The Private Sector

1
The Private Sector

• Providing the Public Good
• of Health Care
• by
• Sue Tolleson-Rinehart, Sheila T. Leatherman, and
  Kathleen N. Lohr
• A presentation to the
• American Politics Research Group
• 31 January 2003

2
Acknowledgments

• The authors time to develop this essay was
  supported by a Vice Presidential Award from the
  Robert Wood Johnson Foundation (grant no. 042467,
  Leatherman, PI).
• We thank Ms. Starr L. Nicely and Ms. Sara E.
  Massie for their excellent research assistance.
• Earlier versions of the present discussion were
  presented at the 2002 Midwest Political Science
  Association Annual Meeting, and in mss currently
  under review.

3
The Status Quo

• The Institute of Medicine (IOM) says the health
  care system is broken this unusually strong
  language reflects a growing sense that the health
  care system is now imperiled in its ability to
  deliver care that is
• Consistently high in quality
• Equitable, available, and timely
• Safe, effective, and ethical
• While the system is, at the same time, riding
  the tiger of unplanned growth in the care that
  is possible through emerging new therapeutics and
  procedures, and thought to be necessary for a
  population replete with treatable chronic and
  acute conditions.

4
The Public Climate

• Managed Care, for good or ill, was reviled by the
  public and elected officials alike death by a
  thousand anecdotes. But it was at least in
  principle a defensible means of coordinating care
  while rationalizing costs, and it was a genuine
  departure from the classic risk indemnity model
  of insurance. In its wake, no one wants to pay
  for what must replace some notion of managing
  care. For instance, in January 2003, 28,000 GE
  workers staged the first strike against the
  company in five decades over only 300-400
  annual increases in their out-of-pocket costs.
  Without letting GE and its stockholders off the
  hook, did GE workers pick the right battle?
• We talk about and expect health insurance, as
  if we are insuring against the risk of ever
  needing health care, the way we insure against
  the risk of fire or theft. But the need for
  health care is a certainty a benefit -- not a
  hazard against which we can insure ourselves.
  And yet we are reluctant to talk about or plan
  for all the necessary choices (including ethical
  ones) that the availability of care engenders.
  Reinhardt among others says that all we do seem
  to want is all the health care that we and our
  doctors can possibly imagine, for free no tax
  increases, no out-of-pocket payments, just by
  magic while all the health sectors managers
  think first of all about the bottom line.

5
The status quo wont work

• We say that without an EXPLICIT consensus that
  the delivery of health care is a part of the
  delivery of the public good, or the General
  Welfare, we cant find lasting, systemic
  solutions to any of these problems of the
  politics of health care the politics of
  providing high quality health care to all.
• And make no mistake this IS about the politics,
  and not the economics, of health carebecause it
  is about hard choices that we as a system have so
  far been unwilling to confront -- our discourse
  must engage the politics of health care, not just
  the economics of it!

6
What WILL work?

• The nation must have a robust, persuasive,
  accessible, and applicable conceptual framework
  for supporting the private sectors understanding
  of its special mission to deliver the public good
  of health care
• The business case for quality, performance
  improvement, and effectiveness are already
  prevalent themes in the private health sector,
  but they have not yet been explicitly conflated
  with the public good
• This is lots easier said than done!!

7
Conceptual Framing Tasks

• Delivering a concise, clear-eyed picture of the
  nature of the real health system
• Making the framework persuasive and usable for a
  diverse collection of audiences
• Validating the framework
• Distilling genuinely transformational strategies

8
The Clear-Eyed Picture

• Perceptions
• Cost and Access
• Quality
• Politics

9
Clear-eyed Picture Perceptions

• Health care is widely viewed as consumer
  product delivered in a competitive private
  marketplace, and the public rather adamantly says
  that it does not want big government delivering
  it.
• Despite this, since WWII, health care is more and
  more viewed as our right that is, we dont
  really think that health care is just like
  widgets, just another consumer commodity (Arrow
  cit in notes view said health care delivery was
  not widgets back in 1963, but he was thinking of
  the inability to achieve Pareto
  optimality/distribute risk and predictability,
  and the moral hazardsof it we would argue that
  the public differentiates health care from
  widgets for other reasons even if they cant
  articulate them).
• The U.S. differs significantly from other western
  postindustrial nations, not so much in the mix of
  publicly v. privately provided health care, but
  in ideology and orientation our comparators
  more explicitly recognize health care as a part
  of the public good, and in which citizens are
  perhaps more likely to think of the communitys
  good, as well as about their own care.
• As the public health sector is growing in the
  U.S., the private sectors are growing in our
  western comparators, so the simple private v.
  public frame is probably inadequate across the
  board in either place and all places struggle
  with providing high quality care to the greatest
  number while controlling costs.

10
Clear-Eyed Picture Cost and Access

• Annual expenditures of gt 5000/person leading
  the world. Unless something changes drastically,
  and soon, health care expenditures will consume
  16 of GDP by 2010 that would be 2.6
  trillion/year
• This enormous expenditure is not accompanied by
  the lifespan, health status, or quality of life
  improvements that you might expect
• All employers (who offer health insurance) once
  again facing double-digit increases in premiums
• Much variation in care (and expenditures for it)
  is not explained by differences in patient
  populations

11
Cost and Access, continued

• Employer-sponsored premiums now exceed 7000/year
  for family coverage
• -- and this is for people who HAVE insurance!
• 46 million people in working families uninsured
  24.3 of the population of nonelderly families
  with wage earners. Their options?
• Some may be eligible for some public programs
  such as SCHIP
• Some may purchase insurance privately, at avg
  cost of 2000-4000/year for individuals
• The plurality or majority? simply do without
  coverage

12
Clear-Eyed Picture Quality of Care

• Quality of Care is the degree to which health
  services for individuals and populations
  increased the likelihood of desired health
  outcomes and are consistent with current
  professional knowledge (IOM 1990 21). It is
  often categorized (Chassin et al. 1998) in terms
  of
• Underuse -- the failure to provide a health care
  service when it would have produced a favorable
  outcome for a patient
• Overuse when a health care service is provided
  under circumstances in which its potential for
  harm exceeds the possible benefit or
• Misuse when an appropriate service has been
  selected but a preventable complication occurs
  and the patient does not receive the full
  potential benefit of the service (these are the
  ones we hear the most about, because this
  category INCLUDES but is not limited to errors,
  or the avoidable complications of surgery or
  medication use)
• and it can also be measured in terms of the
  degree to which quality of care contributes to
• Patient satisfaction or patient experience of
  care, and
• Health status and health-related quality of life

13
Quality of Care, continued

• Recently, the IOM has said that the goal of the
  health system is to continually reduce the
  burden of illness, injury, and disability, and to
  improve the health and functioning of the people
  of the U.S, and it has illustrated the quality
  of care definition by saying that the components
  of quality are safety, effectiveness,
  patient-centeredness, and timeliness (IOM 2000
  2001).
• The U.S. system is self-critical about, and is
  criticized by the rest of the world for,
  appearing not to achieve the level of quality of
  care one would expect given our level of
  expenditures (Leatherman and McCarthy 2002 WHO
  2000)
• The controversial WHO report ranked the U.S. 1st
  in responsiveness but 54th in fairness, for
  example, and it ranked the U.S. 37th in the world
  on its much-debated overall Health System
  Performance index
• Weve shown impressive improvements in things
  like immunization and cancer screening rates, but
  are still overusing antibiotics and underusing
  beta blockers and thrombolytics, to provide some
  common examples
• At the same time, trust in the health care system
  is suffering declines similar to those found in
  trust of other institutions/sectors a new
  phenomenon

14
Clear-Eyed Picture Politics

• DIRECT public subsidy of health care Medicare,
  Medicaid, SCHIP, VA Health System, payments to
  teaching hospitals, etc INDIRECT public
  subsidy, via tax incentives to private employers
  to subsidize health insurance a health care
  system that is 60 public/40 private
  (Woolhandler and Himmmelstein 2002) clearly,
  public and private are inextricable.
• The U.S. private sector is large, wealthy, and
  politically effective (one example PhRMAs
  underwriting of United Seniors Association as a
  527 group for the purpose of lobbying against
  prescription drug benefit and supporting GOP
  congressional candidates in 2002)
• The U.S. public sector, especially Medicare and
  health benefits for veterans, is, if troubled, at
  least still perceived as legitimate (SCHIP is too
  new to have established itself broadly in public
  opinion, and Medicaid probably shares the public
  skepticism with which welfare is viewed)
• Given these, it is probably counterproductive to
  go on framing the debate as one of choosing
  between a fully private or a fully nationalized
  health system we will go on with our blended
  public/private hybrid for the foreseeable future
  (though that does not mean that we wont move to
  some kind of hybrid single-payer system)

15
Conceptual Framing Tasks

• Delivering a concise, clear-eyed picture of the
  nature of the real health system
• Making the framework persuasive and usable for a
  diverse collection of audiences
• Validating the framework
• Promoting genuinely transformational strategies

16
Persuasiveness and Usefulness

• The framework must
• be useful to
• Health sector executives
• Payers
• Policymakers
• The public

• The framework must
• be
• Innovative
• Coherent -- intelligible
• Practical
• Motivating and sustaining

17
Conceptual Framing Tasks

• Delivering a concise, clear-eyed picture of the
  nature of the real health system
• Making the framework persuasive and usable for a
  diverse collection of audiences
• Validating the framework
• Promoting genuinely transformational strategies

18
Validating the Framework

• Turning to the experience of other sectors where
  the system has induced/coerced private entities
  to deliver the public good --
• Education
• Energy
• Finance
• Transportation
• Conducting a Systematic Review of the literature
  on such interventions in the health care sector
  as well as in these other sectors to support the
  delivery of the public good in health care and
  the other sectors
• see some bounding definitions on next slide

19
Some Definitions

• Systematic Reviews are rigorous, highly
  structured reviews of the literature, upon which
  qualitative and quantitative analyses of the
  reviews findings are meant to establish
  authoritative conclusions about the efficacy and
  effectiveness of a given intervention, along with
  a thorough depiction of the interventions
  benefits (outcomes) and harms (in health services
  research, harms are regarded as undesired
  outcomes or risks). Systematic reviews are the
  foundation of
• Evidence-based practice, the leading current
  Western paradigm or epistemology guiding clinical
  practice, defined as integration of best
  research evidence with clinical expertise and
  patient values and a diagnostic and
  therapeutic alliance which optimizes clinical
  outcomes and quality of life (Sackett et al.
  2000)

20
Sues partial and idiosyncratic mini-primer on
the politics of Evidence-based Practice

• Medicine until recently was what physicians
  themselves called empirical or even empiric,
  and by that they mean something completely
  opposite to what the term means to social
  scientists. Empirical medicine is what we
  would characterize as qualitative, contextual, or
  case-history it is the body of wisdom or common
  practice propounded pedagogically, or through
  uncontrolled experimentation and adaptation on
  the part of a given practitioner. This seems to
  work for my patients, or This was the way I was
  trained, describe empirical medicine
  practice not grounded in scientific evidence. In
  fact, because the health sciences tend to regard
  randomized controlled trials (RCTs) as the gold
  standard, and because most medical practice is
  not amenable to investigation by RCTs, most (some
  say over 80) of medical therapies and procedures
  remain empirical that is, utterly unempirical
  as we would understand the word -- untested or
  unevaluated via the scientific method.
• The lack of evidence for empirical medical
  practice leaves it open to bias in observation,
  spurious assumptions of causation, and at least
  the possibility that common practice or the
  accepted wisdom is simply WRONG in short,
  empirical medicine is prey to all the dangers
  of unevaluated practice of which you can think.
  A Scots epidemiologist, Archie Cochrane, made it
  his lifes work to make medicine evidence-based
  that is, to build a foundation of high
  quality evidence (specifically, from RCTs) upon
  which standard medical practice would be based.
  
• The evidence base is, of course, problematic,
  because it remains true that we dont HAVE
  evidence for a tremendous amount of medical
  care and, for reasons of cost, methodology,
  ethics, and investigator interests, we probably
  wont ever have evidence in Cochranes terms
  for much of what transpires when a patient seeks
  care. With regard to that for which we do have
  evidence, the evidence changes as additional
  research is done, or as time passes, or both
  think of it as trying to find a single small set
  of variables that explains all the variance in
  both the 1996 and 2000 presidential elections,
  and you get the idea! Or think of the HRT and
  mammography flaps in the past year

21
Idiosyncratic primer, continued

• Nonetheless, few could argue with Cochranes
  central point medicine ought not to be
  practiced in the absence of any concern for the
  evidence behind it. Cochranes beliefs would be
  reified -- by people like Sackett, quoted on a
  previous slide, who originally defined
  evidence-based medicine as the conscientious,
  explicit, and judicious use of current best
  evidence in making decisions about the care of
  individual patients with, initially, poor
  acceptance by physicians, many of whom felt that
  they were being told that their clinical judgment
  and experience were worth nothing, to be replaced
  by cookbook medicine. Patients and other health
  professionals were also wary because the early
  definitions seemed very autocratic and
  hierarchical, enshrining the physician and
  ignoring other players. And evidence-based
  approaches were expanding to other professional
  and clinical fields. Hence we have arrived at
  a softer and more elastic definition, and the
  current preference for evidence-based practice
  rather than evidence-based medicine.
• More people also recognize, of course, that one
  cannot treat evidence from RCTs as the only
  standard. Much debate revolves around the use of
  nonexperimental, observational studies and data
  as a legitimate part of the knowledge base

22
Idiosyncratic primer, continued

• Acceptance of Cochranes ideas was made much
  easier by the fact that the Clinical Practice
  Guidelines, Outcomes, Effectiveness, and Quality
  of Care movements were already gaining tremendous
  conceptual ground among scholars, policymakers,
  and clinicians. These movements also assumed a
  systematic concatenation of evidence and
  evaluation. I cannot do justice to these
  converging movements in this space, but I do want
  to convey to you how much of a revolution the
  ideas of quality of care, outcomes, and
  effectiveness created in the way we think of
  health services delivery and financing, and how
  much the idea of Guidelines altered the average
  physicians awareness of her day-to-day practice.
  
• The present task makes referring to the evidence
  base particularly important for three reasons
• Part of the persuasiveness of our framework will
  be its use of paradigmatic concepts that the
  current health policy community, from payers to
  providers to policymakers -- has already
  embraced and can understand.
• We WANT to learn from the evidence in health and
  the other sectors to the extent that any part
  of the private sector is imbued with a sense of
  mission to deliver the public good, how was it
  stimulated and sustained?
• This is also simple strategy we dont hold out
  much hope for being able to convince the private
  sector to engage in some pretty dramatic
  re-thinking just because it is the right thing to
  do. We must make a business case for it, and
  the private sector respects evidence as a
  reason to change the way it does things.

23
US Population
Analytic Framework for Evidence Report
(Systematic Review) on Potential Transformational
Strategies for Changing Private Sector
Performance to Deliver the Public Good
Interventions To Improve Health Care System
Performance Leadership Regulatory and
Legal Incentives (financial and
nonfinancial) Educational
Outcomes/Results of Interventions Quality (Pro
cesses and outcomes of of care health status
safety patient/provider satisfaction) Cost
(to public sector, citizens, employers) Access
(to providers and services) Patient Experience
of Care Population-based Outcomes Trust in
System Genuine Policy Change

• Health
• Care
• In the
• Private
• Sector

Harms and Adverse Unintended Consequences
Screening and prevention, diagnosis, treatment,
rehabilitation, palliation
24
Conceptual Framing Tasks

• Delivering a concise, clear-eyed picture of the
  nature of the real health system
• Making the framework persuasive and usable for a
  diverse collection of audiences
• Validating the framework
• Promoting genuinely transformational strategies

25
Transformational Strategies

• With a debt to James McGregor Burns, we really
  are looking for transformational strategies the
  system is already awash in transactional ones.
• And yet they must seem doable, usable not
  dewy-eyed. We need ways of fostering practical
  idealism.

26
Levers of Change
SOURCE Adapted from Leatherman, 2002
27
Levers of Change, continued
SOURCE Adapted from Leatherman, 2002