These days, if you are disconnected from the world for just twenty four hours, you miss a lot. At 5:45 AM last Friday, my wife and I got up at a friend’s home in Needham to go to the airport in time to board a flight at 8:25 AM in Boston that was headed nonstop for Honolulu. We stepped off the plane eleven and a half hours later, but then rushed to another plane which we hastily boarded that was bound for our final destination, Kauai. After getting a rental car and driving to our hotel, we had dinner, and then in complete exhaustion, fell into bed. The next morning we were up early for a walk, and then we began our day of looking around the gorgeous island. We never listened to a news broadcast or read a newspaper. I first learned that Elizabeth Warren had made her bold announcement about how she would pay for her version of Medicare for All when one of my sons sent me a text on Saturday afternoon. He said:
It’s cool that your friend Don Berwick is one of the architects of Warren’s MFA financing plan!
I responded:
Where did you read that?
His text back to me was just the picture of Elizabeth Warren from the top of a New Yorker column by John Cassidy entitled “Elizabeth Warren Doubles Down on Medicare for All.” Cassidy writes:
Now Warren has laid out her own plan, which would transform an industry that represents roughly a sixth of the U.S. economy and comes with a price tag of at least $20.5 trillion over ten years. Rather than tacking to the center, she is betting that Democratic voters—and members of the American electorate—are so fed up with the current health-care system, even after the Obamacare reforms, that they are ready to rip it up and start again. That is an audacious move.
Cassidy has written a good overview article. I recommend it. Since my son’s alert to me I have read several different articles, pro and con, that have attempted to put things into perspective. Cassidy’s piece seems to be fair and balanced reporting. A good example of a skeptical article is Ron Brownstein’s piece in The Atlantic, “Can Warren Actually Avoid Taxing the Middle Class? Her Medicare for All plan makes big assumptions about how much money she’ll be able to squeeze from the health-care system.” He quotes Len Nichols, someone I know, and whose commentary I have always enjoyed, a very respected healthcare economist, to emphasize the disruption and difficulties associated with Warren’s plan:
Len Nichols, a health economist at George Mason, also worries that cuts to providers as large as the ones Warren envisions would seriously disrupt the system.
“You can do this mathematically. The question is: Can you do it in real life with real people?” says Nichols, who served as the senior health-policy adviser at the Office of Management and Budget in Bill Clinton’s administration. “When you talk about 110 percent of Medicare for hospitals and the same as Medicare for physicians, there are a lot of practices that would have to close up shop, lay people off.”
Nichols believes that the largest and best-run urban hospitals could eventually adapt to Warren’s payment rates if given a long-enough transition period. But he says such cuts would inevitably force a substantial number of less efficient hospitals, particularly those in small-town and rural markets, to close or transition into outpatient-care centers. “The disruption we are talking about here would be severe,” he told me.
That is a line of reasoning that we will hear much more often as the candidates debate Senator Warren’s specifics. It is also true of Bernie Sander’s plan if, as it seems, he plans to use current Medicare rates as the core of his payment program. Remember John Delaney’s comments from the first Democratic debate way back in June about Medicare for All putting hospitals out of business?
There are other articles that “damn by faint praise,” like David Leonhardt’s analysis in the New York Times entitled “Warren Goes 1 for 2 on Medicare: The revenue ideas are pretty good.The plan is still a problem.” Leonhardt begins with a laudatory statement, but quickly describes how much further Warren must go:
Warren has addressed one of the two big political problems with her plan — namely, how she’ll pay for it. The other problem — people’s anxiety about being forced into a new insurance plan — is still the larger one, in my view, and she needs to come up with a reassuring transition plan soon. With that major caveat, the newly detailed plan was a positive step.
Leonhardt is not alone in pointing out the huge sales job ahead of Warren. Ezra Klein of Vox has been quite skeptical all along about the electorate’s willingness to jump all the way from where we are to Medicare for All in one huge leap. He has always advocated an incremental approach. He reviews the downside of her plan in an article entitled “Elizabeth Warren’s plan to pay for Medicare-for-all, explained: Warren claims she can do it without raising middle-class taxes.” What follows is his bottom line to an article that I would urge you to read. As usual I have bolded parts that deserve extra consideration, and have annotated his note with my own bracketed additions.
To pass the Affordable Care Act, President Barack Obama and the Democrats tried to systematically neutralize potential sources of industry opposition.
[Throughout the long history of healthcare reform the major sources of obstruction to any improvements in cost and coverage have been the AMA, the hospital lobby, big pharma, the insurance industry, and most surprisingly, organized labor because it prefers to keep healthcare as a bargaining chip for its members.]
They [Obama and the Democrats] cut deals with the insurance industry, the pharmaceutical industry, the hospital industry. They tried to limit disruption as best they could. Those deals might not have been their ideal policy, but they were working in the shadow of Bill Clinton’s failed 1994 reforms, which collapsed under an industry onslaught, among other problems.
Warren’s courting the fight Obama dodged.
[I think this is where Warren’s “experts,” especially Don Berwick, become very important “strategic weapons.”]
“In 2017 alone, health industry players whose profiteering would end under Medicare-for-all unleashed more than 2,500 lobbyists on Washington,” she [Warren] writes. “These industries will spend freely on shady TV ads and lobbying to convince people that a program that saves them massive sums of money will somehow cost them money.”
There are places where I find Warren’s math or ideas a bit optimistic. I’m skeptical that payment reforms will save trillions. I think you can move the system to a lower price structure, but it probably has to happen slowly, gradually, which will jack up the initial cost of the plan.
[Again, Berwick is key. He does believe there is 30% waste in our current practice patterns. He also believes that the price of just about everything in healthcare is too high and he has long said it is time for change.]
I suspect Medicare-for-all will be harder to administer than Medicare is now, particularly in its early years. The unintended inequities [I am not sure what he means] of her employer financing plan seem like both a political and practical problem. If you’re going to cut drug prices that dramatically, at least some of the money should be used to boost innovation in a targeted, sustained way — we want drugs to get better, not just cheaper. And no one really knows how quickly health spending will grow. (One other note: Warren says she’ll unveil a transition plan in the coming weeks, but I don’t yet know what’s in it.)
In a Times “Upshot” piece entitled, ” Elizabeth Warren’s ‘Medicare for All’ Math:She thinks a single-payer health care system can save more than other analysts think. Here’s where she says she’ll get the money to pay for it” Margot Sanger-Katz and Sarah Kliff do as good a job as any other commentators in succinctly laying out Warren’s plan, point by point. I would urge you to read it. They also give a neutral summary statement:
To calculate its cost, she has modified estimates from the Urban Institute, a Washington research group that has assessed the legislative proposal she is endorsing.
To pay for it, she has proposed large new taxes, transfer payments and some cuts to government spending. Altogether, her campaign believes health spending under Medicare for all will cost $52 trillion over the next decade, with about half shifting from other sources onto the federal budget.
The Warren plan includes several key assumptions, including starkly lower prescription drug prices, minimal administrative spending and health care costs that grow at a significantly slower pace.
In her “plan” Warren has remained true to her commitment not to raise taxes on the middle class. The money will come from a creative combination of increased taxes on the very rich, a continued contribution of significance from employers that is equal to their current expense, administrative savings from having the government, and not private insurance, be the processor and payer of claims, benefits of increasing the tax base by solving the immigration problem, money from the defense budget, and significant savings by reduction in payments to hospitals, providers, and big pharma. The plan also includes more value based reimbursement. The major point of several commentators is the likely aggressive opposition led by well organized resistance from doctors, hospitals, insurance companies, and big pharma. Do you remember “Harry and Louise?” There are already assertions coming from these likely sources of resistance, as well as other candidates, that Warren has underestimated the cost of her program by more than 10 trillion dollars over ten years. Finally, there is the enormous task of moving the country from the system that has evolved over the last seventy five years to the new system that will challenge that status quo of the “Medical Industrial Complex” in multiple ways over many years to come.
Warren’s opponents, especially Biden and Buttigieg, are vociferously pushing back on her plan. They are saying that it is unrealistic to think that a majority of Americans who are accepting of their employer financed care, even if they are not happy with the increasing costs and its administrative hassles, will ever go for a “risky” Medicare for All plan. Bernie Sanders has moved from his reluctance to say anything negative about Warren, since she shares many of his policies and views, to openly saying that her numbers don’t work. Whether it is from her fellow Democrats, from skeptics in the press, or from the “Medical Industrial Complex,” Warren will met the challenge face on. Her willingness to fight for what she believes will either give her a big push from progressives in the Democratic Party and attract thoughtful independent voters, or perhaps, be the beginning of her undoing.
Paul Krugman wrote the most positive and realistic review of her proposal that I have read. In a piece entitled “Did Warren Pass the Medicare Test? I Think So: Her plan is serious, even if it probably won’t happen” He writes:
Well, the Warren plan is now out. And I’d say that she passed the test. Experts will argue for months whether she’s being too optimistic — whether her cost estimates are too low and her revenue estimates too high, whether we can really do this without middle-class tax hikes. You might say that time will tell, but it probably won’t: Even if Warren becomes president, and Dems take the Senate too, it’s very unlikely that Medicare for all will happen any time soon.
Nonetheless, Warren needed to show that she was working the problem. And she did. She brought in real experts like Donald Berwick, who ran Medicare during the Obama years, and Betsey Stevenson, former chief economist at the Labor Department. And they have produced a serious plan. As I said, experts will argue with the numbers, but this is the real thing — not some left-leaning version of voodoo economics.
Krugman brings us back to where my son started the conversation, to Don Berwick. I should confess that I would follow Don Berwick into any battle. Most of the commentators don’t mention him, or they just say that he was briefly the administrator of CMS when Barack Obama was president. They don’t even point out that he was so resisted and unjustly vilified by Republicans that he was a “recess appointment” and could not serve longer than eighteen months. I have not read one report that mentions him as a founder of IHI, or as one of the authors of the Triple Aim. There is no mention of his immense contributions and his decades of experience in the struggle to improve the quality and safety of the care we provide. There is no mention of his candidacy for governor of Massachusetts when he ran on a healthcare for all platform. No article that I read made the association of the relevance of his work with the UK’s National Health Service to the challenges that face us as we try to make equitable healthcare available to everyone.
If Don Berwick has joined forces with Elizabeth Warren, I must give her great credit. With Don Berwick providing her advice, she definitely has a plan to improve the health of the nation, while providing equity, and reducing the cost of care that worth considering. Until now I have been skeptical, or more accurately, in a positive wait and see mode. If Don is providing her with his expertise and advice, I must say that she is preparing to do what she has always said she was willing to do, which is to fight for what is best for the country, even though there will be great resistance.
Krugman is absolutely right when he suggests that the current political conversation is totally hypothetical. He says:
Even if Warren becomes president, and Dems take the Senate too, it’s very unlikely that Medicare for all will happen any time soon.
That may be true, but it is also true that it is best to be led by someone who is passionate about the objective, and who really knows where she wants to take us, and that where she wants to take us is toward where we must go. You might have noticed that Warren’s cost projections over the next ten years at a little over 20 trillion dollars of overrun of current Medicare expense are about one third less than the 30 trillion that Biden and others are telling us that Medicare for All will add to healthcare expense over the next ten years. For more than a decade Don Berwick has been saying that at least a third of what we spend is waste. Finally I would remind you of Don Berwick’s concept of the Third Era of Healthcare, the Moral Era. I have written about his Era 3 several times. When I heard Don deliver the speech at the IHI meetings about five years ago when he first presented “Era 3: The Moral Era” there was a collective groan from the 5000 plus people in the audience when he presented the ninth and final point: “Reject Greed.” He closed a podcast interview in 2017 with Zeev Neuwirth by saying:
I can not imagine an American society that is healing without a commitment to the care of the vulnerable, protection of the disadvantaged, the pursuit of social justice and equity, the repair of our criminal justice system, a whole bunch of what I regard as progressive policies which are currently under a very dark cloud given the national ethos and our national leadership today. It’s not OK. I just can’t help making a plea to the professionals who are listening to you in this podcast to be active in restoring a sense of social justice as a primary foundation for our nation. And if the politicians currently in charge won’t do it, and they won’t, then I think professionals have a duty, just as they do to the improvement of the system. They have a duty to the improvement of the moral foundations of the nation, and that for me is a part of Era 3, as well. So, excuse the political excursion here, but it is a time to speak up because what is going on is not OK.
If Elizabeth Warren is willing to fight for the Triple Aim, and her policy statements all but describes it, then she is drafting the help she needs. If you want to read Don’s part of her “plan” for how to pay for healthcare, click here. None of us can predict what will happen to Warren’s plan, but with her bold move I have given up writing her off as unelectable. What I do know is that the best guide to the Triple Aim I could imagine would be Don Berwick, and if he is providing advice to the direction of her plan, the race for the Democratic nomination for president just got much more interesting for me. Maybe Krugman is right when he says:
Even if Warren becomes president, and Dems take the Senate too, it’s very unlikely that Medicare for all will happen any time soon.
To that respectful skepticism I would add my belief that no matter how hard and unlikely it may be, not trying does not make sense, and if she is going to try I am very encouraged by the good judgement she has shown in the selection of her advisors. Senator Warren has given us a gift. With her willingness to be very specific she is forcing a much more informative debate among the candidates. I am looking forward to a much better discussion at the next debate which is scheduled for November 20.
