The Medicare legislation before Congress represents an opportunity not only to reshape a program serving more than 40 million people but also the entire U.S. healthcare system.
It's important to see the House and Senate bills as building blocks rather than boundaries. Both chambers have passed what could be the foundation of a dramatically improved Medicare system. Now it is in the hands of the conference committee. It is possible for the negotiators to create a law that significantly transforms health and healthcare, if it's the right measure.
The right bill would save lives and money, prepare Medicare for the impending retirement of baby boomers, provide a new drug benefit for seniors and substantially improve our ability to respond to biological attacks. The right bill would create a Medicare system that is much less expensive than current Congressional Budget Office projections. It would give seniors the option of staying in the 1965 program or moving to a better system with more choices and better care at lower cost to them and government.
The wrong outcome of the conference will disappoint seniors, fail to prepare Medicare for the baby boomers, make a balanced budget impossible and leave seniors with an error-prone, inefficient system of care that kills patients and wastes money. The wrong bill will create the largest extension of the welfare state since Lyndon Johnson's Great Society in 1965, adding a layer of bureaucracy, price controls and ever more complex regulations.
Paramount to Medicare is the moral imperative of patient safety. Beyond safety are accurate data collection, efficiency and a culture of quality built upon an information technology backbone connecting hospitals, healthcare providers and government authorities in order to handle a large-scale biological attack.
The key to achieving a bipartisan bill with these components is gaining the support of three key constituencies: rural America, senior citizens and the AARP.
The AARP must be able to guarantee its members that they will get a long-promised drug benefit and that the current beneficiary population will not lose benefits or be coerced into a system that they do not want. They must be able to stay in the current system even if they choose to forgo a better one.
In order for seniors to live longer, healthier lives while spending less money on care, Medicare must offer seniors choice, prevention and management of multiple health conditions. Additionally, the drug benefit should contain an open formulary that includes over-the-counter medications.
One model for a formulary would allow the patient to have access to a Travelocity-style drug comparison and purchasing options to drugs within a class. Let's say that two of the allergy medications are available over the counter. The government would subsidize a large percentage of the cheapest drug as opposed to a fixed copay regardless of the price. This would encourage competitive pricing from pharmaceutical companies and competitive purchasing from consumers creating a downward pressure on prices. The patient and doctor, working with a pharmacist, would be able to decide which drug best suits the patient.
Access to quality healthcare in rural markets is crucial to a Medicare bill. Everyone in rural America should have the same access to the same quality of care as people who live in the suburbs and the big cities. We have dealt with rural electric and telephone needs differently because we have acknowledged their needs are different. There is no reason we cannot do the same for healthcare.
Integration of information technology would save both lives and money. The Agency for Healthcare Research Quality has done analyses that conclude IT improves healthcare delivery, efficiency, quality and safety by helping healthcare professionals make the best decisions. The potential savings are $100 billion per year. This would include computer physician order entry, bar coding, e-prescribing and electronic medical records.
Electronic prescribing, part of the proposed bills, is truly a breakthrough. Florida recently passed legislation requiring physicians to print orders legibly instead of scribbling. Contrast this with Rhode Island, which is implementing a statewide system of electronic prescriptions. The reality, as Rhode Island has correctly understood, is that our society has embraced the electronic delivery of important information-from ATM cards to smart gas pumps. Why not provide the same convenience, reliability and safety in the healthcare system?
There are 2 million preventable adverse drug events per year resulting in 7,000 deaths, but still we have not mandated the use of electronic prescriptions. Even without the moral imperative of saving lives, the economic benefits are overwhelming. One study demonstrated a decrease in pharmacy costs of $1.15 per member per month and a 30% decrease in physician-to-pharmacy phone calls by using electronic prescriptions.
If the Medicare bill we are describing were to become law, it would dramatically change the nation's health and finances. Elias Zerhouni, director of the National Institutes of Health, estimates that a transformed health system might save as much as 40% from the current structure. William Stead, chief of informatics at Vanderbilt University Medical Center in Nashville, independently arrived at the same figure.
Now imagine how many lives could be saved if the right Medicare bill lands on the president's desk.
Newt Gingrich, former House speaker, is the author of Saving Lives & Saving Money and founder of the Center for Health Transformation.