tv Health Care Policy Part 2 CSPAN January 13, 2017 10:14pm-11:50pm EST
film the time has come and originally created for overseas audiences. the film documents the progress of african americans. >> the registration, the voting, if it took a patient a bringing about a new sense of hope and not just a new sense of hope and a new sense of optimism. >> american history tv all weekend every weekend on cspan 3. at the same event hosted by the american enter prize institute talked about the challenges for american health
they have a strong stake for their own populations and for everybody in the country. it's important to note that while these are tremendous organizations that are investing a great deal in experimentation and learning they are not typical of american employers. any small and medium sized employees around the country to influence health care. i think one thing we'll talk about is the implications for these kinds of strategies for other employers who have the same resources to effect the market. we think there's a lot to be learned. what i want to do is take a minute to transition between the first panel and the second and mention a few of the themes i think we have heard. we talk about implications for the market as a whole.
first there are lessons. most of the topics you have heard described today have a mirror image. so we do want to be learning and have a dialogue between thought leaders and people here who are developing much broader public policy statements. what the employers seem to have learned is they have to be thoughtful in crafting the en e environments which they are crafting. they are engaging in direct discussions. they are not relying only on their health plan as a mediating organization but they are critical as everyone said but they find themselves needing to drive with the providers. moreover they remain in direct conversation with their provider
systems. if you get into the weeds of some of the models you have heard about today you'll see how much energy they are putting into understanding the care paths and trying to support them in making necessary changes. implication of that is something we are thinking about as a group. we all talked about insurance coverage and insurance products. what we are hearing is what needs to be done and that means a reallocation of roles for everybody in the system which we have to see more about so the signal to the provider community and the public is very important. we need a dialogue between public policymakers and private employers about what that is and how it can be reenforced by
everybody's behavior and action. i also took away observations. first of all their concerns are the same as we hear in state houses and hear in congress. they are acting on the same concerns, same costs and same variation issues. they are often using same approaches as we mentioned. and make things happen in our economy and of the world. that is first problem solved. cost solutions will follow quality solutions. we all agreed we will have to measure that quality and design programs and improve that quality in an accountable way.
>> they are deeply invested in understanding their work force, provider community and impact of the health care they are arranging on their work force. this is not a superficial engagement. there are some differences, things they can do and don't do that don't apply as much as public policy. you heard their work force can be concentrated and can be rural and can be urban. an organization like medicare
we will talk about the implications we have seen in the activities of public policy development coming forward. i'll invite them to take it from here. we will confuse because we on the part the washington outlook, at least many of us do. with that let me make a few comments not stonding there davids comments were an
excellent hand off for this panel but he didn't mention medicaid. there is a tendency, i think -- i certainly have it, to think about medicare and then sort of, medicaid is kind of tough because the states run this. there is a growing appreciation that the employers we heard from this morning clearly recognized if you don't pay attention to the client population, if you don't understand something about the delivery system in the local area rather than some generalized sense you'll probably have trouble implementing cost saving value and changes in policy.
so i think it's a real possibility that part as further reforms. we are just going to call it by different names and it's going to continue on forever, which is, i think good for this panel. if it were not the case we would all have to find other jobs. i think part of the future of health care reform is reader appreciation for the rural states. so i think that's something that we may well see perhaps later this year. let me introduce the panel. i'm going to introduce people in order of speaking. first we have lynn nicoles. let's see. i have to find me lynn is a
then karen fisher, karen is now at the association of american medical colleges. but before that many years working on legislation for the senate finance committee and other roles. fin finally ovick. >> it is a great new effort called the foundation for research for equal opportunity. it is not just narrowly focused on health issues.
ovick as many of you have seen him on tv is a true health policy expert. with that why don't we start with lynn. we'll argue with each other until you stop us. >> thanks, joe. joe gave us five minutes. so i will try to make three points. >> you can use ten. >> no. no. no. i will stick to five. that's fair. so i have three points. two about what's going on now and one i think we need to think about going forward. first i want to begin about how happy i was to hear him say the word bipartisan seven times. every single paul ryan budget, go back and look at every single
one of them, including all of the medicare payment stuff. the most comprehensive produced before the election, he is a long-time collaborator who always wrote the defensible way to think about this right on the hill. hatch is chairman of finance. that bill includes all of medica medicare. as congressman laid out it passed with just about the largest bipartisan majority since world war ii. that is a very very good start.
the second point i want to make is this public/private cooperation that has been waxing and waning and going on is a two-way street. i think you can see a lot of good features that are coming out of that. first and one of the things i liked best about the way the invasion center did its business was emphasizing multi-payer mi h initiatives. the reason it matters is basically to get the incentives and reporting requirements aligned between payers so that they can focus on what they went to medical school or nursing school for. i know where i now have the pref l privilege of living. they are recording between 240 and 500 different quality
different quality me tricks. i don't know what the right number is but it ain't 240. i can assure you that. we have got to do a better job. the only way to do that is get that going on. there are lessons that i think you can learn from some of the different similar but differently structured activities. it is the core of making it work. it is the core of making our health care system more patient centered. that's the idea. it's been tested in lots of different ways. one of the largest public tests was the comprehensive primary care initiative. i don't recommend you read it in one day but i recommend you take a look at it. it basically found, drum roll,
no cost savings. the only part in the country that saved serious money was oklahoma. oklahoma has a really well functioning and health department information which takes data and combines all of the pairs and all of the ehr's. they did better. saved money in year one but not in year two and three. it did not overcome the cost associated with the rather -- i would even say very demanding requirements of the government in all of the things they wanted the primary care docs to do. contrast that with the patients
private sector i know a fair bit about it because i have been evaluating it. it is maryland, d.c. and northern virginia. unlike the government approach they didn't dictate a whole bunch of things. they wanted you to do 24/7 access, same day appointment. pay attention and focus on care plans agreed to by the nurse manager and the patient, sign the contract then go forth and prosper by focusing on those people. they saved about 2.8 or maybe 3% in years two and three. the larger point is this, kind of like what i heard our employers say. they don't really want to get into the micro managing business of how to do it but they want to
set the right financial incentives so the docs can do it. maybe an important lesson is instead of getting a bunch of experts in a room and saying this is what we think doc should be doing, maybe what we should be doing is focusing on which patients to focus on. that is a very very very important thing. the evidence is the date that predicts which [ inaudible question ] -- [ inaudible ]. >> the secret of health care
which is surprising. that is market power on the part of survivors. as big as walmart is it can't really tell local hospitals what to do. boeing is in a little bit different place in about three places. you can do it, sort of kind of. so no employer has enough market share to drive it. it's a better way that we know congressman ryan and others will push pretty hard. okay. fine. that's done. let me point out and read that thing closely. it's all about turning medicare other to health plans, which sounds clean and nice and simple. here is the thing, they don't have market power either over a whole bunch of hospitals.
if you got it out and turned it over and said good luke. i don't have to worry about it because i don't have to worry about it you will care pretty qui quickly but we need all of the buyers to be focused on exactly how to move to the promise land. let's talk about the promise land. one really great feature of being tenured is you have time to read stuff that you wouldn't have time to do if you weren't. i will tell you three things you should read too, but not in one day. the inspector general of hhs, you may think what do they have to do with anything? they do sort of evaluations from their own legal point of view of implementation. they just released a report of
implementation of quality payment program which is a big part. it is about the physician reporting stuff. you will see pretty clear recommendation for back office i.t., which is sort of, you know, euphemistic speech for figuring out how to get the data out in such a way that we can actually do what we said we were trying to do in the regulation which you heard congressman's praise. okay. that's point one. point two, read that third year evaluation and you will see even where we are spending 18 bucks for three years you have got places in this country where the docs can't get out what everybody agrees should be measured. and the third little piece is a
project that i'm involved in which is funded by the basic idea to try to enable small practices around the country to be able to help manage patients with heart conditions much better for all of the usual reasons. i signed on and i was told by the pi of the project, don't worry. you just need to work on the statistics. oh my. i have had to learn way more than i ever wanted to know about getting data out and about the fundamental inability to function the way they were promised. so now i will bring you back. what we are doing in this regulation is we are saying 90%
of what you're going to be judged on in the first year comes from either your ehr. 10% of it comes from claims which medicare will tell you what your total cost is. i submit the you those percentages should be first. we should figure out how to get the data out. they should not be required to have to produce these on their own. we don't want them to learn. we want to enable them to participate in an infrastructure where they can bring two clinical decision making all of the data they need in realtime and it can be done because oklahoma proved it can be done. we need to think about how to build that i.t. backbone so that doctors can actually participate in the 21st century. let me tell you what's going to
happen if we don't. these little practices which are still the core of our nation are not going to be able to compete. they put four to 9% within three years of total medicare revenue at risk and it's total zero. you'll lose if you're at the bottom of this pile. they cannot win because they cannot make them generate to tell them how to do better. we have to do this for them. it can be done cheaper. it will have to be an infrastructure kind of investment. i'll stop. >> thank you. glenn's talk reminds us all that in washington we have a different standard of measurement. so if that was five minutes, well -- [ laughter ] >> bill clinton time. [ laughter ] >> clay, take it away. >> first i want to say thank you so much for the opportunity to
be here today and to speak. i want to echo, i learned a ton from all of the speakers this morning. thank you for those contributions. what i would like to talk about today is the uncertainty here in washington. it has been what we have all been facing since the election and uncertainty about everybody that had a memo and had to rip it up and recalculate on every single issue across the health care landscape. so there were a lot of predictions around that. so what we do in washington really well is i'll make predictions. it is why i think they are sound. it is where some of the things that may progress.
it will be a very busy year across the health care sector here in washington. everybody will be implicated in the discussion. one thing that i think you'll find is a bipartisan idea and it will be throughout what happens. what i would like to do is walk you through three different settings. congress and the private sector about some of the ideas from the first panel, will they present themselves that we are going to have? first we have congress. i think i walked a lot with dr. burr guess. he did a tremendous job of walking through what you can expect from his committee. that's where i did my work. they will have a full plate. but the predominant -- what we
are going to hear is about repeal and replace. it will take all of the oxygen out of the room. it will be where all of the activity from the policymaker standpoint is going to be centered. when you look at repeal and replace -- and i echo that it was definitely welcomed news. i think when you look at repeal and replace one of the questions that gets asked and should be asked is what's involved in that? what are you going to see in this piece of legislation? with repeal and replace and what republicans have been talking about since the passage of the affordable care act is a need to reduce costs for consumers. it has been one of the main arguments. you have your policy debate. it is reducing cost for consumers. it will be a focal point that they want to put forward to try
to accomplish that. so the better way that dr. burr g burrgess talked about, they both have one key component and that is health savings accounts. health savings accounts is something the republicans have been talking about for a long time in policy circles. and i think that is an idea you heard a lot about really well in the first panel. what they are going to look to do is find ways to foster the continued expansion and continued -- you know, make it easier for folks for veterans or others to continue with health savings accounts. so that will be one important feature. a second part of it -- and you're going to hear a lot about repeal and replace and what's going to be in repeal and replace. i think joe said it really well that a lot of focus has been about medicare. obviously medicaid has a big
part of that as well. i think what you'll see in repeal and replace is there will be a lot on what can happen to make that work and what can happen to consumers. there will be a lot of talk about medicaid and what the future of medicaid will be and how that will move forward. medicare, it will be part of the debate as part of repeal and replace. it's not likely to be a prominent feature. it is not a big part of it. it is what you have heard from senator alexander. it is as much as it is a huge issue on the republican side. it won't be part of it. it will be part of the congressional debate though. what i would say is fiscal year 2018 budget, right now it is around the 2017 budget.
that's what is going to give the reconciliation to begin that process of repeal and replace. there is actually a vote that will happen today that will approve the reconciliation instructions and that process will basically start. so phase 2 will start. it is a little odd to pass the budget after you're already in the period. you're already spending the money but it's not necessary to move the reconciliation for republicans. for fiscal year 2018 i talk about the policy debate. there is going to be a real sense among the republicans in congress and from the administration to try to find some fiscal order that around spending that were part of it the why that budget wasn't passed and in this budget as you
look at it what we are seeing from the federal standpoint is that mandatory programs are crowding out discretionary programs. so when you look at the caps that are a part of the federal standpoint the discretionary caps, whether it's the defense department or it's for how much -- you know, for health care or how much more money there will be for nih, all of this is centered. the issue that has been here and will continue to be a problem according to the republicans unless it is solved is that the mandatory programs, medicare and medicaid are crowding out the rest of the bujd and there needs to be some kind of, you know, order brought to that in order for the federal budget to actually work.
that will be part of repeal and replace. you can see substantive changes that you need to take into i count. on the medicare side these budgets are very important for policy debates and for setting the caps. they are not going to change substantive law. they are not going to see -- it is not going to be part of law. it doesn't have anything that would directly effect stake holders. it is something to caution and to qualify. but that will be where the congressional debate will center and something they keep into account. the move to value, the need to reduce cost, to improve quality will be something that will be talked about. so those topics of the first phase will be part of that as well. now, where will the debate related to value continue or policy questions continue? the executive branch is
definitely something that is front and center that we need to contemplate and think about. so with respect to that, while some -- and republicans would want to move forward with medicare reform it's not likely to happen because there's enough on the plate and there's a political sense they can't take down on as well, that said on the executive branch may present opportunities for them to test certain ideas and continue to test certain ideas that are already started whether it is the bundle payment and others. that's where the question will come for dr. price and for others that are situated there as to what they want to do and how they want to move forward. so with that -- and i think the relationship with how it will move forward, the past year you have seen a basically the name recognition and the
understanding of cmmi has changed dramatically from a congressional standpoint. whielt was doing a lot of work and moving forward a great deal there wasn't a lot of focus except for dr. burgess and others. so that is a place where the name recognition has gone higher and created concerns for what its future is. you know, it's my thought and i'll walk through why is that cmmi will play a large role in a new administration. it is for several factors. the first is macra. karen and i had an opportunity to work on it when we were on the hill and see it get enacted. it is a key factor here in that both sides of the aisle want to see it succeed. both parts want to be right
here. they will take steps whether it's working together on letters to cms or others to ensure it works. so they will want to make sure cms continues with he's going to have hearings at his subxwhicommittee. there will be hearings at other places to make sure macra continues. but for macra to continue and for one of the key components of the quality payment program, right, it's mips and it's advanced apms. for the advanced apms to work you need the programs, you need the models from cnmi. s so you need those there so you can qualify for the bonus payments. changes that will be seen if there are any kind of changes to those programs or a discontinuation, that's going to cause a lot of problems not only with -- it's going to cause a lost of problems with stakeholders, with clinicians across the country who view that as a very attractive place for that to be. why? they're not going to get the negative adjustments. they can continue the investment and the move to value. and they can move to a place
where quality is important and they can move to a place how they want to practice. that is one place as the executive branch as dr. price and others take their positions they're going to have to consider. the second piece to this whole -- and this is something that congress will have to deal with and as well as the executive branch, is that cbo, the congressional budget office, believes the cnmi is going to save the fiscal -- the federal government a great deal muof money. i'd point you to the testimony in front of the house budget committee in september where they testified -- in that testimony they outline and really lay out why they think it's going to happen. it's around the process. it's around the process that cnmi utilizes to put forward these demonstration programs. and they believe that process is a really good process. it's not necessarily what has been picked thus far. it's around the process that's been utilized to move forward
these quickly and to get them out to test to see if they actually work or not. under cbo's estimation, the next ten years, they're going to save $34 billion under cnmi and in the out years probably a great deal more. so that's something that the executive branch and congress will have to consider as well. and the final piece to this and i think an important piece is because there's not going to be a substantial medicare reform likely this congress the question is where do those ideas come forward? how can republicans move and look at conservative ideas in medicare and how can they test their own ideas? well, you have the apparatus already set up. so that's where you could see different -- whether it's a premium support model or other models being put forward under the executive branch. you can see that in medicare. you can see it in medicaid. also chip. there's other ways to test this out. when it's your power, when it's your ability to -- it's your car
to drive, that makes it a little less likely you that want to get rid of it. that's just something to consider as well. and then finally i'll just move quickly to the private sector. i think with republicans and democrats as well they want to hear about what's happening in the private sector. they want to hear about the success stories that we heard about on the first panel, and that private sector leadership and that data that they can share are incredibly persuasive and incredibly important for them to be aware of as they're moving forward. and one opportunity i think is there is around with cnmi and with some of the executive authority they have the ability because they're operating these public programs and because of what's in the aca to actually waive certain requirements. they can waive certain -- whether it's a kickback statue or stark or other pieces that may make these models or demonstrations harder to
implement. and so as you look at these private sector opportunities and i think the bipartisan belief that this -- how can they foster, it they'll be looking to that. that's one question i would pose. and a note that was asked earlier too by the audience is what can be done to basically foster an environment to move these forward in the private sector and what can be done to reduce those burdens. this is something that congress has already indicated that they're interested in. i know with karen's former committee, senate finance, there was a white paper that was released by chairman hatch. there was a hearing that was held. we're there asking these very questions. and i think that's an opportunity for folks outside of these public programs to move forward, to continue to though shah leadership, to continue to show that innovation so the health system can move forward in a good way. >> okay. thanks.
dr. burgess raised a couple of questions which probably good thing he didn't answer them. his questions were does policy drive innovation or does innovation drive policy or does innovation occur in spite of policy or independent of policy? i think that's probably the better way to think about it. there are an awful lot of people who seem to think that all great ideas stem from the expert minds in washington who are insulated from much of the real world. and i think that's a real problem when it comes to setting policy because in the end federal policy will drive an awful lot of what goes on. the first panel, at least one of the speakers, several speakers i think pointed out that there's a tendency for washington policy to want things to be uniform
across at least the medicare program. there's pressure to be uniform in the medicaid program. that's a real problem. and i think one of the lessons we can take from the private sector is that uniformity doesn't generally work unless accidental accidentally you can find two situations that are fairly similar. with that, karen, take it away. >> thanks, landon. thanks for the invitation today. and i'm just going to do sort of a litany of items because len did such a good job setting it up and i want to make sure there's time for avik. what we do want uniform is we want high-quality care uniformly. now, how that's done and how that's done in local areas could differ. but i think with the opportunity with telehealth and with the opportunity to spread information quickly there's an opportunity to ensure that we used to think high-quality care only happened in certain parts
of the country there's an opportunity to make sure through clinical guidelines or other mechanisms that we can get that across the country. i think we would all probably agree on that. i do want to pick a little bit on macra and the idea of bringing in the private sector. as clay mentioned, that this was the physician payment bill that passed several years ago. and for several years prior to that there were a number of hearings done both on the house and the senate side that brought in the private sector. employers, physicians, providers, health plans. and said what are you doing, how are you working with your physicians to ensure high-quality care in a way that also is fiscally prudent. sometimes while legislation can take a while to happen that can be a good thing because it allows for that type of discussion to occur. i think that's in part the reason why that bill was so bipartisan and had a lot of support by the physician community and the provider community and others, was
because they were so much a part of it. and i think that's important. let me point to another example of that happening more recently, and that's an effort on the senate side by there -- in the senate finance committee that's been working on a chronic care bill. particularly for the medicare program. the chronically ill are the most expensive segment of that population. and trying to get a handle on making sure those individuals have high-quality care and in a way that can also look at the cost of that is very important. so senators hatch andwiden and senators warner and isaacson came together and led the finance committee and had again a lot of discussions with outside groups about what they were doing with the chronically ill and put together the white paper and introduced legislation at the end of last year, bipartisan legislation that was
introduced at ways to improve the care that the chronically ill receive. and i think that's going to be an effort that's going to continue because while there can be disagreements on one issue oftentimes as clay and i and others know there's discussions going on where people agree on other issues. and i think chronic care is one of those areas that we should watch out for. the panel before talked about quality and the need for quality measures. i was pleased that in the physician macro legislation there was money put in there, $15 million a year for five years, for measure development. quality measure development is not a big money maker for private industry because the measures have to be public and can't be proprietary. identifying, and as was mentioned before, getting good outcome measures and getting those measures so we don't need hundreds of them but can get to be a subset that really
identifies high-quality care is really important and i would argue that's almost a governmental role of saying look, quality matters to everyone in this country and government has a responsibility to help fund those measures rather than put them on physician groups or provider groups et cetera. len mentioned quality alignment. i think there's a role for the government to work with the med sxair medicaid programs along with the private sector. and some of those efforts are ongoing right now with voluntary efforts that are occurring between the medicare agencies and some of the other health plans. but i think everyone would agree. and certainly when clay and i were on the hill we took lots of meetings where that was exactly the case, the providers came in and said how am i expected to do this where i have different payers and yet i'm being expected to do all of these different quality measures? and in the midst of everything else that's happening right now len mentioned about the health
i.t. area. and in 2008 or 9 the government did put funding into encouraging, incentivizing providers to implement more health information technology. the good news is lots of people took them up on that and hospitals took some of the money and worked on information technology, they put a lot more money of their own in and physicians go into it. you go into a lot of physician's offices, hospitals, and you see computers. the issue is now translating that technology into new information and how do you actually utilize that as they gather information to actually improve care. and i think that this administration as we look forward has to continue to build upon that and see how we can utilize the public-private sector role to take health information as len mentioned and make it not just technology but into information. and to build upon that it is the
data piece in getting feedback data. and macra, i think part of the reason people view it so favorably is because it tried to address many of these issues. macra has information in there talking about from the medicare perspective making sure the medicare agencies give feedback data to physicians so that physicians can see what's going on, not only for themselves, what they're doing, but when their patient gets into a hospital. what about post-acute care? what's going on with their patients? it's by far not perfect. i would say one of the issues is that the government and the medicare agencies don't have probably the systems they really need in place to efficiently turn it around. but there's recognition that needs to be done and in the midst of everything else that's being done these are areas that probably need to be looked at. when we look at value the other thing we've been seeing as these alternative payment models and value-based purchasing and
readmission programs have been taking place is we're learning more. and what we're starting to see is the socioeconomic status makes a difference with providers. and while providers have a certain role and can do certain things, sometimes socioeconomic conditions of their patients, the environments and where their patients live, whether they have a family caregiver around them, whether they have transportation, whether they have good nutritious care around them affects how much health care they need. so as we start to look at policies, we need to look at issues that we hadn't looked at before. things like socioeconomic status, things like more risk adjustment, et cetera. and then finally i think on my list is that when we talk about the private sector we probably do need to look at the anti-kickback rules that were set up in a different area, set up in a fee for service area where we were trying to say oh, if anyone talks to anyone else
they're trying to influence them to get a kickback for the care. and we're in a different world now where we're trying to encourage collaboration, encourage coordination, and that's an important law that needs to get done. i'll just finish up with saying one thing. i was asked to be here for the most part because because of my background working with the senate finance committee. i'm now the chief -- and i'll take 30 seconds with the podium to say as when i hear about the private sector and look at reference pricing and looking at giving more transparency about the price of providers, as we do that, again, we cannot look at those issues in a silo. we have to look across the board in terms of all the health care that occurs. if you look at the major academic medical centers in this country they're a subset of the population but they do all of the physician education and that costs money.
they are the places where there's standby capacity and where if there's a next ebola crisis occurring they have to be ready to be able to do that. that costs money. and historically, medicare has paid a share of those costs. not all of them. and to be honest the private sector through negotiated rates probably has picked up some of that. to the extent we're going to get more transparency about how much it costs to provide care we're going to have to have an honest discussion about how those other costs that benefit echl r everyone are going to be taken care of. i encourage us as we think from a policy standpoint that we have to look across the board on all of those issues. >> that should be easy to handle. you know, there's some irony. i don't want to admit how old i am either but i do remember in the early stages of my career back in the dark ages that we were talking about care
coordination. and that was the same era the anti-kickback rules were put in. which clearly meant that once again washington policy makers did not understand that things are connected. and that's i think one of our biggest problems. we don't understand the connections. ing and of course it's -- many of these things are hard to see until you do something. and then realize that you may have a problem. and then the issue is are we able to then admit that it doesn't work anymore? i think that's going to be a real challenge for the foreseeable future. avik, please take it away. >> thanks, joe. it's great to be here with all of you. maybe what i'll trying to do is draw from that earlier panel i had with the large employers because i think part of our task here was to say what lessons can the public policy community learn from what large employers are doing? and then step back and talk more about the broader context of my views at least -- my two bits on
what conservatives and republicans in congress should do on health reform more broadly. i'm going to talk about three things that i drew from the large employer discussion. the first is the discussion of account-based reimbursement. health savings accounts. health reimbursements, et cetera. eli ziad at wells fargo did a good job of showing how they are seeing an uptick in utilization quality from hnas and hsas. and i think one of the most promising aspects of the new reform environment we're in is i hope we can broaden the utilization of those lessons. broadly speaking, we've been living in this era for about 50 years now where the central dogma of health care economics was handed to us on stone tablets by ken arrow at stanford, who said that the laws of economics were magically suspended when you talked about health care. and i think what large employers are relearning on our behalf is
that the laws of economics are not magically suspended when we talk about health care. laws of economics apply to every good and service that's trance mitted in the economy. and if you give patients more control over the health care dollars that are being spent on their behalf, well, voila, you have a more patient-centered health care system. that shouldn't be surprising because that's how the rest of the economy works. but sometimes we struggle to appreciate these basic lessons in health care. so that's point number one, that more agency for patients, for consumers is better. the second point i'd make that i draw from the discussion was the value of longer-term relationships between payers and patients. this was a missed opportunity with the aca where there's an enrollment period every year, which means that if you're the insurance company enrolling that patient for a year a lot of the long-term preventive health outcomes type work you that might want to do, you're not sure you're going to capture the value of that work down the road. so we heard from dr. burgess
about the high price of hepatitis c drugs and why we should pay whatever gilead wants to charge because they're cured of hepatitis c maybe down the road. that insurance company doesn't necessarily capture the value from that. because 20 years down the road they're on a different insurance plan or maybe they're on medicare or whatever it is. one thing we can learn from switzerland and reggie hertzling from harvard business school talked about, this, if you have a five-year insurance contract rather than a one-year insurance contract, for example, then an insurer has a lot more ability to say i invest in prevention, pharmaceutical compliance with cardiovascul cardiovascular, metabolic, though kinds of issues. i'm going to yield those savings down the road and that can translate to lower premiums for that enrolle. the more we can move the longer-term relationships between payers and patients and have insurance contracts that reflect that i think that's going to be a significant value driver that a lot of us aren't talking about in the policy world. the third thing i'm going to mention is price. ube reinhart and a number of
colleagues in health affairs i want to say this is 20 years ago now wrote a great piece for health affairs called "it's the price of stupid." and the his point was we all talk about utilization and say we've got to reform delivery and tweek tweak this and tweak that so people don't go to the hospital 20 times for this instead of 19. that's all great and we should do that very hard blocking and tackling and plumbing work. one thing we should understand is we all complain about the high cost of u.s. health care. but utilization is not the driver of the high cost of u.s. health care. to take one common metric of health care utilization, which is an average length of stay in a hospital, we're actually one to two days below the oecd average for an average length of stay in a hospital. we're much better actually than our typical european or canadian or australian peers in getting people out of the hospital. so we're already doing a lot of good stuff. the problem is the average day in the hospital in the united states costs five times as much as the average day in a hospital somewhere else. and that's not because we're doing five times as much stuff.
it's because the mri costs six times as much. it's because the drugs cost 50% as much. right? so it's the prices that are driving high costs in the united states. much more than utilization. we should do what we can to make sure we're not doing inappropriate care, of course. but if we don't tackle prices we're not going to lower costs. so i think that the experiment that calpers did on reference pricing with orthopedics and in other areas as yvette talked about i think is incredibly important because it showed that you have a lot of providers saying we have to charge $40,000 for a knee replacement, that's our underlying cost. you can't make us do less than that. we'll go broke, we'll close. then when calpers came and said sorry we're not going to pay you 40,000, we're going to pay x and if you don't pay x the patient will go smerlas, magically all the providers said that's a great price, we'll take that, that's awesome. there's an enormous amount of
fat in the system based on the prices that people are charging. and this distortion was created by the employer tax solution of world war ii and the medicare system that came about in 1965. so the more we can move away from that and give payers more flexibility and latitude in price, particularly with reference pricing, i think that's extremely important. i also want to thank joe because yvette and i were classmates in high school in michigan in the detroit area 30 years ago so you've given me the opportunity to run into her after all this time. >> oh, my goodness. >> which i appreciate. she's probably going to kill me now for dating her. now let's draw back and say what does this mean for the health reform environment. i want to double down on something that i think alice riv lichlt n talked about and dr. burgess talked about and that is the importance of bipartisanship in the health discussion. i'm personally very concerned that a lot of republicans while they've criticized the aca for being passed on a party line vote are either resigned or eager to doing the same thing in
reverse, doing everything through reconciliation where it only takes 50 to 51 senators as opposed to trying to come up with a durable health reform that has 60 -- the support of at least 60 senators. i think that can be done. to give my think tank a plug, the health reform plan we've published at the foundation for research on equal opportunity, which you can get at freeop.org. freeopp.org, it was built from the ground up to achieve the objectives of both democrats and republicans. it's designed to cover more people than the aca, improve health care outcomes for the poor by reforming medicaid, but also reduce spending, taxation, regulations and costs by utilizing some of the techniques that we've talked about. i mean, i think that it doesn't have to be exactly like that but that general set of principles let's try to achieve the democratic principles of coverage expansion and marry those to republican objectives of less government and more cost control. that can be done. and the aca didn't get that done to the degree certainly that a
lot of us wanted it to be done and i want to encourage remembers to do that. i think that's how you're going to get to 60 votes for any robust replacement of the aca. and if we don't do it then the result of this new environment for health reform is not going to be satisfactory to anyone because what you're only going to be able to do is take the tax credits or the dollars the aca was spending and maybe spend them in a slightly different way but unless you can change the regulations and other key elements of the aca that are not subject to the senate reconciliation process you're not going get to a more market-oriented and consumer-driven patient health care system. >> thank you, avik. that's a great way to end the formal remarks because it leaves one with a sense of despair. one of the big issues of course is how do you make that straddle from a system that in many ways hasn't worked to a system that might work?
and i think that's going to be one of the big challenges for not just republicans but for democrats. and even more importantly for the health sector and for patients and consumers. there's a lot of talk, especially in the press, that this is somehow just a political issue. and that's prong. it is true that a lot of middle-class people have no idea how the aca may or may not have affected them. they have no clue whatsoever about that. but they also don't foe what they pay in premiums generally either. that doesn't mean they aren't being affected. and as we go along i think we're going to see both because of the pressure for a kind of price transparency that probably isn't useful but also the reality that employers, which is where most people get their health insurance, employers won't be able to conceal the fact that
they're taking the money out of wage raises and putting them into the health sector. so i think we're going to see some problem there no matter what washington does over the next year or two. well, there are so many issues here that i can personally take issue with. but why don't we see if other people have complaints to make before i start ranting and raving. >> since i talked about reference pricing and karen did as well, let me make one point about this whole issue, how reference price affects academic medical centers. i appreciate -- i went to medical school. i appreciate that 34kd schools and tertiary reform centers have costs that are different from a community hospital. it doesn't seem to me that the right way to subsidize that is to make everybody pay more for their health insurance. maybe the right way to pay for that is to have direct subsidies that go to academic medical centers, clean that up instead of advocating for a status quo that isn't serving anybody very well. >> i think that's a conversation worth having. you need with these type of
systems to have the stability over time. so the direct subsidy would have to be stable over time. but i think it's a discussion worth having. i don't want to turn that into that type of discussion. i appreciate that, avik. let me just add, too, and just throw into the equation that we talked about value-based purchasing and alternative payment models. we have seen over the last five years, six years now, that there has been a slowing in the growth of health care spending. and some people say is it the recession? is it really a change in how we're providing health care? or we've seen it in the medicare program and those people for the most part are retired. so it's not saying we're going to hold back on our care. i think we've seen some positive signs about the ability of providers to come together and actually try to work on bending the actual cost curve. because what i worry about is sometimes the easy decision for the federal government is to shift the cost, reduce the
federal government spending curve, but the costs move over to the states or move over to beneficiaries. if we can actually get providers to work together and look at ideas that actually bend the health care cost growth, everybody wins under that. the federal government wins. states win. beneficiaries win. >> wait a minute. somebody loses. bend the cost curve means spend less money, right? do i have that wrong? so if you spend less money, then that means that hospitals will get paid less. doctors will get paid less. >> not necessarily. if you cut out the middle sxhan reduce the compliance -- >> wait a minute. this isn't economics. this is accounting. >> no, not at all. because what if hospitals and physicians spending a lot of money on? it's not merely revenues. it's also costs, right? income is revenues minus costs minus taxes. so if you're spending -- if you get it and if you're billing for
a lot but you're also spending a lot on compliance and regulatory costs and other things then your actual income is lower. so yes, you can spend less money, but if you actually streamline the system so that the costs of delivering care to patients in terms of regulatory compliance, middle men, accounting, billing, compliance, if you can reduce those costs you can actually end up with more savings in the end and actually a system that stakeholders appreciate more than the system they have today. >> well, certainly if you could reduce administrative costs to that extent i'd agree with you. the issue goes back to will we ever really divorce ourselves from fee for service payment? basically, all payment systems have a fee for service base because you have to start somewhere. and so i'm a big fan of
capitation. but the big hmos don't like to talk about how they pay their individual practitioners. but it's highly likely that there's a volume basis at least in part. there's some kind of performance program that isn't just value based. and a salary component. a base for practitioners. it's not at all clear how this miracle will occur. >> joe. joe. there's plenty of ways you can get to the miracle. but let's be clear. i agree with you that we're not -- if we didn't have fee for service we'd have to invent it. we have to account for what's going on. but you can do that without having 1,500 different payers have very different ways of paying for roughly the same cpt codes and roughly the same
icb-9s. i'm back to alignment. that's my magical thinking for the day. what if we agreed that all the payers would have the same set of quality metrics by which they're going to judge the individual providers? yes, you can pay different levels and yes, you might have different forms of incentives or rewards, but as long as the metrics are the same and as long as the provider has applicable incentives that are the same across all payers then you can get to non-trivial efficiencies. i'll also remind everybody of the thing called claims adjustment algorithms. a lot of that billing stuff that docs spend their money on, what is, it 20 cents for a hospital to get paid, 20 cents on the dollar for a hospital to get prayed. 35 cents on the dollar to get paid. that's all about having all these different payers with different rules about getting a claim accepted. what if we had standardized ways to do that? and you know damn well we do. we just don't have the courage to enforce those standards that
i way that would achieve the first,s th efficiencies that avik is talking about. it is achievable. we just have to have a more targeted curve. >> you don't have to have one size fits all uniform standards if technologists can play a role in being the interface on the decision support tools for providers and payers and the like. and that is restricted by anti-kickback laws, by problems with data liquidity, hipaa, et cetera. so that's a whole area of work where it's not very sexy but we need to spend more time so the athena health and whoever else we want to put in that bucket can do the work, serners, et cetera. epix, to be able to create a system where everyone can work together. and they'll take those costs out of the system. >> let's be clear. we don't want to turn this over to epic and serner and say good luck. >> of course not. >> the fundamental problem is no
one's focused on getting the clinician all the data they need to make the decisions they need to make both clinically and financially. >> but they're legally barred by doing that. because there are certain types of information that if serner or epic or athena tries to deliver they're actually barred by anti-kickback laws from doing p t. >> i'm totally in favor of fixing stark but that ain't the biggest problem. the biggest problem is somehow, and we can talk about how if there's enough liquor in this building, but somehow the hr vendors got to be owners of the data. that's wrong. >> sure. >> docs and patients should own the data. period. done. we're done with this. we've got to fix, that then we can fix everything else. >> economists call it externalities. >> when you talked about the fee for service basis, that's always the structure, i think when you look at macra, that's a representation of trying move away from it when you look at
the quality payment program. >> man, that's really great. no, just meaning that with mips that's where everybody is situated now and we're trying to move into the alternative payment models. but that's where the ideas from this morning's panel are trying to be represented in private programs and the public-private alignment. >> okay. we don't want goat into an tensive discussion of alternative pay models. we'll get some questions from the floor. and that has to do with i think a very fundamental issue that several people here alluded to, which is the short-term view that health financing and health policy takes basically on everything. it's somewhat ironic. the medicare program ought to take a long-term view because
with the baby boomers they're stuck with them for 20 years or more. and yet most of the policy is oriented to one year. and if there is broad thinking, it's that ten-year cbo score, but where it really matters is year by year. so that's a problem. it wasn't emphasized in the employer panel. but you would think that the large employers would have a longer-term viewpoint. but i think they're trapped in the mechanics of short one-year contracts with health insurers. clearly the big employers recognize that their workforce, at least the highly skilled part of their workforce they want to hold on to. so that's also a longer-term relationship. and yet all of the relationships have been to date really more
focused on the short term than the long term because it's so hard to capture what was the result of whatever you did up front as a health investment. how did that really affect health and how did that affect cost even past the first year? it's really hard to know. i just wanted to make that observation. as something we all need to work on. >> that's why i made the point about long-term insurance contracts. >> right, right. exactly. >> and avik i think a lot of people have been thinking about long-term insurance contracts for a long time. and the reason we don't have them is because insurers don't want them. let's be clear about that. but let's think a little bit about what the deal is. insurers want the freedom to observe, ooh, you turned out to be sicker than i thought. and patients want the freedom to observe i don't like the way they're treating me. so we do have a tension between the absolute efficiencies of longer-term commitments and the reality of both choice and protection from risk. joe, i'd also say let's remember the providers, god bless them, are just larning how to do risk.
we've been paying them -- we've been overpaying them for fee for service for quite some time. because price is the thing. we've been overpaying for quite some time. i'm not sure i'm going to be pessimistic about the fact that the providers in the boeing world don't want to go to a multiyear risk contract. i'm happy they're doing one-year risk and they're actually hitting their targets if i heard you correctly. so i think we should should acknowledge the good stuff that's going on. >> absolutely. the only question is how many decades into the future. and i think part of that does have to do with government policy. and medicare, other people have said, medicare's a big payer. if medicare doesn't push against its own comfort levels, which are far closer to the body than i think any employers are willing to take chances because there's money at stake. >> let's talk about bearing risk and why medicare's focus is so
short. you know as well as i do it is because of the people we elect and the fact that they have to worry kind of a lot about getting elected kind of quickly. if you're a two-year congressman you can't be talking about a 20-year medicare horizon. you've got to be talking about what do i do today. you go back to this chronic care model, which that's incredibly long-term thinking. it's actually informed by evidence. what a concept, it can occur from time to time. you've got to encourage the congressman to think longer term. how do you do that, joe? you tell me. long-term contract? >> i'm sure there's some kind of a pharmaceutical that can -- >> okay. fine. >> long-term contracts aren't for everybody. but i think having the option of long-term contracts in a way that federal policy inhibits against them is -- >> where medicare's moving some of these models is it's pushing the risk to the provider or it's pushing the risk to the plan.
the idea, that's where it's trying to do that. >> right. and i think -- you know, having organized health plans really helps. this effort. it can be optimistic about this movement in the m.a. direction. those are business organizations that have some size to them. >> you know, speaking of learning while you're doing, think about how medicare advantage today in my view is much stronger than it was 20 years ago precisely because so many americans have had experience with managed plans and it turns out managed care is actually a good thing in lots of ways and so we're more able to -- well, you know what? that's going to be true across the board in these private sector initiatives on teaching consumers how to be smarter consumers. >> right. >> my mother was not a smart consumer. i loved her very much. she died in 2004. she did exactly whatever her primary care doc told her to do. right? whatever. what do you think, doc?
but my child does not think that way. and so fundamentally it's about learning behavior that can help us be better consumers. >> with that i agree. with that are there questions for the audience? let me see. raise your hand. there's a lady here. >> thank you. meg mcginty with the national quality forum. len and karen you both mentioned the issue of alignment. but i'm sure you know how wed people are to quality issues, how your shoes are good but my shoes are better mentality. how do we overcome this challenge? what are your ideas and thoughts to -- >> well, that's your job. >> we're trying but we got some pu pushback here. >> i would encourage the following historical metaphor. constantine when he took over the empire had a problem. and the problem was
christianity, which he decided to make the religion of the empire, was split between these who thought jesus was a man and those who thought jesus was a god. so he convened the learned bishops at nycea. that's why it's called the nycene creed. and he said i don't really care if jesus is god or man but you're not leaving till you decide. what happened? turns out he solved the problem. but my point is you've got to have a deadline, you've got to have a swoerd, and you've got to have a very clear instruction. and in my opinion just for what it's worth you could get the relevant players in a room -- >> who's the you? >> probably aqf has to do it or some -- okay, you want cms to do it? cms can't dictate it. but the cms sword might be you awl got six months. i don't really care but if you don't agree we're going to do it our way.
i guarantee you they will pay attention to getting to fixed. but you've got to have the sword and the deadline. just a suggestion. >> one of the things that has bothered me about this concern about hundreds of measures on the one hand everybody's right about that, that's too many measures if you expect everybody to report on them. but one of the issues is that some measures are actually appropriate and some circumstanc circumstances. so it's a much more complicated world as you well know thafrn i think is often portrayed. it's really difficult. >> and we spent you out there without the sword. and we're very grateful. seriously. for what you do. but you can't really make them do it on time unless you've got the sword. so you've got to combine the sword. but you don't want cms dictating before the private sector has a chance to work it out. in my view if you do that a lot of examples in history would suggest that's a feasible alternative. >> next question.
there's somebody back there. >> great. good morning. my name is jean drummond with health care dynamics international. this has been an amazing panel. thank you so much. one of the questions that i want to ask, we have the opportunity of working across the country trying to dot transformation of clinical practices because of macra. and we're clearly seeing the challenges with the small rural practices. clearly the data. you're exactly right. they just cannot get the data. they're almost held hostage by their own data. my question -- and i appreciate your comment really around the social determinance because many of these clinicians are kind of trapped whether they're in rural areas or urban areas. they're trapped by the challenges their patients -- many co-morbid diseases and the challenge -- health care's far more than health. and so my question to you is what are some solutions that
u.s. policy makers in analyzing this around this ehr, that's one of the biggest barriers that across the system but particularly with the small rural docs are facing. so that's one question around ehr. how do we get through this debacle around interoperability and all of that. that's one. two is what are some of your thoughts around risk adjusted payments. because clearly as we move through acos, you know, there's the option of cherry-picking. don't like to say that. but that's ultimately how do we manage those. so those two big issues, ehr and risk adjusted payments, particularly with a focus on the small rural docs. thank you. >> i'd love to make not a macra point but a macro point. which is you know, when i left my hotel this morning to come over to aai there was a copy of the "wall street journal" in front of my hotel room door.
because the hotel had in their data base that i like having the "wall street journal" in the morning when i check into that particular hotel. there needed to be no meaningful use regulation from the federal government to require my hotel to deliver the "wall street journal" to my door and my hotel room. they did it because they had an economic incentive to provide high-quality service to me so that i would keep going to that hotel. and so the irony of all the stuff we talk about with electronic health records is that again, in the rest of the economy, i think it's always useful when it comes to health care and intractable issues in health care especially, is how does the rest of the economy do it? in the rest of the economy there needs to be no regulations around mandating people to use digital data because it's in the economic incentives of the suppliers of services and goods to be as digitized as possible, to be as economically efficient, to provide as high-quality service as possible. it's only in health care where you have to mandate it because the incentives are so driven away from the patient relative to other sectors of the economy.
so the more we can reform the health care system broadly so that the patient is in control of the health care dollars i think a lot of the stuff around ehrs and the intractability of getting people to use ehrs, so long as the federal government -- i don't want to say gets out of the way but at least doesn't actively try to sabotage it will get a lot better. >> so look at what's happening in the real world, where it is working. go back to tulsa, oklahoma. where this engineer undergrand m.d. professional works at the university figured it out using banking colleagues, not h.i.d. colleagues, how to extract the data from the individual rural practices, small practices in such a way that the doc doesn't have to do anything. they finish the exam, close the record, the data flow. ccda if you know what i'm talking about, treat into the h.i.e. that night. takes all the patients from that doc, gives them back, a profile. you've got three diabetics, you've got five with heart
conditions, yada yada yada and three of them coming in tomorrow haven't been here in two years, whatever, yada, yada, they need the "wall street journal," whatever. you walk in and there it is every single day. how do they do that? they do it through software that is eminently achievable. it can be written by my graduate students. but they have essentially penetrated the wall that prevents this from happening in most of the country. why? because the vendors were given too much power by the federal rules. i would argue it's because some people in congress wouldn't let them impose rules that may be more productive. so here we are. let's fix it. it's totally fixable and you have to find examples that are working. you've just got to break those firewalls down. >> in the 20th century act that was just enacted in december there's a significant amount of work that will be pushed to the office of national coordinator to work on the interoperability because i agree.
i think there's a lot of concern not only around folks around the country but that has been come to washington and they are trying to push for it. i think that's something you'll see. the second piece is i agree with avik on the consumer. the consumer is really the key to this. and the more the consumer and i think the a.r. -- the consumers are demanding this type of information as folks, you know, care for their parents or care for their kids and are dealing with these records issues, i think they are going to be what pushes this forward. but i would say the providers are equally as frustrated. they really want this to work as well. they want to be able to share it. but they want to be able to do it in a way that makes sense. and as we all know it's a very complicated -- a ton of information to share with a lot of privacy concerns around it. so it is somewhat different from what we see in other parts of the economy. >> but there are solutions. >> yeah. >> just to address your other point, i think we continue the same on the quality side on risk
adjustment. we need to get this more finessed. and as people live longer and we're managing chronic illness more carefully, risk adjustment's just going to get increasingly important. >> and increasingly difficult to do. yeah. let's see. another question. anybody else? okay. go ahead. >> thanks for your presentation. my name's leah. and i think common sense is price and cost is depend on the consumer to say whether how much he want to pay or whether you can afford it. i think that's totally true. you can see that over-the-counter drug may be more useful than you go to see a doctor who is not going to give you anything instead maybe refer to another doctor, another hospital, and everything and eventually of course disaster. so i just wonder if the
information from all those providers whether pharma or the hospital can give consumers information that treatment, everything's supposed to be maybe in regulation. they are supposed to give the consumer patients or their family. but that is not true. and you have the right to complain but complaint's improperly processed. so are we having a really good mechanism to better procedures or complain and have a record of complain result? resolution? if we can have all those information available, we can see which officials are doing right, which are doing wrong, and which is totally a disservice. so if we can move this direction so we can have the better choice of provider services.
we know whether we are really in trouble in terms of health or in terms of financial situation. >> that's a really good question. it boils down to getting consumers. we could call them patients. and their families to better understand both their condition wharkts optio , what the options are for treatment, what the options are for providers, what the aftermath of the treatment might be and of course cost. and one of the problems with the transparency push in washington is they want to talk about list prices all the time. when in fact what the average person really wants to know is what's it going to cost me out of poblth? now, it is true that for a lot of purposes, policy purposes you really do want to also know what the actual transaction price is. but for the average patient they
tend to focus on dollars out of pocket even though they are ultimately paying the rest of it we need to address those issues too. >> well, there are tools to do everything you asked for which is quite reasonable. i would say the difficulty we have right now the difference between where we want to be and where we are is we put a pretty big burden on the patient to ask all the relevant parties, all the relevant questions about themselves and in some cases it's really the laws and regulations that prevent this stuff from flowing as easily as it should. but i would just observe that burden on the person to ask the question is part and parcel of our philosophical attraction to the notions of individualism and individual choice in patient centeredness. so it's kind of hard to push it unless the patients ask for it. i will say a lot of ehrs can
generate the relevant clinical data on a particular patient in that physician's office. but not necessarily every physician you've seen in the last three years and not every e.r. you have been into from some emergency access. we need a system that enablds you to access that every morning or however often you want to go to a doc. it's feasible, it's there in technical terms, it's not there in legal and administrative terms. >> okay. very good. one more question? or observation. >> thank you all for the panel and discussion. several of us have alluded to market forces in the course of the day and we haven't come back to it yet. and this consumerism discussion opens up this issue as well. whether you all believe, some of you believe individual consumers acting individually will counter the large dominant forces in both consolidated health systems and consolidated health plans,
which are in fact to avik's point about price setting, or prices, which are driving higher prices in a lot of situations, our employer friends often find themselves victims of prices in the market that they don't have the market power to counteract or to negotiate dun. what do you foresee as the policy options in the networks few years to address the consolidation on price that would bring all u.s. pricing into more alignment with international norms? >> it's a great question. in fact, there's a whole chapter in "transcending obamacare," the health plan i alluded to earlier that addresses this issue. unfortunately a lot of federal policy like the aca, like macra, are facilitating and encouraging consolidation because of all the compliance regulations you can only get to that point with economies of scale. so that's a huge problem.
there's a couple of things you can do to improve hospital -- improve buyer competition. the first is we can do something at the state level where there are certificate of need laws and other regulation that's prohibit new providers fren terg the system. i think that's important to try to reform. same goes tore physician-owned hospitals. i understand the anti-kickback side of not wanting physician-owned hospitals but they are an important element of competition. i think you have to give more money to the ftc and doj to litigate and on an anti-trust basis. if united and continental airlines want to merge the ftc gets involved and that's i gig national merger or if comcast and time warner came want to merge. but if the local hospital of the cleveland clinic is buying up or it's yale new haven owning aum all the hospitals in new england it's too small. it's too small for the ftc and doj often to get involved.
so i think we need to do more to draw resources to federal agencies to attack that. and i think the last thing, and this is sort of my more out of the box idea, so s. you could conceive of a system in which there was an automatic trigger instead of relying on doj and ftc litigation you could have a situation where where if provider concentration in a certain locality exceeded a threshold of concentration, dmifts like to use this thing called the herpendaul, hershman index, if you suddenly have a is duonly or monopoly level you trigger an all payer medicare medicaid regulation. what you're basically doing is saying if you want to stay independent and compete with each other do that, if you think through merging you can have economies of scale and lower costs do that. but if you're only merging to jack up prices on patients and
consumers and taxpayers we're not going to let you do that. >> okay. one of the sishz willingness to pay as well. i think this is where employers play a really critical role. employers represent their workforces not just in health care but in general in terms of total compensation. and so i think if you were to ask the average employee if we could give you $10 more would you like to spend it on health care, the answer would be no. almost certainly. so the ability to resist i think is very important. ultimately the problem we're talking about is a problem of good economic times.
and we can't complain about good economic times. but the reality is it's very easy to say oh, yeah, okay, we'll pay it because we don't feel enough pressure to push ba back. we may be headed in that direction not from the standpoint of a negative economy but from the standpoint of really the lack of balance or the misbalance between health care and everything else. i think may have gotten to the point where we may be at proverbial tipping point, in which case employers really have a job to do. we're counting on you because we in washington would really rather have someone else do the work for us. >> can i make one suggestion on the employer front, and that particularly struck me from the multistate employers, multinational employers, find a way to share what you know about price and cost differenttials across this country. because the deal is medicare
dictates price. they don't pay variable prices. geographic adjusters. but you all pay all of these things. but that's not part of the data base that triggers doj and ftc. o'economists discover p by random chance. but you guys know every single day. figure out a way to share that with the authorities. got to be a way. just show up and have breakfast. >> okay. well, good. let's -- we've expended our time. please join me in thanking not only this panel but the entire group of people. [ applause ] on "newsmakers" house democratic whip steny hoyer of maryland talks about the future of the affordable care act. president-elect trump's cabinet choices and how democrats will deal with the republican majority. "n