Transcript Spencer Berthelsen, MD

Spencer Berthelsen, M.D.
Chairman and Managing Director
Kelsey-Seybold Medical Group, PLLC
• Cost – The US spends twice as much per
capita as the average of other industrialized
nations
• Institute of Medicine – 30% of healthcare
dollars in the US are wasted
• Maldistribution
• Uninsured – crowding the “safety net”
• Powerful economic forces – debt crisis
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1950:
1965:
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2012:
Health care costs = 4.4% of GDP
6.1%
7.6%
12.0%
13.5%
14.9%
16.2%
17.3%
17.6%
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Perverse incentives – fee for service
Demographic shifts
Expectations
Technology
Lack of coordination at all levels
Defensive medicine – less in Texas
End of Life care
Practice Variation
www.dartmouthatlas.org
• Documents disparities in
utilization of healthcare resources
across the United States.
• Information & analysis of national,
regional & local healthcare
markets, local hospitals and
physicians.
• Consequences of inaction were mounting
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46 million uninsured
Emergency Departments overloaded – risk to all
Loss of economic competitiveness – off shoring
Displacement of other priorities
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Standard of living
Education
Infrastructure deferred investment
Defense
– Fiscal – budget deficits – bond market
– Medicare Part A would be bankrupt by 2017
• PPACA Patient Protection and Affordable Care
Act signed into law March 23, 2010
• Passed by the narrowest of margins with a
partisan vote
• Voluminous legislation - 2,500 pages
• Drafted outside of public view
• The most sweeping social legislation since the
passage of Medicare in 1965
• Not supported by the majority of the public
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No pre-existing condition exclusions
No rescissions – except for fraud
No lifetime or unreasonable annual limits
Dependent coverage through age 26
Minimum medical loss ratios 80% or 85%
Guaranteed issue with limited rating ratios
Minimum benefits 60% to 90% coverage
Preventive services covered
Temporary high risk pool
State or federally operated insurance exchanges
Individual and employer mandate with penalties
Individual subsidies and small employer tax credits
• Half of the 32 million uninsured would have been covered
through Medicaid expansion up to 130% of FPL – paid mostly
with federal tax dollars at least for ten years
• Medicaid reimbursement parity with Medicare for primary
care.
• Reductions in Medicare reimbursement to hospitals, nursing
homes and home health care
• Pilots for bundled payments – Medicare Shared Savings ACOs
• Gradually closes the prescription benefit donut hole
• Reduces payments to hospitals related to readmission rate
and preventable conditions
• Establishes a Medicare commission to make binding
recommendations for cost reduction
• Cadillac plan tax in 2018
• Medicare tax – 0.9% of income over $200K for
individuals, $250K for couples
• Investment income taxed additional 3.8%
• Health Insurer’s fee – based on market share
• Drug manufacturers fee
• Device makers excise tax
• $500K cap on insurer executive compensation
deductibility
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Opened October 1, 2013
Coverage effective January 1, 2014
Individual and SHOP
Guaranteed issue
3:1 underwriting range vs. 6:1
Cannot consider health status
Same rules apply outside the Marketplace
Subsidies and tax credits
Penalties if not insured – few exceptions
Federal Data Hub
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Single payer system – Medicare for all
Public Option
Elimination of Medicare Advantage
Price controls
• Move away from rescue care for the indigent
to prevention at a fraction of the cost
• Relief for local tax payers who fund safety net
hospitals
• Loosen the tight coupling of healthcare and
employment
• Establish coordinated systems of care with
medical management systems
• Convert from FFS payment to payment for the
care of a population over time
• Invest in Information Technology
• Avoid catastrophic care
– 5% spending -- 50% of cost
• Increase the supply of physicians
• 3,200 Texas physicians over age 65 –
approximately 1,260 medical graduates each
year
• Texas is 45th in the nation for the number of
physicians per 100,000 population
• Increasing demand
• More medical care will be provided by allied
health professions
• Central control of the healthcare economy
– Premium or fee control
– Massachusetts example
• Accountable Care Organizations
– American innovation
– Best hope to avoid default of price controls
• Hospital Systems transforming into HealthCare
Systems
• Insurance carriers establishing performance based
payment arrangements
• Multispecialty group practices extending their
models of coordinated care – managing healthcare
cost risk
• Government payors promoting systemic change
through effectiveness research and modified
payment for outcomes
• Group commitment to raising quality and
eliminating non-beneficial care
• Investment in Information Technology
• Management, measurement and reporting of
quality and cost
• Reformed payment system away from Fee for
Service to payment for maintaining the health
of a population over time
• Certification
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There is enough money
There is enough time
Change is underway
We know what care is effective
Proven models of accountable care exist today
The consequences of failure are clear
• Improvement on PPACA
• Increased access to care – reduced reliance on
emergency care
• Organization of care to eliminate minimally beneficial
care and increase beneficial care
• Reduce the overall cost of medical care
• Give individuals more responsibility for health
insurance purchasing decisions
• Increase the health status of the population