What's ahead for 1991

What's ahead for 1991

David Nash, M.D. Director of Health Policy and Clinical Outcomes Thomas Jefferson University Hospital Philadelphia, Pa.

One of the main challenges for the future in my particular area of concern--clinical outcomes--is going to be changing the long-held habits of physicians. We must change the way doctors carry out their day-to-day business. That's where the money saving is going to be. We must address the critical issue of volume of services. We must address the profligacy of test ordering and the lack of outcome measures.

One thing is sure: If physicians don't change their practices, they are going to be told what to do by Uncle Sam. Like my favorite quotation, "If you're not part of the solution, you're part of the problem." And we're not talking long term, either. It's right around the corner in 1991. The Agency for Healthcare Policy and Research will release its first three guidelines for specific medical conditions to Congress in January. No one knows what Congress will do, but the guidelines will be tied in some way to reimbursement for Medicare. And as Medicare goes, so goes the country.

One related thing I predict is that hospitals are going to be forced to share unprecedented amounts of information with purchasers of care. What's more, this information will be detailed and specific in ways far beyond simple mortality figures by Diagnosis Related Group. We're talking about patient satisfaction surveys, generic quality screens--like for rates of return to the operating room--and patient functional assessments.

Merrill Horrine Special Programs Director Human Resources Department Hershey Foods Corporation Hershey, Pa.

I think we're going to find in 1991 that employers will start to use hospital data to design better methods and systems for delivering medical care. In Pennsylvania, for example, the Health Care Cost Containment Council issues quarterly reports on hospital charges, outcomes, mortality rates, and the like, making it possible for employers to pick out hospitals for their employees based on the information received. (See November 1990 B&H, "Measuring Hospital Quality.")

Hopefully, states that already have legislation--Iowa and Colorado--will follow Pennsylvania's lead. I fully expect California's data bill to be passed, making it the fourth state to require outcomes data. I'm heartened by interest in other parts of the country--Ohio and Kentucky, to name a couple of states--in banding together to demand outcomes data from providers. I believe wholly and completely that this is the critical item for effective health care cost management to become a reality. If you don't know what you're buying, you can't control the cost.

On the federal level, however, my crystal ball is clouded. I believe we'll see many more proposals in Congress for mandated benefits and on the pros and cons of managed care. I hope it will be recognized that health care coverage is a societal issue and that access to it and money for it should be provided by the people who are fortunate enough to pay taxes in this country. I believe we have an obligation to those who cannot afford to obtain the right kind of medical care.

Very few people actually have no access to medical care. The number bruited about in Congress is 37 million without access, but that's really the number without insurance coverage. What we're talking about is access to preventive medicine and non-hospital treatment; that is, the use of more effective treatment sites than the emergency room.

In fact, I think we'll continue to see an increase in emphasis on prevention through healthy lifestyles. I think the concern with effectiveness of care and outcomes will bring an initiative to change the course of medical cost management in this country. The healthy lifestyle movement is by no means a snowball coming down the mountain in winter, but it's growing and gathering momentum.

I think we'll see a lot more debate on who is responsible--the employer, labor unions, purchasers of health care, the federal government--for taking charge of medical cost management. Ten years ago, we all thought we could get the quick fix by adopting cost containment methods, and that was foolish. A system that took fifty years to build isn't going to be changed in the twinkling of an eye. It's going to take longer than anticipated to develop a system we can live with.

Rex Hardesty Information Director AFL-CIO Washington, D.C.

Collective bargaining cannot safely bear the burden of the increased cost of health care. That's the real core of it. Health care and the costs of health care have to become a matter of public policy, because one of the clear messages to us is that those who are insured plus all the providers pay for those 37 million who have no benefits. It's one of the big pushes that we will make in 1991--making health care a matter of public policy.

Will next year be a good year for cooperation between management and labor? That probably depends on the employer. Last year was excellent if you look only at AT&T. There was a strike at Boeing. There wasn't a strike for 57,000 people at New York hospitals. It depends on the industry.

There's a wide difference in benefits between our plumbers' union, for example, and communications workers or the Amalgamated Clothing Workers at some textile clothing plant in the Carolinas. There's quite a difference in the benefits people have. For example, employer associations in the building trades industry bargain a kitty, and the workers divide it the way they want to. The allocation between health benefits and vacation is their decision.

Congressman Fortney H. "Pete" Stark (D-Calif.)

Access to health care should be considered a basic right of every American. We have not yet reached that goal, and it appears that we slip further away from it each year. Thirty-seven million Americans currently lack health insurance and another seven million to ten million are covered by inadequate plans. As many as 65 million lack health insurance at some point during the year. A national strategy is necessary to provide all Americans basic and affordable health care. Unfortunately, other approaches, including the employment-based one recommended by the Pepper Commission, would not be truly comprehensive. Only a single payer plan under public auspices can assure every American a basic level of health and long-term care services.

For example, under employment-based plans, children are particularly vulnerable. Changing family patterns create equity problems with employer-based plans and often leave children or spouses without coverage. Part-time and seasonal workers also may fall through the cracks in an employment-based system.

I am convinced that a national strategy is necessary to provide all Americans basic health and long-term care services, and to implement meaningful cost containment strategies. An employer-mandated approach would simply continue the current ineffective patchwork of cost control measures.

I have introduced the MediPlan Act of 1990 (H.R. 5300). Under MediPlan, all residents of the United States would be enrolled in the plan and eligible for benefits.

MediPlan is budget-neutral. To finance the basic health benefits, every person with income above the poverty line would pay a premium of about $1,000 through the income tax system. Every employer would pay 80 percent of the MediPlan premium on behalf of each working American through a payroll tax of about 40 cents per hour to a maximum of $800 a year per employee. Revenues also would be raised through a 4 percent tax on gross income, including tax-exempt income, deferred income, and other forms of income not currently taxable.

I suspect that most will embrace the benefits included in this bill. Those benefits are similar to those currently provided to the elderly by Medicare, but, in addition, MediPlan would cover all children and all pregnant women without payment of a premium and without copayments or deductibles. I also suspect that many people will not support the proposed taxes necessary to fund those benefits. To talk about the benefits without considering what they cost and how to pay for them is to mislead the American people. I hope my plan will move the debate forward so that the Congress can enact the major changes the country so desperately needs.

Mary Bondarenko Director of Employee Benefits Consumers Power Jackson, Mich.

ConsumerS Power has 9,000 employees and is one of an increasing number of companies offering a flexible health care option. Before, Consumers Power had a very generous family health care plan. But we had one plan, and you got it whether you were single or married, regardless of your age or family status. If the family had other health care coverage, it didn't matter. Under our "Choices" plan, now a year old, we have multiple options. If there is other health care coverage in the family or less need for generous coverage and the employee wants to trade for a few more vacation days, he or she can have it. It's closer to individual needs than the old plan geared for the "one-income-two-spouses-and-a-kid" family. Only 10 percent of American employees currently meet those stereotypical demographics. It is becoming harder to come up with a plan that meets everybody's needs. That's why more companies will turn to flex benefits.

About a third of our work force is unionized, so we have collective bargaining. I think that the union--that's the Utility Workers Union of America--is beginning to understand the cost effects of its health care much more than it used to. There are big bucks in health care that are a part of the wage package, and dollars are going into the health care package that are not going into wages.

But on the other hand, there is a feeling of "Can we find areas where we can agree?" Like working together to see if we can get discount pricing, or working together to see if we can find ways to reduce the cost of the plan without just shifting costs to the union membership. That's an area where I see real interest from the union, and I think it's reasonable. Other trends I think we'll see are more utilization restrictions, more concern about whether charges are reasonable, and new ways to get discounts, reduce the number of hospitalizations, and shift care to the outpatient side. It just basically comes down to better utilization of the health care benefits that already are there.

John Ludden, M.D. Director Harvard Community Health Plan Brookline, Mass.

I don't think 1991 will be good for HMOs, or at least not as good as 1990, which was a very good year for them.

Medicare rates are another shoe to drop. It will make a lot of difference if they're inadequate--and I think they will be. That may mean a major downward shift in the number of people with risk contracts.

HMOs clearly run behind business cycles and the recession will catch up with managed care in the middle of the year, although already this year it seems to me employer pressure is getting harsher and more sophisticated.

In some ways, the employer pressure is getting better; quality demands are becoming more stringent, and, at least in some cases, employers are more clearly interested is stopping the long-term rise of health costs instead of going for fancy, short-term things like getting market-busting rates from one carrier.

By the end of 1991 the squeeze will really be felt. Of course, my perspective is from the state of Massachusetts, where unemployment is getting worse and is going to continue to get worse. The state government is in total disarray, to put it mildly. But I'm hearing enough from other people to know that the same things are happening everywhere.

The HMO doctor supply is all right for the moment, with the exception of obstetrics where ridiculous things are going on. Every organization wants double-digit numbers of obstetricians available. The recruiting has not been as hard for primary care physicians as it was a year and a half ago.

You're going to see a lot more basic variations like open-ended HMOs. There is a lot of employer enthusiasm for open-ended HMOs used as a step along the path of getting employees into a real managed care situation.

Peggy Connerton Policy Director Service Employees International Union Washington, D.C.

We have about 925,000 members in both the United States and Canada. We not only represent lower-paid service workers but we're also the largest health care union in the U.S. We have 400,000 health care workers; we're the biggest representative of health care workers. And then we also do represent a lot of professional and other workers in the governments, including the state of California.

I think the big labor concerns in 1991 will be health benefits and other labor standards. Parental leave will be one, and working family issues, another. Our union obviously is very representative of the new work force, which includes more and more working women, so we are very much interested in issues that affect women on the job.

Collectively bargained health benefits is an area that's been very troubling to us over the last several years because of skyrocketing health care costs and the failure of employers to take measures necessary to preserve our health benefits. Instead, they have tried to shift the risk of rising costs to union members.

We believe that the problem of health care education is bigger than the bargaining table and that without national health reform, employers are attempting to get the costs off their bottom line and put them on ours--with no effect on health care inflation.

About family leave and medical leave: Three years ago the possibility of passing parental leave in Congress seemed remote. But we've come a long way. We've managed to pass a bill in both houses, so clearly we will be pushing this issue as a top labor agenda item.

As far as the general outlook for cooperation between management and labor, currently labor and management are at loggerheads over health benefits. We did a study earlier this year that shows how this tension has led to increased strike activity. In 1989 health benefits were the strike issue for 78 percent of the workers out on strike, compared to just about 18 percent in 1986.

People are willing to go on strike to preserve their health benefits. I think there will be this tension over what's happening at the bargaining table, but we also feel that some members of the business community are coming to realize that you can't solve the problem employer by employer, plan by plan. I'm talking here about organized labor in general--not just our union. And we think that the business community will come out--as AT&T, USX, Bethlehem Steel, and others have--in favor of national health reform.

By the end of the year, we'll know how the threat of recession is going to affect health care benefits. Obviously, it will mean higher costs for our health benefits, because as more workers join the ranks of the unemployed and the uninsured, I think there will be more pressure by management to try to shave expenses and to squeeze costs down.

So it doesn't bode very well for the health benefits future. Frankly, we believe that the recession and other factors will bring the health care benefits issue to a crisis shortly.

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