Care for all: 10 reforms that could save the system.
Reform #1 - Rationing
A significant amount of medical diagnosis and treatment is for patients with incurable illnesses. Often, time and resources are provided because there is nothing else that can be done, and there is a chance it will prolong life, no matter how poor its quality. As long as insurance pays for the care, someone will provide it. The first and most important reform is a government-sponsored reinsurance system that covers all medical costs above $25,000 incurred for an illness or accident. Everyone would be covered, and the cost of the reinsurance program would be shared equally among all who pay income taxes. There would be an approximately 3 percent savings on the health care premium because of the national reinsurance program. This is the approximate percentage of our present premium used to purchase reinsurance.
The catastrophic reinsurance provides the framework for the most basic change necessary to control medical inflation. The reinsurance organization, with physicians, lawyers, ethicists, and clergy, would develop guidelines for the use of heroic and expensive medical care. Stroke victims, very premature babies, incurable cancers, progressive neurologic disease, surgical cardiology, and other conditions would have the criteria for care spelled out. These criteria would need to be followed to receive payment. Outcomes research in medical care will contribute significantly to this process.
As high technology care and the wants of care recipients expand, the cost and the income tax surcharge increases. When the electorate decides enough is being spent, distribution of benefits within guidelines and algorithms established by panels of experts would put resources for this care to the best use.
Reform #2 - Medicare
The second reform is to change Medicare from an entitlement to a needs program. There are some elderly who do not have the resources to buy health insurance. They would receive coverage under a revised and improved Medicare program. They, as every other citizen, would be covered by the reinsurance program. To fund Medicare, a part of everyone's health insurance premium (3-5 percent) would automatically be placed in a personal account, much like social security, that grows and earns interest. This fund would be available at the time of retirement to purchase health insurance.
Reform #3 - Medicaid
Medicaid or a Medicaid-like health insurance program is the third reform. This would become a federal program with uniform national benefits paid for through taxes. A sliding scale of premiums from zero to the actual cost would buy basic coverage up to the $25,000 of reinsurance. A more liberal national policy on income would be needed in determining Medicaid eligibility. Basic coverage would include preventive care, prenatal care, full pediatric care, and other usual benefits. Not included would be custodial care and cosmetic surgery.
Reform #4 - Prevention
Cigarette smoking, uncontrolled hypertension, untreated cholesterol, not wearing seat belts, and alcohol and drug abuse are precursors for serious future illnesses and accidents. These behaviors can change. Well-run preventive programs in industry routinely demonstrate a $3-6 return on health care costs for every dollar invested in prevention. The fourth reform encourages illness prevention through meaningful incentives to reduce health risks and through penalties for risky behavior. Health care premium copayments and deductibles can be altered for individuals on the basis of known preventable risk factors. All insurance, including Medicaid, would pay for proven prevention and screening programs.
Reform #5 - High-Technology
A cap on the resources going to high-technology procedures is the fifth reform. Through the reinsurance programs, resources would be more fairly distributed to people who benefit the most. Marginally successful diagnostic and treatment modalities would be limited to institutions of excellence and would be evaluated before being provided as a benefit on the reinsurance catastrophic program (Reform #1).
Reform #6 - Eliminate Inefficient
A sixth reform would be to eliminate inefficient providers. In a competitive health care system, identification of providers of less cost-effective care would continue. However, government systems, such as the Veterans Administration medical system and civilian care in the military have no competition. They need to be phased out. Care for illnesses or injuries that are service-connected can be provided through the private sector and paid for through the Veterans Administration by the government. Nonservice-connected illnesses in veterans would be cared for through regular health insurance or Medicaid, just as for all other citizen.
Today, physicians gravitate to the higher paying specialties. More primary doctors and fewer specialists are needed. For the fee-for-service providers, the resource-based relative value scale physician payment system should be expanded and revised until payments for procedures and high-technology medicine are reduced and migration of physicians into these specialties ends.
Reform #7 - Make Competition Fair
The seventh reform would level the playing field for health care providers and organizations. Fee-for-service, HMOs, IPAs and any other approach should be encouraged to compete. Each physician or provider system must offer minimum national coverage but can include any other benefits that it can market, sell, pay for, and make a profit on. State-mandated benefits and other barriers to managed care need to be removed.
Reform #8 - Medical Education
Much of the cost of medical research and medical education is hidden in health care costs. No one really knows what this element costs. The eighth reform is to pay for education and research separately. The payers of health care premiums should not be expected to subsidize medical education and research. We need both, but the cost must be known and fairly distributed among all citizens.
Reform #9 - Medical Malpractice
Malpractice judgments and settlements are extreme. As a result, physicians practice expensive defensive medicine. Reforming the judicial system is the ninth action needed. A fault-based system with a jury selected from panels of experts and with caps on awards would protect the patient's rights to sue, keep awards in a sensible range, and bring justice into the courts.
Reform #10 - Hospital to Home
The last reform is to recognize that a significant amount of health care can be moved from the hospital to the home without jeopardizing the patient. Indeed, the shift often improves outcomes. Home health care must be a fully covered benefit when used in lieu of hospital care. Similarly, hospice care must be available and be a covered benefit.
For the overwhelming majority of people, these reforms would represent little change from the present system. However, the uninsured would disappear, and everyone would have access to basic health care and meaningful prevention. Those willing or able to pay would still be able to get the most sophisticated modes of care. Others could also receive such care, but, through the reinsurance system, and only on the basis of who benefits the most.
There would be a reduction of the per capita resources going into the care of the aged and a significant increase in our investment in children, prenatal care, and preventive care. Because of the increasing proportion of the elderly in our population, the total dollars devoted to elderly care would still be large.
Probably the most important drivers of medical inflation, the high intensity of care and the increasing number of patients getting this care, would be capped by the reinsurance payment policy. The cap would be adjustable by the public's willingness to pay for technology through the income tax surcharge.
Through competition among health care institutions and systems, and the gradual removal of noncompetitive institutions, unneeded facilities and some of the "fat" in health care would be eliminated.
Medical activities, such as research and medical education, that do not directly provide patient care would be funded separately. The national investment in these elements would be measured, the providers held accountable, and reasoned investments decisions made for research and education.
Many society goals would be achieved through these 10 reforms. They would produce a significant improvement in access to care. Everyone who desires health care would get the basics. The costs of health care would be known and contained as society decides.
The public must understand and accept the fact that our present system is failing us in order for reforms to succeed. We must agree as a nation that finite national resources do not allow us the luxury of giving everyone all of the medical care the health care system can conceive. These 10 proposals offer a solution to our health care dilemma by bringing fairness, cost accountability, and financial controls, while retaining competition and choices. With such reform, we will truly care for all.
Clifford J. Harris, MD, FACPE, is Vice President of Quality Management and Risk Management of the CIGNA Healthplan of Arizona. A Distinguished Fellow of the American College of Physician Executives, he is a member of its Society on Managed Health Care Organizations and Forum on Quality Health Care.
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|Author:||Harris, Clifford J.|
|Date:||Jul 1, 1993|
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