At the conclusion of President Obama’s health reform summit yesterday, the President called for another 6 weeks of discussion and debate.  Check out his video from YouTube below.  It’s almost 4 minutes long, but if you fast forward to the 3:00 mark you pick up his main concluding points:

So where do we go from here?  Most telling for me is not his challenge encouraging both sides to work toward compromise over the next 6 weeks, but what he is willing to do if compromise remains unachievable:

“….if we can’t,  then I think we’ve got to go ahead and make some decisions…then that’s what elections are for…we have honest disagreements about the vision for the country and we’ll go ahead and test those out over the next several months ’til November…”

To me, in the absence of substantial concessions from Republicans (not happening!)  this means that he will continue to press his case before the people to see if he can get the traction he needs to push ahead.

If he builds any momentum, or if he is pressed by Dem’s to push for a final conclusion, then we’ll see the so-called nuclear option, the use of the budget reconciliation process whereby only 51 votes are needed to get through the Senate.

This would be a very dramatic and politically very risky strategy.  There is a very entertaining debate about the political impact of reconciliation via Politico here.

But an end is nearing…even if it means enduring another 6 weeks of winter!

I rarely find myself at a loss for words, but yesterday I was pretty blown away by the students at my kids’ high school, Northwest Catholic.  Check out this story–and sorry about the ad leading into the piece:

Breast cancer is everywhere, and last summer we lost our own Rhonda Parent (story here) to this insidious disease.   It’s sad that these kids have the unfortunate experience of knowing someone close to them who is suffering, but their response, and support for their friend, is pretty cool, I think.

1. Mediocrity: The rewards and incentives for employers to establish high performing health plans will be diminished by reform and promote mediocrity among many sectors of the employer market.  This is not the right response—progressive, strategic-minded groups will be able to set themselves apart in their industries, but the prevailing trend will be a march toward mediocrity.

2. Anger: The lack of meaningful reforms that “bend the cost curve” across the system will generate a real backlash among job creators who favor reform that controls cost—right now, there is an expectation and hope for positive change, but reality will prove very disappointing especially in the long term.

3. Paralysis: Insurance carriers really don’t know what to make of reform-an expanded market via the individual mandates is exciting but the weak penalty for non-compliance and the tighter pricing regulations will strangle profitability.  Most companies will overreact on both accounts and miss the opportunity to find new ways to add value to the system—they have too much baggage and infrastructure to respond!

4.  Depression: Insurance agents , particularly those who focus exclusively in the under 100 employer market, see this as the end of the line for them.  Many have been waiting to ride the last wave into the beach, and this is it, which is really sad…Opportunities will abound, but not for those who prefer the status quo and are either too old, too lazy or too scared to reinvent themselves.

5. Innovation: Confusion breeds opportunity, and new ideas and new ways to add value to the system will spawn from all of the new government controls, taxes, fees and huge new bureaucracies that the regulations provide.  It’s not for the lazy or the wary (or the weary!), but it is an exciting time for those who embrace the confusion, uncertainty and the turmoil that will follow.

I, for one, can’t wait to get started!!

1.  27 million people currently purchase health insurance directly on their own.

2.  The vast majority of these policies are issued subject to medical underwriting, where the applicant attests to being relatively healthy and without serious ongoing medical conditions.

3.  As a result of these provisions, these individual policies are almost always cheaper than COBRA or employer sponsored plans which do not include medical underwriting.

4.  The banning of medical underwriting, as addressed in every proposal on the table, means that individuals with serious ongoing conditions will be included in the same pricing pool as the relatively healthy people who currently purchase individual policies.

Guess what will happen to the average premium for these 27 million people? It will go throught the roof!!  What will these 27 million Americans—nearly 10% of our population–think about of health reform????

The only way to mitigate this effect is with a strong individual mandate, whereby all Americans are required to have health coverage or pay a stiff tax penalty.  This will increase the pool of people purchasing individual policies by as much as 10 million people, enough to offset the hiogher cost to cover the seriously ill and unhealthy. 

Unfortunately, it will never happen this was as the Senate version is written, since the $750 penalty included in the Senate bill will be less than the monthly  for most Family coverage policies.  Not much of a “mandate”, not much of an incentive to follow the law.

The unintendended consequence:  27 million REALLY unhappy Americans, many of who consciously choose to live a healthy lifestyle and enjoy lower healthcare expenses as a result.  Not good policy at all…

The policy challenges are also daunting. In the space of one year, the Democrats are trying to restructure one-sixth of the economy, writing a bill that will affect almost every American, every business and every doctor and hospital in the country.

 As I wrote earlier this week, there is still a single major war to be fought (the government run “Public option”) and many, many smaller battles, including:

• How to pay for provisions
• Design of meaningful cost control measures
• The Individual Mandate
• Medicare cuts/Medicare restructuring
• Pay or play for employers
• Comparative Effectiveness Research (best practices)
• Mandated minimum federal benefit levels
• Electronic Medical Records

…just to name a few…we’re moving, but very, very far to go.

If the President’s #1 stated goal is to make sure that all Americans have access to affordable health insurance, it stands to reason that we should have a pretty decent understanding of this population.  The better we understand who they are and the reasons why they do not have coverage, the more effective we can be is developing solutions to address the problem… ground-breakingly obvious, wouldn’t you say??

In any case…the leadership team at Aetna, led by Ron Williams and Mark Bertolini, has done a great job of defining this population and looking for creative ways to address the coverage issue. The numbers look like something like this:

Total U.S. population:                            299.1 million

Insured through employers:                 177.3 million

Individual plans:                                       26.6 million

Medicare/Medicaid:                                     83 million

Total Uninsured:                                       45.7 million

Non-US Citizens:                                         7.5 million

Eligible for Medicaid/not enrolled:            11 million

Uninsured students:                                  4.5 million

< $50,000 income:                                      28 million*

>$50,000 income:                                    17.6 million

*includes Medicaid group above

SOURCE: Personal analysis and interpretations from various sources including Aetna and Kaiser Family Foundation (KFF)

With this understanding, we can contemplate a few simple reforms that would substantially eliminate the problem:

1.  Get the 11 million ENROLLED in Medicaid

2.  Adopt an IMMIGRATION/CUSTOMS requirement that all non-resident visitors prove they cave coverage in their home country

3.  Institute a federal mandate that all residents maintain coverage:

• Require colleges to make STUDENTS document coverage before enrolling
• Provide subsidies or Tax credits to the <$50,0000 POPULATION
• Institute tax penalties for those over $50,000 to ensure they BUY COVERAGE

The cost for these reforms would be a fraction of the $1 trillion programs being debated in congress.  In fact, according to Aetna, we could give FREE COVERAGE to the entire uninsured population for a mere $214 billion…still a fraction of what Congress is proposing.

Do these numbers surprise you?  They surprised me a bit.

Do you know anyone who is uninsured today?  Can you share their story with me?

And make no mistake: this is about our PRIVATE healthcare system, and how private citizens are helping to make it work better.

Today I’ll be riding in the 30th Pan Mass Challenge, a 2 day bike ride across Massachusetts that will raise more than $30 million this weekend for the Jimmy Fund and the Dana Farber Cancer Institute. Read more about the PMC here.

In New England, if you think about the best cancer care you generally think Dana Farber.  Maybe it’s because those of us who are Red Sox fans hear about it through the Jimmy Fund, the Red Sox charity that supports Dana Farber.  Or maybe it’s because they do some of the best research on cancer in the world.  But for whatever reason, Dana Farber is at the top of the list.

It’s great to have the choice to go there if I or someone in my family needs to.  Maintaining that choice, and not having to wait long periods of time to see the specialists we need to, has to be part of whetever health reform that emerges.  Build around what is working, fix what is not.  Freedom of choice and access to the best in the world, like Dana Farber, for those of us with private insurance living in New England, is part of what is working.

For those without private insurance, this is what you are missing and what needs to be fixed.  But very carefully.  For those of you not living in New England, well, I don’t know what to tell you…

Cancer research, of course, and Dana Farber for sure, are huge beneficiaries of PUBLIC tax dollars in the fight to cure cancer. And we need to continually invest tax dollars in medical research for the greater good.  But this event is about how private citizens are enjoined in the fight by riding, volunteering, cheering and contributing to help fight this terrible disease.

I have a 46 year old co-worker who is in late stage breast cancer and nearing the end. I am riding fior her this year, and I am sure I will bawl like a baby 10 times these next 2 days when I think of her and when I see the hundreds of other survivors out there riding and volunteering and cheering everyone on. It is incredibly moving, and incredibly inspirational. It’s about people who care getting off the couch to help others and to support the tremendously talented physicians, nurses and researchers who are trying every day to help find a cure. I am proud to be part of it, and proud be doing a little something to help out.

You can follow me today on twitter here: http://twitter.com/billcarew or donate to my effort here, if you are so inclined.

It’s part of what is working…