Local View: ACA replacement needs 3 key parts
Local View: ACA replacement needs 3 key parts
DR. BOB RAUNER, Partnership for a Healthy Lincoln - Lincoln Journal Star, 5/10/2017
As Congress continues its attempts at replacing the Affordable Care Act, or Obamacare, it is important to discuss what a successful effort should look like. Most health policy experts divide a good plan into two buckets -- increasing coverage and lowering costs.
Although the ACA did a good job on coverage by decreasing the number of Americans without health insurance to the lowest levels recorded, its major failing was that it was weak on lowering costs. The recent Republican effort is struggling in part because estimates show that up to 24 million could lose health insurance while making only a small dent in costs.
A good replacement for the ACA needs to do two things -- continue covering at least the same number of Americans while finally making a serious attempt to lower health care costs. The latest projections show health care costs eating up $1 of every $5 of the U.S. economy by 2025!
Reducing health care costs will require three main strategies -- lowering the cost of prescription drugs, increasing price transparency and reversing the obesity and diabetes epidemic.
Our prescription drug costs are almost double other countries'. Most of our asthma medications, despite being around for more than 20 years, are still not available as lower-cost generics and still cost $100 to $250 per month. This means anyone with asthma will likely spend more than $2,000 per year on medications alone to control their asthma.
Even more worrisome are specialty drugs for rheumatoid arthritis or Hepatitis C, which can cost $40,000 to $50,000 a year. Most of the cost growth for self-insured businesses -- think Duncan Aviation, Lincoln Industries or NebCo -- comes from the rising cost of prescriptions. Any solution for health care needs to deal with the drug patent loopholes that prevent real price competition.
The second problem is the lack of price transparency. Republican proposals frequently point to consumer-directed health plans and health savings accounts to encourage patients to be “better shoppers.” This may have some potential but will not work until we first make prices easier to compare.
The price for a common joint MRI may vary from $500 to over $2,000. Common procedures can vary in cost by three or four times. You won’t see this kind of price variation for a set of Bluetooth speakers because it’s so easy to compare prices from one store to another.
If we had similar visibility of prices in health care, prices would drop dramatically. But this would require Congress or our Legislature to prevent current contracting practices that keep actual prices hidden from patients and their primary care physicians.
The last big cost driver that needs to be addressed is the epidemic of obesity and lack of physical activity, which are causing the dramatic rise in the number of people with diabetes. I do some consulting with a local employer, and its subset of people with diabetes is responsible for 15 to 20 percent of its entire health care costs -- more money than the company spends annually on property taxes.
If we don’t enact policies to reverse the rise of obesity and get people more active, this problem alone will bankrupt our health care system. Any successful solution needs to take on the beverage and sugar industries and get our kids moving again in schools. Sugar-sweetened beverages, like soda and energy drinks, should be removed from the tax-exempt status of food and instead put in the excise tax status of nicotine or alcohol.
If we want to get people moving again, we need to start when they are young by making physical education and recess a core part of the school day. Medical experts recommend at least 150 minutes of physical education a week, yet most of our schools allow only 40 to 70 minutes per week.
Any effective effort to lower health care costs to the point where they are affordable for everyone will need to address each of these problems. If the next proposal in Congress fails to address these issues, it will fail to make a dent in our health care crisis.