A New Landscape for Health CareBoulder County Business Report

PULSE: What’s Next? Health Care Reform in the Boulder Valley November 12, 2013

Jandel T. Allen-Davis, MD

Vice President, Government and External RelationsKaiser Permanente, Colorado Region

Since the passage of the Affordable Care Act (ACA), America has been on a trajectory that will result in significant changes in how health care in America is delivered, experienced and financed. Even if none, some or all of the landmark legislation is changed or delayed in

implementation, we will not retreat to the health care system of old.

In this discussion, after reviewing many of the changes that have taken place in United States with the passage of the ACA, we will take a speculative look into the future, based on the current

status of health care in the US and in Colorado.

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Objectives

Name key components of the national health care reform that have some basis in current United States health care reform initiatives.

Identify 4 key strategies to control costs in the US health care system.

Articulate one potential scenario, should the public policy debate regarding health carereform change.

Fifth Agenda

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Health Care in America:

Since March 2010 the United States has been on a path to enact the Affordable Care Act. In this section, we will lay out the current status of health care in America: the cost, the coverage and the outcomes.

Perfect storm or perfect opportunity?

Economic Status

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United States economy

Unemployment: 7.2% (Colorado 7.0%) Living in Poverty: 46.5 million people

(15% of US population) Uninsured: 14.8% (National Health

Interview Survey Jan.-March 2013)

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Health Insurance Coverage, by type, 2010

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http://www.kff.org/insurance/snapshot/Employer-Health-Insurance-Costs-and-Worker-Compensation.cfm

Health Status

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Adult Obesity

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Childhood Obesity

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Diabetes

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Heart Disease Deaths

Health Care Costs

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Health Care Costs: Contributors

Aging of the population Changes in third party payment Personal income growth Health sector prices Administrative costs Defensive medicine and supplier-

induced demand Technology related changes in medical

practice

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Payment Reform Activity

Whether through insurance reforms, increasing access to coverage, or changing how care is delivered and by whom, many feel that the pace of increase in the cost of health care will not decelerate until we change how the system is organized and how providers are paid.

Insurance reforms help, changing care delivery cures!

Payment Reform Activity

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Payment Reform

Fee for service problems Modified arrangements Risk sharing arrangements and gain

sharing arrangements Global caps Bundled payments Quality bonuses

So, where are we headed?

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The Future of Health Care in America

In this section, we will explore some likely outcomes that will define how care and coverage will play out in the coming decades. We will cover topics such as Medicaid, Medicare, Health Insurance Exchanges, health insurance benefit design, health care status of Americans, delivery systems of the future and the role of information technology.

Some Likely Scenarios

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Looking Ahead

Medicaid Medicare Insurance Market

Limit coverage and benefits

More managed care

Accountable Care Organizations

Means testing: higher income people will have less access

Set the standards for care across the nation

Financial pressures

Fewer small players: mergers, acquisitions

Creative benefit designs

Explosion in individual coverage

Health Insurance Marketplaces (Exchanges): the bet

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Looking Ahead

Delivery System Providers Communities

Coordination of care, venue management, integration

Proliferation of electronic health records

More interoperability and transparency

Value equation: quality and efficiency

Larger multispecialty groups, fewer physician owned practices

Shift back to primary care as payment reform takes hold

Pay for value

Health status will continue to decline

Focus on community health

Built environment, disparities, “place matters”

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Looking Ahead

Patients Hospitals Employers

Self-efficacy

Self-care

Consumerism

Higher out of pocket expenses

Quality improvement activity

Physician-owned practices

Self-funding

Less Employer Sponsored Insurance

Focus on wellness

Productivity measurement will take hold

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Looking Ahead

Brokers/Consultants PPACA States

Will play increasing role in the individual market

Consolidation among the players

Navigators, Assisters, Health Coverage Guides

More delays in implementation possible

“The end of the beginning of health care reform.”

Continue to be learning labs

Exchanges will look more similar over time

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Looking Ahead

Federal and State Government

Financing health care coverage challenges will continue

New rules establish incentives to get most of the US population into the risk pool, standardize benefit design and pricing

State and federal regulators better positioned as referees over a leveled playing field

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We are at the beginning…

— The Lord of the RingsThe Old Walking Song sung by Bilbo Baggins, Chapter 'A

Long-Expected Party'.

The Road goes ever on and onDown from the door where it began,Now far ahead the Road has gone,

And I must follow if I can,Pursuing it with eager feet,

Until it joins some larger wayWhere many path and errands meet.

And whither then? I cannot say.

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We are at the beginning…

— The Lord of the RingsA Walking Song sung by Frodo, Sam and Pippin, as they

set off for Buckland, Chapter 'Three is Company'.

Still round the corner there may waitA new road or a secret gate,

And though we pass them by today,Tomorrow we may come this way

And take the hidden paths that runTowards the Moon or to the Sun.

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Thank you!