The revolution in consumer-driven health care is indeed taking hold, if the responses to two speeches that I gave in the last week are an indicator.
I spoke in Ocean City on Saturday to the annual convention of MedChi, the Medical Society of Maryland. Executive director Michael Preston asked me to talk about innovations in consumer-driven health care, including Health Reimbursement Arrangements (HRA) and tax credits for the uninsured.
Then, I traveled to Salt Lake City on Wednesday where John Nielsen of InterMountain Health Care invited me to keynote the annual meeting of the Utah Health Insurance Association, whose able executive director is Kelly Atkinson.
Doctors and insurers. Clearly two groups that have a vested interest in the system, and I wasn’t sure how they would react. But in both cases, the great majority were remarkably receptive to the changes taking place.
First, the doctors: They are so angry and demoralized over managed care that they are willing to listen to any new idea that will restore control to them and their patients. They were particularly interested in HRAs, where employers can fund an employee’s personal care account to pay for routine medical care, and most often couple it with catastrophic coverage. Many plans also provide screening and other early-detection tests without charge to the employee to encourage them not to skimp on care.
The June 26 IRS ruling allowing money saved in the HRA accounts to roll over tax free makes these arrangements especially appealing.
An inevitable consequence of this new spending arrangement is that patients will ask their doctors more questions about cost and will try to get the price down. How do the doctors feel about that? Many agreed that if the patient is a cash-pay customer, it would be possible to cut their rates and still make money because they can avoid paperwork, payment delays, and battles with insurance companies.
Then, the insurers: They are losing customers, especially small businesses, because premium costs are rising. They want new tools to lure customers back, and they see HRA products as more flexible and affordable and a way to make patients partners rather than adversaries in using care wisely.
Small steps can lead to big changes in the system. Other issues we discussed:
- Health Insurance Flexibility and Accountability Guidelines that are loosening regulatory shackles on states so they can be more creative in their use of Medicaid and SCHIP dollars (and which the Senate Finance Committee warned this week it wants to curtail).
- The new Independence Initiative from HHS to let disabled people decide what they need to achieve greater functionality, not have the government tell them what they can have.
- Refundable tax credits for health insurance, enacted as part of the Trade Act of 2002.
All of these small steps begin to move in the direction of greater consumer choice and empowerment.
Single-payer supporters still made their voices heard in both presentations, some more shrilly than others. They will be a force in the continuing debate, but they were definitely outnumbered.
It’s clear that big, top-down changes to the health care system won’t fly. Consumer driven health care ideas are making progress indeed and may take off sooner than we think. It can’t come a moment too soon.
Here’s the PowerPoint presentation I gave in Maryland: www.galen.org/news/MedChi_presentation.pptf