November 2, 2009

Johns Hopkins Medicine and the health care debate

While concepts for health care reform volley back and forth in Washington, D.C., and around the nation, Johns Hopkins has quietly but meaningfully injected itself into the debate.

Johns Hopkins Medicine has been working with a group of 12 academic medical centers to explain the key role of these institutions in the delivery of health care to millions of Americans.

The group —which includes Emory University, Mount Sinai Medical Center, UCSF Medical Center, the University of Pennsylvania and others—is focusing on a number of issues, including a proposal to create “Health Care Innovation Zones” that would offer support for providers working with stakeholders in their regions to redesign a more patient-centered delivery of health care.

Since last spring, Johns Hopkins Medicine executives have met with a large number of White House officials and members of Congress and their staffs to make their views known.

Edward D. Miller, dean of the medical faculty and CEO of Johns Hopkins Medicine, and Ronald R. Peterson, president of The Johns Hopkins Hospital and Health System, have kept close tabs on the health care debate and say they worry that it’s missing the two most important targets: workforce issues and delivery systems. The two leaders, who have spoken publicly on the subject in a variety of news outlets, say they believe that having more people insured is a good start but that incentives in the current payment system need to be changed.

Miller and Peterson recently sat down with The Gazette to discuss Johns Hopkins’ role in the debate and the future of medicine in America.

Why should Johns Hopkins play a role in the health care reform debate?

Miller: I really think our role should be to help form the policy. I know that is a pretty audacious thing to say, but if we’re not at the table, we are not going to be able to clearly articulate what we think are the important things to address. We take care of a disproportionate number of the poor. We are responsible for training the next generation of people who deliver health care in the broadest sense—doctors, administrators, nurses and those in public health.

I also think that it’s important to recognize the health care payment system. If it’s disrupted, it could bring institutions like this under great financial distress, and that has a huge impact on our community. Not just the community here but also the whole state of Maryland.

Peterson: If you listen carefully to the debate in Washington, it’s labeled health care reform. But if you think about what you have read or heard, it’s largely about health care insurance reform. It’s really been a discussion on how to deal with coverage for people and how we are going to pay for that. There has been very little discussion on what we would categorize as health care delivery reform.

I think what Dr. Miller is suggesting is that we need to be involved in the conversation because we need to emphasize the importance of introducing that thought of a health care delivery model and the workforce needed. Just think if you had tens of millions more people who are covered. Now you’ve created demand, but you have not necessarily created capacity: the supply to service that demand. And that is what we have been talking to people about.

How would you refocus the debate?

Miller: The president says the current system is broken. Well, the current system is broken because of the way the dollars are allocated for the delivery of health care. Namely, it is still a fee-for-service business. You are not going to really fix the system until you take a look at a different way to pay for the health care that you deliver.

Peterson: There is no incentive for a doctor to necessarily spend a lot of time and attention keeping patients well because that doctor is getting paid in the fee-for-service model. We believe there is something to be said for looking at a model that would give incentives for the providers of health care to keep people well as long as possible and be thoughtful for what they do when they introduce the patient into the health care delivery system.

Do such models exist?

Peterson: We have experience with two major programs where we have responsibility for whole populations. For example, we co-sponsor a Medicaid managed care organization called Priority Partners. Within that context, we receive from the state’s Department of Health and Mental Hygiene a monthly payment for each member that is enrolled. There are upwards of 150,000 individuals in the program. Along with that payment is the expectation that we will take care of all their health care needs. That has caused us to think about what we should be doing on behalf of those patients, and what we think is in our own best financial interests as well. It has caused us to pay more attention to prevention and to think about where are the most appropriate places to care for the patient when they need access to service.

Like what Dr. Miller is saying, you should have more incentive alignment between payer and provider. This population model causes us to think about how to do it more cost-effectively, but also how to do what is right medically and what is in the best interest of the patient.

[Editor’s note: The other major program that Johns Hopkins manages is the Maryland division of the Department of Defense’s Uniformed Services Family Health Plan, a health care program serving active-duty dependents, retirees, their families, survivors and certain former spouses worldwide.]

Is reform happening too fast or too slow?

Miller: Number one, you are dealing with one-sixth of the U.S. economy. We don’t think you can turn this thing upside down overnight. When we got into this managed care business, we had to learn. It’s an incremental learning curve. We think that anything that has to happen should be [in] incremental changes, not great big gulps, so to speak.

Peterson: We lost money for the first several years when we took on these managed care responsibilities. And as we learned to manage them, over time we did much better.

Something else to consider: In the past year, Maryland has changed the eligibility requirements for medical assistance, and so, many more people came into the system. We have taken about 30,000 more people. What happens when they first enroll is that they start to consume services. These folks seek out care because they never had access to a primary care doctor before. In a microcosm, it sort of gives you a taste of what could happen if the federal government extends in a big way coverage to large numbers of people.

The point is, we think that based on what we’ve seen, and what the state of Massachusetts has seen, it would be very wise for the federal government to introduce this in some reasonable increments. It is imperative that you balance the ability to ratchet up the capacity of the supply side with the demand you are creating.

This seems to all go back to the point that you want to share what has worked, and what hasn’t.

Miller: If we can identify the 5 [percent] to 10 percent of people who are really sick, because a lot of people are really healthy, and put measures in place to help those who are sick, that is where you can get some real value. We now have the largest primary health care network in Maryland. We have built that over time. If you go back to President Obama’s premise that we need to flatten the cost curve, we think we have experience here—that others can perhaps learn from what we have learned the hard way.

We also think that what we do in the Baltimore region is going to be different from what we do in Seattle or Chicago or San Diego. So there have to be areas of the country where there are experiments of how best to manage populations. For example, we deal with a lot of inner city poor people. In Iowa, you are dealing with more rural populations. Maybe you invest in telemedicine out there because you are dealing with such long distances.

Peterson: Let me be explicit about one thing. We need to be at the table because there is a lot at stake here for us. What I mean by that is that left to the government’s own devices, without some sensitivity to some of these issues, we can find ourselves with some unintended consequences that could be very harmful.

For example, it would be dire if there wasn’t sensitivity to the fact that we need to have dollars for a reimbursement system for graduate medical education. Again, the correlation here is that if you are going to increase the number of people who are going to be served, you need to pay attention to the fact we need to produce the doctors and other health care workers to provide that care. It’s terribly important for us to be able to articulate these things because it’s in our self-interest—but it’s also in the interest of the country more broadly.

How did the group of 12 academic medical centers convene?

Miller: Dr. Mike Johns, who had previously been dean, and I thought that these very large academic health care centers needed to get together on the health care reform issue since their voice was not being heard. I called up people. We got folks at the University of Pennsylvania School of Medicine, and then we started to see who else should be involved.

Is the group able to speak with one voice?

Miller: We try. We are not always together on all the issues. For example, there is the issue of congressional oversight of Medicare reimbursement rates. Some say we need a body outside congressional control that would report to the president and in turn to the secretary of health and human services. I would say that two-thirds of the group are opposed to the concept. I don’t think it’s a bad idea.

My view is that if we don’t get this thing under control at a certain point, we are really going to get in trouble. Medicare is close to insolvency by 2017 by everyone’s calculations, but I think, more importantly, the health of the economy will be severely damaged. We can’t compete with foreign companies if our health care insurance rates are so high that the employer is paying 40 percent of a worker’s health care costs or, if conversely, we have an uninsured workforce.

Just look at a family; they can’t be paying $30,000 a year for health insurance. They just can’t afford that. Wages have been flat for the past five years. So we have to get this under control, and it’s much better to do it in a thoughtful, proactive way than to come to the proverbial edge of the cliff and then just fall off.

What about the danger in doing nothing?

Peterson: I think there is a great danger in doing nothing. I think you will continue with this unsustainable growth rate in the cost of health care, and that burden cannot continue to be borne by employers, so they will continue to engage in cost shifting. We can’t continue to do that.

Second, we see evidence every day in our Emergency Department of the danger of doing nothing. A significant amount of people that we are caring for do not have health care insurance, and one of the major problems with that is that they are coming to us sometimes after the disease has progressed much further than need be, and it’s more costly to them and their well-being. And it’s going to be more costly for us and society more broadly.

Can Johns Hopkins speak with a unified voice?

Peterson: Within Johns Hopkins Medicine, we don’t always agree on every little thing, but I feel we have done a very good job of articulating a sense of principles that we have worked on collaboratively.

Miller: We try to articulate high-level broad principles that we think are terribly important for research-intensive academic medical centers. We also try to be responsible for articulating some thoughts that we think are good for society at large.

Another very important point is that we are much closer to the patient than anybody else and kind of look at it from a patient’s perspective. What would be the best thing for them? And what is best for them in the long run is to live a healthier life with as few health care interventions as possible. We at Johns Hopkins know how to make that happen.

For more on Johns Hopkins Medicine’s involvement in this topic, visit JHM’s Perspectives on the Health Care Debate Web site .