The Dollars and Sense of Prevention: A Primer for Health Policy Makers

Conference Transcript
June 8, 2009


Welcome and Overview

Paul Ginsburg, president, HSC bio

Keynote Speaker

• Steven H. Woolf, M.D., M.P.H., Professor of Family Medicine, Virginia Commonwealth University
    bio  • Slides

Woolf Handouts:

"A Closer Look at the Economic Argument for Disease Management," Journal of the American Medical Association (Subscription required)

"The Power of Prevention and What It Requires," Journal of the American Medical Association (Subscription required)

"The Economic Argument for Disease Prevention: Distiguishing Between Value and Savings," Partnership for Prevention

"Preventive Care: A National Profile on Use, Disparities and Health Benefits," Partnership for Prevention

Panel: Prevention 101

Moderator: Paul Ginsburg


• Jason Spangler, M.D., M.P.H., Managing Senior Fellow, Partnership for Prevention
    bio  • Slides

• A. Mark Fendrick, M.D., Professor, Internal Medicine and Health Management and Policy,
University of Michigan
    bio • Slides

Fendrick Handouts:

"’Fiscally Responsible, Clinically Sensitive’ Cost Sharing: Contain Costs While Preserving Quality," American Journal of Managed Care

"Value-Based Insurance Design," Health Affairs

"Value-Based Insurance Design: Restoring Health to the Health Care Cost Debate," Society of Actuaries


Paul Ginsburg: Good morning. I’m Paul Ginsburg. I’m the president of the Center for Studying Health System Change, an independent nonpartisan policy research organization funded in part by the Robert Wood Johnson Foundation, and affiliated with Mathematica Policy Research.

I want to thank you for joining us today for the third of four HSC conferences on significant health policy topics that are sponsored by the Pharmaceutical Research and Manufacturers of America; the DMAA: The Care Continuum Alliance; and the American College of Preventive Medicine.

Under this sponsorship arrangement, HSC and the three groups jointly choose the conference topics, and HSC is responsible for organizing and conducting the conference. So, if you like the conference, we get the credit; if you don’t, we get the blame.

Our conference today The Dollars and Sense of Prevention: A Primer for Health Policy Makers complements the two previous conferences we’ve had. The first focused on the causes, prevalence, cost and consequences of chronic conditions; and the second examined real world strategies that employers are using to develop effective wellness programs and that providers are using to improve care of patients with chronic conditions.

A recent HSC study, which is in your folders, indicates that the prevalence of chronic conditions continues to increase among the working age population and closely tracks rising rates of obesity in that population.

In 2007, our most recent survey, 39 percent of the working-age population, or 72 million people, had at least one chronic condition such as diabetes, asthma, or depression, a significant increase from 35 percent in 2003. So, 35 to 39 percent, and that’s a very big sample, so this is a very meaningful increase. Likewise, the study found that between 2003 and 2007, the proportion of working Americans classified as obese meaning, body mass index of 30 or higher grew from 25 to 29 percent. Yet we have a health care system that remains focused on episodic acute care that pays too little attention to keeping people well, helping people change unhealthy behaviors, and improving the care of people with chronic conditions.

So, today we’re going to focus on disease prevention. The public and policy makers often receive mixed messages about the costs and benefits of prevention. As health reform moves forward, the role of prevention in a revamped U.S. health care system is a key issue that policy makers will be grappling with over the next few months.

Our keynote speaker, Dr. Steven Woolf, professor of family medicine at Virginia Commonwealth University, is going to help clarify some of the mixed messages that we keep hearing about prevention. Dr. Woolf has published two recent commentaries in the Journal of the American Medical Association copies in your packets that move beyond whether prevention does or doesn’t save money and instead focus on the value that effective preventive services can add to the health care system.

As the nation contemplates reforms to make health care more affordable and accessible, Dr. Woolf’s point that we have to shift spending from low value to high value services both within preventive care and within disease treatment is a point that policy makers would be wise to keep in mind.

Dr. Woolf.

Steven Woolf: Thank you, Paul. That was a nice summary, and I feel like I don’t actually need to do the talk, because that’s a very nice articulation of it.

Thank you. It’s a pleasure to be here. It is an interesting time where experts in the field who’ve worked in this area for decades are wrestling with a very challenging problem with health care reform but reaching different conclusions about how they want to proceed. It reminds me of this T shirt I saw recently that said "bomb squad," and then the tag line underneath it said, "If you see us running, try to keep up." Sometimes it’s important.

Okay, let me just see if I can get my slides shown here. All right, good. I think I succeeded.

Let me begin by saying that I’m going to speak quickly, because I want to limit how much time I’m talking so we get on with the rest of the program this morning. But and so I’ll be speaking quickly, and if there’s details of what I say that aren’t clear, which is always a possibility, it’s in this article that was mentioned earlier and other very good writings on the subject by other authors.

Let me begin with some background, but it’s all stuff you’re familiar with. First of all, to state the obvious, these are projections by CBO of health care spending going out some years, which sets the context for a lot of the discussions that are going on right now an unsustainable growth in health care spending costs and the fact that we have a demographic shift going on in our population, the aging of the population, the baby boomers, the advances that have been made in treating disease that are leading to a larger prevalence of chronic disease in our country, and projections as shown in this slide that the prevalence of chronic diseases are going to increase steadily over the years to come with resulting health care costs required to treat those diseases and obvious implications for the Medicare program, retirements benefits, and so forth.

The context for today’s discussion, though, is that a large proportion of that increase in health care spending is going to be attributable to those chronic diseases, and this particular estimate shown by the Partnership to Fight Chronic Disease a large percentage of the increase in spending on chronic care diseases that have occurred since 1987 until now was attributed to these chronic diseases, and the same pattern is likely to continue going forward, and the key thing is that about 75 percent of those chronic diseases are thought to be preventable. They have potentially avertable causes.

As Dr. Ginsburg mentioned, the obesity epidemic adds a new dynamic to this issue. Projections are that because of the increasing prevalence of obesity, a risk factor that increases the development of diabetes, cardiovascular disease, and so forth, that the obesity epidemic alone is likely to increase health care spending by estimates of 30 percent or so. So, this is a major driver of health care spending, and the logic flows from that that doing something to address those modifiable risk factors would be a pretty sensible thing to do to help control rising health care costs.

The Robert Wood Johnson Foundation, the Centers for Disease Control, and others have estimated that about 38 percent of all deaths in the United States are attributable to four health behaviors shown on this slide, and many people certainly in my field, in medicine, basically stop at that point and make the case that that alone is an argument for investing in prevention. Tobacco use alone accounts for something like 420,000 deaths a year, and that on ethical grounds makes a compelling case that we should be doing something about prevention just to reduce that disease burden affecting so large a population, and that health argument is typically played out in terms of metrics in the health domain, such as the incidence of disease. Prevention could markedly decrease the prevalence of certain diseases diabetes, for example, a major killer in the United States and contributor to health care costs. Studies have shown that intensive life-style modification can reduce the incidence of diabetes by 50 percent, and it’s also measured in terms of lives lost. There are a lot of excess deaths that would not occur if more was done around prevention.

But we’re here to talk about economic issues, so we go to that next level of the argument, which is that doing something to prevent those adverse health outcomes has resource implications, the most obvious being the cost of avertable disease that could be avoided through prevention, and that includes at least two components, and one we should put out a disclaimer here. I’m a physician not an economist, so, you know, take what I have to say with that disclaimer. But, to my mind there are two components of it. One is the access to medical care associated with those avertable diseases, so the cases of diabetes and heart disease and cancer and so forth that would not occur as a result of prevention those expenses are thereby avoided. But there’s also a broader set of economic benefits from producing a healthier population, such as a healthier workforce, greater productivity, greater corporate competitiveness in the international marketplace, healthier families, better school performance for children, and so forth we could go on that extend beyond the immediate economic benefits of avoiding a hospitalization and a visit to the emergency department.

And as I’ll get to shortly, there’s a more subtle and yet more profound argument for investing in prevention, which is getting better value on the dollar from our health care budget.

Now, this type of economic benefit to prevention is something not lost on policy makers right now. Peter Orszag, the current director of the OMB, who was previously the director of the CBO, testified in Congress last year and made this very point as you can see in the testimony here that he was pointing out the marked differences in health care costs that occur for, say, obese persons compared to normal weight individuals. Similar kinds of calculations are being made in state governments. I just saw data from Texas recently where they did the numbers on this showing how much of an increased cost burden they are facing in Texas in their obese population versus the normal weight population. It’s happening in corporate boardrooms around the country, in health plans and so forth.

To give you one example, this is a slide I obtained from Blue Cross and Blue Shield of Minnesota where they ran the numbers on what they’re spending for their insured population, and we’re looking at the return on investment from their efforts to try to reduce smoking rates in the insured population. They were successful, by the way, in markedly reducing the prevalence of smoking in their insured population. I’ll be saying more about that in a few minutes as to how they pulled that off. But here you can see their estimate of the reduced spending levels that they have achieved. The National Business Group on Health and other organizations representing the Fortune 500 companies have also locked in on the ROI of investing in a healthier workforce through addressing health behaviors. And so here are the Blue Cross Blue Shield numbers showing average annual savings per additional nonsmoker of a thousand dollars $25 million less in health care costs each year according to their calculations.

So, if that’s the case, it should be a no brainer that we should be doing this, but the reason we’re here today is it’s actually not so simple. Shown on this slide are examples of different reports that have come out in the past year or so with very different spins on this issue of prevention. They range from some reports that say that investing in prevention will give you a $5 return on investment for every dollar invested to the opposite extreme of saying if you think you’re going to save any money from prevention, think otherwise.

Louise Russell, an economist from Rutgers University, has been articulating this thesis for many years. I remember 20 years ago when her book came out Is Prevention Better than Cure? where she articulated this very point that you don’t save money from prevention.

And so this is a bit of a confusing message, and what I want to do over the next few minutes is basically walk through some principles that might help to make sense of this otherwise conflicting point of view. And if nothing else, I want to get this point across in the remaining minutes that I have, that asking whether prevention saves money is actually the wrong question, and I’d like to suggest that we need to reframe it. But the starting point for this is to remind ourselves that health is a good, in economic terms, and we don’t purchase goods in society to save money.

The analogy I’d like to use for you is purchases that we make as individuals on a daily basis going to the grocery store, going out to dinner, buying a new car, gassing up your car. In any of those contexts, you don’t ask yourself whether you’re going to save money. You don’t go to the cash register at the grocery store with that cart full of groceries and expect the cashier to give you back more money than you’re giving her, nor do you expect this at the restaurant or when you buy the car, and that’s because you’re buying a good. And that’s true on the individual level.

It’s also true on the societal level. When we spend money on national defense or bioterrorism and national security or space exploration and many other examples I could use, we don’t pose the question is this going to save us money, because those are all goods. We want a safe country, we want national defense, we want that basket of groceries. When we go grocery shopping, though, we do ask: Can we stretch our dollar? Can we make our dollar go farther? When we talk about saving money at the grocery store or at the gas pump, we’re talking about efficiency, getting more value on the dollar, and that’s the context that we need to think about health. We as a society want to purchase health. That’s an important good that we value in our society, and the question is how can we take the resources that we’re going to spend on health and make them go farther?

And framed in that context, value becomes the driving principle for looking at prevention but, I will argue, the driving principle for looking at all of our health spending. The priority is optimizing value, and we talk about saving money in this context in making it go farther, and the return on investment then becomes important. Will it save money is the wrong question. Controlling cost by optimizing value is the right question.

It’s basically saying we’ve got this bucket of money. What is it, $2.2 trillion per year that we’re now spending on health care and asking how many of those stick figures can we help? How many lives can we save in terms of health benefit for that investment? We, in economic terms, have different metrics that we use for looking at value, cost-benefit analysis, cost effectiveness analysis, cost utility analysis, and so forth; and basically in very simplistic terms it’s referring to the ratio between how much we spend and how much net health benefit we get back as a result of that investment the cost effectiveness ratio. Very often we measure health services in terms of the cost per quality-adjusted life year (QALY) that’s gained through various health care services, and the metrics and the thresholds vary depending on which economist you’re talking to, but if you pay more than $75,000 to $100,000 per QALY, then you’re getting above the line of what we typically consider a good value on a health care service.

Now, if you were to take a very simple schematic and bear with me here with the imprecision of this and look at all of our health care spending on that $2 trillion a year, the majority of it would fall in that big box to the right, which we would call low value health care services. These are services that cost upwards from $50,000 to even a million dollars per QALY. That’s most of what we invest in, in our health care system.

Then there’s a smaller box made up of high value services that are actually a very good value that cost less than $50,000 per QALY.

And then there’s a tiny fraction of those actually much smaller than this box on the left, but it needed to be that size for the letters to fit in but those are the services that actually produce net savings where you actually get back more value than you spent in order to produce those services. I’ll give you some examples, but for example, childhood immunizations and services of this sort are in that category.

And what we ought to be doing and we ought to be thinking about in terms of dealing with the crisis is shifting our spending from those low value services over to those high value services so that we change those proportions and are spending much more of our health care budget on high value services. The value of doing of that, the economists will point out, is better resource utilization. As a physician and as a public advocate, I would argue the other benefit for it is you’re actually going to save more lives for the same money, and the population will ultimately be better off. But as we look at this health care crisis borne out by these rising costs of care, this underlying principle of shifting toward value, which I think is a theme that you’re going to hear all morning, is really the ticket for trying to get a better handle on health care spending. It’s taking that same pot of money and increasing dramatically the number of lives that are saved.

Now, some people, when we talk about prevention, will say well, that all sounds good, but isn’t there a lot of confusion and uncertainty about what works in prevention and what is good value, and I’ve been in this field since the mid ’80s. I’m here to tell you that there are some debates, but there’s actually a lot of clarity at this point on those issues, and I’d like to go through four in particular.

First, I’d like to establish that we have a very good idea of what works in prevention there’s a core set of preventive services that we know are effective; secondly, that there is a pretty good body of evidence about the value, the cost per QALY of those effective preventive services; third, we have identified some preventive services that are in fact cost saving; and fourth, there are some preventive services, like many disease treatments that we’ve identified, that are a very bad value on the dollar and are not smart investments, and those are well identified.

So, let me just go through each of those four points briefly.

The first one we know what works. There have been reputable scientific panels at work since 1984. The one I’m thinking of in particular is the U.S. Preventive Services Task Force their report is shown on the left hand of this slide which has been working now 25 years reviewing the evidence from randomized control trials and other kinds of studies, documenting the effectiveness of a host of clinical preventive services hundreds of clinical preventive services and have identified for many years a core set of preventive services of established effectiveness. To the right is portrayed the report of the Community Preventive Services Task Force, an entity formed by the CDC back in the mid ’90s that has been looking at the community based, population based counterpart, things that we do at the community level to prevent disease, and have similarly identified a set of preventive services that are implemented at the community level that are effective. So, we know what works and we know what doesn’t work.

Secondly, we know something about their economic value. Shown at the top of the slide is the banner of an article that was published by the National Commission on Prevention Priorities. The National Commission on Prevention Priorities is a commission that was initially chaired by David Satcher, the former Surgeon General, that systematically went through the various effective preventive services and evaluated their cost effectiveness. Shown here are screening tests, health behaviors, immunizations, and chemoprophylactic regimens that were reviewed by this group, and basically they found that of 25 preventive services that had been recommended by the Preventive Services Task Force, almost all of them cost less than $35,000 per QALY, which, as I mentioned, is not a bad value. Shown here are preventive services that cost out in the 0 to $14,000 per QALY range, and shown on this slide are preventive services that are in the 14 to $35,000 category. These are good buys and are not only effective in improving health of the population but offer a reasonable return on investment. You’re purchasing health at a good value, which I think should be the underlying principle that we look at for all of our health care spending.

Now, does this save money? Well, as I said, that’s not the right question. It turns out, however, that there are some preventive services that do save money. Those are listed on this slide. Classic examples are childhood immunizations and smoking cessation counseling, which have for many years been documented to produce a favorable return on investment. But I, again, want to emphasize that although these are obviously no brainers to invest in this type of preventive service, the larger issue for our health care crisis is finding services that offer good value on the dollar.

And we know that there are some preventive services that are a bad investment. They do not offer a good return on investment; they offer poor economic value. This is often the case, for example, when effectiveness or safety is uncertain and for other circumstances that are very common with certain preventive services, particularly when the absolute probability of benefits is low. Preventive services are offered to relatively healthy populations that face a relatively small absolute probability of disease. If you offer those services to people who are at especially low risk, if you do the services too often, like doing very frequent re screening, or if you pursue very aggressive treatment targets with statins and lipid lowering therapies, and so forth, you tend to get less value on the dollar than investing in those services in a more targeted and rational way. I hasten to emphasize, though, that if you apply very similar principles to services in the treatment area, not just in prevention, the same principles hold. Lots of the things we do in diagnostic workups and in treatments for patients offer very poor return on investment when applied in this way as well.

Now, with prevention, it’s very important to clarify what people are talking about when they throw around conclusions about their effectiveness or economic value. With clinical services, say treatment of cancer or heart disease, the context is pretty straight forward. It’s typically happening in a doctor’s office, in the hospital, in the nursing home, and so forth. Prevention’s a little different. The actors can be different people. First of all, there’s the individuals themselves portrayed in this photo a person who’s going out to exercise. Physical activity is an important preventive service, and in this case it’s implemented by the individual himself or herself. Preventive services can also be implemented at the health care system level. The analogy would be the physician who counsels patients to become physically active. And so there’s a separate question apart from the health benefits and economic value of that workout. There’s a separate question of saying what are the health benefits and economic value of physicians counseling people to exercise? What incremental benefit do we get from that, and what’s the return on investment?

And then there’s a third level, which is the community based level, of saying what are the health benefits and economic value of the community changing the built environment, investing in parks, and so forth to promote a setting where people can be more physically active? So, somebody who just throws out a comment: Well, exercise is not cost effective we need to pin them down: Well, what are you talking about here? Which actor are you talking about? Which intervention are you talking about?

And you’ve all learned in school about primary, secondary, and tertiary prevention, these different categories of preventive services, and if you want we can elaborate on that during the Q&A, but what I wanted to show that when we talk about these different forms of prevention primary prevention is keeping people from getting sick in the first place, secondary prevention early detection of disease that we do need to clarify whether we’re talking about those efforts in the clinical setting or in the community setting, because they have different performance metrics and evidence.

Now, the prevention area is a complicated one when we talk about economic benefits, and we don’t have time in just the few minutes that I have to speak to go into great detail, but I just wanted to touch on some of the tricky issues with it.

So, one of them is how much time does it take for the interventions to improve outcomes. For most of my career, the pushback that I’ve heard when people talk about prevention, especially employers and health plans, is that they will invest these up front expenses to offer preventive services to their population, but the health benefits occur decades later when the members will no longer be in their plan, the employees will be with another company or retired by the time those benefits occur.

Just shooting ahead to this slide, this is a recently released report looking at the question of how CBO scores prevention where some modeling was done to show the economic benefits of improved control of diabetes showing the traditional 10 year window that CBO uses for looking at return on investment and showing that although there are important economic benefits that come from better diabetes management in this case during that 10 year time window, the more dramatic improvements in spending occur in those out years beyond that box where the 10 year window occurs. So, that’s one of the issues how much time does it require.

I will point out as an aside, though, and maybe we’ll have more time to talk about this during the Q&A, that the body of research in recent years has pointed so much toward the economic benefits that occur in the short term. So, efforts directed at obesity and smoking and many other services, businesses around the country are measuring benefits within two to five years in many cases in terms of workforce productivity and lower health care cost.

Another question is are the absolute benefits on the population level too modest? Do we get enough of an impact on health outcomes to make the investment worthwhile?

A third question: Does prevention delay but not avert spending? Some people resist the idea of prevention because they feel you’re not really avoiding any cost, you’re just putting them off till later.

And then the most nefarious of the questions as far as I’m concerned is the argument that it may cost more for people to live longer. The way this argument goes is if you prevent disease and avert premature death of a person, then they’re going to be around longer to incur other diseases, which then generate additional health spending and ultimately may not be good for the economy for people to keep living. And we can talk more about that argument later.

Now, there’s a lot going for prevention that gives us some economic advantages that make it very interesting. One is that the various risk factors we’re talking about tobacco, obesity, and so forth have impacts across multiple diseases. So, when we talk about diabetes treatments or treatments for ovarian cancer or any number of specific conditions, their impacts are basically targeted to a specific disease category, patients with a particular condition, whereas the economic benefits that come from addressing tobacco use and obesity and other modifiable risk factors affect an entire range of conditions. I mean, tobacco anything from pre term deliveries all the way through to lung cancer, emphysema, and death itself.

A second factor is the long time horizon that comes from preventive services, so if you think about childhood obesity, for example, as a strategy or as a problem to address, preventive interventions directed at today’s children to deal with something like childhood obesity is going to produce a return on investment generations from now because of the ripple effects that occur. So, there’s a compounding of benefits that occurs over time.

And then importantly, as I mentioned earlier there’s the intangibles, the benefits that come from a healthier population that we often can’t measure very accurately in economic studies but are very important in terms of the healthier workforce, healthier families, healthier communities that have very practical implications in terms of presenteeism and absenteeism that CEOs and employers are very concerned about, but also in terms of community cohesion and productivity and economic development in neighborhoods that all spill out as ripple effects of a healthier population.

Now, I want to wrap up but talk about the fact that the paradigm for thinking about preventive services is beginning to move out of this box that doctors and hospitals typically think about, that what we do has to happen in an exam room or a hospital setting to improve health, and unfortunately much of our policy making reflexively thinks about the clinical setting and the health care environment as the venue for improving health. With prevention, we increasingly understand that that’s a mistake. If you think about it, there’s 365 days in a year. For most of the American population, a very tiny fraction of that is spent in a clinical setting. When we’re talking about how people eat, how active they are, whether they smoke, and so forth those are choices that are made every day, at home, at work, at school and trying to have an impact on those behaviors clearly requires interventions that get outside the walls of a doctor’s office or hospital. It really takes us back to the larger question of what causes those behaviors. What are the influences on those behaviors? What is it about our environment and life style that’s responsible for those? And so the strategy for addressing those conditions involves making changes at the schools, at the work site, at the grocery store, at restaurants, and so forth, to create an environment in which we live that promotes healthier choices. So, increasingly the field is moving toward understanding the linkages between the health care community and the community resources and improving the health of the population. And when we talk about the economics of investing in those changes, we’re seeing some very important returns on investment if those resources are invested wisely.

I’m taking you back again to Blue Cross and Blue Shield of Minnesota, where I mentioned earlier the return on investment they got from their smoking intervention. They did this not just by dealing with the clinical sector. They did this not just by paying doctors to offer smoking cessation counseling but at the policy level and the community level trying to change the environment to encourage less smoking, so tobacco tax increases and other policy and legislative changes that they were involved with that produced that return on investment that I mentioned earlier.

They then took that same model and took it to obesity and started to think about what they could be doing to promote physical activity besides simply telling their doctors to tell patients to exercise. They started putting up billboards; they launched a campaign called Active Living Minnesota; they’ve helped to deal with the built environment by changing the design of streets and walkways and so forth; they’ve promoted active workplaces. These are signs that they have produced that go up in workplaces to encourage physical activity. These are ads that are going up in supermarkets to promote the purchase of fruits and vegetables and so forth, investments that they are making in the built environment as I alluded to. Clearly they are recognizing that if they want to see their health care spending go down for obesity related diseases, they have to invest in some of these community level changes. This is their model and you’ll see many models like this advanced by other groups of looking across the community sector and then making the business decision that it’s worth investing in this to reduce their spending levels.

Let me try to wrap up here with a closing point, which I’ve sort of hinted at throughout the talk is a double standard. This question we’re here today to talk about Prevention: does it save money? is a bit of an ironic question, because what we’re talking about is roughly 3 percent of the health care budget by various estimates. Most of what we spend, and most of that burdensome $2 trillion per year that our country is struggling with, is spent outside the prevention sector in the treatment of existing diseases, and yet we don’t typically pose the question when a new imaging device comes out or a new treatment, does it save money? As I mentioned earlier, that’s typically not the question that’s posed. In fact, Medicare, CMS, and many health plans actually avoid the analysis of the cost effectiveness of the services that they cover. And so I would like to close with the suggestion that we try to level the playing field and pose the same questions for all of health care services across the board, not just for prevention. And these three questions I think are fair questions to ask about anything we invest in with our health-care dollar:

One, does it improve health outcomes and how strong is the evidence?

Two, if the intervention is effective, is it cost-effective? In other words, does it offer good, economic value?

And, third, can other options achieve better results or the same results at lower cost?

Just driving in this morning, there was an ad from some initiative to promote imaging. I forget the name of the coalition that’s pushing it, you know, get the right imaging test at the right time and so forth. So, the question to ask is with imaging devices and those types of diagnostic procedures would be to apply these same questions as we might ask of prevention for those treatment services.

So, in conclusion, the spending crisis requires a comprehensive search for ways to shift spending from services of low value to those with high value. You’re going to hear this theme mentioned again this morning. My contention is that it’s less important whether you call it preventive or treatment, what class of services we’re talking about. As a primary care physician, I am involved with all classes of health care services, and that same standard needs to apply across the board. The thing that matters is not whether it’s prevention or another category but whether you’re getting good value on the dollar.

I think as it comes to prevention, it does make sense to invest in a core package of effective preventive services. We know a good couple dozen of these that are highly effective, save lives, improve health, and offer very good value on the dollar. It makes very good sense for our health care system to invest in them. Obviously, the subsets that produce net savings are a no brainer, that we should include those in our benefits packages. But ultimately the key theme to emphasize is we cannot afford to be this methodical around prevention and ignore the much larger levels of spending going on in the other areas of the health care sector.

So, thank you very much for your attention, and I look forward to our discussion.

Paul Ginsburg: Thank you very much, Steve. You have presented some very interesting, intriguing ideas very clearly, and often when I’m sitting here when there’s a talk, I’m writing notes of things that the speaker didn’t really do right and I ask them a lot of questions. I don’t feel like that now. So, actually to get us started before we go to the audience and the people might want to go to the microphones or if you’d rather write a question on a card you can do that and pass it to the aisle but, Steve, you’ve written about these ideas in your JAMA editorials, and what has been the reactions to these ideas and, you know, do some of them surprise you?

Steven Woolf: The reactions have been pretty favorable, but as a researcher I often think about selection bias the folks who haven’t sent in their messages who don’t necessarily agree. There’s been some healthy debate. Colleagues like Alan Detsky and others debating some of the methodologic assumptions that go into this. Another colleague, who’s a medical ethicist, pointed to the fact that you could argue that a Rolls Royce offers the best value, but in a situation where we are in an economic crisis and don’t have the extra money available to spend, even if prevention offers a good value, the money simply isn’t there to pay for it.

My response to those concerns, though, is that the money is there. It’s just being spent differently, and the difficult choice that we have is shifting the spending, as I showed in that slide, away from ineffective or even in some cases harmful health care services toward those that are more effective and ultimately reducing the rate of growth in health care spending by adopting that type of philosophy.

Paul Ginsburg: Thanks. You know, actually a perspective I have is that I think Steve’s way of thinking about prevention is the way to be doing it, to be paralleling the way we think about other health care, about high value and low value, and it seems like all the people that have done research on actually quantifying the impacts of prevention, I don’t think there’s a huge amount of controversy over which services actually save money the exceptions and which ones are high value and which ones are low value. But somehow given the Washington budgetary environment where we continue to look for free lunches you know, advocates of prevention have really gotten into their head, you know, we can get a lot of prevention by arguing that it saves money, and in a sense it gets us out of this very difficult budgetary situation.

I’ve got two questions here. One is if the prevention efforts you discuss are successful, will there be fewer hospital admissions?. Can you talk about if at all this is happening, and if yes how is the hospital industry responding to this economic threat to their financial viability?

Steven Woolf: Well, this is a very interesting question. I just came back from the annual meeting of America’s Health Insurance Plans in San Diego, and they had a very fascinating keynote panel that included three governors or ex governors Jeb Bush, Howard Dean, and John Kitzhaber from Oregon and this was very much part of the discussion, that, you know, one man’s savings is another person’s income. And the general consensus was that a very useful solution to this problem would be to have a vertically integrated design so that this problem that the questioner is raising is addressed. Namely, if you are a hospital and you’re operating from a different budget, then the idea of an intervention that’s going to reduce your admissions is not particularly appealing, setting aside the moral problems with that attitude. But if you are dealing with an integrated vertically integrated model, then you’re going to realize those health benefits at the population level. Academics like myself are accustomed to thinking at a societal level, so it’s not a natural concern. We want a healthier population, and the idea of an intervention that reduces the need for people to be admitted to the hospital seems fundamentally appealing and morally defensible. But those types of concerns I think could pose a problem in the fractious political debates that are coming up for health care reform.

Paul Ginsburg: You know, actually, to add something, I think we’re fairly well positioned to deal with that, because, you know, health care of course has always been a growth industry, so if something reduces the demand for hospital care, that often doesn’t mean layoffs, downsizing. It means less growth, which is a lot easier to take. And actually I would think that certainly at the moment and probably keeping up for a while, hospitals can’t raise much capital these days. And I’ve interviewed a number of hospitals where they have seen they have taken steps to reduce their length of stay even though they’re being paid on a per diem basis rather than DRGs. Why? Because they don’t have any capital to expand, and in a sense if they can use their existing plant more efficiently they’re better off. So, I think Steve had the long term answer of let’s change our financing system, which kind of lines up with so much that’s being done in the disease treatment discussions about health care reform, but we may have a particularly good window to downplay these concerns.

I’ve got another question here. How can health care reform improve health prevention? Are you aware of any specific policies likely to become law soon? And I guess I would interpret that as what should the people writing the health care reform legislation be doing about prevention?

Steven Woolf: Well, there are some obvious strategies that come to mind, and I think are front and center right now in terms of health care reform, and that would be coverage for these effective clinical preventive services that offer good value on the dollar. Most research shows that patients who face copayments or other out of pocket expenses for preventive services are less likely to use them, and for many years there’s been a consensus that you need to offer first dollar coverage for those types of effective preventive services, a policy that’s been used for childhood immunizations and so forth. So, enacting legislation that protects that first dollar coverage for effective preventive services is important. But I again want to come back to this point that health care reform is different than health reform, and what I’m excited about is that there’s a lot of discussion on the Hill about part of the reform being investments in a community to produce a healthier population, and that again was part of the discussion that Kitzhaber and others were having in San Diego last week is that we need to change our whole model to think about how do we produce a healthier population rather than financing an industry, because the two are not necessarily in synchrony with each other.

Paul Ginsburg: I’ve got another question card here. Many of the CMS studies, particularly those in the case of disease management, suggest a diminished return on investment, and these studies were stopped. How do we send a message to government entities that programs like disease management and prevention are warranted for the rest of the population, not necessarily the older than 65 age group who might be past their prime as a target for prevention?

Steven Woolf: Well, it’s an interesting question, because it interweaves several premises that are each a little complicated. First of all, disease management as tested in those demonstration projects is not necessarily equivalent to chronic illness management in its broader sense and in particular, as we’ll hear more about later, highly effective interventions for management of chronic disease. And, secondly, what we’re talking about in terms of helping the general population to avoid disease and manage risk factors risk factor modification is not entirely analogous to the time the disease management interventions were tested and the demonstration projects. One way of saying I don’t think the demonstration projects are necessarily generalizable to what we’re talking about here, but I could go into it more later during our panel.

Paul Ginsburg: Good. Question there?

Ms. Peterson: Good morning. My name is Karen Peterson. I’m from the Prevent Cancer Foundation, and there are so many interesting things in this discussion that it’s really hard to pick just one or two to talk about, but I would say that you’ve made me think a lot about changes that could come in the medical division of labor in terms of who does what to whom and under what circumstances and to what extent. So, I think that that’s a rich load that, you know, we don’t hear much about these days, but maybe it’s just not quite the time.

Okay, so I have one other note, and that is that I was really happy to see that you made a distinction between type 1 and type 2 diabetes, because clearly type 1 diabetes is an autoimmune disease. It’s not part of the obesity problem, so it’s good to keep an audience aware of that.

Okay, so what I really want you to talk about, though, is the idea of a time lag in evidence bases; that is, you know, evidence based medicine is what we all want, and yet it takes a while to generate an evidence base and what do we do in the meantime. And the other piece of that and you can talk about any of this is what do we do to keep an innovation pipeline open in not only the treatment based side of medicine but also the prevention based side of medicine if what we do is to take a kind of very strict evidence based approach?

Steven Woolf: Well, the issue you’re raising is an important one that people in evidence based medicine have been talking about for at least 20 years that I can remember, and that is that is does take a while to produce evidence of effectiveness. I remember a particular study that’s been often quoted that it takes about 17 years to go on average from the initial trials all the way through to changing practice behavior. That’s a bit of an exaggeration in many cases, but it is a problem, and in academic settings, at conferences that deal with these issues, there are ideas about how to change study designs and come up with new innovations methodologically to speed up the process of getting that evidence.

In the context of what we’re talking about today, though, I think we have the evidence already for so many different things that we could be doing whether it’s in prevention or in other areas. That evidence has been around for two decades, and we’re not doing it. There’s a classic study by the Rand Corporation that was published in the New England Journal of Medicine in 2003 showing that Americans get 55 percent of these health care services that are effective based on this body of evidence. We have a health care system that is flawed in getting these effective services to the people who need them. So, while it’s true that we need to do more and the comparativeness effectiveness initiative is going to help with this to build up our knowledge base of what’s effective, the larger problem is glaringly apparent, which is that even for the stuff that we have known for many years as effective, we don’t have a system in place to get it to the people who need it.

Paul Ginsburg: Thank you. Yes.

Lynda Flowers: Good morning, Lynda Flowers, AARP, Public Policy Institute, and I’ll raise the flag for the past their prime 65+ folks. Dr. Woolf, I was wondering if you could talk a little bit about the undersubscription of preventive services among those who currently have access to first dollar coverage, and I’m thinking about the Medicare population where many of the services are provided are offered to them without cost sharing and yet they are woefully undersubscribed and there are significant disparities even within that population.

And then I had a second question, which is unrelated, and that is in terms of the health reform ideas that I’ve heard floating around out there, there’s one about a wellness trust or establishing a separate entity to sort of get all this information in one place, and I’m wondering if you think that’s a necessary step to take in order to get us to where we need to be in terms of preventive services.

Steven Woolf: Thanks, Lynda. Nice to see you again.

Lynda Flowers: Thank you, Steve.

Steven Woolf: I think this is a very big issue that you’re bringing up, and we probably don’t have time to get into all the details. The one thing I will emphasize in my response to you, though, is the need for delivery system redesign. A lot of the reasons why patients who don’t have a financial barrier in terms of copayments and so forth are still not getting the preventive services that are recommended have to do with deficiencies in the way we go about making them aware of preventive services that are due and helping them to get the services that they need. Those range from even issues of physicians not having reminder system to make them aware of the fact that patients need these services, information in their EMR, and so forth, that help them identify patients who are overdue all the way through to getting them out to the gastroenterologist for their colonoscopy and so forth where there are breakdowns in the system.

I’m a family physician, so I’m not just a prevention guy. I deal with all the different categories of health care interventions, and there’s a fundamental problem with the platform that we use for delivering care, and that problem shows symptoms with prevention, but it also expresses its symptoms in the management of diseases. So, for example, the same absence of a reminder system to tell me that this Medicare patient is due for a mammogram is also failing to remind me that this patient with diabetes is due for their eye exam. And the point of that is that investing in fixing those delivery system problems has a huge ROI on it, because it not only will help me to improve delivery preventive care, but it’s also going to help me with my chronic illness management or remembering that they need their advance directive signed for their end of life care and a whole spectrum of issues. So, we have to fix the delivery system and, again, I take heart from the fact that the health care reform legislation that’s being discussed on the Hill puts a lot of emphasis on trying to improve the infrastructure of our delivery system for more coordinated, integrated care that will provide benefits across those.

As a primary care physician, my bias is that it’s important for the prevention strategy to be embedded in the patient’s ongoing care. One of the problems with the wellness trust model, if I understand it correctly, is that it partitions that off into a separate entity, which may not be connected to the patient’s ongoing health care issues. But in any case, I don’t want to take too long with that one question, but it’s a very interesting area.

Paul Ginsburg: Good. Next question.

Robin Cheung: Hello, Robin Cheung, Center for Health Outcomes and Policy Research at the University of Pennsylvania. I notice that you know, in this talking about restructuring this system, the delivery system, and changing the model of care delivery, I notice you don’t talk at all about nursing and the contribution the significant contribution they’re going to make when during this reform and changing the delivery system of care, so I wonder if you could speak to that.

Steven Woolf: Thank you for bringing that up, because that’s very important. It’s important on two levels. It’s important in the clinical setting. So, for example, the models for how in an ambulatory care practice or in the hospital we can improve the delivery of services to patients need to get off this notion that it’s got to be through the physician, because nurses and physicians’ assistants, the nurse practitioners, and others often can do the job and do it better than physicians can, and so that more team based group approach I think is key. But the other point I’d like to tag onto your question is when I talk about the need for us to do stuff in the community, it’s very important to recognize that the providers of that care in the community are rarely going to be physicians, and, frankly, it’s not just nurses; it’s going to be public health department staff, it’s going to be Weight Watchers, it’s going to be work-site clinics work site health staff and so forth that play a vital role in promoting a lot of these health changes. We have to get outside the box of thinking of the physician as the captain of the ship in promoting health, because they have very limited leverage.

Paul Ginsburg: In fact, if I could add something. This really takes us into provider payment reform, because, you know, for often short term reasons, so much provider payment is linked to only a physician (off mike) gets paid for something, whereas now with the emphasis on coordinated care, it’s pretty clear that there are things that a practice should do, and other people in the practice not the physician - may be the people who can most effectively or cost effectively do that, so reimbursement innovation in say the medical home, do open an opportunity for using more nurses and other personnel as part of the delivery process.


Will Mederski: Will Mederski with LaRouche PAC. A question regarding the quality and your the use of the term "value" and exactly how that’s defined. You have systems in Oregon where they basically set up 709 I think different treatments, right? Actually, it might be based on illness 709 illnesses which they then limit the coverage of. I think about 120 are basically the state funded health care systems will not fund or will not pay for that treatment, because it’s not cost effective. And similarly in Massachusetts with I believe it’s pay for performance where doctors are graded similar to how they’ve done with teachers graded on whether or not they’re cost effective in their treatments and in some cases actually deny treatment deny service to patients because they don’t think it ineffective won’t look good on their report card. So, the implementation of this cost effectiveness there’s cases in the United States right now, which it’s basically rationing of health care, and I asked for a clear definition of who’s defining quality or value here physicians or an accountant in the operating room?

Steven Woolf: Good question, and as a physician I assure you I’m sympathetic to the concern. I have written for some years now about the imprecision of a lot of these performance metrics, and if and for a variety of methodologic reasons physicians who are providing good care can get dinged and penalized for trying to do the right thing by patients if the performance indicators are not valid, and for similar reasons, rationing can pose problems if the way the standards are developed results in appropriate services being denied to patients who need them. So, it’s a very complicated issue, and the human body is complicated and medicine is complicated, and trying to come up with rules that define what is appropriate and what isn’t is very challenging. Having said that and that is a concern I’ve had since I was young and started my career it’s been pretty obvious to me that you don’t have to go into that area, that grey zone, to find stuff that we’re doing in medicine that is completely wasteful and where there’s very little ambiguity about the ineffectiveness of those services. Physicians who are in practice and nurses and others in the health care professions know what these services are. They see them every day. And we know that we can remove those services and not compromise healthy outcomes whatsoever and markedly reduce spending without even getting into the grey zone where these more controversial rationing decisions have to be made.

Paul Ginsburg: Actually, one perspective is that if we’re talking about a system that spends a third party’s money and we get into concepts of high value and low value, in a sense by identifying something as low value based on the research, is that are we going to call that rationing? And if we are, you know, are there any constraints on what medical care can be provided with a third party’s money?

Steven Woolf: If you look at the welcome to Medicare visit, which Congress passed to provide physical exams for new Medicare enrollees, if I understand the regulations correctly, if you had an EKG on December 31st and show up in my office on January 1st for your Welcome to Medicare visit and you became eligible for Medicare on January 1st, I have to repeat the EKG even though it was just done yesterday. Is that rationing for me to say I don’t think that EKG should get done?

Paul Ginsburg: Yes. Another question here. What is the uptake politically on the Hill I think it says and the administration about health reform? We’ve tried to rein in cost for 30 years and here we are at 16 percent of GDP. CE I guess that means cost effectiveness is far from helping us distinguish anything other than the one size fits all to prevention is prevention our only last hope? I see not cost saving bullets in the short term. I apologize to the drafter of this question. I don’t know if you can get anything.

Steven Woolf: I’m not sure I caught the question, and I don’t know whether it would be helpful for the person who posed it to clarify. All I’ll say just briefly is I think one of the themes of the question is, is there any prospect for us to get anything done this time around with health care reform, and I’m optimistic. There’s a degree of cynicism that comes over the years of seeing these efforts come and go and not suceed, but as they said in San Diego last week it’s not Harry and Louise now, it’s Thelma and Louise the situation we face now, you know, the scene where they’re going over the cliff. I think what you see now compared to the previous situations is a convergence of stakeholders all coming into alignment about the need for something to be done. Importantly, the business world the Fortune 500 companies, the auto industry, and all the others really, in a perilous situation, without getting this solved. That wasn’t the case in prior years, at least as I recall, and I think the convergence of interest I think is the best chance that I’ll probably see in my career of something being done.

Paul Ginsburg: Yes.

Ilise Marrazzo: Hi, my name’s Ilise Marrazzo. I’m with the Center for Maternal and Child Health at the Maryland Department of Health and Mental Hygiene. I think it’s fascinating how you’re moving toward this concept of value in terms of value for your money, which, obviously being in state government with budgets being what they are today, is such a huge priority. My question is how do you sell this to the public? How do you get the public to buy into prevention so that they don’t feel like they’re getting short changed and that really that their quality or their care on the other end is being affected and they feel like they’re being denied services so that we’re not adding more money to the system, we’re actually shifting services, which in some people when they spin that means that those services won’t be available for my treatment?

Steven Woolf: It’s a great question, and I’m a physician, I’m not a communications person, but I think one compelling way of putting it is simply that you’re going to take the same money and save more lives, and I don’t know whether that’s the ticket, but certainly from my perspective I think that’s a compelling argument for changing the way we allocate our resources if we can explain to people that their health will be better for the same amount of money and more lives will be saved for the same amount of money, that that’s an appealing idea.

Paul Ginsburg: Yes.

Ali Kahn: Good morning, Ali Kahn, Center for the Study of the Presidency and Congress. In talking about leveling the playing field, you mentioned you focused specifically on cost effectiveness, which is (off mike) both an important and admirable goal. But we’ve seen repeatedly on the federal level attempts to talk about cost effectiveness being stymied by political forces. Indeed even with the new Federal Coordinating Council on Comparative Effectiveness Research, the Council is barred from making any sort of recommendations as to (off mike) sort of payment or form or other sort of tying the recommended guidelines to actual, you know, cost or delivery incentives. So, I’m wondering basically as we try to frame or shift a frame into focusing on, you know, cost effectiveness, what who would decide where that what treatments or what preventive services are cost effective and what sort of frame or what sort of, I guess, element is necessary to give that to make that authority politically viable.

Steven Woolf: Well, it is a problem with this unlevel playing field that probably what will come out is some mechanism probably at CMS to look at the cost effectiveness of preventive services, but you point out the fact that in other areas of health care, which as I mentioned earlier is where most of our spending goes, CMS actually is expressly discouraged from considering cost in making coverage decisions. Some similar patterns occur with health plans, and as you point out it’s politically sensitive for the comparative effectiveness initiative to deal with cost. So, we have this fascinating paradox in our health policy that we have a crisis stemming from the irrational allocation of resources, but we are tying the hands of policy makers from actually considering the costs in making choices about coverage policy. You know, colleagues in Europe scratch their head trying to understand the Americans, though, and why we do things this way, and it ultimately comes down to political concerns I think that those restrictions are being placed.

Again, I want to emphasize in response to the previous questioner that I’m not na´ve about the dangers that lie in developing rules around economic value and cost effectiveness and rationing services that some bureaucratic panel decides is not effective. Those concerns are obviously there and need to be attended to. But we are years away from getting down to that grey zone. By some estimates, you know, 30 percent of our health care spending is related to these inefficiencies in the way we provide care. Not considering the waste that we have in our spending as part of our policy making process, it seems fundamentally irrational in a moment of crisis.

Paul Ginsburg: Yes.

Richard O’Sullivan: Yes, Rick O’Sullivan with Change Management Solutions. Our firm works with associations and professional societies facing profound change. (off mike) to say about a third of our clients are in health care. And, Dr. Woolf, your construct where you distinguish between health reform and health care reform I can understand that, but is that dichotomy sustainable and any effort at prevention since many of the benefits of prevention are outside the health care system. Yes, it does cost more in screenings for corporate wellness programs, but the businesses get that back and then some in increased productivity, reduced absenteeism, less turnover, etc. Similarly, when you look at asthma, childhood asthma in inner cities, for years I had a standard joke that the major cause of that is rodents and other vermin in low income housing and these kids don’t need inhalers, they need an exterminator, but I’ve yet to see the plan that has the Orkin man listed as a preferred provider. And I’ve been saying that for 10 years and it’s still true. So and you look at the Centers for Disease Control claiming that the loss of bicycle access is a major cause for childhood obesity, so we’re now spending $200 billion a year on childhood obesity or enough money to build 400,000 bicycle lanes a year. How do you draw a distinction between health care and the environment, and what role should health care reform play if you just focus within health care and health care delivery? As the saying goes if the only thing in the box is a hammer, everything starts to look like a nail, so how do you really focus on prevention and engage these other beneficiaries?

Steven Woolf: Well, as I said earlier, I think that important move is beginning to happen. And in, you know, the legislation that I am aware of on the Hill, there is talk about community health teams and public health interventions and putting money into those strategies in an attempt to start to get at that. There’s a huge culture shift that has to occur. My colleagues in medicine are not used to thinking about, you know, the examples you mention and others -- intervention done outside the clinical setting as being important to health. Our research has shown that those types of interventions are far more important to health than just about anything doctors do. One of my colleagues, Jonathan Fielding who runs the health department in L.A., said the most important thing we could do to improve health in this country is high school graduation rates. There are a lot of and then people say, you know, the most important number is not your lipid level but your address. Social determinants of health are increasingly recognized as major drivers of health outcomes and dealing with those root causes will have very dramatic effects on health. I think I mean, there’s a long way to go, there’s lots of political battles to fight to get there, but I think there are an encouraging number of policy makers who are starting to get this and put more emphasis on the need to deal with those community based issues to improve health status.

Paul Ginsburg: I think you have one last question for this session. When costs and value are disaggregated, where are the anticipated conflicts between who pays which is cost and who benefits which is value?

Steven Woolf: Yeah, that’s a tough question, and it gets back to that integrated model again. I know and I’m not an expert in this, but I understand when CBO looks at these issues that there are different offsets that apply when you think about community based prevention and clinical prevention, that these are coming off of different ledgers and therefore you you know, when I as an academic look at the societal benefits of these interventions, it looks very different to CBO when they are partitioned this way. Ultimately, I would argue that the methodology needs to change to deal with our realities rather than changing our realities to conform with the methodology, especially as I keep harkening back to in a crisis setting where our economy is in jeopardy. It seems worthwhile to change our methodologies to find a solution rather than retaining the status quo because it doesn’t fit on the right ledgers.

Paul Ginsburg: I want to thank Steve again for his terrific presentation.

Thanks. We’ll be taking a 15 minute break. We’ll restart at 10:30 with our panel.


Paul Ginsburg: Now that we have a better understanding of the potential value of effective disease prevention, our expert panel is going to talk about why many patients don’t receive appropriate preventive care, how coverage and benefit structures effects patient access and adherence to recommended care, and a little bit about how the Congressional Budget Office scores proposals for preventive services.

Our first panelist is going to be Dr. Mark Fendrick, a professor at the University of Michigan, who’s going to talk about how benefit structures affect patient access and adherence to recommended care.

Then we’re going to hear from Dr. Jason Spangler, a senior managing fellow at the Partnership for Prevention, and he’s going to take us through some of the barriers to patients receiving effective preventive care.

And I regret that I got an e-mail late last night from Chapin White, the principal analyst at CBO, saying that his boss had called him and that he needed to be in a meeting this morning. You can imagine what CBO is doing about scoring health reform these days. He did send me preliminary versions of his slides, and I will, to start the question period, just say a few things about what Chapin might have said if he were here with us. Also, Steve Woolf is going to join the panel when we get time for questions to get into a broad discussion.

Mark Fendrick: Thank you, Paul, and good morning. I want to thank the Center for Studying Health System Change for having me here, and Dr. Steven Woolf for the perfect set up for a discussion around value-based insurance design.

As you might see in the packet, unlike the other speakers, my slides are not available to you, but because this field is changing so quickly and I’m able to actually make changes on the basis of what Steve had to say, you’ll be able to find this presentation at, where you’ll also be able to find out all the information you’d ever want to know about value based insurance design and how it may fit into the health care reform debate.

Like Dr. Woolf, I am a primary care physician, I’m a general internist at the University of Michigan, I see patients a day a week. The remainder of my time has been spent looking at the clinical and economic implications of medical innovation and trying to figure out why physicians and other clinicians do what they do and then how the health system reacts to that. I am a researcher and a data guy, and I think that coming into D.C., which is often described as a data free environment, I want to implore upon you that asking for information to help make better decisions regarding value in health care is absolutely a necessity.

I personally have looked at the clinical and economic implications of the cost of the common cold, laparoscopic surgery, helped put defibrillators into airplanes and casinos. Our group showed that Katie Couric’s Today Show colonoscopy did more for the public health of Americans than a billion dollars of NIH funding. And I wish that wasn’t funny, it’s true. We’ve actually gone so far as to work with Halle Barry and Harrison Ford in trying to convince the Spear sisters to talk more about prenatal care and vitamins.

But just to show you that you can apply really good research to maybe what might be considered shallow questions, I have to start this presentation after a break, which is probably the most shallow of our many research studies, which is the first quantitative approach of why people fall asleep at lectures. And I just show this to you not good science to good questions, and when Alwyn asked me to come, she insisted that I leave my tweed jacket at home in my closet in Ann Arbor.

What you see at the bottom of the slide is a doubling of your risk factor of falling asleep. And I promise not to have a monotonous tone.

So now that I have your attention, getting away from the statistics, I want to go back to the only thing I want each of you to recall about this presentation, which is returning prevention health and wellness to the health care cost debate.

Why the bridge? When I graduated medical school, I thought that my charge would be to improve the health and quality of life of my patients and their family members and any other people close to them. What I realized very early on, that the cost of health care was a very, very important issue. And I’d like to describe the current debate that goes on now, is that those of us, many of us in the room, and particularly Dr. Woolf, we are left side of the bridge people, we are quality of care, quality improvement people.

And I’ll tell you as I tell every group, especially inside the beltway, that I did not go to medical school to learn how to save people money. I went to medical school to improve the health and quality of life of the people who I deal with. What I learned very early on, that the right side of the bridge, cost containment, was a very important time. And I linked with a brilliant health economist, Michael Chernew, who’s now at Harvard Medical School, 16 years ago, and we thought that if we worked hard enough, that the left side of the bridge, the quality people, and the right side of the bridge, the cost containment people, could come to the middle and have a kumbaya moment over value, right.

It turns out that when I started, we were probably 90 percent on the cost containment side in 1993. And to use the great Thelma and Louise analogy, I actually think we’ve gone completely over the bridge on the right side. And there is very little, if any, discussion, at least in my opinion, about health in this whole health care reform debate.

And as I show you clips that I have been able to take out of the major medical journals, that being the New York Times and the Wall Street Journal, it is all about money, it is all about money. And I know there are a number of organizations represented here who really do believe that we must restore health to the health care cost debate. Now, another thing, I often look for the exits, particularly around a great economist like Paul Ginsburg, to go in front of any audience to also say, I think we should spend more money than we’re spending now on health care. Why is that? It’s because if I asked any of you to tell me these most important things that our health care system could do for you, your family members, your friends, your constituents, we are woefully underutilizing those interventions.

And Steve already mentioned, I took the slide out, that the best research in America and how we’re reaching the use of those high-value services is just barely over 50 percent, so we need to spend more.

Now, in this environment, that’s very difficult for me to say. And to move one step further from Steve’s graphic issues of moving from low value to high value care, many of you might remember, at the end of the last presidential campaign, in some desperation, the losing party was calling now President Obama the redistributionist in chief, right.

I will tell you, while he stayed away from that moniker, I would love to take that $2.3 trillion we have and redistribute it in a way that I know Dr. Woolf and I can markedly increase the health, quality, length of life (off mike) compared to what we’re getting now. It’s not that we don’t have enough money, it’s about where we’re spending it, as most people would say, in all the wrong places.

So there’s my one slide on the left side of the bridge. I will now spend the remainder of my time very uncomfortably as a clinician about cost and cost growth and how we could bring these two things together.

I will tell you that during the campaign, having worked with the then junior Senator from the state of Illinois, Senator Barack Obama was a left side of a bridge guy. He was a quality person, he was an access person. And I’ll tell you that once he stepped into the office of the presidency and he started to hear about the economic troubles that our country was really facing, many of you might have noted very clearly that when he first addressed the Joint Houses of Congress, he shifted from a left side of the bridge guy to a right side of the bridge guy.

And there’s quotes that from Peter Orszag that Steven had mentioned, and others, that all of a sudden now, that health care reform became a cost issue as opposed to one of access and quality. So Dr. Chernew and I get frequently called about ways how to lower health care spending, right. And I’ll tell you that it was very nice to have Dr. Woolf make this point early on, debunking what I call the No. 1 myth in Washington, that good, quality health care actually saves money.

And while I could quote Steve’s many articles from JAMA, I tend to quote Woody Allen, who says, the best way to reduce expenditures is death. And the idea that we want to keep people longer, health is a good, and we should spend for it.

So as we get calls on the phone, Dr. Chernew and I, help us save money on health care from large corporations and not for profit organizations, Dr. Chernew, being a dismal scientist, an economist, he’ll say, if you want to spend money on health care, don’t provide health insurance; it’s a very straight forward way to go.

There are other ways, though, softer, gentler. Many floated around here in D.C. and around the country that people believe are going to lower our medical spend.

I grew up in the era of early managed care, it’s coming back. Prior authorization programs are re-emerging. The prior auth number in Michigan is 1 800 NO WAY. Where a high school student on her after school job tells me that I do not know how to refer patients and order X rays and prescribe prescription drugs. And I’ll tell you that while the sticks are prevalent, there are very few carrots out there, similar to what Steve said earlier, to tell me this patient has not been immunized, this patient has not had her mammogram, this gentleman has not had his colonoscopy. So this idea of sticks and carrots I’ll introduce now and I’ll come back to in a little bit.

Generic drug programs, a very important aspect of cost savings, although we’ve gotten in a bit of trouble differentiating from the term generic drug, which is actually a brand to exact same chemical entity to therapeutic substitution, which is where doctors are making changes to different chemical entities that may be the same or may not be the same.

While this is an issue for another conference, I think that the idea of full transparency of what the system is doing to our medical care needs to be improved upon.

Disease management was raised during the Q and A. When I talk to large groups of payers around the country, over 90 percent of them have disease management programs, and almost all of them believe that disease management actually lowers medical spent. I’ll tell you that, again, being a purveyor of the medical literature, the best controlled studies show that disease management programs are highly valuable, they produce lots of health, a great left side of the bridge intervention. However, in most cases, they do not actually reduce medical care costs.

Moreover, in trying to describe the malalignment of incentives that we actually have in the health care system, one of the things that many of the committees now on both sides of the Hill are trying to work out, that in most disease management programs, while we are investing real resources to get individuals to do certain things in the medical arena, the patients out-of-pocket expenditures for those exact same things are going up.

So this is not a clinical thing for Steve and I to deal with. The fact that we pay a nurse $60 an hour to tell patients to weigh themselves, to eat better, to take certain medications in the case of a patient with congestive health failure. It’s amazing to learn that a system, while you’re paying someone to tell a patient to do a certain thing has actually raised the cost to see the nutritionist, has raised the cost to see the physician, and has raise the cost to take all the medications that are recommended.

So when I turn to not fellow clinicians or policy advocates, but to CFO’s of large corporations, imagine this idea and disdain they get when they realize that they’re investing money here to get someone to do something and then creating a barrier in the exact same episode of care.

So the concepts of value-based insurance design as we tie to both primary and secondary preventive services I think become germane as we try to look at the system from beginning to end.

My show is a perfect set up from Steve. This is the New York Times article talking about the Medicare demonstration products projects that did not have the headline, Medicare finds how hard it is to improve quality, right. They did not talk about the trade offs between whether the patients got better, had other process or outcomes measures. But the fact that the pressure was put so hard so early that these demo projects would actually lower medical spend, that people really didn’t look as carefully as one might in terms of the long term clinical implications of these programs, lots and lots of pressure to reduce medical spend.

So, again, coming inside D.C., I think many of you would probably raise your hand if I asked you, how many believe that information technology is going to reduce medical spend? It’s very, very popular around the Hill, $16 plus billion for health IT, again, a huge left side of the bridge intervention, lots of health that’s going to come to identify that patient who did not have her pap smear, the diabetic who did not have a foot exam, and prenatal care services.

I’ll tell you that the focus of health IT is getting people to do less, not more. And if you allow me one anecdote, as I see Jason enter the room, perfect, I actually thought when I got started in this business that actuaries were people who studied birds, and I realized that the actuaries are probably the most important people as we move this real tension between quality improvement and cost containment forward.

And I think that all of us frequently refer to Peter Orszag now at OMB, but once the country’s actuary, who really looks at these issues of quality and cost trade offs, and has made it quite clear in his testimony to the Senate Finance Committee last year that health IT is generally not sufficient to produce health care cost savings. And as you go down Mr. Orszag and other CBO quotes on these supposed interventions to lower health care costs, you’ll see that the bird watchers tend not to agree with the zealots out there who are making these claims of four to one, five to one, 17 to one dollars return on investment as we spend more.

I think it was raised in the Q and A, I’m not going to spend a lot of time on one of the most contentious issues of health care reform again promoted to save money - comparative-effectiveness research.

And again, if you look at the CBO report on where comparative effectiveness chimes in in terms of major decreases in medical spending, unfortunately, the numbers aren’t there.

So where do we turn to next? And the legacy of the previous presidential administration and lots of discussion, as Dr. Ginsburg mentioned, is physician payment reform, the patient-centered medical home, which remains to be the physician centered medical home, at least in my review of this, is certainly one way to save money.

And I will tell you that while my neighbor, who makes four times what I do as an interventional radiologist with 11 weeks of paid vacation, should probably be paid less, I believe that primary care physicians like Dr. Woolf and myself should probably be paid more. And the idea of payment reform, at least historically, came about in what we call these one-size-fits-all statements, pay all doctors less, pay all hospitals less. And certainly if you want to lower health care costs without a discussion of the left side of the bridge, I think this would hold true. But there are certain stalwarts, both in the private and public sector, who understand that there are real health manifestations of some of these interventions.

And again, I turn you to the New York Times of medicine, that in discussion of the patient-centered medical home, it is not about the quality enhancements that Steve and I want to see.

The reason why, in my opinion, that the patient-centered medical home is so attractive is because there are people who are selling this patient, I’m sorry, physician payment reform concept as a way to save on health care costs.

And while we’re all excited about various types of studies from the guys at your health plan in the state of Maine and North Carolina, the evidence really isn’t strong enough, at least from an academic perspective, to make a very confident statement that these patient-centered medical homes, accountable care organizations and other great ideas out there will really bring about this bend the trend that everyone inside D.C. wants to see. So here we are at the key part of the conference, and now that Jason is here, this is probably where I would have started if I knew he was going to be here, is this idea, myth No. 1 in Washington, that preventing chronic disease actually saves money.

And although you heard the quote from Mr. Orszag that, as your BMI or your weight goes up, your medical care costs in a given year go up, I think the only thing I would add to Steven’s amazing presentation is that if you look at 20 studies over 15 years and looking at the cost over a lifetime of obese individuals, they actually cost less than the people who weigh less and exercise because they die sooner, right.

And again, I chuckle nervously on that, too. We don’t want that to be the goal of our health care system. But I think that as we look at just cross sectional situations as opposed to this idea that health is a good, we should not think about how little to spend on health care, we have to figure out how to invest our money to maximize the amount of life years per dollar spent. And Steven showed this slide; I want you all to see this and know about this, that the woman who literally wrote the book on prevention is now being asked over and over and over again to say what is very clear, that preventing chronic disease, a great investment, terrific value, left side of the bridge extraordinarily, will not save money.

And it’s hard for me to come into D.C. because it’s so palatable to talk about save lives, save dollars, right. But unfortunately, the data we have doesn’t bear that out. But that doesn’t mean that we shouldn’t do prevention. And to Steve’s point, that does not mean that prevention does not provide more health per dollar spent than other areas of medical care expenditures.

So I don’t know if Steve noticed that the slide I really wanted him to spend a lot of time on in his presentation, you couldn’t see because the letters were black. And this is an assumption he made that you know, and he’s the expert, not me, about a very, very important point as we move forward about where all this ties in prevention into health care reform.

And I just want to quickly go over the term, and I know Jason is going to spend a lot of time on this. But I when I talk about prevention, and when we talk about prevention in the health care reform context, it includes what I call the Ben Franklin, an ounce of prevention is worth a pound of cure. The primary preventive services which the U.S. Preventive Services Task Force has been dealing extraordinarily well in a non partisan way since its advent, and this is looking for things that happened before an adverse event, and Steve has better definitions, and you can read his slide in your handout, although you couldn’t see it on the screen.

This is screening for blood pressure, for sexually transmitted diseases, doing a screening colonoscopy, the type of things before you have anything wrong with you.

Secondary prevention, and I’m not even going to get into tertiary prevention, it’s just after you find a risk factor or a disease, such as an eye or a foot exam for someone with diabetes, or using cholesterol medications after you have heart disease.

And I don’t know much about the details of the mandate, but the U.S. Preventive Services Task Force now spends their time almost exclusively on primary preventive services.

My ask, and I did not know ask was a noun until two years ago, my ask to all of you is to think about prevention in this conference in a broader sense to include secondary and even tertiary types of things, because given that we’re talking about prevention and value, it is those secondary prevention things, in my opinion, that highly, highly rate in terms of ROI compared to other types of things.

So as it was said that many current benefit designs, including actually some high-deductible or consumer-directed health plans, and, in fact, most reform proposals including a draft of the HELP bill that became available last week, include low or no co payments for high valued U.S. Preventive Services Task Force recommended primary prevention services, and Jason will go through many of those.

I think that is terrific, I think that’s a huge step forward, and unfortunately, I think it’ll do nothing to overall health care costs, although pushing lots of health, which is what my goal is, on the American population.

In terms of health and financial outcomes, our review of the literature would suggest that evidence-based secondary preventive services are among the most valuable, because once you have a risk factor for disease, you’re likely to have something expensive happen to you.

You’re likelihood of having a $60,000 heart attack is much higher if you have high cholesterol and high blood pressure. Your likelihood of having an admission for congestive heart failure is about 50 times higher if you have a diagnosis of congestive heart failure already.

And some of you might have heard that a major American College of Cardiology initiative is to focus on high value interventions to reduce readmission rates, which is very, very attractive to many of the staffers putting together health care reform bills.

Patients with chronic conditions, as you saw on slide number one and in Dr. Ginsburg introductory remarks, are much more expensive than healthy individuals. And if you want to bend the trend, and this is hard for me to say as a public health professor, you should invest in those people who are likely to be sick now as opposed to investing in all of you who are totally healthy and unlikely to have a medical spend for many years to come.

This is a you can imagine a real tension for someone who’s really interested in overall population health. But if the Congress doesn’t get it, Dilbert gets it, right. This is just from two weeks ago. We can save the most money by downsizing the unhealthiest workers first. How do we know who they are? Well, close the parking lot that’s nearest to the building and there they are, the sicker people lying face down. Should we help them? No, it’s too late for broccoli.

And I’ll tell you that this idea that knowing that the sick people are the ones who are most likely to drag us further into the health care cost quagmire suggest, as we go in a temporal way, we should probably think about investing in trying to prevent those high cost, and as Steve mentioned, often preventable interventions early on.

So here is my call to action, that when we talk about prevention of chronic disease, I think we have done an extraordinary job with the Partnership for Prevention and what the U.S. Preventive Services Task Force has done to focus on primary preventive services. And they make up an extraordinary small, as Steve showed you, percentage of medical spend.

But many evidence-based secondary preventive services, many of them actually reduce overall spending as opposed to the small number in the primary side. These are also identified, but not by the U.S. Preventive Services Task Force, they’re often identified by evidence-based guidelines in specific clinical conditions. The underuse of these services are actually worse than in the primary prevention era because benefit designs tend to have taken away the financial deterrent, at least for most covered Americans.

The current one-size-fits-all cost sharing scheme that we have in America for clinician visits, diagnostic tests, and prescription drugs fails to recognize these high-value services.

When I get to talk to a CEO of a Fortune 500 company, and I’ll say, you know, do you know that your employees pay the same out of pocket to see a cardiologist after a heart attack as you would pay to see a dermatologist for acne I can’t see; do you know that your employees pay the same for a diagnostic test like a hemoglobin A1C to measure the quality of care and measurement of control in diabetes as a screening test that they heard Dr. Oz talk about on Oprah last week that has no evidentiary basis; and most importantly, do you know that your employees pay the same out of pocket for a drug that’ll save your life as one that’ll make your toenail fungus go away or your hair grow back, right. There is no acknowledgement in our current benefit design, and I imagine most of your benefit design that would encourage you more to do those things that your clinician would want you to do and discourage you from not doing those things that the evidence might even suggest that would hurt you. So, again, you know, I’m an academic like Steve, you might have heard this term, public or perish, right.

I’ll tell you that I published and I still perished, until I learned that the way things get done in the U.S. regarding health care is through the New York Times and the Wall Street Journal, it’s not through the New England Journal of Medicine and JAMA, as much as we hope and as much as we try.

We have made great strides in getting a lot of these issues out in the forefront. And again, it’s all about cost, right? Every one of these newspaper articles I picked have nothing to do about quality of care, they’re focusing almost exclusively on cost.

Now, I imagine, given some of the comments in the Q and A, there are still some people in this room who believe that health care should be provided in a free market way, the same way we buy many other services. And I’ll tell you that despite the belief that people have that Americans would buy health care in a wise way, if you go back to the health insurance experiment that the Rand Corporation did in the ’70’s, through every study ever done, looking at Americans’ responses to changes in prices in health care, we have seen that as copays for services, some primary prevention, but almost all of these high-value secondary preventive services that I think Steve and I would have no problem agreeing on, as the costs go up, people stop buying the bad stuff, but they also stop buying the good stuff.

So it’s because of this that when we think about, you know, where should we be putting our cost sharing and understanding the concepts behind value-based insurance design, the whole philosophy behind clinically sensitive cost sharing or value-based insurance design comes from a quote from one of the country’s great philosophers, my mother, who said, "I can’t believe you had to spend a million dollars in grant funding to show that if you make people pay more for something, they’ll buy less of it, right."

So as we’ve seen cost sharing go up, we have seen the utilization of things that I beg my patients to do, and I’m getting a bonus to have them do, and pay performance programs go down. And since we chose prevention today, while we have seen it in every prescription drug class we’ve looked at, we’ve seen it in every type of ambulance calling, emergency room visits, physician visits, but again, for those who believe that Americans are not responsive to price, here is a nice article by Trivedi published last year showing that there is clear responsiveness to cost sharing in terms of those high-value services that Steve mentioned, such as mammograms, colonoscopies, pap smears and others.

So it is our belief, and this is the idea I’d like you to get behind slightly called value-based insurance design, which has a role for soft paternalism. No black and white decision making like in Oregon, it’s just a redistribution of the amount of funds, where the system can put in place a situation where we reduce the undesirable clinical adverse consequences of increased cost sharing, but keep cost sharing in those situations where you’re not getting a lot of health, or, in fact, no health for the money.

I’ll tell you that the U.S. Preventive Services Task Force has come out and made things easier for me, saying that prostate cancer screening in men over the age of 75 is harmful, right, although I have not seen any health plan in the Unites States, private or public, that does not pay for this service, right. It is mind boggling to me to think that if I told you that something else was harmful in the public domain, in your grocery store, it would be removed in a day. The fact that we have still, as payers, been willing to pay for things that do not produce health would push my chairman of medicine to say, go out and tell those payers that they get exactly what they deserve, right, that we have to push the system toward value, push the system toward efficiency.

The basic principles of value-based insurance design are very straight forward and they tie very nicely into what the Partnership for Prevention and other preventive organizations are doing; the first and foremost, it acknowledged heterogeneity among medical services.

Although your benefit design that all of you have suggests that your out-of-pocket expenditure is the same for everything, we all acknowledge that medical services differ in the clinical benefit provided.

And I’ll tell you, in speaking to a group of 800 AARP members a year and a half ago, there was not a single person in the audience who did not agree that there is, in fact, heterogeneity among medical services, and they would agree to a benefit design that shifted people to use more of the things in the green buckets and fewer of the things in the red buckets. The trickier part, though, is this second part, which is the clinical benefit derived from a specific service, whether it be a green bucket thing like colonoscopy, which I have fought for coverage for 20 years, or a red bucket thing, something that we feel that we shouldn’t be paying for, like prostate cancer screening over the age of 75, right. It’s that specific person matters.

And I’ll tell you that having worked with Ms. Couric on this issue many years ago, the only thing we disagreed upon is the level of benefits that people should get for colonoscopy. And I tried explaining this to lay audiences this way, that if you are a first-degree relative of a colon cancer sufferer, you should be paid to get a colonoscopy. Your risk is so much higher from those of us without a family history. And many of you might know that the cost of treating metastasic colon cancer has gone up 15 times over in the last ten years.

So you make a left side of the bridge argument because of the risk factors, you make the right side of the bridge argument because screening colonoscopy is actually cost saving in first-degree relatives.

If you’re 50 years old, you should get your colonoscopy for free. If you are a 29-year-old Katie Couric fan with no family history who wants a colonoscopy, and our studies show that these numbers went up substantially, right, it is our belief that you should pay 100 percent of that test, right, as your recommendation, Steve, or age specific. And you should be fined $500 for taking your mother’s slot, right.

And some of you might remember that in the third year of her program, she actually had take your mother to cancer screening day, because while a 29 year old does not benefit, the mother of that 29 year old almost always will. And so this idea of getting down to the specific targeted patient group, as Steve mentioned, really mattered.

The same briefly as treatment, so cholesterol lowering medication far more valuable in terms of lives saved and cost effectiveness if you’ve already had a coronary event, as opposed to the majority of Americans who take cholesterol lowering medicines who have not had a heart attack or stroke just yet.

The evidence base that we have currently allows us to make a lot of these decisions without getting into some of these really tough discussions that came up in the question and answer period. So cost containment efforts, as much as wanted to believe that prevention and quality and health matter, I think as we roll into this real the meat of the health care reform discussions, are legitimate, they will remain, they are important, but they should not produce avoidable reductions in quality of care.

And what value-based design packages do is, they say high-value services barriers are low, and low-value services barriers are high. And I’ll tell you that I left a two pager out on the front desk; we won an award from the Society of Actuaries, which is a really cool place to be hanging out, because they love the idea of not charging $10 for ten things to bring in $100.

They strongly prefer using their many years of experience to charge $3 for some things, $7 for some things, $22 for some things, and $35 for some things to guarantee, as Steve said so articulately, we guarantee more health at any price point, right, by redistributing our incentives for both patients and clinicians to get them to do more of those things that produce health and less of those things that don’t.

So very briefly, and I so, Jason, I stacked the deck when you weren’t here a little bit, so I started talking about this concept, and some of you might have heard this; many years ago we published and we still perished, we’ve gotten to the point now that we very successfully have implemented this in the private sector, many large self insured organizations have done it, and to tie into Steve’s earlier comments, it goes far beyond those issues of just doctor visits and drugs and diagnostic tests, and we were thrilled to see just last month that there is serious discussion about adding wellness programs and community-based initiatives and things that tend to fall outside the benefit design like free gym memberships, smoking cessation programs, and broader wellness programs into some of these situations that may get appropriate tax issues, as well.

I think the most exciting thing coming to you today in D.C. is to let you know about Senate Bill 1040, which was introduced by Senators Debbie Stabenow and Kay Bailey Hutchinson just last month, which calls for a demonstration project in Medicare for a value-based insurance design initiative for prescription drugs for 15 common conditions in the Medicare population for which we know that copay issues and donut hole issues and other cost-related issues have led to marked and systemic underuse of prescription drug classes that we have shown to produce lots of health, and in many instances, given their secondary prevention situation, have been close to cost neutral, or in some situations, save money. So in wrapping up, I turn to all of you, and I know from Dr. Ginsburg and Alwyn, you represent a broad swath of constituencies.

I think it would be great to hear from you during the Q and A whether you would endorse a value-based plan design that encourages clinically sensitive incentives to encourage both patient and provider behavior. And I know provider reimbursement reform has been a major issue for the Center for Studying Health System Change, insist that barriers to evidence based, high-value secondary prevention remain low.

And I’ll ask Jason to at least once in his wonderful conclusions, when he says prevention, he’ll say and I include secondary preventive services, as well. The ask here today, and this is a new push for me in public, to think what you would consider a U.S. Preventive Services Task Force that doesn’t only focus on those high level screening things, but those things that actually impact that large number of Medicare and other Americans who already have a chronic disease for which we have not been able to clearly identify, those services of highest, medium, and low value. And most notably, this is directly to Paul, is to try to couple demand side incentives with all the great work that you guys have done with supply side incentives to truly bring about a seamless system that does not have any glaring lack of incentives as you move through.

So with that, I will close, and again, ask you to think about returning prevention, health and wellness to the health care reform debate, and instead of allowing these people to bring out chainsaws to cut costs, to think about a value-based insurance design idea that would allow us to use a scalpel, and as we cut away, we could preserve the baby and hopefully throw out lots of that wasteful bath water that Steve mentioned. Thank you very much.

Paul Ginsburg: Thank you very much. And now I’d like to turn to Jason Spangler, who I introduced before, and terrific that you’re here.

Jason Spangler: I apologize for being late, as you can imagine, some scheduling confusion. And I thank Mark for filling in. What I’m going to be talking about hopefully will not repeat a lot of what Steve said. There may be some repetition. And it’s going to complement a lot of what Mark said, and it’s actually I’m going to take a step back, I think I was supposed to go first on purpose, and talk a lot more about primary prevention and the importance of that. And I think secondary prevention is important, too, and tertiary prevention, just a matter of perspective.

And Mark talked a lot about coverage and value-based benefit design and a little bit of access; I’m going to talk about access with primary prevention, and also about the delivery system and what we can do in the delivery system in regards to prevention.

So Mark mentioned Partnership for Prevention, that’s where I work. We’re a nonprofit, nonpartisan health policy organization. And basically we focus on prevention broadly. And in the past year and a half, two years, but throughout our history, we want to get prevention in health reform. So what Mark talked about, his last slide, that’s what we are working on and have been working on for a long time.

We work across sectors, too, so health care sector, business, Mark talked about companies that are doing that, we work a lot with businesses and employers, as well. We do a lot of translation of evidence. About two years ago, we came out with principles for prevention centered health reform, and we focused on three things, and Mark talked a lot about clinical preventive services, and historically we focus on that, too, but we also realize that community preventive services, as Mark touched on in the end a little bit, are also just as important, and those are not just, you know, the gym memberships, tobacco cessation, but tobacco policy, tobacco taxes, the built environment, bike paths, sidewalks, stuff like that are also very important.

And there’s a lot of interaction between that and the health system, too. So like when you see health IT, you know, health reminder systems are actually a community preventive service, but work in the clinical area, so they’re also very important.

And then kind of to pair them together, you know, increase the impact of both of those, you know, they reinforce each other, there needs to be research around both of those, whether it’s primary prevention research, secondary prevention research, there needs to be a lot of work on community preventive research.

As you’ve heard about the U.S. Preventive Services Task Force, there’s a partner task force called the Task Force in Community Preventive Services you may have heard of, which is basically the CDC, which is completely and always has been underfunded and needs to be funded more to research the community preventive services, which have, in many respects, a broader impact, you know, on society when it comes to health.

So when we say investing in prevention, what does that mean? The first is improving quality and quantity of preventive services.

You guys already know what these are, immunizations, counseling, medication, screening, and we just think that overall clinical preventive services are important, but as I said, also community, media campaigns, environmental change, policy change I mentioned.

You probably know how the Task Force works. They give ratings based on net benefit and the quality of evidence, you know, A through D, D being negative, A being the best. There are a lot of services which are I, which there just isn’t enough evidence for. And we’ve been pushed recently to what do we do with the I, what are we going to do, should we just try them out, should we wait, and how does the I impact benefit design, and that’s a tough question that, I don’t know if the Task Force is going to answer, they’re trying to answer that. But, again, more research needs to be done with most of those. If you go back to 2007, and now they don’t publish a book like this really anymore, everything is online as it’s updated, and there’s been recent updates. There was an aspirin counting update a few months ago, other recent updates even since then.

Back by 2007, they had 58 different interventions, 29 were A or B recommendations, there’s a list there, I’m sure you’ve seen most, if not all of those. So what we did, and this is what I’m going to focus on when it comes to the value of preventive services, particularly clinical preventive services, what we did is, we commissioned a group of experts together, and I don’t know if you mentioned this or not, Steve, but the National Commission on Prevention Priorities, which Steve is a part of, basically to look at the value of these services, what’s the benefit of these, what’s the impact.

And if this is repetitive, just somebody raise their hand and I’ll skip through all this. But I’m going to focus particularly on what they’ve done, and hopefully Steve didn’t do all of that.

But they looked at services in 2001 and again in 2007, as well as those by the advisory committee on immunization practices, because the Task Force has, you know, deferred to the Advisory Committee on Immunization Practices on immunization. And basically what they looked at you didn’t talk about this, Steve, did you? Okay. So I’ll talk about the methodology, we’ll breeze through the findings, and we’ll talk about utilization, and then barriers, and what we can do to overcome those barriers.

So what we did is, not me, but the Commission looked at, you know, the clinical preventive burden. So what’s the impact that these services have, you know, how many live saved and QALY were mentioned, that’s how this was measured. Then they looked at cost effectiveness of these measures. So how much is spent, how much is saved, and according to lives saved according to that.

So you have a score of one to five for each one of those, one being low, five being high, so for a total each service would get a score of two to ten. So you’re probably seeing this slide Steve showed. So, you know, high value services are ten, and then as we go down, lower value services.

Now, those services are still important, they’re still recommended, they still should be done, just when you come to value and you have to prioritize, you have limited time, limited resources, what produced more value than others, and those are the ones that are at the top, which were mentioned already. And then, I don’t know if you can how you can read this, but if you divide these into cost saving versus how much QALY, you know, almost all of these are less than $50,000, which is kind of a benchmark number of something that’s cost effective.

So they’re all high-value services. Now, what do these tell us? You know, most are cost neutral or save some money more than they cost, many are very cost effective. It’s great, for a small cost, as Steve mentioned, you know, good value.

And then a health care system will be most efficient if it utilizes or optimizes the use of these services.

Now, and I don’t know how much he touched on this or not, utilization, but I’ll talk about this in a little bit more detail. How well do we do on these services? Now, you know, Mark mentioned that the primary services aren’t that great, the secondary services are worse, secondary preventive services are worse, and we haven’t done research on secondary prevention services, but on the primary, we know that it’s pretty low.

Steve may have mentioned how many lives saved; but you take these five you may have seen this, the Chlamydia screen one is actually not lives saved, it’s cases of pelvic inflammatory disease prevented. But if you take the first four, and then the next one, the breast cancer, you know, over 100,000 lives would be saved if we had increased utilization to 90 percent. Most of these, as you see, are less than 50 percent. So what do we do? Why don’t more people use clinical preventive care? And this is what I’m going to talk the rest of the, you know, briefly, and we can talk in more detail about this

But, you know, there are barriers that face patients. Most people don’t know what they should be doing. And most clinicians, I would say, don’t really have the time necessarily to tell them what to do. I mean they want it’s not that they don’t want to, and I’m a clinician, too, it’s not that people don’t want to do this, it’s just a lot of times they don’t have the time, and also, as I get to this, they’re not compensated for doing that.

In addition to not knowing what they need, and most of the need has been mentioned, it’s based on age and gender, almost exclusively it’s based on age and gender. And people, you know, a woman who’s 65 may not necessarily need she knows she needs to get a mammogram and a pap. Now, she may not even need to get a pap anymore depending, but she knows she needs to get a mammogram. Does she know that she should get a flu shot every year? Probably. Does she know that she needs to get a pneumovax immunization? Maybe, maybe not.

So in addition to not only knowing what they need, that’s kind of a first step; second is, they don’t know the effectiveness. Again, like Mark said, if people knew that it’s actually if you’re an 80 year old man and you want to get screening for prostate cancer, if you knew that that’s harmful, you probably wouldn’t do it.

If you also knew that, you know, the amount of lives that could be saved or the, you know, if your life could be saved if you got a colonoscopy, you know, if you’re 55, you may be more inclined to push to get that done, not only wherever your provider is, but, you know, people could probably influence you even benefit design or the insurers, if they don’t cover that.

Now, most of these services are covered basically, and then we’ll talk a little bit about cost sharing, which Mark touched. Another problem is, a lot of people don’t have a regular source of health care, they don’t have a primary care provider, they don’t have a medical home, whether that’s a physician, whether that’s a nurse practitioner, whether it’s just a clinic, wherever they go, a lot of people don’t have that. A lot of people, you know, it’s episodic care, it’s not coordinated care along the continuum. They go to the emergency room or an urgent care, or they see a whole bunch of people, you know, that’s not coordinated. They see a cardiologist for this, they see, you know, an internist for this, so

And then finally, you know, the out-of-pocket cost discourages utilization. There’s been plenty of data that shows as you raise co pays and deductibles, the utilization of preventive services goes down, and Mark touched on this, you know, as you raise copayments, people don’t use the good stuff or the bad stuff.

We also know that if you eliminate those co pays and deductibles, utilization goes up. And so it’s not just it’s cost sharing overall, it’s co pays and it’s deductibles itself.

Now, a lot of plans are actually doing pretty well when it comes to deductibles. There are still co pays for these services, for the most part. And then as Mark touched on, and we can talk about this a little bit, is when you look at legislation when it comes to health reform, they’re trying to eliminate these. And if you look at the MIPPA legislation, which was some of the Medicare changes from last summer, they included A and B recommended services would be covered by Medicare, which weren’t previously, except by legislation, they also are trying to eliminate deductibles and co pays for those same services. So that’s starting to happen, which is good news.

Now, health care system barriers, we touched on this, you know, lack of time. I don’t know if this was mentioned, but, you know, there was a study done several years ago, it talked about if you were how much time it would take for you to talk, counsel, discuss with your patient, do all the recommended clinical preventive services.

So one patient, all the A and B recommendations for that patient, seven hours a day it would take to do that. That’s not doing anything else, not seeing any other patients. Basically it’s a patient a day and all you’re doing is prevention, and obviously that’s you can’t do that.

Even if you took just the A recommendations, so those are just strongly not just recommended, but strongly recommended, it still took about four hours a day just to do those. So, obviously, it takes a lot of time to do that. There’s a lack of training when it comes particularly to the counseling interventions. So how do you counsel someone on aspirin use? How do you discuss benefits and harms of using aspirin for the heart disease and stroke? We don’t really know.

Even the counseling that we do know, so for tobacco cessation counseling, there’s research and literature that shows this is an effective way to do counseling. You know, it was originally the four A’s, now the five A’s. We know this works. But how many providers are actually trained how to do those sorts of things? I was never trained how to do that, and I don’t think anybody else is really trained how to do that.

And these are actually the services that are actually done by the you know, when it comes to screening, screening for colon cancer, screening for mammography, you know, those are services that are pretty well utilized. But when you counsel on tobacco cessation, when you counsel on diet, counsel on aspirin, those things are not done as much.

Then again, lack of reimbursement, you know, whether you talk about reimbursement, payment reform, again, I’m in total agreement with Mark, you know, the things that should be paid for are the things that show value. And these are not paid for because I don’t think people realize how valuable they are. And even things that they’re starting to realize, so when you talk about tobacco cessation counseling, which is covered by Medicare, the reimbursement is so miniscule, I mean in some we’ve heard even from some physicians, they get $10 every time they counsel for something like that.

In addition, there’s a lot of counseling that’s done by providers that you can’t code, so they’re not paid for it at all, and it takes time away, and they need to make that up some other, you know, in some other method or some other patient, seeing more patients, doing more that is paid for. So that’s also something that’s lacking.

There has been talk within the patient medical home, patients in a medical home discussion about a and you may have heard this, a bundled payment, which is basically where a each provider gets paid a certain amount per patient that’s supposed to cover everything that’s not paid for now, so that would include counseling, phone calls, e-mails, whatever you do that maybe is not covered or you can’t reimburse for. So if that would include prevention stuff that’s not paid for, I mean I think that definitely is a good idea. And then just overall, there’s just not investment in a prevention oriented health care system.

The system is not set up and has never really been set up to be prevention oriented, it’s set up to be treatment oriented. You know, patient comes in, you diagnose something, and then you treat them, and that’s basically how our health care system has been always set up.

So there has to be a drastic change just overall with the system. And as health reform becomes, you know, more and more discussed and has been discussed a lot, there is going to be a lot of discussion, has been a lot of discussion about incremental change versus just change the whole system and revamp it from the bottom up. And it’s likely the former will happen and not the latter, but in many cases, it would probably be better if the latter did occur.

So this is basically the bottom line, general principles, when it comes to prevention, preventive services, you know, any standard - we feel, and a lot of our partners feel, any standard benefit package should have preventive services covered. And we would say all those covered. But if you were to - if you had to limit, obviously, the high value are the most important. Now, one good news is, if there is a public plan, which I’m sure you’ve heard a lot about, the template for that plan will most likely be the Blue Cross plan within the federal employee health benefit plan. And the good news about that is, most of these services are actually already covered, and a lot of them don’t have cost sharing copays.

So if there is some good news, getting onto that, you know, first-dollar coverage, so that’s no cost sharing, that will eliminate the financial barriers that we know exist. No copays, no deductibles for these services.

The same standard should be used to evaluate preventive services and treatment. This is what we call making a level playing field. Nobody looks at a treatment and says, well, is this cost effective, how much is this going to save, will this save money, you know. You have someone who has colon, for example, colon cancer, chemotherapy for that, nobody says, well, is this going to be cost effective, should we treat this patient for this, they’re probably going to, you know, nobody looks at that. And we think that that’s important. When you look at whatever is covered, that use the same standard, because right now, prevention has been singled out as being a cost saver, and if it doesn’t save money, we’re not going to do it, that’s what a lot of people have said. Obviously, that shouldn’t be the standard. But if you’re going to look at it that way, look at treatment that way. Nobody looks at treatment and says not only is it not cost effective, they don’t look and say cost savings, nobody looks at it that way at all, but just have the same level.

You know, if you’re going to look at cost effectiveness, which is okay, look at it both ways, because we know there are plenty of treatments. I’m not saying that you shouldn’t cover those, but there are some that are harmful, there are some that are definitely not cost effective, so just, you know, have the same standard for both, or don’t, you know, or don’t have that standard for either.

If effectiveness, you know, they should cover all A and B recommended services, and then again, hold treatment to the same standard.

I want to talk a little bit about community preventive services, too. Mark touched on this a little bit. More and more people are realizing, and plans can’t really cover community preventive services, but, you know, the local and state, federal governments, local community organizations are realizing the importance of community preventive services. Businesses, Mark mentioned this, businesses are realizing that, you know, they are an important player and sometimes the most important player in their community, and whatever they do around health and wellness or prevention and wellness for their employees needs to translate into health and wellness for the community that they live in.

So that is I would think the level of interest in that is being raised with legislators and policy makers, and it’s very important. One thing that needs to be done is additional research when it comes to community preventive services. Again, I mentioned earlier, the Task Force doesn’t have the resources right now to actually do that.

And I will mention again the NCPP, the National Center for Prevention Priorities, the work that they’re doing now is, they’re continually looking at clinical preventive services, but they’re moving to community preventive services and looking at value at community preventive services. And if you have limited resources, what community preventive services provide a greater value than others. Now, it’s a very different look than with clinical, and the methodology is going to be a lot more complex, as they’re finding out. But it’s important work, and others that are doing that, you know, work, as well, it’s just it’s very important, because I think the effect that it’ll have on health, you know, as Mark mentioned, what we’re trying to do is improve health.

If we save money, great, if we bend the curve, great; but right now, our health care system is not improving health overall. It’s not efficient. What we put in, we’re not getting out what we should. And that’s basically I think what all of us, when it comes to prevention, whether it’s secondary, whether it’s tertiary, primary, value based benefit design, we’re not getting out what we’re putting in, and that’s what we want to do.

So that was pretty brief, but if you have any questions, I’d love to answer them. Again, thanks, Mark, for covering some of what I did. I’m sure some of this was repetitive from Steve, but again, you know, clinical community, high these are high value services, they should be covered as much as possible, and again, important in any part of health reform. And we’re hopeful, we have our fingers crossed that it’s going to be included in what they’re working on right now. So thank you.

Paul Ginsburg: Thank you. Steve, do you want to join us at the table? What I want to do is first say a few words on what Chapin White would have said if he was here, because he did send me a draft of his slides. And I think the essence of it is in one slide, and he called it an unpopular view on preventive services, where he says that not all preventive services are created equal, preventive services are investments, some are good, some are bad, all involve uncertainty.

Cost effective does not mean cost savings. And be aware of cost shifting. And I would say up until this point, it’s pretty consistent with what Steve Woolf was saying. And I’d like to explain for a minute the cost shifting.

In a sense, what Chapin was going to say is that CBO’s principal job, not their only job, is to say what is the impact on the federal budget. I’ve seen CBO work in many reports and areas which has gone broader. It has talked about the economy, talked about the health care system as a whole, but I think the principal audience for CBO analyses, which is the Congress, is most interested in the effects on the federal budget. Why? Because we have such a federal budget problem. And I would say the implication is that it would be nice to be freed of this, but in a sense, to be freed of it means identifying say high value preventive services and finding a way to pay for it either through reducing waste in the health care system that shows up on the federal budget, or even by raising taxes.

So, in a sense, part of it is just the way the process the debate has evolved, is that CBO has become the place that says something which nobody here is disagreeing with, you know, there’s a lot of good prevention that’s highly effective, high-value that doesn’t save money, and we can’t say that it saves money because all the research says it doesn’t save money.

And I think, unfortunately, a lot of friction and noise has come up against, well, CBO must be wrong, they do save money. I’ve spoken to a lot of congressional staff and they all believe that most prevention saves money, even though these experts will tell you that’s not the case. But wait, there are very there are many high-value preventive services, and we need more of them, and I guess that’s where we are at the moment. Before I start taking questions from you or inviting the panelists to comment, I just wanted to have a perspective I have on value based insurance design, which was an idea that intrigued me a long time ago, and I’ve been watching it and following the work that Mark Fendrick and Michael Chernew have done.

And I had always thought of value-based benefit design as actually appeared in Mark’s slide as differentiating the cost sharing by the value of the service, which meant that some very highly valued, particularly secondary preventive services, would have less or zero cost sharing, but low-value services would have higher cost sharing.

And as I’ve watched value based insurance design actually be implemented in some sites, it’s only been to lower cost sharing to the high value services, and maybe that’s not surprising that there’s been difficulty, because, you know, the services that are the lowest value often aren’t covered at all.

But then it dawned on me not too long ago that during this decade, we’ve had such an increase in cost sharing across the board that maybe actually we’ve gotten there, that to the extent that we identify the high value services and have lower cost sharing, we don’t have to worry about identifying low value services with more cost sharing because everything has more cost sharing. And we certainly could do better than that, but at least there’s some movement in that direction.

First I’d like to ask any of the panelists if they have something they’d like to say or ask their colleague before we turn to the audience.

Mark Fendrick: If I could briefly respond, I think that that is a wonderful summary, Paul, of where we started and where we’re going. Steve mentioned this in remarks, and as much as we have tried to be able to identify that these primary and secondary services actually are cost saving, particularly in the short term, in the short window that Steve mentioned, we didn’t emphasize enough I think, which still appears to be the holy grail to get to cost neutrality, which is a better quantification of the non medical financial implications of improved health.

Jason talked about it, so the idea of disability reduction, productivity, and other things such as retention and morale that are just really hard for a health services researcher like myself to get my arms around.

I’ll tell you that in most of the services that Steve mentions in the highly cost effective arena, the return on investment, which is a different way to look at these things, tend to be somewhere between 60 cents to 80 cents on the dollar on the medical spend alone. Most of the champion leaders in the industry from the employer side basically say I’m not exactly sure how much I’m getting from the non medical benefits of this, but it’s clearly more than 20 cents on the dollar.

It doesn’t need to be the four to one, five to one, and I’ve seen as high as 17 to one returns we’ve seen on that, Steve, in many white papers or gray literature, and I think the more we come together, and you’ve probably all heard of those business leaders who really do get it, that you can get overall cost savings if you take a broader view of what good health actually produces in the work force.

Paul Ginsburg: Steve.

Steven Woolf: The comment I wanted to make in response to what you just said, Paul, and to Mark’s presentation, was that I agree with everything that was said. Quite a bit of it focuses on this notion of cost shifting. And your point, Paul, at the end of your comments about how we’re sort of at a place now where, just by default, the cost shifting has occurred with the low value services; but the other piece for me that I think would be important, and I imagine Mark could elaborate on this, is on the provider side, of providing - of dealing with the misaligned incentives for those low-value services.

So even if the cost shifting leaves patients in a place where they have a significant barrier to those low value services, we still have the problem of providers getting perverse incentives to offer those services. So, in contrast to the $10 that Mark mentioned for smoking cessation counseling to deal with the leading cause of death in the country, I can get paid $300 or $400 for taking off a sebaceous cyst for cosmetic purposes.

So that problem, which was addressed beautifully in The New Yorker magazine article by Atul Gawande recently really is still a fundamental flaw in promoting those high-value services.

Paul Ginsburg: That’s a really good point. You know, I think historically, provider payment has attempted to be neutral in the sense that we don’t want provider payment to influence how physicians practice, that’s the way the Medicare program was set up. But inadvertently, I would say by neglect, we have created an extremely powerful system that is providing strong incentives to provide many low-value services. And it’s probably I haven’t seen any one study, but it’s probably likely that the services that have the inadvertent overpayments probably are more likely to be in the lower-value end than on the higher-value end. Jason, did you have any comments before we go to the audience?

Jason Spangler: Yeah; I just wanted to comment about CBO, and I wish Chapin White was here, because CBO has been beat up a lot, and by people on my side. You know, CBO does what they’re supposed to do. They’re supposed to look at how much any legislation is going to effect the budget of the government and that’s it.

They’re not they can’t look at societal cost, they can’t look at how things are going to affect society; you have a certain window, if you expanded that window, maybe you would see some savings for certain services, but, you know, I think they’ve been unfairly, and in many respects, beaten up, because they’re being asked to do what they’re not supposed to do. And if they if Congress wants to change what their, you know, what their mandate is and what they’re supposed to do, that’s fine, they can do that. But, again, you know, I think the ultimate goal it seems like for, when it comes to health reform, has been savings, and because CBO doesn’t save or doesn’t show savings for certain things that we think are important, then they’re the villain for that. So just keep that in mind when, you know, people talk about that.

You know, I think they do what they’re supposed to do, if people want to change what they do, then that’s okay, but again, it’s more about value than savings, and some things will save, some things won’t.

Paul Ginsburg: Alwyn.

Alwyn Cassil: Alwyn Cassil with the Center for Studying Health System Change. And I can’t pass up the opportunity to have three physicians at my mercy without throwing this question out.

I want to draw together some of the concerns that arose in the first Q and A and kind of get your sense of whose job is it, if anyone’s, to help get the public more engaged in this whole idea of better value for money spent on health care. And, I think there is a lot of fear thatwe’re going to go back to those bad old days of the person with the high school diploma telling Mark what to do to me and what not to do to me. But at the end of the day, you are the guys that pull the lever, you know, you decide what care patients get. And it seems to me that you have to be part of the solution-- that sings the gospel to patients that this low-value stuff, not only will it not help you, it can hurt you, it can take you on the path of medical misadventure.

And, let’s say we lived in a world where all the stars were aligned and the incentives were aligned, it’s still going to take physicians to convince patients that they are not being shortchanged. And my question to you is, is the profession up to the task?

Paul Ginsburg: Who would like to start?

Mark Fendrick: Well, this is a terrific question. And I’ll just say that, as I’m trying to think of a reasonable answer to this, is that when I - the idea that physicians in the U.S., if they were golfers, right, are paid every time they hit the ball, no matter where it goes, right. So if I were, you know, a golfer paid under that situation, I would be the highest paid person in the world because my ball never goes in the hole. The fact that all of you have heard that in certain circumstances, when we make a mistake or an error occurs, we’re actually paid more, right. I know no other profession where this situation has gone so awry. So having addressed a number of clinician groups, not only physicians, and maybe there are some represented here, is there any push back at least publicly to say that I am going to start paying you for the health you produce as opposed to what you’re doing.

And it would be very hard politically to go against that publicly, and maybe someone else will comment. So the I would believe that the professional organizations are behind them.

The issue is the one that Steve just mentioned 30 seconds ago, before your question, is that, to quote Upton Sinclair, one of my favorite quotes of all time from The Jungle, "it is difficult to get a man to understand something if his salary depends on him not understanding it," right. So this idea that, you know, physicians are not like any other entrepreneurs, they’re trying to I don’t think any physician is trying to harm people. But I think if you put a situation in place where your revenue could be maximized by doing some things, as opposed to others, you’re going to do it. And what I’ve charged people like Jason, but not Jason, before is, we have never looked at a study that has a simple chart that shows profitability to physicians or hospitals, right, and cost effectiveness. I’ll tell you that that line is no where near it should be. And so, you know, to blather on and give you - we will incrementally move, in my opinion, in this step of health care reform and what’s going on in the private sector, that we are going to stuff the physician’s mouth with gold, the same thing that happened in the National Health Service in 1948, to get them to do more of the things that we want them to do, that we believe produce health.

And hopefully, on the back side, we will find someone, which is not me, someone who is tough enough, who’s paying the bill, to say I’m no longer going to pay you for doing things that harm people, start from that.

Then you go to I’m no longer going to pay you for those things of low value. And then you get into that really rough situation that I hope I’m retired for that was brought up in a Q and A, which is we’re really at the margin.

And the last thing I’ll say is, the low lying fruit are so low that although we can’t do value based design, the fact that diabetics pay a lot of money for eye exams and we don’t get a lot of money for doing those things, for an ophthalmologist, doesn’t make sense. There are ways that we could start, as we’ve seen, as Paul mentioned, in the private sector. There are 500 different value-based insurance design experiments, all which are different, trying to get us closer to this aligned system that, you know, Steve, Jason, and I all, of course, want to see us get to eventually.

Jason Spangler: I agree with everything Mark just said. I would say one thing we need to do is, go back, go upstream as far as possible, because we are not taught these things, we are not trained this way. You need to go the whole way, I mean because I agree, we do have a responsibility, but most physicians don’t know, and the way they’re trained is not geared this way.

And again, as I said, and other people have said, you know, our system is not geared this way. So I think one thing we need to do is go back and train. I think we need, in medical school, in residency training, these things need to be emphasized, and not just prevention, but value in general, and producing health, you know, not just treating a patient. And, you know, there are other there are intrinsic things in the system that we all went through training, that beat out some things in you, and you know, you’re just trying to survive certain aspects of it. But I think that’s I think the education of the provider, the clinician.

And I would say that the non physician clinicians do this better, you know. The PA’s, I know there are PA’s in this room, there are probably nurse practitioners in this room, they’re trained better when it comes to these things. And I think the physician community has a lot to learn.

And I would say that there is some, you know, double AAMC, the American Association of Medical Colleges, is starting to slowly do this sort of thing. So I mean I think but I think you need to start back that far to do that if you’re going to influence or have the physician influence the patient.

Paul Ginsburg: Yeah, Steve.

Steven Woolf: So Alwyn, the answer you’re getting is this, that there needs to be a culture shift. I don’t want to suggest, though, that we have to wait 20 years before we’re going to see real change. I think these policies that we’re talking about need to happen pretty quickly. But the culture shift I think is an important part of it. And what we’ve spoken of so far is the need for a culture shift among physicians. I see three sectors I think where we need a culture shift; one is in the health care professions, and I agree that we’re probably going to need a new generation oriented toward this in our training, but also current practitioners need to start thinking differently about what they recommend.

The second audience is policy makers. I think that their perspectives need to shift about what good value means, and I think that’s by necessity happening because of the crisis that we’re dealing with, so that dialogue is underway, but more needs to happen there.

And the third is the public and patients. So I mean we probably all had this experience. There are plenty of good doctors out there who are conservative, and I don’t mean in the political sense, but who will encourage the patient not to have a test or not to have a procedure because they know that it’s really not good for them.

And the reaction you often get from patients is, you know, more is better, and you’re not providing me quality care. And many patients feel like if they come out of a physical with lots of tests ordered, that they are better off. And changing that mindset will require some re-education. But as somebody said during the break, we’ve seen with the green movement environmental issues a shift in public understanding about these things, so that, you know, attitudes about whether you should have a hybrid and other choices that people make have been changed in recent years because of greater awareness, call it marketing or communication or whatever, we’ve done a better job of helping the public to understand the issue, we need to do that with health care so that the public feels invested in a need to think differently about what’s good for them.

Paul Ginsburg: Go right ahead.

Jason Spangler: Just to reiterate something that Steve said, you know, if you look at the data, you know, Kaiser Family Foundation does periodic survey data on the public about this, and one of the things that shows is, when it comes to unnecessary care, you know, experts think that up to maybe 50 percent sometimes of care is unnecessary.

The public, when you ask them about it, you know, it’s less than 15, or 15 percent, or 16 percent think they’ve ever received unnecessary care. And if you were to say to them, you know, do you think that, you know, clinicians should be doing certain things or providing certain care for you or recommending and they shouldn’t recommend, you know, they don’t want that, they don’t want their, you know, their provider to do that, so I think the public is

Mark Fendrick: So a final quick comment, because the word rationing comes up all the time. I think that what we’re trying to do is basically so if people want to get things in the U.S., they’ll still be able to get it. It’s the idea that we are and I wish I could remember exactly how Steve said it.

We are going to use public funds in a way to maximize the amount of health we could get for that amount of money for that population. And I think that having doing this now for five years, I have not come across a single constituency that has said compared to what we have now to a system that we could guarantee healthier lives and fewer deaths for the exact same amount of money is exactly what the constituencies want and is exactly what Mr. Orszag is pushing for.

So I think there should be some optimism moving forward. And if people want to waste their money on things that their own money on things that don’t produce health, that’s fine, but just don’t use my money to do that, and that’s the messaging we’re trying to get out there. And we’ve explored that in a number of different groups, and it seems to be fairly well received.

Paul Ginsburg: Thank you. Before I go to the final question, please, if you haven’t, fill out this evaluation form, we make good use of them. And, sir.

Stephen Forstenzer: My name is Steve Forstenzer, I’m with the Maryland Health Care Commission. A comment that I wasn’t going to make, except that you mentioned it, we have now, the difference is, it’s rationing by whether you can afford it or not, whether you’re considered a worthwhile citizen or not. But we ration on health care much less rationally than almost anybody else does.

There was some mention about medical homes, and there is an attempt even without that. A lot of insurance companies require that you have a primary doc, who then makes the referrals. But speaking personally, often that occurs, but the receiving physician does not seem to consider asking the referrer about some medical history for the patient.

So I’m currently in a situation where I’m getting certain medications that if he had asked my primary, he would have never written. And then I had to go tell him because I had to research it online to say, no, this med raises my blood sugar and I’ve had diabetes for nine years. There’s got to be a system, and I know it’s a long way to a medical home. I worked at Montefiore when we had a whole medical group that required that, but it went the way of communists.

So - but even in this given system, if someone says you can’t have procedure X until you go to your primary for a referral, something has got to be in the system to make the next step happen, otherwise, each of us becomes our own advocate because we’re the only one around who knows ourselves.

Paul Ginsburg: Yeah, but we’re running late, so let’s just get one answer, one response from

Mark Fendrick: That’s a plug for your next conference to be on health IT. I think that is not a value proposition, I think that’s what everyone is talking about and trying to bring

Paul Ginsburg: Thanks. I want to thank Alwyn Cassil and other HSC staff involved in putting together this conference, and thank all the people on the panel who really did a phenomenal job.

Panelist Bios

A. Mark Fendrick, M.D. - Professor, Internal Medicine and Health Policy and Management, University of Michigan

A. Mark Fendrick, M.D., is a professor of internal medicine in the School of Medicine and a professor of health management and policy in the School of Public Health at the University of Michigan. Dr. Fendrick’s research focuses on the clinical and economic assessment of medical interventions with special attention to how technological innovation influences clinical practice, benefit design and health care systems. He has authored more than 200 articles and book chapters and lectures frequently on the quality and cost implications of medical care to diverse audiences around the world. Dr. Fendrick remains clinically active in the practice of general internal medicine. He is the co-editor in chief of the American Journal of Managed Care and is an editorial board member of three additional peer-reviewed publications. His perspective and understanding of clinical and economic issues have fostered collaborations with numerous government agencies, health plans, professional societies and health care companies. He serves on the Medicare Coverage Advisory Committee. Dr. Fendrick received a bachelor’s degree in economics and chemistry from the University of Pennsylvania and his medical degree from Harvard Medical School. Dr. Fendrick completed his residency in internal medicine at the University of Pennsylvania, where he was a fellow in the Robert Wood Johnson Foundation Clinical Scholars Program. He currently co-directs the Center for Value-Based Insurance Design at the University of Michigan.

Paul B. Ginsburg, Ph.D. - President, Center for Studying Health System Change

Paul Ginsburg, Ph.D., a nationally known economist and health policy expert, is president of HSC, a nonpartisan policy research organization in Washington, D.C., funded in part by the Robert Wood Johnson Foundation. Ginsburg is a noted speaker and commentator on changes taking place in the health care system. His recent research topics have included cost trends and drivers, Medicare physician and hospital payment policy, consumer-directed health care, the future of employer-based health insurance, and competition in health care. In 2008, for the sixth time, Ginsburg was named by Modern Healthcare as one of "The 100 Most Powerful People in Healthcare." He received the first annual Health Services Research Impact Award from AcademyHealth, the professional association for health policy researchers and analysts. He is a founding member of the National Academy of Social Insurance, a public trustee of the American Academy of Ophthalmology and served two elected terms on the board of AcademyHealth. Before founding HSC, Ginsburg was the executive director of the Physician Payment Review Commission (PPRC), created by Congress to provide nonpartisan advice about Medicare and Medicaid payment issues. Under his leadership, the PPRC developed the Medicare physician payment reform proposal that was enacted by Congress in 1989. Ginsburg previously worked for the RAND Corp. and the Congressional Budget Office. He earned his doctorate in economics from Harvard University.

Jason Spangler, M.D., M.P.H. - Managing Senior Fellow, Partnership for Prevention

Jason Spangler, M.D., M.P.H., is a managing senior fellow and senior program officer at Partnership for Prevention, a national, non-profit health policy research organization. He is the lead for Partnership’s health system activities, which comprise both healthcare and public health. His portfolio also includes Partnership’s Health Professionals Roundtable on Preventive Services, promotion of clinical preventive services and prevention policy. Prior to working at Partnership for Prevention, he was employed as a public health and health policy consultant with the Public Health and Policy group at Pfizer Inc. While at Pfizer, his work focused on health literacy, public health policy, and partnership management. Dr. Spangler graduated from the University of Pennsylvania. He received his medical degree at the Pennsylvania State University College of Medicine and completed his internal medicine residency at the University of Pittsburgh Medical Center. Following this residency, Dr. Spangler moved on to Johns Hopkins where he completed a general preventive medicine residency and did an additional year serving as chief resident of the program. He is board certified in general preventive medicine/public health.

Steven H. Woolf, M.D., M.P.H. - Professor of Family Medicine, Virginia Commonwealth University

Steven H. Woolf, M.D., M.P.H, is a professor in the departments of family medicine, epidemiology and community health at Virginia Commonwealth University and is director of the university’s Center on Human Needs. Dr. Woolf has published more than 150 articles in a career that has focused on evidence-based medicine and the development of evidence-based clinical practice guidelines, with a special focus on preventive medicine, cancer screening, quality improvement and social justice. From 1987 to 2002 he served as science advisor to, and then member of, the U.S. Preventive Services Task Force. Dr. Woolf edited the first two editions of the Guide to Clinical Preventive Services and is author of Health Promotion and Disease Prevention in Clinical Practice. He is associate editor of the American Journal of Preventive Medicine and served as North American editor of the British Medical Journal. He has consulted widely on various matters of health policy with government agencies and professional organizations in the United States and Europe, and in 2001 was elected to the Institute of Medicine. He received his medical degree from Emory University and underwent residency training in family medicine at Virginia Commonwealth University. Dr. Woolf is also a clinical epidemiologist and underwent training in preventive medicine and public health at Johns Hopkins University, where he received his M.P.H.