Many factors fuel rising health care costs, but consumers have the power to begin changing the tide.
Friday, October 11, 2013
Zane, who is CEO Emeritus of Tufts Medical Center, addressed the Friends of Lesley and other members of the community in Marran Theater on Lesley’s Doble Campus on Wednesday evening, followed by a Q&A and reception. Lesley University President Joseph Moore and Trustee Barbara Russell, who is a Lesley alumna and Zane’s sister, welcomed the large audience.
During her talk, Zane revisited health care reform in Massachusetts and its implications for the national model, and she categorized and explained what she identifies as the five main drivers of health care costs: providers, insurance companies, the business community, consumers and government.
Zane described herself as “an equal opportunity offender” as she delved into the complicity of all the different cost drivers, and predicted big changes in the near future in the way medical care is provided and consumed in this country.
She gave the example of Massachusetts insurance companies, which take 10 cents off every dollar for overhead that is used to build up bigger reserves than they need, and then used to expand into new territories and states and “lowball” businesses to buy their plans, she said.
“They use those reserves that they’ve collected off your premiums in Massachusetts. I think that’s a little bit scam-like, and the fact is, it adds to your cost of care,” explained Zane, who serves as Vice Chair of the Board of Trustees at Tufts Medical Center and is on the faculty of the Tufts University School of Medicine.
“From the insurance side, it is time for us to put a spotlight on that 10 cents on every dollar,” she continued. “We believe, in Massachusetts, we could have insured all the uninsured by the savings on just the administrative overhead. That’s not to take away from the fact that providers own some of the problem, but it doesn’t absolve the insurance industry from owning some of the problem.”
She faulted providers for an enormous variation in the way care is provided, particularly as it relates to chronic diseases such as diabetes; and she believes fancy medical technologies are pricy but data have shown they don’t necessarily improve outcomes.
Zane urged individuals to be better consumers and more discriminating about the cost of their care, and she provided an example: “If you have an MRI at a major academic medical center, it will cost more than if you have an MRI at a community hospital, which will cost more than if you have an MRI at a freestanding MRI clinic.
“There is a tremendous amount of data in Massachusetts to show that simply paying more has zero correlation to quality,” she noted.
Zane predicts the business community will soon make a major shift in the way they provide health insurance to their employees by discontinuing to manage health care plans, and instead, giving each employee a set amount to buy their own insurance on the virtual marketplace.
“We are very spoiled here. We are very used to having access, and we are very used to going where we want, when we want, and we don’t want to pay anything for it, and that just isn’t going to happen anymore,” said Zane.
“I’m from Massachusetts, and I’ve seen the future”
Zane supports the so-called individual mandate, that all Americans must have health insurance, because it’s the only way the system will work, she says.
”My view isn’t about ideology on the right or left; it’s about math,” said Zane. “Without young healthy people in the insurance pool, all we will have is older sicker people in the insurance pool, and that will cost all of us more in the long run.”
In her speeches to audiences from around the country, Zane often says, “I’m from Massachusetts, and I’ve seen the future,” referring to health care reform, passed in the Commonwealth in 2006.
Zane lauded Massachusetts’ work to get all its residents insured, which set the stage for the national model, “but we have to be honest about how we pay for it.”
She said the state didn’t have enough money to make health care accessible to everyone, so the state dipped into the Medicaid contract, which reduced Medicaid reimbursements to all hospitals and doctors in Massachusetts.
“Tufts Medical Center got about 72 cents on the dollar for everybody we served on Medicaid, and lost 28 cents on the dollar,” she remarked. “Who paid for that? You did. Insurance has to pay more to make up for what the state didn't pay.”
“After health care reform, that reimbursement dropped from 72 cents on the dollar to 60 cents on the dollar,” she said.
Zane said Obamacare will shake out similarly.
“The theory is we will insure 30 million more Americans. How will we do that?” Zane posed. “We will pay for it the exact same way the state of Massachusetts did, and instead of opening up Medicaid contracts, we’ll open up our Medicare contracts on the federal level and reduce payments to doctors and hospitals.
“That’s just a fact. It is just not more intellectually complex than that.”
The good news, she said, is that the Affordable Care Act is a step in the right direction and will get every citizen a dedicated primary care physician, as opposed to obtaining emergency care, which is the least efficient and most expensive form of medical care.
And while it’s being met with resistance now, Zane predicts public opinion will shift dramatically in the next year or two in favor of it.
“I think very soon people will say, ‘Don’t go near my health care,’” she forecasted.
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