In Part II of our Q&A interview with the CEO of Boston's Beth Israel Deaconess Medical Center, Paul Levy shares how Massachusetts' mandatory insurance coverage law has impacted his institution, and his thoughts on how healthcare reform should play out at the national level.
FierceHealthcare: Do you have a prediction, or even a personal preference, as to what type of insurance model is going to work?
Paul Levy: The approach we're using in Massachusetts which, I think works pretty well, basically requires people to have insurance--in other words, there's a personal mandate that you have to have insurance, and then the state has created an insurance exchange. The insurance companies in the state have to live by the rules of that exchange and provide the insurance coverage, and then subsidies exist for the lower income people. I think that's a pretty practical way to do it.
The Netherlands has a similar kind of approach where there's a requirement to have insurance, insurers are required to take anybody who wants insurance, and they use the private companies to do that. The alternative approach is to have a public option alongside those private insurers. I don't personally favor that one, because I think the other one can work as effectively, if not more so.
FH: From your comments, I take it that directly government-funded schemes--like a Medicare for all, or even single-payer--are not something that you favor?
PL: That's right. I don't like the idea, just personally, of the government controlling the broad base of health insurance in the country. I recognize that it does so with regard to Medicare--that's a particular population group--but I think for the broad base of the population, I'd prefer to rely on the private markets to do that.
FH: What effect has the Massachusetts reform scheme had on your institution?
PL: It has had very little effect. It's re-categorized some people who used to be free-care patients, to now being on an insurance plan. Financially for the hospitals, it has had very little effect because we used to get some payment through the free-care system to pay for the free-care patients, and now we get some payment through the insurance system to pay for those same patients. So overall, I think it hasn't had a big effect on the hospitals, generally.
FH: But that might not be the case in other states where, perhaps, there's not a free-care fund of any substance?
PL: That could be, but I'm not that familiar with other states. The thing with legislation is, there are always unintended consequences. I've always thought that you shouldn't make major global changes in this field. You should work on the edges and make incremental changes. But that's my personal view about how public policy should be done.
FH: Are there any issues in your mind that are so hot right now that incremental change won't do the job?
PL: I think the answer there lies with the public, and what their concerns are. I think people who currently have insurance are mainly worried about what happens if they change their job or lose their job, or if they have a pre-existing condition and they have to change insurance companies. That's why I think changing the overall regulatory scheme around insurance companies is important. The second thing is, there should be some system in place where everybody can have insurance. To me, those are the two major things, and I would focus on those.
FH: What impact--again, if any--do you think changes like mandated insurance coverage would have in a facility? It sounds like you're saying probably none at all.
PL: In our case, we're kind of ahead of the curve in Massachusetts. A lot of those changes have already happened here, so the question is, to what extent can they happen elsewhere, and be done in a way that doesn't have unintended consequences.
FH: Have there been observable, unintended consequences in Massachusetts? For example, one of your local daily newspapers reports that the wait for a primary-care doctor in the Boston metro area has jumped.
PL: I don't know if that's true. I've read stories in both directions. I just don't know.
FH: In your opinion, do you see any areas in which a system, other than in a primary-care capacity, may have trouble absorbing ranks of newly insured. Are there any other stress points you're anticipating?
PL: I haven't seen real stress points here, no. Remember, we had a very small percentage of the population who did not have insurance. There are other states that have a bigger percentage. So it may be different.
FH: Have you seen people who are not acutely sick appearing in your EDs?
PL: That's always been the case. And it's not clear how much of that has been related to having insurance versus not having insurance. I'm not sure I can really give you a complete answer to the cause of that. I'm not sure if there’s been an increase or a decrease. I think it varies, and if there is an increase or decrease, it's also hard to quantify the reasons. Sometimes it's because people actually have insurance, but they've been going to a primary-care doctor who says 'Go to the emergency room.'
FH: One question about Massachusetts: What are the unintended consequences of perhaps the market reactions to the mandated coverage issue? While people with, say, chronic illnesses can still get insurance, but there will be traps billed into the insurance that still make it very hard to use and the insurance companies will still win, somehow in terms of denying care, just in a different way.
PL: You do need to regulate the companies to ensure you don't get unintended consequences. There's a question there as to what extent the federal government is willing to take over that regulatory function from the states. That's an issue that Congress has to deal with.
FH: Do you think systematic health reform is really needed?
PL: Well, the use of the word reform is always problematic because one person's reform is one person's reverse. I think what's really needed is a movement to provide as many people as possible with insurance so they can get access to preventative care and primary care and the like. That kind of change, in terms of insurance coverage, I think has to occur at a national level.
There are a few parts of this that would be helpful. One, which I believe is in almost every bill that's been proposed so far, is changes in the rules so that insurance companies cannot deny coverage to people because of pre-existing conditions, and other provisions like that which make it difficult to get insurance. That does take a change in national law, because right now the insurance industry is regulated in several states, and there's wide variation in those rules.
For example, insurance companies in Massachusetts are not allowed to use pre-existing conditions as an exclusion. I'm hard-pressed to find anyone who disagrees with that kind of regulatory change, and I'm hoping that that survives all of these different bills.
The next question is, how do you provide insurance to all members of a population? And here, obviously, you have to make it available, but also, a large number of people can't afford it. So some kind of subsidy is required. This gets to the nub of the problem in Washington, which is that if you provide a subsidy to one group of people, someone has to pay for that. And the forum--how that payment takes place--is a major political fight, because when you are creating a new subsidy, you're taking money away from some other group in some other way. That's a traditional political problem that Congress and the president have to face--what's the best way to finance a national mandate?
A lot of the discussion in Washington right now is about that issue. The degree to which Congress is willing to do some kind of broad-based tax is directly correlated to the degree in which they want to provide a subsidy; which is to say, the more subsidies you offer, the more money you have to raise, and the more money you have to raise, the broader the tax vehicle. If you have a very narrow tax plan, it can't raise as much money as you otherwise would want. That, I view as the major political battle going on in Washington right now, and I think it's one that will be hard to work out.
FH: What do you think would happen if the entire souffle of health reform collapsed, and nothing changed?
PL: It's inconceivable that that would happen. Something will pass, and the world will be better for it.
Interview by Anne Zieger, senior editor, FierceHealthcare and FierceHealthFinance.