Tom Price is now in place at his new office at HHS. One of Dr. Price’s first actions was to release a YouTube video that promises us a lot but does not say anything specific about what he plans to do. Seema Verma has been working her way toward Senate confirmation as the Administrator of CMS. Paul Ryan is throwing himself into the work of getting all his ducks in line for the repeal of the ACA. Across the country real people are showing up at town meetings with their Congressman to defend the ACA and express their anger at feeling vulnerable to losing their healthcare coverage. All the pieces are beginning to fall into place for a long process in the House and the Senate. Perhaps making it a long process is the best defense of the ACA. David Blumenthal has recently reminded us of the wisdom of Lyndon Johnson in his Commonwealth Fund blog. Johnson believed that any new president’s ability to get healthcare laws done eroded quickly.  


The flip side of the moment is that the ACA is even more complex than its opponents say and its supporters probably understand. Its complexity offers opportunities for its opponents to reduce its benefit without repealing it fully. The Secretary of Health and Human Services has many ways to undermine the law by not pursuing the options it offers to improve care. There are many components that need enforcement like the penalties for not having coverage. Much of the concern this last year was derivative of insurers pulling out of the exchanges because they were losing money. Most people do not know that those losses were anticipated, and the law called for subsidies to cover those losses. Republicans in Congress blocked the appropriation of funds to subsidize the exchanges as specified in the ACA. You might remember that Marco Rubio bragged about this accomplishment a year ago in the Republican presidential debates.


The greatest success in undermining the objectives of the original ACA was the successful request of the Supreme Court by many “red” states that they be allowed to reject the expansion of Medicaid to those below 138% of poverty. The Kaiser Foundation has recently published maps and data that everyone should review to enable them to appreciate the wide variation in Medicaid across our country.


Medicaid and Medicare are not apart of the ACA, but they are interwoven with it. Changes in either will significantly impact the ACA, the number of Americans covered for care, and the cost we all experience for our care. Republicans have advocated for vouchers and block grants to control the expense of these programs before and are doing so again.


My objective is to underline that as imperfect as our access to care and cost of care is at the moment, it is most likely to get worse for some period even if the ACA is not repealed. Even more worrisome is that so far the “replacement” that is proposed in documents like the one coming from Paul Ryan depend on ideas like tax credits, vouchers, and the selling of health insurance across state lines. It is hard to imagine how these maneuvers will accomplish anything other than a reduction in Federal spending and even that is not certain. What they will accomplish is the loss of coverage for many millions of people, an increase in the bad debt of hospitals, and the loss of substantial Federal supports to healthcare where you receive care.


The Kaiser Foundation has published an excellent paper outlining and refuting the “talking points” of the congressional champions of repeal and replace. We have heard the President say that the ACA “is a complete and total disaster”.


The Kaiser paper counters:


Yet a careful analysis of some of the GOP’s talking points show a much more nuanced situation and suggest that the political fights over the law may have contributed to some of its problems…

Here are the four major points they make.

  1. The individual health insurance market is collapsing.

— House Speaker Paul Ryan (R-Wis.), on Meet the Press, Feb. 5, “the law is literally in the middle of a collapse.”

— Senate Majority Leader Mitch McConnell (R-Ky.), on the Senate floor Jan. 9: “Obamacare continues to unravel at every level, leaving Americans to pick up the pieces.”

Kaiser’s response:

But even with these challenges, the health law’s marketplaces, also called exchanges, are providing coverage to more than 10 million Americans. Some analysts say they are far from collapse…“I have never believed the individual market was in a true death spiral,” said Joe Antos of the conservative American Enterprise Institute. A death spiral is when so many healthy people leave a market that only sick people are left and insurers cannot spread costs.

  1. Out-of-pocket spending is too high.

— Speaker Ryan, at CNN Town Hall Jan 12: “Deductibles are so high it doesn’t even feel like you’ve got insurance anymore.”

— Senate Majority Leader McConnell (in a CNN op-ed): “It’s raising health care costs by previously unimaginable levels, and it’s hurting the very people it was intended to help.”

Kaiser’s response:

People who are most angry about the Affordable Care Act, said Chris Jennings, a health official in the Clinton and Obama administrations, “want deductibles lower and more benefits.”

But Republicans’ most popular proposals for replacing current individual insurance plans — cutting back on required benefits and giving more people access to tax-preferred health savings accounts — would likely increase out-of-pocket spending for those who use health services (although it would be less expensive for people who are healthy all year long).

  1. Medicaid patients can’t find doctors to treat them.

— Sen. Bill Cassidy (R-La.), on the Senate floor Jan. 9: “It is the illusion of coverage without the power of access.”

— Speaker Ryan, from CNN Town Hall Jan. 12: “… so our concern is, that people on Medicaid can’t get a doctor and if you can’t get a doctor, what good is your coverage?”

Kaiser’s response:

Benjamin Sommers of the Harvard School of Public Health, ….said the idea that patients with Medicaid can’t get care comes from looking overall at how many doctors and other providers accept the program’s generally lower payments and higher administrative burdens. …“The best question … is when you talk to the people with coverage and ask them if they can get the care they need.”

And he said “study after study” shows that “when people get Medicaid, their access to care improves dramatically,” including greater use of primary care, preventive screening, and care of chronic conditions. “Even with some potential limitations of provider participation, patients are much better off once they get that [Medicaid] coverage,” he said.

  1. The ACA has reduced jobs.

— Tom Price, the secretary of Health and Human Services, during a confirmation hearing before the Senate Health, Education, Labor and Pensions (HELP) Committee Jan. 18: “The ACA has decreased the workforce by the equivalent of 2 million FTE’s (full time employees).”

— Senate HELP Committee Chairman Lamar Alexander (R-Tenn.), on the Senate floor Jan. 9: “Across the country … employers have cut jobs to afford Obamacare costs.”

Kaiser’s response:

… the strengthening economy, including in the health care sector, has shrunk the part-time workforce and expanded full-time employment well beyond the numbers reduced by the Affordable Care Act, according to most analysts. In fact, so many jobs have been created in the industry since the ACA became law that it is becoming a problem itself, because having such a vast chunk of the economy devoted to health care makes it harder to reduce health spending.

If the Kaiser analysis is correct, it is obvious that the primary Republican concern is not universal access to quality healthcare. It is the cost of care. The predictable response will not be a reduction in the cost of care, but a reduction in funding resulting in a reduction of access and quality.


What do hospitals and providers do when they encounter a loss of revenue or a reduction in revenue from a patient or a group of patients without coverage? They avoid those patients if possible, or when they can’t and have bad debt they shift the costs, if possible, to others who can pay. People will not die in the street, as the President has famously promised, but they will die sooner than they would have if they had access to preventative care.


We can only be spectators to much of what will be happening. There are ways that pressure can be applied to individual congressmen and senators, as has occurred at recent town meetings, but most of us will not get to say something until we vote in 2018. I share the desire of most Republicans that we reduce the expense of healthcare. This week HHS has predicted that the growth of the cost care will substantially exceed the growth of the GDP over the next ten years. By 2025 we will use 20% of GDP for health care.


Most of the clinicians I know believe that the most reliable way to reduce the cost of care in the moment is to practice in a way that reduces waste by providing care that reduces the number of admissions and readmissions to hospitals that occur because of failures in chronic disease management. They believe in using generic drugs when possible, reducing use of the emergency room, not ordering tests that will add no benefit to management, and promoting patient engagement in self management. We know that fee for service payment structures make practice more expensive, and that various forms of value based reimbursement support the objectives of better care.


Many of us believe that the strategies listed above will reduce the cost of care in the moment. We have seen organizations like ThedaCare, Denver Health, Atrius Health and Virginia Mason Medical Center lower the total cost of care while improving the measured quality of care. Accountability and efforts at continuous improvement do produce the desired results. We are also believers in the benefit of the application of the principles of population health to make a difference immediately as well as over a longer period of time. Finally, we believe that we could make great gains if we could ever effectively address the social determinants of health and the behavioral origins of disease. We believe that good practice with the resources to address the needs of the patient as early as possible yields the best outcome for the patient at the lowest total medical expense.


I believe that we can provide better care for everyone at costs that could represent hundreds of billions of dollars of savings using the principles and tools of Lean. Those savings would occur against the trends that we see developing. I also believe that to achieve those savings we need political leadership that we do not have.


I have heard Don Berwick say that healthcare transformation is a local exercise. Healthcare finance methodologies and regulatory policies are set outside the practice and far from where most of us have any influence. I do believe that to variable degrees every patient and every provider will experience difficulty sooner or later from the discussions and the outcomes that will flow from Washington over the next several months and perhaps over the next four years. I believe that those organizations that embrace the challenge of lowering their costs, improving their quality, and improving the work experience of their healthcare professionals as their primary focus will survive and perhaps thrive. They will be a huge benefit to those who get care from them.


I also believe that there is no better way to organize for the challenges ahead than to embrace Lean or if you prefer, “continuous improvement science”. I have never seen a healthcare organization “cut” its way to sustained quality. I have seen savings which are the desired outcomes of “cuts” accrue to those who are willing to discover and eliminate waste through the use of a well-defined process improvement methodology.