In August 2015 I gave a talk on the history of the evolution of health insurance that was part of a seminar entitled “Practicing in the Era of Healthcare Reform.”  I concluded my talk with a slide labeled “Persistent Problems.” I recently reviewed the presentation and was surprised by how appropriate the list still is as we face the continuing dilemma of “repeal and replace.”


Persistent Problems: [As of August 2015]

  • Healthcare disparities
  • Large number of people uninsured, still
  • Cost is a persistent issue as healthcare consumes a still increasing share of our collective resources, to the detriment of education, infrastructure and the income of the middle class
  • Ambiguities about optimal finance mechanisms and the evolution of the health insurance industry as we continue the attempt to move from “volume to value”
  • Emerging workforce challenges
  • Still searching for the conceptual framework and operating system that will provide optimally for the health needs of the population.
  • Effectively engaging physicians in practice evolution to improve quality and service
  • Still ineffectively collaborating with patients to enable effective self management.
  • Still largely practicing the “repair care” of individuals rather than the optimization of health for populations
  • What we do not know that we don’t know


In Robert Pearl’s new book,  Mistreated: Why We Think We’re Getting Good Health Care and Why We’re Usually Wrong, Chapter 6 is a review of the ACA.  He reminds us that President Obama published his own ideas for improving the ACA about a year after I made my little list. Obama’s ideas were published in JAMA in the late summer of 2016. Pearl lifted a quote from the President Obama’s article which captures the spirit of my continuing concerns.


I am proud of the policy changes in the ACA and the progress that has been made toward a more affordable, high quality, and accessible health care system…Despite this progress, too many Americans still strain to pay for their physician visits and prescriptions, cover their deductibles, or pay their monthly insurance bills; struggle to navigate a complex, sometimes bewildering system; and remain uninsured.”


Pearl’s explanation of the history and the objectives of the ACA is helpful. He presents a deft analysis of the role that President Obama’s experience, values and concerns played in addressing the short term objective of extending healthcare to millions of citizens without access to care.  Pearl also demonstrates how Obama tried to craft the ACA to address the long term objective of lowering the cost of care within the accepted parameters of the existing business realities and America’s belief in the power of competitive markets.


Pearl begins his creative discussion by reminding us of Daniel Kahneman’s “availability bias” and its reverse “unavailability bias”, or as Pearl says,


“…the events and figures that we know about but don’t often encounter get pushed down into our subconscious, rarely entering our thought process…You’ll find perhaps no better example of it than U.S. health care.”


Pearl notes that Obama was working against the reality that most Americans got good coverage from their employers. To many of those Americans the fact that over 50 million other Americans did not have insurance was not their concern. When Obama looked at the reality of 50 million uninsured Americans through his eyes as a former community organizer, he was motivated by the inequity and personal pain of the uninsured, and the ultimate waste and expense of 50 million people in a country of our wealth not having access to care. That 50 million, one in six Americans, had no care did not seem to bother many of the nearly 85% of the population that might see their care affected by a solution to the problem.


“So when Barack Obama stepped forward as the newly elected president in 2008, he set about a long and arduous journey to address the huge disparities he saw in access and clinical outcomes.”


Pearl describes a story in which he was a player. He was one of the people that President Obama called to Washington to provide input to the development of the ACA. He points out that Obama adopted the lessons learned the hard way by Roosevelt, Truman, and Clinton. The result of the effort was “a policy born of political reality.”


Pearl continues:


Obama concluded that it would be unproductive to send Congress a well-baked yet poorly backed plan… to the surprise of many, rather than painting the legacy players [specialty societies, hospitals, insurers, device manufacturers and big pharma] as villains or obstructionist, the president included them in the discussions…


After the death of Ted Kennedy and the election of Scott Brown while the bill was in conference between the House version and the Senate version costing the Democrats their filibuster proof 60 votes, the only possibility of passage was for the House to accept the flawed Senate bill and then do a little “clean up” through the filibuster proof “reconciliation” process. It was a tough start for a piece of legislation that few people completely understood, and many never wanted to try to understand.


Pearl is writing after the election of President Trump and in the time before the House bill to repeal and replace the ACA was passed. But he provides us with a valuable view of the ACA that could be helpful as the Senate debates its bill. He points out that Obama knew that the transformation of the American healthcare system would be a long process, even though there would be immediate criticism if it did not make an immediate difference.


The bill’s layout–front loaded with expedited, bipartisan enactments and back-ended by the most controversial provisions–was a politically sensible move for the president and one of the most important reasons the legislation passed Congress. The expedited provisions were the ones that just about everybody favored, such as extending coverage to young adults up to age 26…the most problematic parts included a new tax on medical devices, along with major penalties for the most expensive plans (dubbed the “Cadillac tax”)… But there is much more to the ACA…Beyond its layout and between the lines, you’ll find the unwritten implications of the law and the strategy President Obama thought stood the best chance of addressing the fundamental challenges of American health care today.


Pearl says that the bill contains seven “bets”, and Obama knew it would take time for several of them to play out.


Big Bet 1: Cover the forgotten– 18 million people got healthcare with the ACA and that perhaps as many as 24 million or more may lose coverage if it repealed may be its most effective defense. The “forgotten” included the 18 million working poor who could not afford insurance, but did not qualify for Medicaid. The ACA originally offered the states the ability to enroll every individual making less than 138% of the poverty level. Sadly, because 18 states have refused, less than half of the 18 million were ever enrolled.


Big Bet 2: Cover the Excluded- the second line of defense for the ACA and an uncertainty becoming a problem for the AHCA, is that the ACA forbids exclusion from insurance or higher premiums because of a preexisting condition. The insurance realities of this provision make the unpopular “mandates” necessary without huge federal subsidies.


Big Bet 3: Creating the Insurance Exchanges- this really was a Republican idea. It was part of “RomneyCare.” Pearl points out that the first two bets were that covering preexisting conditions and giving preventative care to the “forgotten” would lower the cost of care by avoiding more devastating medical outcomes. The exchanges were developed to be beneficial for middle class consumers who were working hard but could not afford coverage.


Big Bet 4: Caring for Seniors and Rewarding Excellence- this is the move by Medicare from volume based FFS toward value based reimbursement mechanisms like Medicare Advantage, ACOs, and bundled payment mechanisms.


Big Bet 5: Integrating a Fragmented System- integration was an expectation of the Exchanges and ACOs. If the Exchanges drove competition, then innovation, consolidation, and integration would be by products of the new methodology. So far this bet is not a winner. Insurers are abandoning the exchanges because of the poor selection and the lack of subsidies necessary to “get over the hump” of the initial coverage of the accumulated needs of years without coverage. The ACOs have also encountered difficulties “getting going.”


Big Bet 6: Finding a Meaningful Use for Technology- The HITECH act was passed the year before the ACA with bipartisan support. The adaptive changes required of practices and the IT providers have diminished the return on investment. The answer is not to throw away what we have accomplished. To realize the benefits that computers should provide will require new workflows and cultural changes, as well as technical competencies that are developing much more slowly than the Obama administration had hoped.


Big Bet 7: Measuring Quality and Effectiveness- Perhaps a non physician could have never imagined the power of the combined pushback of clinicians, big pharma, and device manufacturers against this strategy. PCORI, the Patient Centered Outcomes Research Institute was a great idea, but Machiavelli advised us 500 years ago that we should expect resistance if we did anything that challenges the status quo. Pearl describes the issue:


The president expected PCORI to clarify which approaches achieve better health outcomes for patients at a lower cost. He hoped that all doctors would follow its recommendations and embrace the approaches shown to be effective. But in retrospect, President Obama and his staff underestimated the power of the legacy players to resist change.


Pearl’s description lays out Obama’s initial strategy. In 2016 President Obama expressed his concern and deep understanding of how the ACA had only partially lived up to expectations. He offered solutions to the problems in JAMA before Trump was elected. It is noteworthy that since the election and probably after Pearl sent his book to the publisher, Obama wrote a second article that was in a January 2017 issue of the New England Journal of Medicine to further assess how to improve the ACA. His thoughts in both articles are very compatible with my little list from August of 2015. In the NEJM piece President Obama is offering direct advice to President Trump and the Republican majority in Congress as they prepared to repeal and replace the ACA with poorly developed programs. His advice remains timely:


Health care policy often shifts when the country’s leadership changes. That was true when I took office, and it will likely be true with President-elect Donald Trump. I am proud that my administration’s work, through the Affordable Care Act (ACA) and other policies, helped millions more Americans know the security of health care in a system that is more effective and efficient. At the same time, there is more work to do to ensure that all Americans have access to  high-quality, affordable health care. What the past 8 years have taught us is that health care reform requires an evidence-based, careful approach, driven by what is best for the American people. That is why Republicans’ plan to repeal the ACA with no plan to replace and improve it is so reckless. Rather than jeopardize financial security and access to care for tens of millions of Americans, policymakers should develop a plan to build on what works before they unravel what is in place.


Obama is offering advice that is consistent with continuous improvement science. What has happened is not failure. It is discovery. As Obama suggests, and as evidenced by the concerns of so many who are afraid of losing what they have enjoyed under the ACA, we have made progress.


Obama’s statement is the foundation for improvement of the ACA. So far I see little evidence that either the president or the Republican leadership have of a high level of understanding of the ACA, it accomplishments, the real reasons for its problems, or viable potential solutions. They do seem to recognize that they should be careful about rescinding many of the benefits Americans now believe should be continuing policy.