Sen. Whitehouse on changing the way doctors get paid
The Affordable Care Act is mostly known as an insurance expansion, expected to extend coverage to more than 30 million Americans. That’s the part of the law that the Supreme Court heard three days of oral arguments on this week, with opponents arguing that a mandate to carry health insurance was outside of Congress’ authorities.
But, as I wrote last week, a big chunk of the law is dedicated something arguably more ambitious: an overhaul of the American business model for medicine. “This is a very significant piece of the bill that has received virtually no attention because it’s so non-controversial,” Sen. Sheldon Whitehouse (D-R.I.) told me in a recent interview.
Earlier today, Whitehouse published a report looking all the changes the Affordable Care Act makes to how care is delivered; by his count, there are 47 of them. We spoke about what those changes are, why they matter and what obstacles they face:
Sarah Kliff: This report identifies nearly four dozens ways that the health care law changes how doctors and hospitals deliver health care. Why do we need those changes? What isn’t working right now?
Sen. Sheldon Whitehouse: If you look at some of the reports that have come out about the health care system, from very credible sources, you get estimates that we could be saving maybe $700 billion annually on what we spend on health care. That would be a huge economic benefit to not only the taxpayer, but also to our competitive industries, if they’re able to spend less on health care. And these savings in the Affordable Care Act aren’t about taking something away, but rather about delivering more efficient care. It’s a true win-win, and positively the road we ought to be on.
What we’re facing is a choice: Do you take Medicare benefits away from people and cut reimbursements while maintaining a system that wastes? Or do you assert yourself, put your hands on the wheel, and find ways to cut that waste? It’s a topic that comes up in a lot of conversations I’m having, about how to find savings in a responsible way.
SK: Tell me a bit about what road you see the Affordable Care Act putting us on, on that front.
SW: I think we are on the road to a different delivery system. I think you are seeing immense leadership out of the private sector in certain areas, I would single out Kaiser, Gunderson Lutheran, Geisinger Health Systems, the Mayo Clinic and Intermountain as some key leaders. They are actually making it happen. The Affordable Care Act provides mechanisms for making that happen, changing the incentives. What it does is launch a whole array of pilots and a new innovation center that has the ability to take successful pilots and deploy them nationwide.
SK: One of the biggest pilots on that front is probably the Accountable Care Organization program, which encourages doctors and hospitals to accept a flat fee for all of a patient’s care. It seems like the administration stumbled when it kicked off that program, as most of the health system reacted negatively to initial regulations. What happened there, and what does that say about how successful other delivery reforms will be?
SW: I thought it was unfortunate that the original rule that got so bureaucratized, and you saw all the private sector leaders, who were committed to it, saying they didn’t need to be led by the nose. It was unfortunate they started that way, but I think they immediately learned their lesson. Now I’m hearing from folks who are in the program, and feel the process was corrected. Our first instinct may be to gum things up, but we’re also capable of learnings.
SK: How quickly do you see our health care system moving from one that pays for volume, to one that pays for value? And what role will the Affordable Care Act play in that transition?
SW: You can’t force your way to delivery system reform. As Atul Gawande has said, it’s a process of experimentation and learning. And there is innovation involved in getting there.
What you have to do is create the conditions that allow that innovation to take place and propagate as quickly as possible. When counting on learning from innovation, there are great successes but also failures. The Wright Brother invented the aircraft and started an amazing process of innovation, where we now have planes that carry 500 passengers. Along the way there were some silly looking vehicles that crashed early on. We have to have some tolerance that there is going to be some error, and some missteps.
We have to trust that the path of innovation is the right one. The biggest danger is that one or two things go wrong, and they become an excuse to say ‘we give up,’ and then we’re going out there and cutting benefits”