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Statement on the U.S. Supreme Court Health Reform Decision

June 28, 2012
9:18 am

The Supreme Court has upheld the Patient Protection and Affordable Care Act (PPACA).  We applaud the fact that mechanisms remain in place to bring millions of uninsured Americans into the health coverage system.  We shouldn’t lose sight of the fact, though, that the need to continue improving the quality and affordability of our healthcare system remains strong.

Expanding access to health insurance, while maintaining system stability and affordability for patients and consumers, requires broad public participation.  While the individual mandate has been deemed constitutional under Congress’s taxation powers, we continue to be concerned it may not be fully effective in encouraging sufficiently large numbers of healthy, uninsured Americans to purchase health coverage.  We urge Congress to consider supplementing the mandate with additional enrollment incentives.  Also, HLC will work to educate Americans about their coverage options and assist them in the enrollment process.

The Court’s decision notwithstanding, Congress must still address aspects of the health reform law that could undermine healthcare affordability, access, quality and innovation.  There is a bipartisan understanding, for example, that the Independent Payment Advisory Board exists only to cut payments to providers without regard to value, making it more difficult for seniors to receive medical care.  Medical device excise taxes will place obstacles in the way of new lifesaving innovations getting to patients while also removing jobs from our economy.

The goal of health reform is to ensure that every American has access to high-quality, innovative, affordable healthcare.  All health sectors are dynamically moving forward to deliver that care to patients and consumers.  Now policymakers must do their part to advance and remove impediments to this essential progress.

Beyond Thursday

June 26, 2012
12:03 pm

I don’t want to minimize the importance of Thursday’s forthcoming U.S. Supreme Court ruling on health reform.  There is a great deal at stake.  Particularly if the Court declares the individual health insurance mandate unconstitutional but leaves insurance reforms in place, Congress is faced with the responsibility of finding mechanisms to bring more healthy Americans into the health coverage system.

But, even though Washington, D.C. and every cable news network is consumed with what might happen on Thursday, it’s worth nothing that there are substantial healthcare challenges that will continue to exist regardless of what the Court decides.  And there are healthcare delivery reforms that are and will continue to be ongoing well after the Justices have their say.

These points were made clear over the past few days by two leading health industry CEOs, both members of the Healthcare Leadership Council.

In a conversation with Sarah Kliff of the Washington Post’s well-read WonkBlog, Aetna CEO Mark Bertolini said that the future of the healthcare system hinges far more on the industry’s ability to contain costs than it does on the Supreme Court decision.  His company is among those working on health delivery and payment structures that align reimbursement with quality and patient outcomes instead of quantity of services.

And in an interview with Bloomberg Television, Cleveland Clinic CEO Toby Cosgrove left no doubt that health providers are already implementing cost-effective, quality-driven reforms.  He also raised an issue that will continue to be an important one well after the Supreme Court announcement Thursday.  Dr. Cosgrove correctly pointed out that, in order to get costs under control, the nation needs to place a stronger emphasis on wellness and disease prevention.

To truly understand where American healthcare is going in the next few years, you’ll gain more from reading and watching these interviews than you will from following Thursday’s wall-to-wall cable TV court analyses.

A Good Vote and a Flawed Argument

June 08, 2012
9:18 am

The U.S. House of Representatives did the right thing yesterday in voting to repeal the excise tax on medical devices that is part of the Patient Protection and Affordable Care Act.  The vote came in solid bipartisan fashion, not a common occurrence on Capitol Hill these days.  The vote was 270-146 with 37 Democrats joining the majority.

It’s a sound move to kill a tax that will, according to studies, eliminate jobs in the United States.  (In fact, it’s already forced some medical device companies to begin laying off employees.) It will also undermine medical innovation.  Because it’s a tax on revenues, not profits, it will be particularly damaging for the many start-up companies that drive much of the innovation in this country.

Of course, it’s already been made clear by the U.S. Senate leadership that there are no plans to give the legislation a vote in that body.  As one Senator told Politico yesterday, “I hear from the medical device companies in my state and I tell them, ‘I don’t think this is a bad bargain for you.’  It will be more than offset by increased demand for your product.”

The Senator’s reference is to the greater number of people who will have health insurance under PPACA and, ostensibly, be purchasing more medical devices.  That argument, however, isn’t grounded in real-world circumstances.  In terms of volume, the most significant purchasers of medical devices are senior citizens, who are already covered by Medicare.  And many other medical devices are currently implanted by surgeons in the operating room, whether the patient has insurance or not.  The medical device field is not one brimming with elective purchases.

This vote takes place against a backdrop of declining public support for health reform.  A CBS News-New York Times poll this week showed that two-thirds of Americans want the Supreme Court to overturn all or part of PPACA.  Even if the law survives the Court challenge, implementation will be more successful if the public is accepting of health system changes.  A good start in building that public support would be rejecting the law’s most objectionable provisions.