Health Consumer Access, you discussed how healthcare cost information from the FAIR Health consumer website helped inform a conversation with your surgeon regarding a subsequent procedure you were scheduled to undergo. How can your experience teach other healthcare consumers about using price information to make healthcare decisions? 
    NMB: The beauty of FAIR Health is that now consumers can access at any time, in their own home, cost estimates for medical and dental procedures from the FAIR Health consumer website. The price information from the website enables consumers to understand how much their insurers are likely to reimburse for the cost of the care they receive out-of-network and how much they will be responsible for paying out-of-pocket for medical and dental services and procedures – whether they are insured or uninsured. 
    In addition to being a great resource for estimating and planning out-of-pocket costs, the cost information from the website also is helpful for initiating open dialogues with providers on fees. As I described in the consumer newsletter last year, prior to a subsequent surgery I was scheduled to undergo, I used FAIR Health pricing information to discuss fees with my surgeon and negotiate the costs of my care; since then, I have had these conversations many times with my doctors and they were always more than happy to work with me. Access to objective price information gives consumers who choose to go out-of-network the ability to plan ahead for their finances, and compare costs in different geographic areas if need be, so there are no hidden surprises. 
    BA: This month, we are beginning to see how health insurance exchanges impact insurance coverage across the nation. How do you think the Affordable Care Act (ACA) will, if at all, impact the role that consumers play in the healthcare system? Which aspects of the ACA are you most enthusiastic about from a consumer standpoint? 
    NMB: The ACA presents both opportunities and challenges.  Expanded coverage and new insurance standards can potentially improve access to care. The health insurance exchanges are providing consumers with the opportunity to shop for coverage in a way that allows them to easily compare the benefits, services and prices of various health plan options. In that way, the ACA makes the healthcare system more accessible to consumers and moves the healthcare system in a better direction. Being a cancer survivor, I am especially enthusiastic about the fact that now, cancer screening as a preventative measure – which is incredibly valuable for saving lives – will be available at no cost to consumers. 
    Of course, some consumers may be concerned about having a plan with a narrower network of providers and that their specialists or primary care providers may not participate in plans sold on the exchanges. They may feel that this compromises their health and limits their choices. So, consumers purchasing plans on the exchanges may feel some degree of vulnerability as well. 
    BA: In many respects, this has been a banner year for cost transparency – a Time Magazinearticle highlighted challenges in obtaining hospital service pricing, the Centers for Medicare and Medicaid Services released hospital pricing data and a study illustrated the impact of price data on provider decision making. What about the growing trend of cost transparency are you most enthusiastic about? To what extent do you think healthcare cost information encourages consumers to play a more active role in their healthcare decisions?
    NMB: I have always believed that the best consumer is the educated consumer. Access to cost information that’s transparent, reliable and accurate is such an effective tool in helping consumers make better healthcare choices and decisions. When consumers are armed with the right information, we can make better choices. We’re able to demand high quality service from our providers and we become active participants in our own healthcare. And that’s especially important because we really are the best ones to advocate for ourselves. 
    BA: FAIR Health has been at the forefront of bringing cost transparency to the market. Was the creation of an organization such as FAIR Health, and the universal demand for healthcare cost transparency, inevitable?
    NMB: I truly believe that the movement towards greater healthcare cost transparency was inevitable. Before FAIR Health was created, there was no information or database on healthcare costs that consumers could access to determine their out-of-pocket responsibility and reimbursement amounts for out-of-network care. They were unable to compare costs or know if the fee for a service was in line with those of other providers in a particular area. Unless consumers did their own due diligence and went out to doctors and actually paid the doctors’ consultation fees to learn what doctors would charge for a procedure, there really was no basis of comparison or a way for consumers to understand what their costs would be.  
    It took a true hero of the people to fight for healthcare cost transparency on behalf of all consumers: former Attorney General – now Governor – Cuomo. He gave all New Yorkers a feeling of hope and confidence in the system; he was the voice for the consumer that had gone unheard for so long.  Through his vision and creation of FAIR Health, the confusion and guesswork on out-of-network cost reimbursements were eliminated and instead a fair, accurate and unbiased source of cost data for reimbursement was created. 
    This interview appeared in the October 2013 issue of FAIR Health Access.

  • Q&A: Sherry Glied, PhD

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    A leading health policy expert, economist and scholar, Dr. Sherry Glied has contributed extensively to the national dialogue on health reform. Following confirmation by the U.S. Senate on June 22, 2010, Dr. Glied served as Assistant Secretary for Planning and Evaluation at the Department of Health and Human Services from July 2010 through August 2012. She had previously served as Senior Economist for healthcare and labor market policy on the President’s Council of Economic Advisers in 1992-1993, under Presidents Bush and Clinton, and participated in President Clinton’s Health Care Task Force. The current Dean of New York University’s Robert F. Wagner Graduate School of Public Service, Dr. Glied was previously Professor of Health Policy and Management at Columbia University’s Mailman School of Public Health from 1989-2012; she served as Chair of the department from 1998-2009. The recipient of numerous honors, she is a member of the Institute of Medicine of the National Academy of Sciences and of the National Academy of Social Insurance.  
    Dr. Glied’s research has focused on health policy reform and mental healthcare policy among other areas. She is the author of Chronic Condition and co-author with Richard Frank of Better But Not Well: Mental Health Policy in the U.S. Since 1950. She also is co-editor with Peter C. Smith, of The Oxford Handbook of Health Economics. Dr. Glied recently spoke with FAIR Health Access about the Affordable Care Act (ACA), its impact thus far on the healthcare landscape and how cost transparency will likely impact the healthcare market in the coming years. 
    BA: As an economist, how did you become interested in healthcare reform and mental health policy? 
    SG: The development of my interests in healthcare reform and mental health policy were both accidents in different ways. I was trained as a labor economist and the focus of my PhD was on labor economics. I wrote my dissertation about the effects of the HIV epidemic on the labor market.  When I applied for a job everyone said ‘you’re not a labor economist, you’re a health economist,’ so I became a health economist. Shortly afterward, national interest in healthcare reform in the United States grew because of Harris Wofford’s victory in the Pennsylvania Senate race in 1991. I was asked to go to Washington to do both labor and health economics for President Bush’s healthcare plan. From then on I’ve been a healthcare policy person. It was a consequence of being in the right place at the right time. Healthcare reform is such a fascinating area; it has afforded me a great deal of intellectual stimulation and great opportunities, and it was a very fortunate outcome of my dissertation topic.

    I became interested in mental health policy in a similar way. When I joined the faculty at Columbia University, there were many mental health services researchers who needed an economist to help with grant proposals; they called me and I became a mental health economist. The problems involved with health economics and, even more so, with mental health economics, are among the most complicated and challenging in economics. As an economist it was very fertile ground on which to conduct research. So once the opportunities had been laid before me I did the sensible thing and took them. 
    BA: Historically, employer-sponsored health insurance has been the foundation of private coverage in this country. Recently, some employers have asked a portion of their workforce, such as those employees who work part-time, to purchase individual coverage from the health insurance exchanges (marketplaces). Does this herald a greater shift away from employer-sponsored coverage in the coming years? What new trends in employer-sponsored coverage will likely emerge in the next five to ten years? 
    SG: Some large employers are moving to private exchanges and over time, if the Affordable Care Act marketplaces work out, there’s a possibility that more medium-sized and small employers might move to the exchanges. Are we likely to see a shift away from employer-sponsored coverage? I’m actually one of the few people who think that employer-sponsored coverage is a strong institution and is not likely to disappear any time soon. It offers many advantages even compared with the health insurance exchanges. There is a good reason, especially in very large companies, to retain employer-sponsored health insurance, but I can see it fading out among the smaller firms over time. Employers are pretty innovative so we will continue to see changes in the way employer-sponsored coverage operates. We don’t entirely know what those trends are going to be yet and I am not enthusiastic about predicting, so we’ll see. 
    BA: Under the Affordable Care Act (ACA), coverage for behavioral health services is one of ten essential benefits. How might this impact the quality of mental healthcare in the long term? To what extent does our healthcare system have the capacity to provide behavioral health services to those who will be newly insured and/or newly eligible to be reimbursed for this type of care?  
    SG: One of the most important reforms in the ACA is not only that coverage for behavioral health services is one of ten essential benefits that plans are required to cover, but that parity in mental health and substance use services is now required for all plans. Many people who would benefit from having access to mental healthcare, but who did not have coverage for those services originally, now will have that coverage. We are actually in pretty good shape to provide services for those people as they come into the mental healthcare system. There are not many psychiatrists, but very few people actually see psychiatrists. We have plenty of psychologists and social workers, except in small areas of the country. However, we have serious issues in the quality of mental healthcare across the country. So, we need to further explore how to assess the quality of mental healthcare and how to make sure people not only have access to care but that the care is likely to work for them. We are a long way from that.
    The capacity to provide treatment for substance use is much more of an issue. Primary care practitioners deal with most mental health problems, but they are not ready to deal with substance use problems. The substance use treatment system is quite divorced from the traditional insurance system and we know that there is a lot of substance use, especially alcohol use, that hasn’t been diagnosed and treated. A lot of work will need to be done to ensure access to quality care for those conditions as well. 
    BA: Research shows that the rate of growth of national healthcare spending in recent years has slowed; the economic downturn has been cited as a reason for this slowdown. Is this trend likely to continue? How may coverage expansion and the growing prevalence of high-deductible health plans impact future national healthcare spending? 
    SG: One of the interesting aspects of the decline in the rate of growth in national healthcare spending in the US is that it is parallel to declining rates of growth of national spending in most of the economically developed countries such as Canada, France, Germany and the United Kingdom. One reason for that trend must be that new high-cost technologies are coming along more slowly. We see that in the case of prescription drugs and some other cases. Part of the reason for this is that hospitals, providers, investors and even technology companies recognize that people will not be willing to pay in the future at the rates that they’ve been willing to pay in the past, so investments in those goods are decreasing a little bit. The positive side of this is that it might rationalize some of the irrational patterns of technology buying that we’ve seen such as the substitution of very costly drugs for other drugs that may be just as effective and competition between hospitals to buy the latest and greatest piece of surgical equipment, which doesn’t make much sense from a public health point of view. Although slowing the inefficient use of technology may be good, technological growth is the reason we’ve seen improvements in healthcare. So it’s a real balance between making intelligent investments in new technologies and improving quality of care against the cost-increasing elements of doing that. 
    Coverage expansion is not expected to have a very big effect on healthcare spending because most of the people who will get coverage have not been the sickest people; coverage expansion is expected to raise national healthcare spending by just about 2% which is a bump up in one year, but insignificant when compared to the rate of growth of healthcare spending over time. As for high deductible health plans, I’m dubious as to whether we’ve really seen a growing prevalence of these plans. Everyone’s deductible is going up over time, but the threshold of $1250 we use to define a plan as a “high deductible” plan hasn’t changed since 2003. More plans are crossing that threshold but whether we’re actually seeing a change in how health insurance is organized is less clear. 
    BA: Although the ACA primarily focused on expanding coverage and access to care, national dialogue continues to focus on containing healthcare costs.  How will cost transparency give rise to new areas of research that advance understanding of potential solutions for controlling healthcare costs?

    SG: We’ve known for quite a long time now that one of the reasons why the US healthcare system is so expensive, so very expensive, compared to systems in other countries is that the prices for almost all healthcare goods and services in the US are just much higher. That claim has been made at the national level based on total data, but not really on prices for specific services. Ironically, transparency is likely to shed light on just how high average prices are—how much we’re paying on average for different services. We already see this: article after article such as the one in the New York Times that highlighted the cost of childbirth being so much more expensive in the US. This is the kind of research that nobody could ever have done ten years ago because the data were not available. It’s actually really raising the profile of these price questions, which are very important questions: Why do things cost as much as they do, and what can we do to bring those prices down? It’s not simply a matter of cutting items or services; besides being hugely disruptive we don’t know why they are as expensive as they are and maybe there would be a negative outcome by cutting them. If we can’t identify the problem then we can’t look for solutions. Making healthcare prices visible has changed the way we look at these price questions, from simply looking at the volume of services people use to studying prices for specific services. 
    BA: How might cost transparency help us to better understand and define quality and value in healthcare, and influence the development of new models of healthcare financing and payment? 
    SG: We can’t define value unless we have some idea of quality and cost. Frankly, we haven’t made as much progress on the quality piece as we all have wished we had. But at least we are getting the cost piece moving so we’re a little bit ahead of where we were. What we could think about is where we really need information on quality for shopping. We would have to look at the data to see whether this is true or not, but my guess is that elective surgeries, such as knee replacements, are the kinds of procedures that people could shop for. They have time to make a decision and can compare prices of different providers. The procedure is mostly performed outside of the hospital, so it would be easier to compare the prices. It would be great if we could get good quality indicators for those particular kinds of procedures—single item large purchases—because when people have higher deductibles, those are the ones that they have the opportunity to shop on and that are the easiest ones to shop on. Maybe we should be focusing our quality efforts on those services and not only on the ones we’ve thought about such as care for diabetes and heart disease; people are not going to shop simply based on quality indicators for chronic conditions like those. Many factors that influence patients’ healthcare decisions for chronic care, such as having a doctor they like and who is conveniently located, are not captured by quality measures. 
    We are at the dawn of thinking about how transparency will affect healthcare and don’t really know how it will evolve over time at all. However, one interesting aspect of transparency, which the FAIR Health model plays into nicely, is that we’ve seen a return to narrower provider networks in many of the marketplace plans. It’s one of the outcomes that we had not really anticipated. In a competitive market system that’s probably the single most effective way of getting prices down. It’s how all other industries do it as well—by negotiating with people who are willing to participate at lower prices. One of the reasons we can now have those narrower networks is that we have much more information about what going out-of-network actually means. FAIR Health is really all about that. If you know how much it would cost to go out-of-network you can make more sensible decisions about choosing plans with narrower in-network options and can recognize what it means to be in- and out-of-network. That’s not the way we expected cost transparency to play out, but it’s an interesting way that transparency has played out. It’s also an interesting example of how having price information changes the picture in ways that you can’t necessarily anticipate. 
    This interview appeared in the November 2013 issue of FAIR Health Access.

  • Q&A: Peter J. Millock, Esq.

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    As a former General Counsel of the New York State Department of Health from 1980-1995, a clinical associate professor at the State University of New York at Albany, School of Public Health and as a partner at Nixon Peabody, Peter J. Millock has brought important, diverse perspectives to the development of New York State’s public health and healthcare regulations.  Currently, Mr. Millock focuses his legal practice on affiliations and networks of physicians, hospital and other health and mental health providers; regulatory and enforcement matters before state agencies; and legislative lobbying on healthcare issues.  In 1993, he served the Clinton Administration on the President’s Task Force on Health Care Reform as a member of the Legal Audit Team.  He is a past member of the State Data Protection Review Board.  Mr. Millock is a member of the New York State Bar Association; he is also the past chair of its Health Law Section.  He has been recognized for exceptional standing in the legal community in Chambers USA: America’s Leading Lawyers for Business 2013 for healthcare and has been recognized in Chambers USA in previous years.  Mr. Millock recently spoke with FAIR Health Access about his career and how the Affordable Care Act may spur changes in healthcare law in the years to come.  
    BA: What led you to pursue a career in health law?  
    PJM: Initially I was an environmental lawyer; I worked at a small firm in New York City that specialized in environmental law.  I then worked for the New York State Department of Environmental Conservation and became very involved in the area of hazardous waste in the wake of the Love Canal disaster.  I led a Task Force that included people from the Environmental Protection Agency, New York State Department of Environmental Conservation and the New York State Department of Health to identify hazardous waste sites in western New York and also to fashion legislation that would deal with inactive hazardous waste sites.  That statute became the model for federal legislation on the subject.  That work led me to the New York State Department of Health.  My responsibilities there were as all-encompassing as the Department’s scope, from AIDS to medical malpractice to hospital reimbursement and everything in between.  I spent 15 years as the General Counsel to the New York State Department of Health and have practiced health law at Nixon Peabody for the last 18 years.  
    BA: As a healthcare lawyer for over three decades, what challenges in the healthcare environment today, at the national level and in New York State, most surprise you?  How have these challenges evolved over time?
    PJM: What surprises me most is that the issues have not changed.  The three primary issues in healthcare – quality of healthcare, access to healthcare and cost of healthcare – have been the same issues for the last 30 years.  The challenges today involve longstanding problems that have not been addressed through law, policy or private initiative.  The Affordable Care Act (ACA) is an effort to address access, but says very little about quality and cost.  The ACA is the greatest achievement in healthcare policy in 30 years, but it is far from a panacea. 
    Looking at New York, the regulatory framework remains unchanged and the issues are the same as they were 30 years ago: hospital quality of care, the certificate of need process, malpractice issues and the role of private finance were unresolved issues in 1980 when I joined the Health Department and they remain unsolved.  
    BA: You served as General Counsel of the New York State Department of Health (NYS DOH) at the time that its Commissioner was Dr. David Axelrod, who is remembered for his innovative, cutting-edge approach to advancing public health in the state.  How did your experience as chief legal advisor to Dr. Axelrod influence your viewpoint on the extent to which the courts and legal precedent impact the development of public health policy?  Which advances during the time you served at the NYS DOH have had the most impact on New York State’s healthcare laws and policies? 
    PJM: Serving as General Counsel under David Axelrod was an extraordinary experience because he was an extraordinary man.  David Axelrod was head and shoulders above any other commissioner at any agency then and since.  He had a particular view of the way the law should be used.  He saw the law as a tool, and not as a permanent constraint.  He was not shy about pressing the envelope on most issues.  That led him into controversy and he made powerful enemies.  He kept powerful friends:  Governor Hugh Carey and Governor Mario Cuomo.
    Working for David Axelrod allowed me to participate in many of his initiatives.  One of these involved the development of information on risk-adjusted performance at the state level.  He championed confidentiality of medical records.  He advanced the idea of something similar to the Affordable Care Act.  He was instrumental in promoting the Harvard Malpractice Study, which supported a whole new view of malpractice.  In addition, he created the Task Force on Life and the Law, which served as the model for task forces established in other states and led to the development of statutes and regulations that addressed issues such as the right to die, the definition of death, healthcare proxies and other issues. 
    It is difficult to describe the spirit of innovation at the Health Department then.  It certainly wasn’t typical of any state agency anywhere.
    BA: The famous 1987 ruling in Boreali v. Axelrod struck down a state regulation to ban smoking in most indoor places.  What were some of the issues involved in the Borealiruling?  How has the Boreali decision impacted subsequent public health efforts in New York?  How might the Boreali ruling have been different had it been decided in today’s day and age? 
    PJM: The New York State Legislature tried many times to pass legislation limiting smoking indoors and failed.  As Health Commissioner, David Axelrod had the State Public Health Council promulgate a regulation that restricted smoking in indoor areas.  The regulation was challenged by the tobacco industry, and in Boreali, the Court of Appeals struck down the regulation because it was seen as an abridgment of legislative prerogatives.  The State legislature then enacted a statute which mirrored the regulation.   
    Boreali is often cited when an industry wants to invalidate a regulation.  In one circumstance, the decision does retain precedential importance:  where the Legislature tries but does not succeed in passing a law, a regulatory body cannot step in and usurp legislative power by promulgating an omnibus regulation.  Most recently, the Boreali ruling was cited as a basis for striking down New York City’s “soda ban.”  
    BA: How might the reforms that are part of the Affordable Care Act (ACA), such as development of Accountable Care Organizations (ACOs), impact states’ laws and regulations around healthcare?  How might the implementation of the ACA spur the development of new areas of healthcare law? 
    PJM: Two issues are most interesting to me.  One is antitrust law.  The ACA encourages combinations of competing providers in ACOs.  This has been prohibited or at least discouraged by the antitrust laws, so the impact of the ACA and its ACOs on the antitrust laws will have to be resolved.  Combinations within an ACO also raise self-referral issues – referrals of patients from one provider to another where the referring provider has an interest in the place where the patient is being referred or realizes some other benefit from the referral.  This subject will have to be reevaluated to accommodate ACOs.
    Other changes in the industry largely sparked by economic forces and not the ACA or other new laws, also pose substantial legal issues.  One is the increasing size of healthcare organizations.  Hospitals in New York are merging into larger and larger entities and doctors are being employed by those hospitals or by much larger private practices, the so-called “mega practices.”  These two developments are changing the relationship among hospitals and between hospitals and physicians.  The legal ramifications are substantial.  For example, how do hospitals within a large system share quality of care information?  
    BA: How do you think ACOs will fare compared to the capitated models of the 1990s?
    PJM: We have a long way to go before we’ll know whether ACOs will fare better than the models of the 1990s.  At that time, hospitals acquired practices, hospitals and doctors created physician health organizations and physicians formed independent practice associations.  Most of these efforts were unsuccessful.  Economic factors today are pushing providers to do more together.  Everybody is threatened by reduced reimbursement and increased competition. The dramatic changes in the healthcare market today may cause ACOs to be more successful than their predecessor entities.   
    BA: FAIR Health has been at the forefront of bringing cost transparency to the market.  What makes FAIR Health unique in the healthcare arena?

    PJM: FAIR Health has been terrific.  I don’t think anybody imagined three or four years ago that FAIR Health would be as successful as it has been.  The organization has really had a big impact on the availability of understandable information to the consumer, to researchers and to private companies doing business in the healthcare world.  The magnitude of its database mandated by the original settlement has contributed to its success.  And FAIR Health’s neutrality has given it a credibility that its predecessor didn’t have and some of its competitors in the business now don’t have.  As a not-for-profit fulfilling a public objective, the organization has a very unusual position in the market.  But these natural advantages are not enough to explain FAIR Health’s success.  It is blessed with superlative senior leadership. 
    This interview appeared in the June 2013 issue of FAIR Health Access.

  • Q&A: Dr. Nancy Nielsen
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    As an elected member of the Institute of Medicine, a past President of the American Medical Association (AMA) and Senior Associate Dean for Health Policy at the State University of New York (SUNY) at Buffalo School of Medicine and Biomedical Sciences, Dr. Nancy Nielsen has made significant contributions to the medical field from a variety of different vantage points.  Dr. Nielsen was the AMA representative on many quality initiatives, including the National Quality Forum, the AMA-convened Physician Consortium for Performance Improvement, the Ambulatory Care Quality Alliance (AQA) and the Quality Alliance Steering Committee.  Recently, she served as Senior Advisor to the Center for Innovation within the Centers for Medicare and Medicaid Services in the US Department of Health and Human Services.  Dr. Nielsen recently spoke with FAIR Health Access about her medical career, how the evolving healthcare landscape is changing the practice of medicine and how these changes are creating new opportunities for physicians and other healthcare stakeholders to work together towards better patient outcomes. 
    BA: You entered medical school after having started a family, in your late 20s.  What influenced your choice to pursue a career in medicine?  To what extent have the challenges that women face when pursuing medical careers eased since you first began your own career?
    NN: I wanted to be a physician from the time that I was a young child; I just had to delay that because of financial reasons.  So, delaying my medical education wasn’t a matter of choice, it was a matter of necessity.  With respect to the challenges that women in medicine used to face, a number of specialties that used to be fairly closed to women are now welcoming them, such as orthopedics, urology, neurosurgery and surgery.
    BA: You have had the opportunity to shape and observe the medical field from various perspectives.  What have been some of the most gratifying roles you have played?
    NN: Nothing has been more rewarding than taking care of patients and sharing their lives -- that was a real privilege and I feel very fortunate to have had that opportunity.  The greatest privilege in terms of my professional career, though, was leading the AMA at a time when there was clearly an opportunity to move toward health insurance for all Americans.
    BA: As an internist and professor of medicine, what are the greatest challenges facing medical students today?
    NN: Medical students face several challenges.  One is making sure that they know enough in a world where knowledge and science are expanding exponentially.  Beyond that, there’s the obvious financial challenge.  It costs a lot of money to go to medical school and it’s very difficult to incur debt as an undergraduate, much more debt as a medical student, and then be paid a minimal salary as a resident.  Reimbursement and payment for services for the primary care specialties such as pediatrics, internal medicine and family medicine, are much less than in fields where more procedures are done.  This clearly has impacted folks who choose primary care specialties versus other specialties and has influenced people in their choice of careers.  Another challenge that both male and female students face now and are concerned about is work-life balance.  This was not something that was talked about when I was going through medical school and residency.  In fact, it would have been thought to indicate a lack of dedication if you even brought it up.  But that’s not true anymore and that’s a very healthy development.
    BA: In today’s era of rapid change and reform, what are the most significant changes that are – or will – take place in the way that physicians practice and are trained? 
    NN: Right now the attention to value - to making sure that the amount of money that is spent achieves the outcomes that are hoped for - creates a situation where the business model under which physicians learned to practice medicine is changing.  There is much more attention to prevention and human behavior than there ever was before.  Physicians will practice under a new business model that will be a major shift away from fee-for-service payment to more population-based payment, as we see in accountable care organizations.  We see a burgeoning of education that applies to not just the medical profession or the nursing profession, but to inter-professional education involving doctors, nurses, pharmacists and therapists of all sorts -- that is a significant change.
    BA: What aspects of the patient-physician relationship – unique in that it is not only a professional but personal one – should be considered when defining and evaluating quality of care?
    NN: How you define and evaluate quality of care is important.  The buzzword in Washington and across the land is value-based purchasing, which means achieving good outcomes with costs that are kept low -- quality at a price that is affordable.  However, value is in the eye of the beholder.  If you’re an insurer or the government paying the bills you’re worried about cost and quality, but mostly cost.  Patients may define value differently depending on their situations.  Patients newly diagnosed with cancer are looking for the best outcomes, for a physician who can relate to their situation and their family.  Value is different to a young person who wants routine care but doesn’t think about catastrophic care; we all know how invincible people think they are when they’re young.  Those much older with three or four chronic conditions may not worry about preventive care, but about access to medications and to specialists; to them, value would be the freedom to go where they need to go to meet their needs. 
    BA: You served as the spokesperson for the AMA’s Voice of the Uninsured campaign; you also have spoken about your own experience being uninsured.  What impact do you think the Affordable Care Act (ACA) will have on reducing the proportion of the uninsured and improving access to care?  What challenges will still need to be addressed to successfully ensure care for those who are currently uninsured?
    NN: When the ACA was passed, it was anticipated that 30 million Americans would have health insurance because of its provisions.  This has changed primarily because of the Supreme Court decision on Medicaid expansion.  Now, states have the option of either expanding or not expanding Medicaid so probably fewer than 30 million Americans will become insured; we’ll also see how many Americans can afford insurance through the exchanges.  Many doctors and most hospitals hope that states will expand Medicaid because the costs of the uninsured are borne by all of us.  The greatest challenge is being able to afford the healthcare that we need in this country.  Right now, we pay much more for healthcare than other developing countries do but our outcomes are not nearly as good except in a couple of situations.
    BA: How influential do you think the Accountable Care Organization (ACO) model will be on the way we pay for healthcare in the years to come?  What role will FAIR Health play in the development of ACOs?
    NN: Accountable care organizations may be real game changers.  A group of providers -- including doctors, hospitals and other kinds of facilities that give care or services for patients -- come together and agree to be responsible for the care of the patients, and for the costs of care.  Goodwill is not enough; you have to understand what the costs are and what the prices will be.  Doctors have been completely insulated from the true cost of medical care, as have many patients except for those without health insurance.  So, FAIR Health has a major role to play.  Its data will be critical to the ACO business model in appropriately valuing services being rendered.
    BA: FAIR Health has been at the forefront of bringing cost transparency to the market.  Was the creation of an organization such as FAIR Health and the overall demand for healthcare cost transparency inevitable?
    NN: The overall demand for healthcare cost transparency was indeed inevitable.  The demand came from throughout the country -- from the halls of Congress, for years from health insurers, from employers and from patients.  But I don’t think the creation of FAIR Health was inevitable – that took the courage of then-Attorney General, now Governor, Cuomo.  He did not take on this case for doctors; he took on this case for patients.  It was his courage that led to the settlement that created FAIR Health, an organization that is impartial, has no skin in the game and is there to provide information to anyone who needs it.
    BA: How is the conversation in the healthcare arena changing?  What role do you see FAIR Health playing in this changing model? 
    NN: The conversation in the healthcare arena is focused clearly on what we pay for healthcare right now.  The ACA addressed access and insurance, but it didn’t address the issue of ever-escalating costs.  There is much more to be done in that regard.  Steven Brill’s March 4th article about hospital prices that appeared in Time has received a lot of attention, including a Congressional hearing today [April 9th].  There isn’t anybody in Washington who hasn’t read that article, paid attention to it and who isn’t demanding change.  Now the issue is not just about who to blame for rising costs, it is that we are all in this together.  We need more attention to prevention and better outcomes for patients.  We cannot afford what we are paying when we don’t get the results that other countries get for less money. FAIR Health will play a role in providing cost data to help us understand what we’re paying for healthcare.  But addressing healthcare costs will require more than that: it will require creativity and innovation around how to achieve better outcomes for our citizens with fewer resources at a cost that does not bankrupt our country and does not bankrupt families.
    This interview appeared in the April 2013 issue of FAIR Health Access.

  • Q&A: Sara Rosenbaum, JD

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    As a policymaker, professor, scholar and writer, Sara Rosenbaum has devoted her career to promoting health policies to improve the lives of low-income, minority and medically underserved populations.  Known for her work on a range of legal and policy issues including the expansion of Medicaid, the expansion of community health centers, patients’ rights in managed care, civil rights and healthcare and national health reform, Professor Rosenbaum is the Founding Chair of the Department of Health Policy and Harold and Jane Hirsh Professor of Health Law and Policy at George Washington University School of Public Health and Health Services.  She also holds appointments in both the Schools of Law and Medicine and Health Sciences.  
    As a member of the White House Domestic Policy Council under President Clinton, she directed the drafting of the Health Security Act and oversaw the development of the Vaccines for Children program, which offers near-universal coverage of vaccines for low income and medically underserved children.  Named one of the country’s 500 most influential policymakers, Professor Rosenbaum regularly advises state governments on health policy matters and has testified as an expert in legal actions involving the rights of children under Medicaid.  Among other honors, she is a recipient of the Investigator Award in Health Policy from the Robert Wood Johnson Foundation, is a member of the Institute of Medicine and has been recognized by the Department of Health and Human Services for distinguished national service on behalf of Medicaid beneficiaries.  Professor Rosenbaum serves on governmental advisory committees, private organizational and foundation boards and is a past Chair of AcademyHealth, a leading professional society for health services researchers.  
    Professor Rosenbaum recently spoke with FAIR Health Access about her career in healthcare policy and how the Affordable Care Act will continue to change the healthcare landscape.  
    BA: A focus of your health policy work has been the intersection of civil rights and healthcare.  How does Title VI of the Civil Rights Act of 1964 relate to healthcare access and quality?  To what extent was the passage of the Affordable Care Act (ACA) in 2010 a civil rights victory?  
    SR: Title VI of the 1964 Civil Rights Act came along at a time when the healthcare system ranked with education as among the most pressing targets of desegregation.  From the time it was enacted, for example, Title VI included healthcare as a major focus, something that is not well-remembered.  Dr. Martin Luther King, Jr. observed a long, long time ago that segregation in healthcare was potentially the most serious of all forms of segregation because it involved life itself.  During the debates over the Act, healthcare was specifically discussed, and the Act’s original implementing regulations gave specific examples of prohibited discrimination that included hospitals’ decisions to relocate into communities inaccessible to minority populations.  Discrimination based on race, ethnicity and national origin has been a terrible fact of life in healthcare for decades.  Today, luckily, progress has been made, although given how deeply intertwined race and poverty are, the healthcare system continues to experience a vast amount of de facto discrimination because of the extreme difficulties poor and uninsured people face in gaining access to quality healthcare. 
    Those who specialize in civil rights have been extremely active around passage and implementation of the ACA because it is self-evident that gains for low-income Americans are, in effect, gains for minority Americans in the US.  The ACA of course makes a seminal contribution to the problem.  The Kaiser Family Foundation just published a study showing the disproportionately large impact of the Act on minority Americans, who are much more likely to be uninsured.  To the extent that a central purpose of the Act is to create more equal access, its benefits for minority Americans should be seen as a one of the greatest civil rights achievements of our time. 
    BA: You directed the drafting of the Health Security Act in 1993 under former President Bill Clinton.  Though the Act did not ultimately pass, how did it set the stage for the development and passage of the ACA in 2010?  
    SR: One of the most  talked-about aspects  of the failure of health reform in 1994  was the notion that the last thing a  White House should do in health reform is to deliver a fully formed piece of legislation and then attempt to manage the legislative process from within the White House.  The ACA developed much more organically and rested on leadership from Members of Congress. Of course, the White House was criticized for not being sufficiently engaged.  But its  decision to pull back and allow the ACA to evolve on Capitol Hill, and in accordance with Capitol Hill timing, was very much a reaction to the experience of health reform in  the Clinton Administration, which had sent a bill fully formed to Capitol Hill and then said, “now pass this.”  Another key difference is the extent to which President Clinton’s bill attempted to introduce structure into how healthcare itself is organized and delivered, by emphasizing the development of fully integrated delivery systems.  The ACA is much more about financing reforms, with incentives to the healthcare system to move in  the direction of greater clinical and financial integration,  but not with the same kind of highly regulatory intervention as President  Clinton’s bill. 
    BA: After the ACA is implemented, what challenges will remain with respect to ensuring access to care and coverage, especially for low-income and medically underserved populations? 
    SR: The big challenge is going to be healthcare capacity in these communities.  We did a study a few years ago showing that, not surprisingly, the ACA would have its biggest impact in terms of coverage on communities that already have been designated as medically underserved.  For that reason, the expansion of community health centers and the investment in the National Health Service Corps became terribly important features of the Act because they represent a commitment to build capacity in underserved communities, with investments coming ahead of the January 2014 implementation date for the coverage expansions 
    BA: As implementation of the ACA moves ahead, what course corrections or adjustments may we observe?  What issues may emerge as ACA reforms are implemented?
    SR: When major legislation is passed there are always errors, omissions and provisions of the law that have to be tweaked and corrected. Other pieces of the law may require more significant reforms once they begin to gain real-world implementation experience.   As I see it, there are several big problems which, in a different world, we would have addressed already through follow-on legislation.  The first is the lack of sufficient funding to implement the Act.  It’s a very costly Act to implement because in my experience, interventions to regulate a complicated marketplace and make it operate more efficiently and fairly are always far more complicated than laws that involve setting up a new program. Just getting the money to run this program has been a big problem.  For example, the Bush Administration was given three times the money to implement Medicare Part D – a single benefit expansion for one small segment of the population.
    The other absolutely crucial issue, which we won’t begin to see the effects of until people start enrolling, is the modest nature of the premium subsidies, which in turn may discourage many eligible people from enrolling.  If the subsidies prove to be inadequate, the Act will fail to attract the young healthy covered lives that the new marketplaces need in order to function well. 
    So my biggest fear – and a lot of people’s biggest fear – is that the subsidies are insufficient to attract the large number of younger, healthier people who are needed to make the system work.  Older, sicker people will get much needed premium subsidies, but without younger populations, the cost of coverage will be far higher and health plans offered in the new Marketplaces will struggle to survive.  
    The biggest long term issue, which spills over into what FAIR Health is all about in some ways, is that in order to make a regulated market work, health insurance is going to have to be affordable.  In order to this work, insurance is going to have to be much less expensive.  In order for insurance to be affordable, we are going to have to figure out how to control not only the cost of coverage, but the underlying cost of healthcare.  Controlling those costs becomes an absolutely crucial element of health reform.   
    BA: To what extent will the introduction of the public insurance exchanges broaden the scope of consumers’ roles in their healthcare coverage and decisions?  What can we expect to observe as consumers select health plans this fall, particularly those consumers making these selections for the first time?  
    SR: It’s going to be a long, evolutionary process.  We will need lots of resources to assist consumers with how to enroll in health insurance, how to pick a plan, how to secure the subsidy coverage and how to make use of their coverage.  These are all decisions and processes that are not simple, especially for people who have lived most of their lives without health insurance.  Those of us who have grown up with insurance don’t really appreciate how new an experience this will be for those who have not had coverage or ever chosen a health plan.  I frequently describe the odyssey of moving toward health reform as moving toward a “new normal” in which being insured for healthcare costs becomes as routine a fact of life as having auto insurance.  What will it take for the US to get to the point of experiencing the new normal in which everybody has health insurance just like everyone has automobile insurance?  It is a known fact that, if you drive, you must have insurance.  If you want to be able to afford your healthcare, and get the right healthcare, you need to have health insurance.  It will take the country a while to get to the new normal, a place we quickly arrived at for the elderly when Medicare was enacted.  This will be a much longer haul. 
    We will also need to get people accustomed to using healthcare in ways that are different from how many of us relate to the healthcare system today.  Too many Americans don’t have a regular source of healthcare, lack effective means for securing preventive care or care management for chronic illnesses, and receive care sporadically, in the wrong place and at the wrong time.  The ACA will help to remove the financial barrier to accessing healthcare.  In doing so, the law will enable people to develop a good relationship with the healthcare system, a relationship that many previously may not have had the opportunity to secure.  
    BA: FAIR Health has been at the forefront of bringing cost transparency to the market.  How will cost transparency give rise to new areas of research that advance understanding of potential solutions for controlling healthcare costs?
    SR: The door that FAIR Health opens with its data -- and of course the increasing scrutiny healthcare prices are receiving through Steven Brill’s recent article in Time and the recent decision of the Centers for Medicare and Medicaid Services to put hospital pricing data online -- opens up vast questions of all kinds: why do these enormous and inexplicable pricing differentials exist?  What should people pay for certain services?  How do we control these prices?  
    In figuring this out, there are really two issues.  What should healthcare providers charge for their services, and what should people pay?  If you want to go shopping for a new sweater, you can wait until the 40% sale to start, and you know that you will find great buys.  Unfortunately, so much healthcare is discretionary; you can’t simply wait around until gallbladder surgery goes on sale.  The central question of our time is what how to properly construct paying for healthcare.  Once we are able to answer this question, we can begin to get spending under control and open up the healthcare system in the ways envisioned by the Affordable Care Act.  
    This interview appeared in the May 2013 issue of FAIR Health Access.


  • Q&A: John W. Rowe 

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    As former chairman and CEO of Aetna, Inc., former President of Mount Sinai Medical Center, former CEO of Mount Sinai-NYU Health, as well as professor, researcher, and physician, Dr. John W. Rowe is the rare leader who has had the opportunity to observe the healthcare system from many different vantage points. Beyond the myriad leadership roles he has played, Dr. Rowe has focused his clinical work and conducted highly-regarded research on geriatrics and gerontology. In 1998 he co-authored the book Successful Aging, which emphasized that lifestyle choices bear more influence than genetics on aging well. Indeed, Dr. Rowe has earned many honors and accolades for his research and related efforts to promote policy to improve care of the elderly.  The Harvard Business Review January-February 2013 issue, which assessed the performance of more than 3,100 CEOs worldwide from 1995 to 2010, ranked Dr. Rowe at number 40 overall and first among those in the healthcare services and healthcare finance sector. In a recent conversation with FAIR Health Access, Dr. Rowe discussed his incomparable career, the changes currently afoot in the healthcare arena, and the role of cost transparency in addressing rising healthcare costs.
    BA: Throughout your career, you took on the toughest challenges – whether it was pursuing an innovative approach to the transformation of Aetna, leading the Mount Sinai Medical Center and Medical School to a new era of quality patient care and research, or initiating the merger between Mount Sinai and NYU, to name a few – and not only met those challenges but created new paradigms that others could follow. In addition, your earlier career as a research scientist in the field of aging continued throughout and beyond your leadership at Mount Sinai. What do you consider to be your most significant accomplishments?
    JWR: I’ve been exceptionally fortunate to lead some large, very high quality organizations. I have been most pleased with the ability of both Mount Sinai and Aetna to nimbly align themselves with important emerging trends in the marketplace and position themselves for success in the future. So I feel the strategic efforts were the most rewarding.
    BA: How did aging and caring for the elderly become the focus of your clinical practice and research?
    JWR: I came to gerontology and geriatrics not through an initial focus on older people but from a science-based interest in the biology of aging. I developed a substantive, broad-based research program in aging and developed a clinical interest in geriatric medicine as a secondary focus. There are a lot of people interested in aging who tell you a story about their grandfather, but that was not me. I was initially interested in the molecules.
    BA: In 1998, you and Robert Kahn published a book titled Successful Aging, which emphasized that lifestyle choices have more influence than genetics on aging well – good news indeed. How has the way in which we think about aging evolved since the book was published?
    JWR: All of us who were involved in the MacArthur study on successful aging, which resulted in the book Successful Aging, have been very pleased with the important impact the work has had on the field. Since our work, many universities have established centers of successful aging. The National Institutes of Health now has a program to support that research, and our findings have found their way into many textbooks and university courses. We feel the major contribution has been a reorientation of research in aging — away from the previous preoccupation with declines and disabilities to a broader consideration of the factors permitting individuals to live not only long, but active, lives.
    BA: How did your experience as a physician inform your role as CEO of Aetna?
    JWR: There is increasing recognition that in order to be effective, health insurance companies need to not only understand the technology of insurance but also the evolving trends in our healthcare system. Every month we see insurance companies making partnerships with physician groups and hospitals. Just this month, on February 12, 2013, the nation’s second largest health insurer, WellPoint, hired the director of a healthcare system to be its new CEO. Having come from a large medical center and being a physician myself was very advantageous as Aetna began, back in 2000, to think about ways to work more effectively with healthcare providers. I think this approach, which was different from what often seemed like antagonism between doctors and insurers, was critical to our success.
    BA: Last year you published an article in The Atlantic titled “Why Nurses Need More Authority,” which argued that allowing nurses to provide primary care to patients would increase coverage and lower healthcare costs. Do you think nurses have a large role to play in the reform of our healthcare system?
    JWR: Certainly. I strongly support the federal initiatives to provide many previously uninsured individuals with access to health insurance, but I am concerned that it may be a hollow promise if we don’t also assure their access to primary care. It is currently estimated that we have a shortage of 45,000 primary care providers — a number that will only rise as the insurance rolls increase. Advanced practice nurses have been proven, over and over again, to be able to provide core primary care services as well as physicians. Freeing nurses from some of the regulatory and cultural shackles and permitting them greater autonomy will go a long way toward assuring access to primary care for our population.
    BA: With the passage of the Affordable Care Act (ACA) and the concomitant efforts to implement its various provisions, what would you identify as the biggest hurdles to implementation? 
    JWR: The two biggest hurdles to effective implementation of the ACA are going to be the establishment of the exchanges so that they work effectively and fairly, and assuring the availability of sufficient numbers of primary care providers for the newly-insured. The experience in Massachusetts taught us some early lessons about how exchanges work and how shortages of primary care physicians might be addressed.
    BA: Which aspects of the ACA are you most enthusiastic about? What do you think is missing?
    JWR: There are three major domains in healthcare: access, quality, and cost. It’s important to understand that the ACA is really about insurance reform and providing access to care for previously uninsured individuals. While I’m very enthusiastic about this aspect of the effort, we should also be well aware that there are important elements related to the quality of care and the cost of care which have not been addressed by the ACA and require our attention.
    BA: How is the conversation in the healthcare arena changing? What role do you see FAIR Health playing in this changing model?
    JWR: The major change has been the progressive evolution in the concept of an Accountable Care Organization and the coming together of a hospital’s physicians and insurers to take responsibility for the quality and cost of care of a defined population. FAIR Health, as a trusted source of current market-based cost information, is an essential resource for the effective functioning of Accountable Care Organizations.
    BA: National dialogue continues to focus on rising healthcare costs. What nearer term solutions should we be focusing on to address this issue? Is cost transparency part of the remedy?
    JWR: Recent evidence indicates that the annual expenditures for healthcare have been rising at a somewhat lower level than previously. However this “bending of the curve” has been due largely to a reduction in the volume of services. The next major target must be efforts to reduce the unit cost of services, where appropriate. A trusted, transparent source of current market-based cost information is required for the efficient operation of the healthcare market. In that context, FAIR Health is exceptionally important.
    This interview appeared in the February 2013 issue of FAIR Health Access.

  • Q&A: Christopher F. Koller 

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    As the country’s first state health insurance commissioner, an adjunct professor in the School of Public Health at Brown University, and the current president of the Milbank Memorial Fund, Christopher F. Koller is a nationally recognized health state policy innovator. Under Mr. Koller’s leadership from 2005 to 2013, the Rhode Island Office of the Health Insurance Commissioner received widespread attention for its rate review process and its efforts to use insurance regulation to promote payment reform, revitalize primary care and transform the delivery system. Prior to that role, Mr. Koller served as the first CEO of the Neighborhood Health Plan of Rhode Island; he was also the founding chair of the Association of Community Affiliated Plans. In addition, Mr. Koller was a member of the Institute of Medicine’s Committee on Essential Health Benefits and currently serves in a range of national and state health policy advisory capacities. In a recent conversation with FAIR Health Access, Mr. Koller spoke about the efforts he made to help reform healthcare in Rhode Island, state efforts at health reform, as well as potential solutions for improving primary care and healthcare quality and delivery overall. 

    BA: Your career in healthcare has been marked by significant “firsts.” You were the first CEO of the Neighborhood Health Plan in Rhode Island, the first health insurance commissioner of Rhode Island and, indeed, the country. To what extent did the lack of precedent in those respective roles allow you the opportunity to innovate more freely in those capacities? What inspired your unique approach to regulation?

    CK: I have never thought of myself as an innovator, although the lack of precedent in both roles probably scared me less than it might have other people. Risks around programs and policies were ones that I was willing to take. In both cases, there certainly was an open slate which enabled me to try new things and obtain feedback. As health insurance commissioner, I made some missteps and some of our initiatives, well-intentioned as they may have been, in retrospect, were not as effective as planned. Still, we learned from those experiences and went on. 

    Our unique approach was mainly inspired by the broad statute that created the Office of the Health Insurance Commissioner. Normally, commercial health insurance regulation follows two standards: to guard the solvency of insurers and to protect the interest of consumers. However, when the Rhode Island legislature developed the role of health insurance commissioner, they gave the position two additional responsibilities: to ensure the fair treatment of providers and to direct health plans towards policies that improve the entire healthcare system. When I started as health insurance commissioner, our lawyer would remind me that the Office’s obligation to direct health plans was a “shall” not a “may.” Our Office, however, could interpret how we would fulfill that obligation. In many cases, insurers knew that in a better world they would be paying more for primary care and less for other types of care, or implementing innovative types of payment reform, but they just needed support to do what was in the public interest. 

    BA: What led you to pursue a career in the healthcare sector? What do you consider to be your most significant accomplishments? What were some defining challenges that you faced?

    CK: I began working at a hospital consulting firm when I was in college; I could never find anything that interested me more than the healthcare field.  I believed that pursuing a career in healthcare would allow me to become involved in socially important, intellectually challenging issues—and it has. I am proud of the work we did at Neighborhood Health Plan—it is a community health center-based Medicaid health plan. We expanded the program, gave low-income individuals greater access to healthcare and arranged ways for payors and providers to help improve the system. 

    As health insurance commissioner, a significant achievement was using the rate review process to incentivize health plans to spend more on primary care. International data clearly show that high-performing healthcare systems spend more money on primary care. The U.S. spends about five to six percent of our healthcare dollars on primary care compared to 20 percent internationally. In Rhode Island, the policies of our office increased primary care spending to ten and a half percent of all healthcare spending by commercial insurers in the state; Rhode Island residents will reap the benefits of that in the future.

    One of the most challenging moments I faced in my career was the year that the Office of the Health Insurance Commissioner was defunded. I remember receiving a call from a legislator who told me that the office was eliminated and would be merged into the larger department of business regulation. However, there was sufficient public outcry, and within a week, the funds were restored. That was very gratifying. 

    BA: How has your experience in healthcare and as an insurance commissioner informed your current role as president of the Milbank Memorial Fund? 

    CK: The Milbank Memorial Fund has identified three major priorities for the next three years: we will respond to the needs of state policymakers using evidence and experience to improve the health of populations, help states build health policymaking skills and enhance the impact of the Milbank Quarterly. The first two priorities correspond directly to my experience in state policymaking. The states are where the action is, yet most state leaders lack the resources to accomplish the work they need to do. Good leadership is not simply being good at one’s job, but building public consensus and support for initiatives. 

    The Fund continues to emphasize the importance of primary care and examine issues related to population health—a population-based approach, as opposed to individual patient care. In that regard, it is important to consider the impact of social determinants of health. As a nation, we spend far too much money on medical care, and we often confuse health with healthcare.  Research—much of it published in the Milbank Quarterly—has demonstrated that the best way to improve the lifespan of our population is not through medical care, but by improving diet, exercise, education, relationships, the environment and other upstream factors. The issues of equity and justice also are important given the health disparities between income levels. 

    BA: Recently, the Milbank Memorial Fund released a report entitled, Aligning Payors and Practices to Transform Primary Care: A report from the multi-state collaborative. What actions do you think are the most critical to improving primary care? What lessons can be learned from these efforts – such as the Rhode Island Chronic Care Sustainability Initiative (CSI-RI), which you launched as health insurance commissioner, to create a patient-centered and value-based primary care system?

    The most significant lessons that can be learned from these efforts include focusing on primary care, aligning incentive payments and payment mechanisms across payors, and considering what is being paid for—what constitutes good primary care. Only states can align payments because they have special antitrust exemptions that allow them to bring together different payors and primary care physicians to coordinate payment models if it is in the public interest. Improving primary care also will involve developing standards for high-quality primary care. The Fund is actively working with many states to help them develop and sustain their all-payor primary care transition initiatives. It is a high priority for us, and one we care about deeply. 

    BA: As implementation of the ACA continues, what ongoing challenges to improving healthcare quality, availability and affordability need to be addressed? What solutions should we be focusing on to address these issues? What role do you think consumer engagement can—and should—play in these efforts?

    CK: Of the three—quality, access and affordability—affordability of healthcare will be the toughest to address. There is a debate around the role of consumerism and the role of public collective action to improve affordability; both approaches have merits. 
    Despite its limitations, only government can ensure access to healthcare. There has to be a role for government to define policy priorities, develop solutions and protect the public interest just as it is doing through the ACA.  Healthcare is also a commodity, however.  Its consumers need to be involved and the obvious way to engage them is to align their interests economically. A significant portion of healthcare costs has shifted to consumers but they often do not understand the cost implications of their choices. Learning to manage a $2,500 deductible on one’s own may not necessarily slow down cost trends, but it still has to be part of the discussion. Research shows that cost sharing curtails needed care as well as inappropriate care, so patient engagement is necessary, but not sufficient, to address the affordability issue.

    BA: The national dialogue continues to focus on rising healthcare costs. What are some of the most significant challenges to tackling the issue of prices and spending? What nearer-term solutions should we be focusing on to address this issue? Is price transparency part of the remedy?

    CK: I would frame this as an ongoing debate over the best way to allocate limited resources. The two extremes for addressing this issue are: a central planning version publicly funded by the state, and handing vouchers to consumers and letting them make decisions about care. The U.S. solution lies somewhere in between and will have to allow for differences from state to state. People who have worked in healthcare longer than I have say they have never seen a time of so much experimentation and discussion around these issues. 

    As we have discussed consumers also will have to be involved in some way.  Price transparency is definitely part of the remedy, but it is not the whole piece. In Rhode Island, we focused our transparency efforts on public education and changing provider and payor negotiating behavior, rather than making consumers wiser shoppers.  Evidence and logic say that giving people a health savings account (HSA) and price information shifts costs but may not  bring down cost trends. Actuarially, most of the healthcare costs are driven by five percent of the people who account for 50 percent of the costs, and next year’s “five percenters” are not this year’s.  Transparent pricing is not going to prevent them from getting sick and incurring those costs, or being price sensitive when they do. Rather, they need more supports like sophisticated care coordination and disease prevention mechanisms. That said, price transparency in healthcare services is valuable for public accountability; few things work better when they are kept out of the public view. 

    Regardless of the paths taken, provider payment reform will be central to addressing healthcare prices and spending. Doctors have to be paid differently—on a population basis rather than on a per-procedure basis. Solutions also will involve revaluing certain medical services to correspond more with the evidence and placing greater emphasis on the entities that can advance population health, such as good primary care.  Transparency can only help those efforts. 

    BA: FAIR Health has led efforts to bring price transparency to the healthcare sector and has become a leading source of independent and objective price information. What broader role do you think FAIR Health will come to play as the healthcare landscape continues to evolve? 

    CK: I am proud to be associated with FAIR Health because it has been so successful in serving as a trusted reference for out-of-network pricing. But it is also important to understand that charge, price and cost are three different economic terms. We do not really understand what costs are: a service can seem cheap or expensive depending on how costs are allocated. As a society, we need to consider the role of price transparency as opposed to charge transparency, and the role of public organizations, trusted community-wide efforts, national nonprofit resources like FAIR Health and private initiatives in making that price information more readily accessible to different stakeholders—consumers, providers, researchers and others. Those of us who have pushed for making price information public have encountered resistance. If price transparency is part of the future of healthcare, trusted price information from organizations like FAIR Health will be a public good. This role will require a lot of public policy support, because price information is currently considered to be proprietary. Whether and how to make prices transparent is a matter of public policy, and FAIR Health will be critical to that conversation.