POWER BREAKFAST VIDEO #1 (of 5): Health care efficiency
On Sept. 25, the IBJ convened a panel of five of the city’s leaders in health care and life sciences to examine the reasons behind and potential effects of health-care reform. Reporter J.K. Wall moderated the discussion, featuring:
Dr. Craig Brater, dean of the Indiana University School of Medicine
Dan F. Evans Jr., president and CEO of Clarian Health Partners
Kyle Defur, president of St. Vincent Indianapolis Hospital
Dan Krajnovich, CEO of UnitedHealthcare Indiana/Kentucky
Dr. Mercy Obeime, medical director of St. Francis Neighborhood Health Center at Garfield Park
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J.K. WALL: Kyle DeFur, I want to ask you the next question. At the beginning of this whole process, President Obama said he had two goals with health care reform, reduce costs and improve quality. Those are big goals, but to do it at the same time, what needs to happen? What would you say is the best way to achieve both of those at the same time?
KYLE DEFUR: Well, I think one approach to that is clearly pay-for-performance kinds of incentives, I think that’s a good way of looking at how we go about simultaneously improving quality and decreasing costs. As mentioned before, I think primary care access, as Dr. Brater said, really looking at how do we compensate primary care, how are we supporting them, how do you get more people to go into primary care is a key piece, because primary care can be very effective in early intervention and prevention and wellness and there’s a lot of costs in the system today related to people not going to primary care but rather waiting until they become so ill that they show up in the emergency department. An example of that is if a patient shows up in the emergency department with full-blown pneumonia, they may be hospitalized, put in an intensive care unit for two or three days and then step down to a medical unit for two or three days and then discharged and have a bill of $20,000 or $30,000, when in fact if they had gone to a primary care physician a couple weeks ahead of that they could have been treated with $4 a day antibiotics, you know, so for just a couple hundred dollars for the physician visit and the antibiotics they could’ve been treated and kept healthy as opposed to entering into the most expensive place in the system, which is a hospital, and incurring $25,000 to $30,000 in expenses. So I think that’s one of the ways, the concrete ways, that we look at reducing costs. One of the other things that it’s safe to say Indianapolis has really jumped in with both feet on is utilizing Lean Process Improvement Methodology, taken from the manufacturing industry, and implementing what’s also referred to as the Toyota Production Model, but it really focuses on elimination of waste within our processes. Staff are on these teams and they do the work. As we know, variability is the enemy of quality, and we eliminate waste and hardwire the more efficient processes. Again those are who are involved in the processes, the staff are on these teams and they develop them. I’ve also learned over the last few years in looking at Lean Process Improvement and implementation of it that you really do simultaneously increase quality and decrease costs by getting waste out of the system because waste is extra steps in a process, it’s duplication, and when you eliminate those things, you eliminate those additional steps, you eliminate possibility for error as well, and so I think in improving quality improvement, focusing on using methodologies such as Lean Process Improvement is another way we can get cost out of the system as well as improve quality.
DR. CRAIG BRATER: There’s no way you can really get meaningful cost out of the system unless you do something about overutilization. That’s a big elephant in the room. You can nibble around the edges with all this pay-for-performance stuff, that’s got all sorts of issues. One of the biggest determinants of whether or not an individual adheres to a regimen, come to the clinic, taking their medications, etcetera, is health literacy. So let’s say you have a pay-for-performance plan but your patient has low health literacy and so no matter what your efforts are you have trouble getting them to adhere to a certain regimen, so your pay-for-performance plan punishes you. Well, it turns out that the people with the lowest health literacy are probably the people who need your services the most, so then you end up with yet another perverse reimbursement system. So some of this terminology sounds nice on the surface, but if you drill down a little bit there’s a lot more to it than that. So, you know, I don’t want to sound like a broken record, but No. 1, it’s complicated, multifactorial. No. 2, there are serious, serious flaws, and I’m worried that there’s too much tinkering around the edges, we’re using a lot of buzz words. And lastly, what I started with is that one of the biggest elephants in the room is that we have a system that rewards doing stuff instead of spending time with patients, so it’s a completely broken business model. We are here for the IBJ, so if you want to talk about the "business" of it, people are rewarded for doing more and more things. Well, that’s not always in the best interest of the patient, so how are we going to get our arms around that? Pay-for-performance doesn’t do it. (Applause.)
WALL: Dan Evans, what do you think about this?
DAN F. EVANS JR.: Well, bootstrapping on what the Dean just said, and everybody in this room I think can relate to this and, of course, every health care professional up here can, if we pay for more stuff it doesn’t matter how efficient we get, we just do more stuff more efficiently. If we’re doing stuff that shouldn’t be done in the first place we’re all complicit in that, and what am I talking about? Futile care. Most health care expenditures are in the last few months of life. Many people in this room because of your ages are dealing with elderly parents right now. I know who you are, many of you are my friends. You call one of us dealing with really profound issues, "Does Mom have a living well, yes or no?" "Does every family member understand what it means, yes or no?" "Did you discuss it last Thanksgiving when you all were sitting at the dinner table, yes or no?" If you answered any of those questions as "no," when the moment comes you’ll become a maximum utilizer, and the tinkering around the edges that the Dean just talked about will not affect the profound implications of that lack of preparation, and that’s a psychosocial issue in this country. What happened in the House Bill where it mentioned—what was it, Kyle—200 bucks a primary care physician got paid for counseling one time a year? One time a year a family could get counseled and the doc could get reimbursed on palliative and end-of-life care, and instantly that was converted into a death panel, so that became the third rail. Wow! Did those guys drop that one right away? But you know what I’m talking about because you know whether or not you have a living will and medical power of attorney and you know whether or not your family, your siblings, your children understand what it means for you and this is deeply personal and that is part of the 50 percent that Dan was talking about. I don’t know what part of it is for you, Dan, but it’s got to be in double digits. Anyway, the general assumption is that a third of critical care is futile, doesn’t make any difference, the patient dies in two months anyway. Who decides in our culture who gets the care and who doesn’t? If you’re an actuary from Mars and landed here and had a choice of a million dollars to spend on an 80-year-old or an eight-year-old, you know what you’d do, right? We do not make that kind of a decision. We pay people for more stuff, so we have overutilization. The hospital systems in Indianapolis do the best they can to be more and more efficient, but essentially they’re doing the same stuff, so the only way to cut health care costs, and it’s implied in many of the articles you read, is eliminate innovation, who is in favor of that? That’s one quick way, just get rid of innovation, no more improvements in medical care. Or ration care, who’s in favor of that? I believe I just heard a resounding nobody in the room, which means status quo.
DAN KRAJNOVICH: Well, I couldn’t agree any more on the innovation piece of that and also to Dr. Brater’s point, I think clearly he hit it right on the head, overutilization and it’s something that we do believe that we need to get our arms around and I think a lot of that does start, too, in the area of prevention and wellness in what we can do to take better care of ourselves and some of the programs that we can institute across the country in terms of making sure people understand how their health status impacts the cost of health care. Kyle clearly, you know, brought up I think a very legitimate point in terms of the waste in the system. The American Medical Association estimates that it costs $90 billion a year to process claims and so there’s a tremendous opportunity and we’re working with physicians and hospitals alike to take advantage of swipe card technology, take advantage of real-time adjudication, because we do believe we can wipe out a substantial amount of that waste in that system, so there are a lot of efficiencies that we can tap into and using the innovation that Dan Evans alludes to.
WALL: But, Dan, you’re the one representative of an insurance plan or payer on stage and I think what Dr. Brater was talking about was sort of the fundamental financial incentives in this system are, to use his technical term, screwed up. What would it take for those to change, for insurance companies, insurance plans to pay providers in a different way?
KRAJNOVICH: Well, you know, first, you know, I agree with Dr. Obeime in terms of doctors should be paid and paid well and I think it is important to create the kind of mechanisms so that doctors are incented to perform at even higher levels, and I do think there’s an issue and a risk of us deteriorating the talent pool certainly in the area of primary care and other fields here depending on what does come out of the health care reform, but doctors absolutely should be paid and absolutely should be incented to perform. I think it’s important some of the work that’s being done here locally with the Indiana Health Information Exchange and Quality Health First and working to create score cards to provide to physicians so that they understand how they’re treating their patients, how they compare against their peer groups so that they can continually treat their patients better and better and understand how again they’re performing in the marketplace and the work that the Quality Health First and IHIE does is fabulous work.
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POWER BREAKFAST VIDEO #2 (of 5): Paying for health care
On Sept. 25, the IBJ convened a panel of five of the city’s leaders in health care and life sciences to examine the reasons behind and potential effects of health-care reform. Reporter J.K. Wall moderated the discussion, featuring:
Dr. Craig Brater, dean of the Indiana University School of Medicine
Dan F. Evans Jr., president and CEO of Clarian Health Partners
Kyle Defur, president of St. Vincent Indianapolis Hospital
Dan Krajnovich, CEO of UnitedHealthcare Indiana/Kentucky
Dr. Mercy Obeime, medical director of St. Francis Neighborhood Health Center at Garfield Park
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J.K. WALL: Kyle DeFur, I wanted to ask you, we’re talking about changing how doctors and providers are paid. They’re paid now on basically a fee-for-service model, they’re paid for doing stuff, not necessarily spending time with patients, not necessarily on the outcomes that they achieve with those patients. If that were to shift, if you start paying providers on outcomes and on time with patients, not just on procedures and tests, how would that change St. Vincent Indianapolis, how would the place look different, function differently under a different kind of payment model?
KYLE DEFUR: Well, I think that the alignment of incentives is important and I think one of the aspects that’s being talked about in different parts of health care reform right now is about the payments and I think that can be a positive thing because it gets the hospitals and the physicians and others on the same page in terms of really focusing not on how the reimbursement works necessarily but rather how are we going to manage the care of this patient. It’s especially true with chronic illnesses and how do we manage the care of this patient who has a chronic illness across the continuum of care and those are by looking at bundled payments you can create an incentive for really coming together and taking away some of those barriers and, in all honesty, some conflicting incentives in terms of how care is delivered today. I think from St. Vincent’s perspective and how it affects the hospital, you know, we have been and are preparing for that kind of reimbursement change in the market. I think there are some things that you have to have in place, as I mentioned, the aligned incentives, you have to have an IT infrastructure, electronic health record, that’s critically important to be able to manage in that kind of environment and, as earlier stated, the primary care access and early intervention for prevention and wellness is very, very important.
WALL: Does anybody else have any thoughts on just how the health care environment would be different if we overhauled the way we pay doctors and hospitals in a different way? Dr. Obeime, I wanted to ask you a question. Oh, do you have a thought, Dr. Brater?
DR. CRAIG BRATER: Well, I think what you’re referring to is if you imagined in contrast to what we’re doing today is if you had a fully capitated model is basically what we’re talking about if you take it to the extreme and that would affect all of us because all of our business models are based on what we’re doing today, so we’d have to fundamentally change and we’re not prudent if we don’t start thinking about that. I mean, the way the medical school works is we cross-subsidize education and research with revenues that we generate clinically and in the current business model we generate those revenues by doing stuff, just like everybody else, so we have to think about if we went to a fully capitated model then how would we have the resources to shift over to education and research to do those things the way they need to be done in a quality way. I would go so far as to say if it’s done in a fashion where academic health centers cannot cross-subsidize education and research then we’re going to have some big problems, not just at the IU School of Medicine but in academic medicine in general and you’ll see some of these research engines grind to a stop, so you have to be really careful about it, and maybe I’m not smart enough, but it’s very hard for me to see systems get away from rewarding for doing a lot of things. The simplest way to have a compensation model or a reimbursement model that gets away from that as far as I can tell is really going into the capitation end of the world.
WALL: Dan, you had some thoughts?
BRATER: Parenthetically, you could get rid of a hell of a lot of administrative expenses if you did that.
WALL: Did you have some thoughts, Dan?
DANIEL F. EVANS: Well, the question is how would it impact the hospital industry? The answer I think, dovetailing into what Craig and Kyle specifically said, is we should be incented to keep people out of the hospital. We shouldn’t be incented to treat people in the hospital. Right now the current—Well, you know what I mean, I don’t mean that the way it sounds—maybe I do mean it the way it sounds. But the money all goes to acute critical care, it doesn’t go to the clinics. Indianapolis is in a better situation than maybe any other city in the country because of IHIE. You all know what that is, the Indiana Health Information Exchange, Vince Caponi of St. V’s is Chairman of it, Tom Inui of the Indiana University Informatics at Regenstrief is vice chairman of it, Matt Gutwein of Wishard—By the way, we all should support the Wishard referendum. (Applause.) The idea is to be interoperable, and you all know what the truth is right now, you go to one hospital or one doctor’s office, you go to one hospital and one doctor’s office. We cannot keep people out of hospitals unless we are networked and we are way beyond that. So to answer the question that we’ve got to be paid to keep people out, not paid to keep people in, that is a paradigm shift of maximum … that means you’d all have to agree to less choice. You’re the ones who call me and want to work around the primary care docs, right? Right? I’ll bet I get ten calls a week from somebody in this room trying to figure out a way to go see one of the subspecialists at one of the IU Medical Group or Methodist Medical Group or PC or SC to get around the process because that’s what you do when you’re frustrated, right, you do a work-around. IHIE should avoid that frustration so you’re confident your data precedes you and your primary care physician/family doc is empowered to deal with your pneumonia before you show up at 86th and Harcourt Road or 16th and Capitol or Beech Grove or Southport or on the northeast or east sides of town, period.
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POWER BREAKFAST VIDEO #3 (of 5): Tort reform
On Sept. 25, the IBJ convened a panel of five of the city’s leaders in health care and life sciences to examine the reasons behind and potential effects of health-care reform. Reporter J.K. Wall moderated the discussion, featuring:
Dr. Craig Brater, dean of the Indiana University School of Medicine
Dan F. Evans Jr., president and CEO of Clarian Health Partners
Kyle Defur, president of St. Vincent Indianapolis Hospital
Dan Krajnovich, CEO of UnitedHealthcare Indiana/Kentucky
Dr. Mercy Obeime, medical director of St. Francis Neighborhood Health Center at Garfield Park
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J.K. WALL: The first question from the audience is from an OB-GYN doctor who says overutilization is a real driver of health care costs. This doctor has ordered many tests, performed many C-sections because she needed to cover herself against a bad outcome. How can we reform health care without tort reform? Who wants to take that one?
DANIEL F. EVANS: That’s a great question, and in Indiana it’s a red herring and let me tell you why, Indiana has tort reform, so this is a psycho- social issue, not a legal issue. There is a cap on damages in Indiana of 1.25, or something like that. It’s a relatively low cap. There aren’t these large punitive damage cases here, so a doc or an administrator that empowers a doc to overutilize has nothing to do with tort reform in this state. It’s a psychosocial issue. It’s back to what Craig said, does the system incent us to overutilize? The answer is clearly yes, but blaming tort reform for that is an inappropriate blaming. Having said that, the United States has 50 jurisdictions for tort law, that’s what’s wrong, so we’re in a national risk pool, meaning that the premiums we pay for malpractice are, by and large, dictated by national experience, not by local experience. So the premiums here are discounted because we happen to have capitation, the awards are. Well, what doc understands that? I doubt if any doc in the room has ever thought about that issue before, so I think it’s a bit of a red herring, plus it’s not going to happen, no bill has it in it and it’s not going to happen, so you can spend a lot of time talking about it. We have to change the incentives, not tinker around the edges, and that would be major tinkering, not really changing the underlying issue.
WALL: Anybody else have thoughts on tort reform?
DR. CRAIG BRATER: Close the law schools. (Laughter.)
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POWER BREAKFAST VIDEO #4 (of 5): Care for illegal immigrants
On Sept. 25, the IBJ
convened a panel of five of the city’s leaders in health care and life sciences to examine the reasons behind and potential
effects of health-care reform. Reporter J.K. Wall moderated the discussion, featuring:
Dr. Craig Brater, dean of the
Indiana University School of Medicine
Dan F. Evans Jr., president and CEO of Clarian Health Partners
Kyle Defur,
president of St. Vincent Indianapolis Hospital
Dan Krajnovich, CEO of UnitedHealthcare Indiana/Kentucky
Dr.
Mercy Obeime, medical director of St. Francis Neighborhood Health Center at Garfield Park
(To view more videos, scroll
to the bottom of the page)
J.K. WALL: Dr. Obeime, here’s a question for you from
the audience. We talked earlier about how the health care reform proposals do not cover any illegal immigrants or are not
explicitly covering any illegal immigrants. What’s your opinion on actually providing the services and covering them and
could doing so actually save money in the long-run?
DR. MERCY OBEIME: Gee, I’m
going to be in trouble any way I answer this question, so I have to see which way may be a little easier. When we talk about
illegal immigrants, sometimes I think that people do not hear the "illegal," they just hear "immigrants,"
and that’s why sometimes there’s a lot of frustration because we have to look at the real issues, okay? Let’s say—I
use Wishard because anybody can go there. If we have a patient, I don’t care where the patient came
from or what their status is, if this patient shows up at Wishard and has active TB or now we’re talking
about the H1N1 flu and has this condition, can we in our right minds say that we will not treat this
patient and if we did not how would we get rid of this patient regardless of where the patient came from?
I don’t know which airline you could tell that "This patient has one of these two conditions, we
don’t want to treat this patient in this country, put this patient in your plane and fly them somewhere," I don’t
see how that would fly, okay? But having said that, though, I think that if we had it written in bold that America takes
care of illegal immigrants, we are setting ourselves up for trouble. In Canada and in Europe if you do not have your card,
you’re going to pay for care, but as Mr. Evans said, people know how much it costs. People that live in the US that go to
India, go to Europe to get their hip replacement done for about $20,000 or $10,000 depending where you go and these are self-insured
people who know, "This is how much it’s going to cost me and I know I can pay that," in this country you cannot
do that. Once somebody is uninsured, even if they said, "I have X amount of money to pay for this,"
then there’s a crisis. One way I know it’s been done where people choose to pay cash for their services
has been OB-GYN before it became so easy to get Medicaid for delivery. I know for a fact that—my
husband is in the room, so I hope I don’t get in trouble for using this example. When I had my first
child we did not have insurance that covered pregnancy because my husband was single, he didn’t think
he needed insurance and when I came here before we got insurance I got pregnant, but what we did, Humana
Women’s Hospital told us ahead of time, "If you pay X amount of money this is how much you will have to pay but
you need to pay now before you even deliver the baby," so we went ahead and paid that amount and I got decent care, I
mean I got perfect care, wonderful care, my daughter is doing wonderful. So that is what we have to look at. So when we
are talking about illegal immigrants or legal immigrants, I think the fact that it is inflammatory politically is what people
are afraid of and why people are afraid to take a position, I think we should not announce that we’re going to do that, otherwise
we might have an influx, but at the same time I don’t see how we cannot treat people if our lives are in danger because one
person has it. So I don’t know if that helps.
DR. CRAIG BRATER: Can I make a comment
on that?
WALL: Yes, Dr. Brater.
BRATER: Very
briefly. I mean, I think it goes back to what Dan was talking about, I mean we’re paying for this care anyway. To think
we’re not paying for that care is naive, so if a patient shows up in the emergency room wherever, hopefully they’re going
to be taken care of. I mean, I certainly don’t want to be part of a society that would turn a sick person away from an emergency
room, for God’s sake, so we’re paying for this anyway but then the way we’re doing it is that the care is occurring in the
most expensive venues, in the emergency room, so in many ways to me it makes more sense to have a system that will make sure
that there is a way to provide health care to people who need it and do it in the most cost-effective way and again that’s
not in the emergency room, so I think it needs to be addressed. I realize it’s highly politically charged. But another way
for me to look at it is that I think it would be morally reprehensible for us to even comprehend a system where we turn people
away at the door who need health care.
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POWER BREAKFAST VIDEO #5 (of 5): For-profit health insurance
On Sept. 25, the IBJ
convened a panel of five of the city’s leaders in health care and life sciences to examine the reasons behind and potential
effects of health-care reform. Reporter J.K. Wall moderated the discussion, featuring:
Dr. Craig Brater, dean of the
Indiana University School of Medicine
Dan F. Evans Jr., president and CEO of Clarian Health Partners
Kyle Defur,
president of St. Vincent Indianapolis Hospital
Dan Krajnovich, CEO of UnitedHealthcare Indiana/Kentucky
Dr.
Mercy Obeime, medical director of St. Francis Neighborhood Health Center at Garfield Park
(To view more videos, scroll
to the bottom of the page)
J.K. WALL: The next question is we’re the only country
that allows health insurance companies to operate as for-profit businesses. What value does that bring to the health system?
Dan Krajnovich, I’ll let you answer that one.
DR. MERCY OBEIME: Dan is a nice guy.
(Laughter.)
DAN KRAJNOVICH: Well, you know, again I think it comes back to
some of the things we’ve been discussing here which is, you know, in the medical field, obviously back to paying doctors well,
you know, this is a very complex industry, one that requires a lot of talent, one that, quite frankly, I think this country,
if there’s one aspect that we are proud of is that we do have probably the most talented health care individuals in the world
residing in this country and, quite honestly, on the health care insurance side as well, you know, again it’s a complicated
system and we certainly have very talented individuals working on that end. Back to Dr. Brater’s point, you know, it’s not
a perfect system out there today and we all realize that and we need to fix the system. Quite honestly, I was with my barber
yesterday, and he said something very revealing to me and that is he doesn’t think anything’s going to happen and he, quite
frankly, is disgusted with the whole process of what’s happening right now in D.C. and what’s happening across the country.
He’s given up, he said, "Nothing’s going to happen," and, quite frankly, I think that would be the biggest tragedy
of all if we end up going into next year with no health care reform. We’ve supported it from the beginning. We need to cover
all Americans. We need to look at ways that we can eliminate pre-existing condition limitations, we need to look at ways that
we can provide coverage without rating people on their health care status and/or their gender, and we need to look at how
we can bring everyone into the system in a way that we don’t disadvantage low and moderate income families and we need to
open the system up, the best system in the world to every American
DR. CRAIG
BRATER: Could I, could I …?
WALL: Yeah, go ahead, Dr. Brater.
BRATER:
We keep hearing this stuff that we’ve got the best health system in the world. The data show that if you look at
outcomes, measures of outcomes, that we are at best average in the industrialized world in terms of our outcomes, and the
data also show that our costs for average outcomes are much, much higher. So this whole notion that we’ve
got the best health system in the world, I’d like for somebody to show me some data that even suggests
that that’s true. (Applause.)
WALL: Dan, there’s another tough
question for you, which is with the requirement that insurance companies not exclude pre-existing conditions
and not set lifetime maximums, both proposals of health care reform, will that destroy the private for-profit insurance business
model?
KRAJNOVICH: You were talking about Dan Evans, right?
DANIEL F.
EVANS: I’ll be happy to let you have it.
KRAJNOVICH: You know, again, I’ve
stressed it before, we have supported many proposals for a long time, quite frankly, when we entered into the whole issue
of reforming health care, and that is that we do need to create a system to eliminate pre-existing limitations and to eliminate
things such as, again, rating people based on their status of health and those things can be accomplished. But they can only
be accomplished if we bring everybody into the system, it’s inherently important. We have people declined coverage today that
can afford it, and they’re sitting out on the sidelines. We need to create a system that brings everybody in and that will
impact the cost out there and that is something that we need to certainly look at and figure out how we do and I think it
can be done through the pre-existing limitations and lifetime caps and things of that nature.
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