Health care was front and center for the American public in 2019 – and with good reason. It’s one of the top issues voters are worried about going into the 2020 election.
On this episode of The Dose, David Blumenthal, M.D. and Shanoor Seervai review some of the big health care developments of the year, including the Democratic presidential candidates’ health reform plans, legislative activity around drug costs and surprise bills, and Silicon Valley’s growing interest in care delivery.
Note: After we recorded this episode, on Dec. 18, the Fifth Circuit Court struck down the ACA's individual mandate, but did not decide on the constitutionality of the law in its entirety. The Supreme Court will ultimately rule on the future of the ACA, but the timing is uncertain. Read this post for more.
SHANOOR SEERVAI: Hi everyone, welcome to The Dose. It’s hard to believe the year is almost over. And it’s time once again to look back at the past year and everything that’s happened in the health care universe. And then what that means for 2020. My guest today is David Blumenthal, president of the Commonwealth Fund. David worked as the national coordinator for health IT in the Obama administration. In the past, he’s also worked as a physician, a health system leader, and a professor. So, it goes without saying that he has a pulse on every aspect of our health care system, from what the 2020 presidential candidates are saying about health reform to what tech companies are doing to shake up traditional models of care.
David, welcome to the show.
DAVID BLUMENTHAL: Great to be here, Shanoor.
SHANOOR SEERVAI: All right. So let’s get started with, I think what everybody is most interested in, what are the 2020 presidential candidates saying about health care?
DAVID BLUMENTHAL: Well, this has been a big year for health care. In the run-up to the 2020 election, health care has turned out to be one of the most important issues for the American public. And it’s also an important issue for the Democrats, in general.
And any serious candidate for president in the Democratic Party has to have a position on health care. It’s always been true, but it’s true now more than ever. There are a range of such positions now. And they span the spectrum from the small modifications of the Affordable Care Act all the way toward the often discussed Medicare for All single-payer proposals.
SHANOOR SEERVAI: So, explain to me David, what would a small modification look like? How would that be different from what we have right now?
DAVID BLUMENTHAL: The small modifications are usually intended to make the Affordable Care Act somewhat more generous and cover more people. For example, to increase the subsidies that are available to help people buy private insurance. And also, to introduce a provision of the Affordable Care Act that was removed, and that was something called reinsurance, which is a way to provide insurers special protection against the high cost of care associated with very sick people. And that usually requires some federal subsidy or some governmental subsidy to do, because these people have very, very high costs of care and their premiums don’t cover the costs.
SHANOOR SEERVAI: And then if we move to the other end of the spectrum and look at the most generous, Medicare for All as you said?
DAVID BLUMENTHAL: That would be a single payer program, the federal government would become the insurer for everybody. It’s called Medicare for All, but it’s really not Medicare as proposed by several candidates. It’s really more generous than the existing Medicare program.
It would not only cover everybody, but give them much more, complete coverage than Medicare provides, more generous coverage without copayments, deductibles, and coinsurance that now exist under Medicare. More generous coverage of things like mental health services. And it would also involve more restrictions on payment to hospitals and doctors and other providers of care that would reduce the prices paid to them, and thereby reduce the cost of care, or at least so it’s projected to do. And it would, in the process, eliminate all private insurance, which is, of course, a huge change for this country.
SHANOOR SEERVAI: Do you have a sense of what the public wants or where sentiments are when it comes to this very wide range, as you described, at the one end, modest fixes to make the Affordable Care Act work better, and then at the other end, a full overhaul of our system?
DAVID BLUMENTHAL: The public is divided. About a third in our surveys would favor Medicare for All. About a third would favor building on the Affordable Care Act. And about a third would like something very different that would be neither the Affordable Care Act nor Medicare for All. There is not majority support for Medicare for All when people are given the choice between options.
The American public does believe that the federal government should take care of people and that nobody should go without coverage. Substantial majorities of Americans believe that. But they tend to get anxious when the federal government is given responsibility for insuring everybody.
There is a high level of satisfaction, whether it’s deserved or not, there is a high level of satisfaction in polls that ask people whether they like their current insurance. And most people do, even people who have pretty high deductibles. So, it’s a pretty tough thing in politics to take something away that people say they’re satisfied with. And when that is posed as a possibility, people get concerned.
SHANOOR SEERVAI: So, let’s say that whoever wins the election in 2020 does want to make big changes, take something away that people say they’re satisfied with, and I know you’ve done a lot of historical research about this in the past on what a president needs to do if they want health reform to be successful. So, what would the winner of the 2020 election need to do if they want to make big changes?
DAVID BLUMENTHAL: Well, the fundamental factor here is how hard it is to do major health care reform. And that is because it is politically so fraught. People — it’s very personal. The thought of losing something that people like, like their current health care coverage, makes people very nervous.
That means that the president has to act when his or her political capital is at its height. And they have to act with passion and commitment and a willingness to tolerate a lot of political opposition. And to give up a lot of other issues that they might be interested in. Those issues could involve taxes, they could involve immigration, they could involve jobs, they could involve climate change. All of those would have to be postponed until the president got his or her wishes on health care.
SHANOOR SEERVAI: So you need a really single-minded focus on health care, and you need to do it first.
DAVID BLUMENTHAL: To me, what that means is, the health care presidency, as I call it, lasts about six months. And if you’re not successful in getting what you want in that six-month period, the likelihood is that you’re in a — you’ve entered a guerilla war period where you will be attacked from all sides and ground down until the law kind of withers, the reform kind of withers away.
So that means that a president has to act fast. It requires a lot of presence of mind, a lot of planning, a lot of single-mindedness, and a lot of commitment to health care.
SHANOOR SEERVAI: And if we look at the last person who did that, that was President Obama. And brought us the Affordable Care Act. But the current administration has taken a lot of actions to change the way that the Affordable Care Act works. So, what’s happened in 2019 that’s impacted the Affordable Care Act?
DAVID BLUMENTHAL: In 2019 we’ve been seeing some backsliding in the numbers of insured Americans and some deliberate efforts on the part of the current administration to undermine, change key provisions of the law.
For example, they have — the current administration has changed regulations that now make it acceptable to sell very short-term plans, lasting three or six months, and also different kinds of plans called association health plans, neither of which have the same benefits that are required under the Affordable Care Act for private insurers to provide. They tend to be cheaper, but they tend to be skimpier. So, more people are buying those plans. And those plans, in some cases, are very limited in their coverage.
The administration’s also steadily reduced the amount of outreach that’s done to help people enroll, the amount of support that’s available to people as a consumer service to help them choose plans.
SHANOOR SEERVAI: You mean plans on the individual market?
DAVID BLUMENTHAL: On the individual marketplace. And they have also failed to take advantage of Medicaid fully. They have allowed waivers that make it harder for people to enroll. Things like work requirements, which force people to —with certain categories of eligibility for Medicaid to show that they’re working or doing other community kinds of service for up to 80 hours a month.
So, this combination of things has resulted in about a million and a half to two million more people without insurance over the last couple of years.
Another thing, interestingly, that’s affected Medicaid enrollment has been the so-called public charge phenomenon. The administration has said that anyone who is getting public assistance, including anyone who’s enrolled in Medicaid, may have less chance of becoming a documented American, that is they may have more trouble getting a green card, becoming a citizen. And this has discouraged people who are undocumented or who are aspiring to citizenship, has discouraged them from enrolling even when they’re eligible. One of the things that has occurred is that fewer children are insured now than were a year or two ago, and it’s probably the public charge regulation that is causing that.
SHANOOR SEERVAI: Uh-huh. And we’re also seeing a fear in families where there might be people of mixed status, right? So, my sense is that previously in a mixed-status family, maybe the people who were documented would seek out public benefits. But those who were not might not. Whereas now there’s sort of a wholesale fear of anyone knowing the status of the family.
DAVID BLUMENTHAL: Yes, correct. And also probably a lot of confusion, justifiable confusion, about what it would mean for an aunt if her nephew was enrolled in Medicaid, even if the nephew was a documented citizen, but the aunt was not, would she be less likely to become a citizen if someone related to her became — was on Medicaid? It may not in fact prejudice her chances, but the fear could discourage enrollment.
SHANOOR SEERVAI: Okay. Well, let’s shift gears a little bit and talk about another issue, which is the cost of health care. Now this isn’t a new problem in 2019. I think that Americans have been worried about how much health care costs for a long time. But it has been getting a lot of attention this past year. Why is that?
DAVID BLUMENTHAL: Well, you’re right that health care costs are a long-standing issue.
As costs have gone up though, employers in particular, have felt the pressure of increasing premiums that they’ve been paying on behalf of their employees. And they’ve been passing more of those costs onto their employees in two forms, first asking employees to pay more of the premium. And secondly, selling them less generous plans. Plans that have higher copayments, higher deductibles, and higher coinsurance, that is requiring a payment at — when you see a doctor or when you’re in the emergency room.
It’s the latter, I think, that has affected people’s view of the health care. It’s the amount they have to pay out of pocket that isn’t covered by insurance anymore. And it’s affecting people who previously felt protected.
Another thing that’s contributed to this is the high cost of drugs. So people now are noticing how expensive drugs are because they’re being asked to pay for those drugs until they exhaust their deductibles. And there are a lot of very common drugs, generic, so-called generic drugs, antibiotics, and other drugs that I used to, as a physician, prescribe for pennies, now costing 100 or 200 or 500 dollars a pill for no apparent reason.
SHANOOR SEERVAI: Right, so the costs of the drugs are going up, but also because employers are cutting back on what they’re spending on their employees’ insurance, people are seeing that they have to actually, as you say, out of pocket pay more, and that’s — that’s alarming.
DAVID BLUMENTHAL: They’re feeling it. It’s coming out of their pocket. It’s cutting into their budgets for entertainment, for food, for rent.
SHANOOR SEERVAI: So you have described a situation where people are seeing their premiums go up, seeing their deductibles go up, seeing costs go up. And then they have to budget for that in a way that they really feel. But there is something else that’s happening that people aren’t able to budget for it because it’s completely unexpected. And that’s this phenomenon of surprise medical bills. Can you talk about that?
DAVID BLUMENTHAL: Sure. When employers and insurers want to reduce the cost of care they go out shopping for doctors and hospitals that charge less. And then they make contracts with them. And they construct what’s called a network, which is a group of providers who are available to the people with insurance. And they’re available because they are more affordable.
What sometimes happens though is that certain groups of doctors or hospitals whose services are needed in a particular area will refuse to negotiate with the insurer. They can get away with that if there are no alternatives. So, let’s say all the emergency room doctors in the town of X, Y, Z have decided that they’re going to get together and refuse to negotiate with the insurers that insure people in that town. And somebody has a car accident and they end up in the emergency room. And let’s say that the hospital has a contract, and so if you were planning in advance to get your care at a place that you would be covered for you would go to that hospital. But low and behold the emergency room doctors in X, Y, Z don’t have a contract. Well, they’ll stitch you up or they’ll set your broken bone or they will take care of your bleeding —
SHANOOR SEERVAI: It’s an emergency.
DAVID BLUMENTHAL: That’s right. You have no choice. But then they will bill you. The insurance company has no contract with them, so the insurance company won’t pay. And the bill ends up in your mailbox. And those bills can be thousands of dollars.
That will also happen, let’s say you need to have your broken arm set and that requires surgery. Well, off you go to the operating room. The operating room is covered because you have a contract with the hospital. But let’s say the anesthesiologist and the radiologist don’t have a contract. Well, their bill ends up in your mailbox, too. More thousands of dollars.
And that is not acceptable to many legislators and to many people. And there’s a big controversy about that now in the United States Congress. And we’re right now in the midst of negotiations in the House and Senate about how to manage that. It’s not clear what’s going to happen.
SHANOOR SEERVAI: Right. And so we’re going to need policymakers to come up with some sort of resolution on that. And at the same time as policymakers are struggling with many of the difficult questions we’ve talked about today, there are some other actors who want to get on the health care stage. And those are technology companies. Again, this is not completely new in 2019 where there’s a desire from tech companies to revolutionize the way that people get health care. But what’s the latest going on in this space?
DAVID BLUMENTHAL: Yeah, so who knew that Google and Apple were health care providers?
SHANOOR SEERVAI: Who knew?
DAVID BLUMENTHAL: Yeah. Well, turns out they aren’t quite that yet, but they’re kind of edging up to it. And this is the story. Starting 10 years ago, the American health care system started getting wired. And pretty much every doctor in every hospital now uses electronic health records to record the history and physical exams and lab tests that patients have and encounter.
And it’s a vast source of information about what’s going on in care and what works and what doesn’t in care. And also just to keep track of it is a big job and one that hospitals and doctors need help with.
And so along come the big high-tech actors and say, “We’ve got lots of computing capacity. We’ve got computer science wizards. We can take this data and make it dance. We can tell you all kinds of things about your patients you didn’t know. You can use those to treat your patients better. We’ll find patterns, association between drugs and outcomes, things that work, things that don’t. We’ll find mistakes. We’ll finds ways you could improve. And we’ll also apply so-called artificial intelligence to give you new rules that you never thought you were going to see before. And we’ll also mine the entire scientific literature and make it available to your doctors and nurses in real time. And we will combine what we’re learning in China with what we’re learning here in the United States. Everything’s possible.”
And the local hospital can’t do that. They don’t have these technology wizards. They don’t — they can’t mix that data up and get all kinds of magic from it. So, they’re developing relationships with the Googles and the Apples and the Microsofts and the Facebooks of the world. And at some point, the data moves from the hospital and the doctor’s office into the so-called cloud, where these companies can manage it.
That has now happened with one of the world’s — country’s largest health care systems called Ascension. And the very large IT company called Google. Ascension has put its patients’ data in the Google cloud. And Google is promising to use that data to make Ascension’s care better and Ascension’s management better.
It makes a lot of sense.
SHANOOR SEERVAI: In theory.
DAVID BLUMENTHAL: In theory. But it’s causing a lot of people heartburn because people are not sure they trust Google to sit on their data, to keep it private. And the question is, is it even legal to share that data? It probably is legal under current privacy protections, but that doesn’t mean those privacy protections are what people now want because those privacy protections were created before the internet existed and before Google was even a gleam in anybody’s eye.
So, it’s a different world. And even though it may be legal from a privacy perspective, it may not be acceptable from a policy perspective. So, those issues are going to get hashed out. The upside potential is huge, to learn from this data about — how to be a better doctor or a better nurse or a better hospital. And we would all benefit from that. And as somebody who’s practiced medicine with the help of electronic record and with computer assistance to make me a better doctor, I have a lot of respect and hope that that that opportunity will the good for everybody. But it’s going to have to be managed in a way that makes people comfortable.
SHANOOR SEERVAI: That makes sense. Is there anything else that you think our listeners need to know, David?
DAVID BLUMENTHAL: No, I think that’s a lot for them to absorb just as it is. And you know, I think 2020 is going to be a very important year for health care. The results of the election will influence everybody’s life, whether they are aware of it or not.
SHANOOR SEERVAI: All right. And we should all keep our eyes on this space. But just to close, thank you so much for joining me today.
DAVID BLUMENTHAL: Thanks. Pleasure.
SHANOOR SEERVAI: Listeners, thank you so much for listening to The Dose this year. If you’re enjoying the podcast, leave us a review on iTunes or wherever you listen to your podcasts. And please tell your friends.
If there are topics in health care that you want to hear about in 2020, we want to hear from you. Send us an e-mail. Our address is [email protected]. Happy Holidays!
Guest: David Blumenthal, M.D.