The former U.S. Secretary of Health and Human Services under President Clinton, whose eight-year tenure earned her the distinction of being the longest serving HHS secretary in U.S. history, is now the president of the University of Miami. She also serves on the boards of Gannett and Lennar Corp. At HHS, Shalala oversaw a budget of nearly $600 billion, funding a variety of programs, including Social Security, Medicare and Medicaid, childcare and Head Start, welfare, Public Health Service, the National Institutes of Health, the Centers for Disease Control and Prevention, and the Food and Drug Administration. In June 2008, President Bush presented her with the Presidential Medal of Freedom, the nation’s highest civilian award, for her work as co-chair on the Commission on Care for Returning Wounded Warriors. She was invited to share her views on healthcare reform and then answered a round of questions from the director audience.
Let me talk about what I think is going to happen without healthcare reform, because I actually think the healthcare system is going to change with or without healthcare reform. All of us on corporate boards recognize that healthcare reform will affect risk assessment, benefit cost, taxes and personnel management.
- Second, we need to eliminate the fee-for-service payment system.
- Third, I think doctors increasingly are going to become employees of healthcare systems. They want stability in their income, which will allow hospitals and healthcare systems to get a more integrated care system. So expect some payment reform to go on, with the insurance companies desperately trying to figure out a way to get around some of these costs because employers are pressing them to slow down the growth of healthcare costs.
- Fourth, I think there’s going to be a lot of work on the fraud issue. There are billions to be recaptured. There are a lot of areas where the government could recapture significant money in fraud and I think with our much more sophisticated computer systems that there’s going to be bipartisan consensus to go after fraud—big time.
If you ask Americans where they think the costs are in healthcare, they say fraud and pharmaceuticals. They don’t say you need integrated healthcare systems or any of the things that the experts say. You can expect bipartisan consensus, at least on fraud, but I’m not as sure about the second one because of the power of big pharma to influence the direction of negotiations.
We’ll see a lot more innovation in alternative delivery systems. That includes what you’ve already seen. Even though the numbers are low and it doesn’t look like they’re really turning a big profit yet, don’t underestimate these clinics in Wal-Mart, Walgreens and CVS. Depending on the scope of practice rules in the state, they have to have doctor supervision. They’ll get you an appointment with a doctor in 24 hours. These sytems are convenient and they’re very risk averse; they’re only doing things where there is a clear standard of practice that nurses can handle. The fact is that America’s advanced practice nurses can handle 70 percent of what a primary care physician can offer. And many of us are linking our own healthcare plans to them.
Finally, let me say something about what I expect to see in healthcare in general—and that has to do with nurses. You’re going to see nursing become more important in healthcare. One way of holding down costs—not necessarily lowering costs but holding down costs—is to put together integrated healthcare teams and to use nurses, pharmacists, and physician assistants, for what they’re good at doing.
If you look at where our big costs are—chronic care management—that’s where you’re going to see nurses and physician assistants. You’re going to see a larger role for nursing in the whole prevention area and you’re going to see healthcare reorganize itself, even with the limitations determined by state politics. Is that going to reduce our risk? Is it really going to drive down costs in the long run? I do believe that we can’t sustain these growth numbers. Congress has to find the political will to do something. And consumers are going to have to have a bigger role.
Why hasn’t anyone been able to present to the American people the summary that you presented so succinctly?
Part of the problem is that every time you start talking about healthcare, starting in 1933, when Franklin Roosevelt tried to do it, someone yelled, ‘Socialized medicine!’ The only reason we got Social Security and Medicare and Medicaid is because someone figured out the private sector couldn’t do it. We’ve tried all the private-sector solutions. For low-income workers, you’ve got to have government subsidies. I believe you can have a private delivery system, but we’ve got an ideological problem about the expansion of government. I think government only ought to get involved when it’s in the public interest and there’s not a private alternative. So, I don’t think the solution is a single-payer system. I think we take a complex entity and we get the systems right.
If healthcare reform is successful, you will have a tremendous increase in demand for medical services and a fixed supply. How does that work itself out?
We watched it in Massachusetts. What happened is that Massachusetts had this huge spike where demand went up, and then it settled down. That’s why I’m talking about the role of nurses. Most of the healthcare demand was for primary care. Once they got over that hump, the system seemed to settle itself down. What we know now is if you don’t have insurance, you’re more likely to be sicker by the time you go to the hospital. That’s what’s costing us money now. People who don’t have insurance tend to be sicker and tend to go to the hospital or to the doctor too late. That’s when it costs us more. So we’re better off paying for the entry level and then organizing it in a way that’s less expensive.
How are we going to get the states to allow all nurses to do everything you say they will do? If you want to buy a basic insurance policy in one state, it’ll cost you $1,500 a year and in another, $4,500. How do we solve problems like that?
One of the things about healthcare reform was there were going to be some national plans so we could do some of that. We’ve given the states the power over scope of practice for professionals, but it’s as much of a problem for doctor specialists as it is for nursing specialists because the politics plays in where everybody wants to restrict everybody else, to spread the wealth, so to speak.
The good doctors’ offices that you go into now have nurses playing dramatic and important roles as part of the healthcare system. We need that across the board. Part of it is pressure on the system to deliver high-quality care with a more integrated model. I actually think we’re going to get that.
Should consumers be more involved?
[Employers] are moving towards more consumer driven-plans that make sure people have their own money at risk. What you have to be careful about is price sensitivity, particularly for low-income people. You don’t want to put in a co-payment or some kind of a deductible that prevents them from going to a primary care physician or an advanced practice nurse.
There’s no accountability here, because people consider it a benefit that’s simply given to them and they aren’t conscious about the relationship between benefits and their own salary structure.
The fact is that both the right and the left oppose healthcare reform. The left, represented by the unions, has negotiated these huge benefit structures where people don’t pay anything and they say that they took that instead of taking salary increases. They’re very reluctant.
If someone starts talking about taxing high-cost plans, that’s going to affect mostly unionized employees. Number one, I think people have to have their own money involved, and number two, people need to be made conscious about the way they use the healthcare system so they understand what the costs are.
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