Let's talk a little about the ACA.
You might say the Affordable Care Act, Patient Protection and Affordable Care Act
of 2009, well, isn't that very dramatic health reform legislation?
At many levels, it is.
It's the first federal law that simultaneously regulates
health insurance, and healthcare services, and health, which is related to,
but distinct from medical care.
How did the ACA overcome these obstacles?
These fiscal and interest group and rationing related obstacles
that had prevented the Clinton reforms and a series of
other proposals throughout the decades for being taken seriously?
Well, the ACA comes right after the Great Recession of the mid 2000's.
And that Great Recession came with - brought with it, a federal commitment
to stimulus funding, that made health reform fiscally palatable.
Not fiscally welcomed, still subject to a number of restrictions, but possible.
The ACA also appeased the interest groups,
pertained managed competition frame, a major role for private insurance
companies, a guarantee of additional business for American hospitals, and
to a lesser extent, American physicians, and, the ACA was forced
to renounce rationing.
To pledge no death panels, something that really should never have been taken
seriously to begin with,
but also to limit the way in which the study of healthcare delivery,
the process improvement commitments within the ACA could actually be applied
to individual entitlements to coverage for particular services.
And the most dramatic innovation in the ACA, something that was called the
Independent Payment Advisory Board, might have actually attached direct
consequences to continued high growth in healthcare expenditure,
was never chartered, never constituted, never met,
and was ultimately repealed.
So, um, timing, where stimulus allowed fiscal palatablity, appeasing the
interest groups, and renouncing rationing, managed to let the ACA thread the needle,
and expand healthcare entitlements.
But something else is going on here.
Having a law that combines health insurance regulation, health service
regulation, and health, is extremely ambitious.
It could only be that ambitious if there actually had been some new insights
into American healthcare that justified the ambition.
And let me talk about a couple.
First let me talk about what we have learned about our system
that brings us from health reform based on rationing,
to health reform based on improvement.
The entire program that you're a part of is a program about transforming and
improving the healthcare system.
Getting value out of healthcare delivery.
Value was not a word attached to health reform in the 1990s.
When in 1994, a young management consultant and McKenzie and I
volunteered as healthcare advisers for a California gubernatorial candidate,
we decided that her platform in healthcare should be around value.
Her policy adviser, also our age, now a very prominent media executive
took us aside and put hands on our shoulders, and kind of laughed at us
and said "Nobody thinks about value in healthcare. Certainly not if you're
a Democrat. Think about access, think about quality, don't think about value."
Well, today we think about value.
Not only Republican candidates think about value, Democrat candidates think
about value, and nonpartisan policy processes focus on value.
That only happens because we've actually re-framed
the core of the health policy debate.
When I learned basic health policy, and still if you learn health policy today,
you describe a healthcare system typically around three parameters.
And you all know what they are. Access, and Quality, and Cost.
And you think about these descriptors not just as legs of a stool,
but as legs that need to be of roughly equal length.
Which means that in order for the stool to balance and the system to work,
you have to have the right amount of access, and the right amount of
quality, and the right level of cost.
And implicit in this cost-access-quality frame, is the notion that
our current system is in equipoise.
And so there's a book that was written in 1994.
I could argue that it was actually, you know, outdated by the time it was
published, but it was written by one of the great figures in physican
policymaking of the 1960s and 1970s, a physician named Dr. William Kissick
who spent much of his teaching career at the University of Pennsylvania, but
who was also present at many of the formative moments of
American health policy.
With Luther Terry regulating tobacco at the passage of Medicare, and
you know, with federal reform throughout the succeeding couple of decades.
In 1994, Dr. Kissick wrote a book called "Medicine's Dilemmas: Definite Needs,
Versus Finite Resources."
And this captured the thinking of 1993, 1994.
No society in the world, Dr. Kissick wrote, has ever been, or will ever be
able to afford providing all the health services
its population is capable of utilizing.
This means that if you want higher quality healthcare,
you're going to need to make it less accessible,
or it will become more costly.
If you want more accessible healthcare, you have to suffer an increase in cost
or a decrease in quality.
If you want less costly healthcare, you have to sacrifice either access or quality
or both. That world of cost, access, and quality, is the world that brought
fewer rationing into the national health policy debate,
but empirically, it's not the world we're in today.
And many of the things you'll be studying and have studied in this course
confirm that.
The IOM identified in 2010 dollars, 750 billion dollars a year of healthcare
spending that was wasted.
That number is probably close to double, today.
Probably close to 1.5 trillion dollars each year, is wasted,
gets wasted on services that are unnecessary, services that are
inefficiently delivered, excess administrative costs, missed prevention
opportunities, fraud, and a very large category of mispriced services.
Services that are simply priced much higher than a functioning market for
that service should charge.
And this is the frame within which healthcare reform exists today.
We've gone from feeling constrained by rationing to pursuing improvement.
And that is extremely liberating.
We may have reasons to ration certain services, and that rationing would still
have to be done ethically. But we have actually learned from twenty five years
of research, that our current system is not in equipoise, waiting for the next
technology to challenge the affordability of the system.
It is instead performing quite poorly, and is ripe for general improvement.
The ACA managed to thread the needle, fiscal palatability,
overcoming fears of rationing, appeasing interest groups.
And it managed to assert a role for health system improvement.
A role for improving efficiency and improving fairness in the system.
But, it still did it in a very pragmatic way.
And for me, the best indication of this was the brief set of remarks that
President Obama gave in the summer of 2015.
The occasion he was marking was the Supreme Court upholding the ACA
for the second time.
It had upheld the ACA against constitutional challenges in 2012
in the case of NFIB versus Sebelius,
and in June 2015, it upheld the law against statutory
challenges, issues of statutory interpretation,
in a case called King versus Burwell.
And President Obama celebrated this in the Rose Garden, but he did
it in a way, that is, I think, very important.
He acknowledged that the ACA really has a limited vision.
It never had the courage to assert explicitly, social solidarity and a
public commitment, but instead it satisfied itself with improving the
consumer experience of care.
And President Obama said the following.
He said "Unlike Social Security or Medicare, a lot of Americans still don't
know what Obamacare is, beyond all the political noise in Washington.
Across the country, there remain people who are directly benefiting from
the law but don't even know it.
And that's okay," Said President Obama.
"There's no card that says "Obamacare", when you enroll, but that's by design,
for this has never been a government takeover of healthcare,
despite cries to the contrary."
And understand here, that he's talking about the fears of rationing.
He's talking about the interest group opposition to quote "socialized" medicine.
But he goes on to say,
"This reform remains what it's always been.
A set of fairer rules and tougher protections that have made healthcare
in America more affordable, more attainable, and more about you,
the consumer, the American people."
This is significant.
Equating consumers to citizens, is in some sense, the best that
America achieved in the post-Medicare period.
Other countries have public solidarity, other countries have a collective
commitment. The U.S. at best, has consumerism around healthcare.
And I like to say, kind of contrary to President Obama's assertion,
that the law should have named its program of health insurance.
There should have been a card, there should have been a collective
commitment, but that card and that collective commitment
shouldn't have been towards something named after
President Obama, largely by his opponents, but it should have
been something that we all should care about.
And so I've often sort of written that what we needed was not
Obamacare, we needed Americare.
We needed a patriotic symbol, we needed a source of solidarity,
and that's what, even best case, we failed to get in America.