Rough Day On the Hill For UHG

From the sounds of it, things weren't all that friendly when Steve Hemsley and Andy Slavitt (CEO of UHG and CEO of Ingenix) met with a Senate Committee on Commerce, Sciences, and Transportation today. This was to discuss Ingenix's alleged establishment of arbritrarily low "out-of-network prices" used by the insurance industry to pay claims; to the detriment of the consumer.

Actually, Hemsley and Slavitt had some really important things to say to the Committee (if you want to read their testimony go here). But, it didn't sound like anyone listened very well. To give you an indication, Senator Claire McCaskill of Missouri stated at one point, "We need to be vigilant and stay on you like white on rice." Doesn't sound like a trusting partnership is forming here.

But, on this one I have to sympathize with United.

Getting a handle on health care fees (the old Usual, Customary, and Reasonable determination) has always been a chore in the system we've set up. Hemsley states in his testimony that our model is challenged "when the costs of a routine, identical medical procedure can vary widely within the same geographic region between private and public insurance, such as Medicare". Something needed to be set up- and United happened to capitalize on the opportunity. You can't blame them for developing something the system needed on a broad scale. (Now- the potential for a conflict-of-interest because of the way UHG is corporately structured may be another story).

The Committee failed to understand that establishing higher UCR non-par fees only shifts the dollars back to the employer in the system we have today. It sounds like they are saying that since the consumer doesn't have to pay- nobody will. That's not the way it works. It's another example of shifting the responsibility- as opposed to addressing inherent problems in the system itself.

Slavitt commented, "Trusted, accurate data and information technology comprise one of the keys to modernizing the health care system, particularly when combined with national quality standards and properly aligned incentives."

We couldn't agree more- and that should be the real message; but, sadly, we don't think Senator McCaskill and others got it.

Watching the Sunday Talk Shows- It's Depressing

When I get the time, I like to scan the different Sunday talk shows to keep a fresh perspective of the views of our politicians and commentators and keep updated on the status of our country- strictly from a media perspective (I know it's a bias view- but entertaining at least). Last week, (not surprisingly) it was all about the AIG bonuses and the general status of our economy. I was intrigued with the force of the disagreement existing between our political parties about how best to address these challenges and the many other challenges we are facing. Both sides are entrenched in their views- and the criticism on all sides flowed freely. I didn't see a lot of bi-partisan collaboration.

As I watched the different shows, I began to wonder- "If all of this political capital is being spent on these critical items that need to be addressed now- how are we ever going to make the changes to our health care system that need to be made?" There may not be any political capital left- on either side.

We don't need incremental change now- we need a major overhaul in our reimbursement

structure, our focus, our perspective, and the fundamental way our system operates. As we've stated in the principles of our Collaborative Health Care system- it's going to require a bi-partisan combination of public and market initiatives to make it work. From what I have been reading and witnessed on Sunday, it ain't going to happen.

In a September, 2008 essay in Business Week, Louis Gerstner (retired chairman and CEO of IBM) suggested that "the processes of government are broken, preventing us from taking responsible action". He further contends "the U.S. is better at patching problems than fixing them." The collapse of our banking system, housing, and credit markets, is a perfect example; many folks knew the way the markets were operating was unsustainable. We just didn't listen or do anything about it.

David Walker, CEO of the Peter G. Peterson Foundation highlights the issue at hand in the title of his article in Fortune, "Call This A Crisis? Just Wait." He's talking about Social Security and health care. He states, "at the heart of these problems is our leaders' collective failure to act in the face of known challenges. Our country has veered from its founding principles, which held to individual responsibility and accountability today in order to create more opportunity tomorrow. When our constitution was written, the concepts of thrift and prudence were no less at the center of the American spirit than liberty and justice."

The health care crisis is out there. We're coping with it now, but there will be a day of reckoning in the years ahead. Whether we like it or not- health care is as important to our economic security, as revitalizing the credit markets. It's just not at crisis stage yet. From what I'm seeing now- I don't see a lot of promise for a major reform effort coming from the government structures that are established today. Quite frankly, I'm tired of the talk and rhetoric. We need to look for alternative ways to get the message across that we can't wait and hope that all of the other stakeholders- employers, consumers, health plans, and providers can come together with a solution. We don't have a lot of time.

Maybe I should stop watching the Sunday talk shows.

Can Health Care Change It's Thinking?

Our goal at CHCI has always been to help organizations change the way they think about health care. Whether we like it or not, we've evolved into a "sickness-based" system comprised of many independent stakeholders that is not organized or coordinated toward any common goal. The result is an extremely expensive health care system that doesn't produce the outcomes or results we would expect for the dollars we are spending. In order to really reform or change our system- we first need to start changing the way we think. We need to change our perspective.

We've been in a few meetings with organizations over the past few weeks that really pointed out to us that it's the "thinking" that needs to change first- then we can start to be truly innovative and creative in making the changes we need to make. Many organizations seem more comfortable with throwing more tactics at the problem, but feel they must fit these tactics in the context of the way things exist today- as opposed to changing the market dynamics themselves. We're being incremental about our approach to fixing our health care challenge- as opposed to being bold and creating a whole new health care paradigm.

The familiar Albert Einstein quote comes to mind, " The significant problems we face cannot be solved at the same level of thinking we were at when we created them". Addressing the challenges we face with our health care system is a significant problem- all stakeholders involved will need to change our level of thinking if we're going to fix it.