[Music] [Music] [Music] [Music] [Music] for good afternoon or good morning as the case may be and thank you for coming to the KO Institute my name is Michael Cannon I'm the director of Health policy studies here at Ko and we're here to talk about a book that the Institute is releasing to today the title of that book is recovery a guide to reforming the US Health sector and uh I'm the author of that book so so I'm very excited to present it to you today and very excited to get feedback uh on the book from our guests our guests are from uh my farle Sarah Dash president and CEO of the Alliance for Health policy and Lauren Adler a scholar from The Brookings institution both here in Washington DC and uh we're going to uh the way this event is going to go I'm going to say a little bit about the book try to introduce you to the book comments from both uh Sarah and Lauren and then we're going to turn the uh uh turn the mic over as it were to the audience we will be taking your questions uh in person from those of you who who are here in the KO Institute haak Auditorium we'll also be taking questions from those of you who are watching online uh you can submit those questions wherever you're watching uh this event using the hash KO events and they'll show up on this iPad that I've got right here and I'll do my best to answer and get through as many of those questions as I can uh I was telling uh Lauren and Sarah earlier I you know you might not be able to tell but I do try my best with slido so uh with that welcome Lauren and Sarah uh anything you want to uh uh share uh before uh we dive into the mat material um no I think we can do the I can introduce myself a little bit more maybe once uh we get going okay that sounds good absolutely thank you thanks for having us excited to be here sure so uh this is the book recovery a guide to reforming the US Health sector and I'm going to uh walk through just a couple of the themes uh that that I touch on in the book in the hope of expanding its audience a little bit uh and and the way I'm going to do that is first let me see if this if this fellow works if we could pull up the first slide and then I'll start advancing them oh well look we did pull up the first slide they're just not on the screen in front of me okay so this is the book this is the book and if you know anything about me if I've achieved any no Variety in this world at all it's for the work that I did trying to stop Obamacare or the affordable Care Act uh you'll see some of the accolades or not quite accolades that I got for that work in some of these in some of these slides and unfortunately in the United States hyper part it's in political climate that means that half of the country will be open to my book and the other half will absolutely not un uh doubly unfortunate most of the people who work in health policy are in that second group so what I want to do today is uh is say that if you are in that second group I want to beseech you to give this book a chance uh there's uh because there's more for you in this book than you might think recovery is fundamentally about making Health Care More Universal and restoring your right to make your health decisions how how so you might ask well let's start with a chart from this book okay here we go here's that chart uh this chart this chart summarizes the results of a series of experiments that several employers ran uh and an amazing thing happened in those experiments something you almost never see in healthcare at least not in the United States prices fell in these studies employers tested an innovation that consistently and dramatically reduced health care prices in a very short period across a wide range of services those Services included as you can see MRI scans CT scans knee and shoulder arthoscopy cataract removal hip and knee replacement colonoscopy lab test tests and for every one of these Medical Services The Innovation these employers tested causes caused prices to fall immediately and significantly without denying anyone access to the care that they needed the Innovation was even able to overcome the market power of monopolistic hospitals and get them to reduce their prices too and the academics who published the study where from uh the results of these experiments and including uh Health Economist James Rob J Jamie Robinson at uh UC Berkeley believe this Innovation could bring down prices even more than they did in these experiments so for we supporters of universal healthc care this is the best news you've ever heard and this is the most important chart you've ever seen because if what you want is to make Healthcare more Universal what you want more than anything is falling medical prices falling prices make Healthcare more Universal three times over first they bring health care and health insurance within the reach of those who previously could not afford them they therefore shrink the number of people who cannot afford the medical care they need two they reduce the cost of helping people who still cannot afford the care that they need that group is now smaller and health care prices are lower so it's easier to provide care for them and three they leave the rest of us with more resources uh because we too benefit from lower medical prices making it easier for for us uh to help that now smaller group of people so if Universal healthc care is your goal falling prices this chart should be your obsession it is not government programs that made food so Universal that we're now keeping 8 billion people alive on this planet a record8 billion people it was first and foremost falling food prices now as always there's both good news and bad news here the good news is someone discovered an innovation capable of overcoming the market power of monopolist providers to reduce prices and make Health Care More Universal without denying care to anyone the bad news is this Innovation is giving people less health insurance the employers and insurers who ran these experiments noticed three things first providers were charging wildly varying prices for certain Services hospitals charged anywhere from $112,000 to $60,000 for or hip and KN replacements for example two those high prices did not correlate with quality they could find no evidence that those prices correlated with quality it was ju just an example of providers using their Market power to charge prices as high as they could uh and three for all their vaunted purchasing power not even huge health insurance companies like Etna or huge employers like the state of California could for the life of them negotiate those prices down the Innovation that those insurers and employers decided to test is something that we Health WS will call a reference Prize or a reverse deductible which really just sort of clouds what's happening when we use terms like that all they did all those terms mean is it ensur has told patients look you can go to any Hospital you want for your Hipp orne replacement but we're only paying $30,000 take that $30,000 anywhere you like but if the hospital you choose charges more than $30,000 you're paying for for every penny in excess of that $30,000 you are on the hook for 100% of the marginal cost in other words this Innovation gave patients less insurance than they had before when the insurance company would cover the full cost of those procedures it therefore changed whose money was at stake instead of the insurance company being on the hook for the cost in excess of $30,000 patients were on the hook it was the patients money that was on the line and that made patients care a lot more about the prices of those Services as a result of that one simple change all sorts of amazing things happened things that definitely do not happen in healthcare because Healthcare is a special sector of the economy where these things definitely do not happen first patients started demanding price information from hospitals second patients furn or hospitals furnished patients with useful price information this reform delivered price transparency and third patients responded to those higher prices by changing their behavior they increased the market share of low price hospitals from 50% to more than 2third and finally hospitals responded by reducing prices the chart shows average price reductions here uh and they were dramatic but high- price hospitals reduced their prices for hip and neede Replacements even more dramatically than the average about 37% per procedure or $116,000 and that was over just a two-year period when do you ever see prices falling that much in healthcare it's very rare some hospitals uh were getting so killed by losing Mark loss of market share that they went to insurance companies and said can we reopen our contract so that we can reduce our prices so price sensitive consumers in these experiments did with large employers and insurance companies and for that matter the Department of Justice could not they broke monopolies all without denying care to anyone and there's an important lesson here uh I think in the United States the pursuit of Universal Health Care has largely taken the shape of having government encourage more and more health insurance all sorts of government policies push in that direction the tax preference for employer sponsored health insurance mandated benefits laws at the state and federal level that require consumers to purchase essential coverage uh the Medicare program the Medicaid Program chip uh Hippa Obamacare all these policies and all the while Advocates of universal healthare wonder why prices keep Rising now note that the experiments in this chart were pure austerity all they did was take something away from patients they took away coverage for the the share of the cost of these services and excess of the reference price uh and yet no one lost access to care everyone was fine except for the except for the price gouging uh inefficient monopolistic providers they lost market share that's a feature though not a bug the price reductions even reduce the cost of health insurance for every one of these patients co-workers now recovery does not Advocate austerity these these exps were just austerity that is not what recovery is advocating it does not propose to take this one successful Innovation we all found and have government mandated the healthcare industry wouldn't stand for that anyway uh the uh the benefits would not be Salient to workers and the industry would use uh their their substantial Lobby budgets to uh uh to scare workers off of that sort of a an approach and ultimately kill that reform what recovery proposes to do is something different to make consumer to make Healthcare more Universal by letting consumers control all 4.7 trillion dollars that's sloshing around in the US Health sector most of which consumers spend under the incentives that we saw that led to the high prices that this experiment was trying to reduce produce that way consumers can choose whether this type of insurance feature is right for them and Recovery proposes to do this uh with tools that I I I think should apply to or should appeal to people of both political parties and across the ideological Spectrum uh first it would do so by using traditionally Democratic public option principles to reform the Medicare program which by the way would put an end to how the pharmaceutical hospital and insurance Industries have captured that program it would also do so do so by discarding the worst parts and keeping the best parts of tax-free health savings accounts uh eliminating a lot of the parts of taxfree health savings accounts that de Democrats tend not to like and preserving the parts that Republicans tend to like uh recovery further proposes to make Healthcare Universal by eliminating barriers to proven ways of reducing the problem of pre-existing conditions and barriers to nurse practitioners and other midlevel clinicians practic to the full extent of their their training by reducing barriers to women exercising their right to choose contraception by eliminating unwise medical malpractice liability reforms improving care for veterans the list goes on if you if you are of a you know alen enthoven sort of uh bent and you believe that integrated prepaid health plans like Kaiser Permanente uh do a lot to improve the quality and reduce the cost of healthcare there's something in recovery for you if you believe that uh the United States should emulate other countries in how they organize and deliver Medical Care there's a lot of in in recovery for you it it looks at what other countries are doing and I'm just scrolling through these very quickly uh because each one of these uh uh charts could be its own presentation but in a lot of countries people have have more control over their health spending than they do in the United States and I think uh that there's something in recovery for you if you want us to emulate other countries I mentioned mid-level Clinic Ians including Dental therapists where there are barriers to them protect to providing uh more affordable uh basic Dental Care to people uh and pre-existing conditions and finally if you're not even a health walk if you're someone who car is more about say US foreign policy than you do about making healthc care better and more affordable and more secure that there's even something for you in recovery and that is that uh unbeknownst to most policy makers in Washington DC including most foreign policy analysts Health Poli has a huge impact on US foreign policy or maybe at least at the margins and how is that the way that the that the US Congress has structured veterans benefits enables Congress to hide to uh to ignore one of the largest financial costs of the United States military intervening in in conflicts overseas and that is the cost of veterans benefits which don't Peak until decades after a conflict ends and Congress doesn't pay those costs until or doesn't try to meet those costs until they come due so when Congress commits or or the president commits troops to battle they can ignore one of the largest financial costs of of military conflict and what recovery proposes is to allow is to require Congress to fund veterans benefits up front uh an expense that will rise when Congress commits troops to battle so that if Congress wants to intervene uh in foreign conflicts it has to give up more butter in order to get those guns which means that in marginal cases it might choose not to intervene at all or it might choose to withdraw withdraw from uh foreign conflicts sooner uh all uh uh all all of which the reforms recovery proposes to the veterans health administration would achieve so with that uh I want to suggest that if you support Universal Health Care and the right of patients to make their own health decisions there might be more for you in recovery than you might think and I hope you'll give it a look and with that said I want to turn things over first to Sarah uh to hear from her uh hear her comments on the book and then Lauren great thank you thank you thank you Michael um and it's great to see all of you here and hello to our friends who are watching online so Michael said I'm Sarah Dash I'm president and CEO of the Alliance for Health policy we are a nonpartisan not for-profit based here in DC um we're actually about a 30-year-old organization and I'm going to say a little bit more about the alliance um in a minute but um you might be kind of wondering why I'm here and what brought me to KO well first of all thank you Michael for the kind invitation um some I thought it would be helpful to share a little bit about myself so I grew up kind of in the era where we were all listening to free to be you and me and then um I also now have my own 5-year-old daughter who um I believe will apply for an internship here at Ko because she has made it very clear to me that she does not like people telling her what to do so um she has um you know a little bit of um uh footsteps to follow in there and then something you might be surprised by is when I was at in um High School I I think I entered um an essay cont focused on the Fountain Head so I had a little bit of a a little bit of a Libertarian streak there um but then I went on um and worked for a couple of the um members of Congress who were the champions of the Affordable Care Act so I think there's sort of a Time 10 years ago or so when um my sitting in this chair would have been kind of inconceivable um but I'm so happy to be here and in part because I think um the the piece in between um my my growing up and coming to to the hills I moved away from home when I was 16 to pursue a career in dance and I feel very very strongly and kind of come at Health from that lens which is that for people to um really sort of achieve their optimal flourishing and their optimal potential that health is a prerequisite to that you know maximizing our health maximizing our um our potential is is a key part of that and so so I believe very strongly in that and then also kind of come at this from a more ecumenical sense which is what brought me to the alliance right which is that I believe we have a moral obligation to come and sit one another's tables whether or not we agree with everything that's being said uh I think we're at a moment in time a moment in history when um we we are in a hyper partisan even more partisan than um when I worked on the hill and it was during the ACA and sat and listened to um constituents who had taken the time and trouble to drive you know several hundred miles down to Washington DC to tell me personally why they hated the Affordable Care Act and that was during that tea party um summer if you if you all recall that um you know and I'll I always remember that because I think as much as I believed in the goals of the Affordable Care Act and the goals of Affordable Health Care um Universal Health Care that were being espoused by the ACA and the issues that the AC was seeking to address it's always kind of stuck with me that um that fear and anger is out there about our healthare system and I think we are still in a place where people are you know still frustrated still um sort of not trusting that their health or financial needs will be taken care of as well as um you know kind of angry and it's it's easy um given how big our system is to kind of blame one thing or another but we are in a really low trust environment when it comes to trusting government when it comes to trusting um institutions in the private sector and there's a lot of finger pointing happening so part of why I'm here is to just try to engage in a conversation around um what what might be possible so um with that let me just say a little bit about the alliance and the work that we've done and I think we we're we're at a really interesting juncture here you know which is we are um we're we're I said we're nonpartisan and and then we're actually bipartisan and then Michael introduced me to the ter pan ideological which I think is even better um because truly it's it's not possible anymore in this day and age to kind of put people neatly into these categories right so I think one is we create a table that um people who are serious about having an authentic conversation can come to that table and have that conversation and second we are multi-stakeholder which means that um we take our community very seriously here in the health policy World which means that um we are not trying to pick sides between um doctors and hospitals or payers or Pharma or consumers or people right and so we're we're trying to really build that trust and create a table where people can take baby steps towards having a real authentic conversation recognizing that our system is really complicated and um untangling some of the challenges and some of the um distortions in our system is going to take um a lot more work than a few conversations or Round Table salons like it's a this is a long-term probably next decade effort um lastly you know we've we've been um we've done a lot of interviews on the hill with sort of bipartisan staff and I think that um what's interesting is I do think there's the recognition that coverage alone is not enough that affordability is important I think people are curious about that um my own sense is that where there is an opport opportunity to bridge some of the partisan divide um over the next several years to decade it will be around the topic of affordability um the question of how that gets done um I think that's a really important nut to be cracked so with that I'm looking forward to the conversation and um to the conversation on the book and thanks again for inviting me great uh I guess I'll take that as my Quee to to pipe in here so hi I'm uh um great to see folks in the audience I'm Lauren Adler uh fellow and associate director at the Center for Health policy at The Brookings institution uh just down the road uh here in Washington DC uh I've been doing Health economics research for 10 years or so now and worked at a um before Brookings I worked at a couple bipartisan or Centrist uh uh think tanks that Brookings institution is a large nonpartisan research institution um sort of I so I do a lot of you know sort of academic style research on health economics on provider pricing Insurance markets uh you know wholesale kind of reforms to the system uh then you know I think like most folks in D DC do a fair amount very policy focused on you know trying to help folks make uh you know the subjective optimal uh policy decisions but uh you know I think opening the door to anyone who um you know I think we do a lot of work with folks in both parties um even if the sort of institution may have a uh you know an impression uh a lot of the work we do crosses that boundary uh I think my comments May kind of have a little bit of that also so I thought right the book itself in my eyes sort of you can kind of break it up into a little bit of there sort of the setup of what are the problems in the current system and in that section uh sorry the sort of the setup and then there is the solution section uh in the sort of setup and what the current problems are uh you know I think I I have a fair amount of agreement with the the book so right there is a lot here um sort of start on the positive signs of agreement right there clearly is a lack of competition in certain areas um of Healthcare that does sty Innovation and raise costs I think many of those bring very little benefit so you know the book talks a lot about I want to say a lot of state-based policies that are kind of anti that I would consider anti-competitive so you know there are certificate and need laws that the sort of add extra regulation if you want to create a new hospital or create a new nursing home um there's a lot of restrictions on uh advanced practice practitioners right your nurse practitioners who want to practice at the top of their license I think that pretty clearly is any competitive uh effect on markets I very strongly agree in the discussion on uh much of the employer-based tax exclusion so right we have employer Healthcare in this country you uh you know you don't pay taxes on the benefits that your employer pays you that very clearly at the margin is incentivizing uh you know employers to care less about the price and the cost of Medical Care um and that is like that is a clear Big Driver of the high prices we see in the system um I you know I similarly agree much of the sort of current matching system in Medicaid uh does create number of perverse incentives here to um right if you're going to get a federal match uh for the dollars you spend you clearly care less about spending at the margin a lot of this sounds very e Economist lens on a lot of things that you know always focused on the spending at the margin here uh similarly right I agree FDA does have a lot of issues I agree in many ways that they do tend to be too cautious in certain uh approvals um however I think think I where I think I'm going to differ a lot is on the sort of solutions and what the counterfactual to some of this is you know I also think you know like some of the statements in the book I tend to I think take a kind a broad brush view to picking one piece of evidence and not the other so you know there statements about the sort of broad effects of Medicaid or Medicare coverage um you know when I my read of sort of the best evidence out here is Medicaid and private insurance or ACA private insurance does sub substantially reduced mortality and has saved substantial lives there's two good papers in uh in one of the sort of top econ journals from one from Sarah Miller and Company and one from Jacob golden company with finding pretty strong um pretty impressive mortality uh you know improving Mort sorry saving lives uh taking stop using Economist jargon here uh in terms of of the sort of big programs here and then right there's a lot of talk and uh you know Michael's first slide here was look cost sharing you know having folks be liable for the sort of full cost um on the margin of the service that they're buying I think very clearly does reduce spending I think it'd be kind of shocking if it didn't do that I but the you know I think we also have evidence that it does so indiscriminately in the sense that folks seem to reduce spending equally on high value and low value care and I just think that is something that needs to be uh to be wrestled with um and I I even agree with some of the the big bigger picture criticisms of might not find them criticisms but basically right the fact that a lot of our insurance regulations certainly do drive up costs I think the fact that we have this big third party subsidized system does mean that we pay more for Health Care again where this is sort of gets to my where I think I I draw on the disagree is I I think those exist for a reason uh and basically I think many government regulations uh like sort of Ensure Community rating or something like that where everyone sort of pay you know you have some way to buy into uh Insurance even if you're sick I think those are trying to solve fundamental problems if your goal is that everyone should at least be able to have access to healthc care right I think the book sort of talks a lot and sort of lays out what I kind of consider a dream world of you know everyone has perfect foresight they're going to buy into these comprehensive major medical uh things when they're perfectly healthy and they're going to have the foreset to be in this like great plan and there will there probably would be a market where you could buy into something I like that that could be guaranteed renewal but even in that world right if you have an expensive medical condition You Are One Missed payment away from destitution right go to like the administrative burdens and things like that right if you miss one payment on your insurance policy from a private company who has all the incentive in the world to not to to have you miss that payment uh right then you are stuck and now you are shut out of this sort of cheap entry market and you are going to be paying full Freight for your uh for your medical care uh or you know say what what happens if your insur you had perfect foresight but your insurer goes out of business there's going to be something this happens in the long-term care market today there are some insurers who fundamentally misprice risk and they think they're you know it's not that easy to price this policy that is guaranteed renewable for a hundred years uh that is going to be a hard thing some insurers are going to get it wrong and if they get it wrong in a systematic way that is going that insur is going to go out of business and then you are again if you have a expensive health condition you are going to be stuck in this um this world here right or you know take a disease that makes you lose income you have your 50-year-old and you have cancer and you can't work anymore uh you eventually you know maybe you say so take you know maybe you saved up for that but take a 30-year-old who has the same situation um who's not going to have any savings to kind of keep buying this coverage and eventually you're kind of left in um some charity care system that probably pops up um at the back end uh here I also think a key thing without government regulation here is you'll no longer be able to get coverage for expensive services that afflict subpopulations um particularly ones that are that are based on observable characteristics like gender or race so you know the example of a healthy 20-year-old woman who wants to get coverage is going to have to bear the full cost of the chance that she may have a baby uh right that is like going to be built into her premiums and not the 20-year-old man's uh even they sort of perfectly healthy I think a big one here is drugs the target rare diseases so um you know right anything where it is especially based on observable characteristics so you know I I could imagine some World popping up where you actually are even buying this sort of coverage for your kids right because some of this is like you have to have the fourth your parents have had to had the forethought here to get you coverage when you were born um but you know take a a Jewish person who is having a kid and wants to get coverage for say there's a dise a drug that treats TX or a black person who is trying to get coverage for a drug that treats sickle cell disease right they're just not going to be able to get that because that is very clear to the insurance company uh upfront they can obser on observable characteristics uh and that is going to be very difficult or you know with when it's not the parents take the person the 20-year-old healthy person whose parents didn't have perfect foresight and now they're buying insurance for the first time but they have hemophilia which means there is always a risk that they are going to have need $100,000 worth of Medical Care um at one at one issue so uh that is an insurance company will likely know that or will try very hard to figure that out um so I I think that is an important uh an important thing uh to consider uh here and similarly you also have coverage you'll have difficulty trying to find coverage for anything that correlates to higher spending on other services so there's a lot of evidence and to be fair this is difficult in our current situation too but getting sort of affordable coverage for mental health care or for substance AB use because that tells the insurance company you are also much more likely to need bigger medical like other Medical Services or an inpatient stay um andv very expensive that again because that it will be very difficult to find or impossible I would uh probably argue to uh to find coverage uh for that and again right I sort of tease this but right in a lot of these things you need your parents to have had the perfect foresight here which I think is just very difficult to imagine and what are we you know if your parents didn't have that foresight and you're just sort of like tough luck I I also kind of think just sort of politically it's a pretty difficult to imagine that being uh a world we end up in you know I to me it sort of all draws back to you I do think there is a tradeoff here I do think the sort of regulated system does mean that we are paying more uh than we would otherwise although I would note that other countries just deal with this by having some sort of price setting right the other option here is let's just say you know every insurance company has an option to you know to to to sign a contract to pay hospitals 200% of Medicare they can still negotiate whatever they want below that but they have some sort of option here right you can sort of get at uh some of that cost issue uh that way uh but I agree this is probably it is driving up costs here but I think in my view you know you know broadly that that base piece is justifiable for the sort of safety net the Simplicity and honestly some of this there's a lot of talk in the book about you know the sort of the Innovation that us currently has and sort of currently in sense some of that is based on the fact that we have high spending or the example of hepatitis C Drugs for instance comes up which is a drug that sorry a disease that primarily afflicts lower income uh individuals to me that is something that our current system actually is the thing that provided the resources such that there was incentives to invest and create a hepatitis C medic and Medicaid in particular right if there was no coverage for lower income folks it is very difficult to imagine it have been been financially beneficial to develop uh that drug or again back to the sort of rare disease type of populations I I think there this sort of world leads you to a place where there is no Financial incentive to create the drug that that cures TX or something along those uh along those lines I also think this comes up with a lot of these Healthcare decisions and I think discussions and I think uh maybe puts at odds with I think how most people think about it is there's a lot of trashing on our current health Healthcare System some of which I agree with I think there's plenty of things that does bad and I don't want to be like completely broad brush there's plenty of those sort of criticisms that I very much agree with and think should be solved maybe in somewhat similar manners to um to Michael but I I also think that especially for folks in employer Healthcare it's kind of the sort of you know the same thing folks say about Congress that right everyone hates health insurance industry and hates health insurance but most folks are think they their employer based plan works decently right this is sort of an every time it's come up of like blow up the system typ of reforms whether that's sort of single-payer Bernie Sanders style Solutions or the sort of more libertarian style Solutions the kind of thing is like well I kind of like my employer based plan it's not perfect but it's pretty good I get coverage if I get sick I'm I get that's covering the hospitals I want to go to I have access to care and it's it's it works decently well and same thing with Medicare right folks are getting access to care and it's imperfect but it is you know I don't know it's not perfect right it is decent and it is I think most folks are relatively happy when you sort of talk about the sort of more blow up uh and completely change the uh the sort of system uh here so I'll close on that because I think that uh there's sort of a lot of DC circles both left and right there's a lot of trashing in the current health Healthcare System but I do think it's worth noting that it it works decently well for most people even if it is similarly being some falling through the cracks yeah yeah I mean just to pick up on that I think if I if I could I mean I think you know lesson we learned certain live through it um as a staff or right it's it's what people are afraid to lose like it's the devil you know and it's um the fear of the unknown whether that solution be you know a a govern more government solution or more like go it alone kind of solution um you know I think um really appreciate your analysis of this and I think there's just like my assessment of this is that um so a couple things right I think we we definitely need new more Nuance in our policy conversations I think you know Michael in the in the book A lot of the um the assessment of some of the problems the quality challenges the um you know we we spend a lot but you know our life expectancy our per you know our our health um isn't really living up to the amount that we spend I think those are all probably challenges that everybody could agree on um I would say I think where we get into trouble is when there's like blanket kind of statements about it's the government or you know on the flip side like oh it's the private sector and um that's I think that's kind of what stops some people from coming into a room in having a conversation um there's some things in there here where I think there could be like room for definitely room for conversation room for um even maybe agreement or progress and then there's others that would be non-starters or people who kind of um you know spent Blood Sweat and Tears like working on the ACA and you know those kinds of things like repealing it isn't going to happen but I think we also need to recognize like we're in a moment in history where we are still we're I think part of what our challeng is as a country is that we're building on some things that were kind of historical accidents like the employer sponsored tax exclusion and that have kind of become embedded in what the expectations are and then for me the interesting question is what does good look like going forward and then what's the process by which we actually have that conversation to think about what the trade-offs are you know the trade-offs between risk like the risk that my child might have um a rear genetic dis disease um you know and the choice like I would like to choose um you know whether I see a nurse practitioner or physician and I'd like to choose kind of where I go for care um you know the choice between like Financial Security like I just want it to be protected you know versus hey I'm willing to take a little bit more Financial Risk on myself if it meant um paying less you know and I I think some of it is just like we we have to get to a better place where we can have adult conversations about these kinds of tradeoffs um in a way that's um more focused on getting it right than being right if that makes sense so um I'll just tag that on okay before you move to your next question thank you both for for your comments I want to issue a correction I think I gave the wrong hashtag for to our online audience if you want to submit a question online use the hashtag k Health uh K health will send your question to this uh here for fancy iPad and I'll be able to ask it um I I I want to if I can respond to Sarah and Lauren um uh thank you for your comments uh and my my broad response is that there there's this tendency I guess not just in health policy but especially in health policy to say that if I can identify a problem with that approach over there then we cannot use that approach and if you're if you're someone who's very skeptical of markets and Healthcare you might find a way that people might fall through the cracks of a market system in healthcare and say well then we can't have that we have to do this other thing that can be extremely unhelpful and even uh uh counterproductive and harmful if if you don't apply the same scrutiny to that other thing over here if you assume that this is a Nirvana that we can that that if we avoid bad things over there then there won't be any bad things over here and so what I try to do in the book is I try to do what the the the economists call a comparative institutions approach and look at both what happens in markets and what happen when markets individuals consumers entrepreneurs make decisions versus what happens when government makes those decisions in their stead uh and I'm going to have a bit to say about that uh in a moment but uh uh uh one of the one of the things that Lauren raised is there's a literature on the effects of health insurance and health insurance subsidies on health and there have been a couple studies recently that have said that uh there is a positive impact that when the afford the Obamacare expanded health insurance coverage few fewer people died and uh we could we we could talk about those studies uh those I think the most important thing to say about them is that they are anomalous that most of the uh well-designed uh reliable studies that are out there have found that uh consistent results uh that uh that say that uh expanding health insurance coverage or or struggle to find any impact of Health uh expanding health insurance coverage on health this includes not just uh uh observational studies like the ones uh that you're uh well one of them I think was quasi randomized but multiple randomized control trials that have struggled or found zero impact of health insurance expansions on health and I and that's an addition to um observational studies about the Medicare program and other programs that have also found uh no evidence that they improved Health uh Lauren mentioned uh uh that when you give people control over say that 14 that $4.7 trillion dollar that they spend on uh that we currently spend on Healthcare in this country they might cut back in ways that har on health consumption medical consumption in ways that harm their health and that's certainly possible in in fact I think that that probably does happen but again what uh multiple randomized control trials have found is that when people do that when people consume less Medical Care the net impact on health is zero or not uh not detectable and what what that means is that if people are cutting it suggested people are not cutting back in indiscriminate ways or if they are they're cutting back on helpful Medical Care at the same uh rates that they're cutting back on harmful medical care because those two things would have to go hand in hand if you're going to get uh no effect from people having less health insurance finally on a comparative in or uh next on a comparative institutions uh uh uh approach to these questions Lauren you mentioned a lot of ways that a a completely unregulated marketed and health insurance could leave people falling through the cracks if they have um an uninsurable pre-existing condition if they didn't enroll in coverage when they uh had when they were healthy and could afford the premiums if their parents didn't enroll them in coverage those are all ways that people could fall through the cracks of the health sector um but all of those things were present in one of the studies that I cite and I had even had on one of the slides that show the prior to the Affordable Care Act if you enrolled in coverage through the uh individual Market which means that insurers could underwrite you they could charge you higher premiums what they generally did was not uh uh was they if you enrolled when you were healthy and then got an expensive illness you would keep paying healthy person premiums and they uh guaranteed they would not cancel your coverage that guarantee might fall through but what happened was people uh in that market even once they got sick ended up in poor health they lost their coverage less often than people in employer sponsored insurance now why is this important for a comparative institutions analysis because the type of insurance that the government had been favoring through the tax code is employer sponsored Insurance nine out of 10 people with private coverage get it through an employer that means that the government was effectively penalizing this other Market that was more secure than employer sponsored Insurance because your coverage did not disappear when you lost your job so with all the things that can go wrong in all of those markets the uh a relatively unregulated market for health insurance was making health insurance more secure for people in poor health than um than the type of insurance that government favored and you could say well we can use the government to fix that problem then if the government is uh is is if the tax code is favoring a type of health insurance that's that throws people out uh of their coverage after they get sick and leads in with an uninsured and uninsurable pre-existing condition I've got news for you people have been trying to do that the government has been trying to do that for decades and yet for almost a century at this point the government has been uh has left that policy in place fueling the problem of pre-existing conditions by throwing people out of their coverage and rather than fix that problem the government has try been trying to clean up the mess that it made by favoring employer sponsored Insurance W with such uh additional inter interventions as the Medicare program the Medicaid Program the uh uh the uh consolidated Omnibus the Cobra um the uh Hippa the U Affordable Care Act chip all of these additional government interventions uh because government is not very good at solving the problem that that study uh identifies uh a problem that makes government um uh that highlights that government is very bad at making these decisions certainly no Nirvana when it comes to maternity coverage I mean that's another example how people could fall through the cracks of a of the sort of system that uh that I recommend in the book but another implication of the evidence that I provided the book including that one most important chart in health policy is that with uh the the fact that we are ensuring uh uncomplicated deliveries to the extent that we are are is probably increasing the price for uncomplicated deliveries to the point where people feel that they need health insurance or at least more people feel they that they need health insurance to cover those deliveries whereas if we were not uring them so heavily more people could afford those uh those expenses out of Po expenses out of pocket and still have coverage there for uh complicated deliveries uh and finally as a another example um uh oh uh another example of a comparative institutions analysis is that uh you might say well one way of fixing the problems that uh exist in a an unregulated health insurance market and the employer Market is to put everyone in a market for health insurance like the Affordable Care Act creates uh and as one of the questioners asked uh about like the uh uh like Switzerland has they basically in Switzerland have been ACA like model why not do that and just ban insurance companies from discriminating on the basis of pre-existing conditions well as I discussed in the book as it turns out those those very regulations which are really just price controls they're nothing fancier than government price controls are making coverage worse for people with expensive conditions because they don't eliminate the economic uh uh reality underlying high prices for people with expensive illnesses what they do is they force Market actors to deal with those under underlying economic realities in a different way or as Michael guso who is now an economist with the Biden Administration argues in a uh uh through a series of paper papers that he and colleagues have done on these sorts of price controls they require insurance companies to engage in backdoor discrimination that according to guso and his colleagues leave even healthy people with inadequate health insurance because uh coverage for many expensive conditions is getting worse uh those regulations require insurance companies to engage in a race to the bottom to make coverage less uh comprehensive for illnesses is like multiple sclerosis and other uh expensive conditions so if you take a comparative institutions analysis I think that the argument for individual choice and U and and Market competition is much stronger than if you uh make sort of a appeal to a Nirvana that does not exist um and and with that I do want to get to some questions but if uh Sarah or Lauren want to respond to that I want to give you a chance that's well thank you we use that a lot um so and I'm curious to hear what the audience questions are I mean I do have to say I think first of all I think there's like no appetite for retiga some of the arguments that um you know we we dealt with during the Affordable Care Act I think there were um significant problems in the individual Market as it stood that were well documented I remember the hearing on insurance recisions um which I think three um you know well-known health insurance Executives kind of ad committed to um resending coverage for people once they got sick um but you know and then on the maternity coverage I think we can all remember the hearing where you know um one of the Senators said well I think your mother you know needed needed health insurance so I I think you know I just want to be careful that like we're moving forward and not backward and and rehashing kind of old um conversations I think that said I think one of the challenges that we continue to face and I I truly I don't know um the best way to get out of this but I I do think the Paradigm of coverage in in our country has been sort of like one group and then another group and then another group right and that's what has caused I mean I think you're right the tax treatment of ESI you know part of the the point of um you know the advanced premium tax credits in the ECA was to try to like equalize some of that out right um you're suggesting a different way to equalize equalize it a little bit more right but um at the end of of the day you know we first we chose people with with employer sponsored coverage you know then we chose um seniors then we chose you know poor people or frail and I think one of the challenges that we face and sort of why I why I'm I maybe a little more of the philosopher in this conversation then you know I don't want to go back and forth on the studies as much but that current of fear and frustration and anger that I think is there um in the citizenry is like great I'm going to like hold on to what I have um you know and um the fact is that we've sort of balkanize the way that we cover People based on circumstances that maybe aren't as relevant anymore or don't apply I mean right like if we want to talk about freedom and flourishing right like nobody wants to be stuck in a job that they no longer like but you know if it if they have to stick with it because of Health ins Insurance then they're going to stick with it that's kind of why the ACA tried to create um a little bit more of a Level Playing Field right like with exchanges so I think some of what we're talking about definitely is on the margins but I I just I will say I think we need to find ways to move forward in the conversations and you know we are G to kind of have to figure out ways to work with what we have rather than um you know I I mean I'd love to do a tabletop exercise where we like the whole thing up and and find ways to maximize human um freedom and flourishing you know and lower costs and get to Universal coverage but um I don't know that like we have to work work with those guys down the street too so um I'll just put that out there yeah I mean I'll just just quickly I think three just sort of three kind of points on what you said Michael I mean I think one where there is it's a hard to resolve discussion uh or sort of question is just right yes it is true that many of the sort of community rating and guaranteed issue regulations do have some of these unattended consequences where they do slightly somewhat modestly weaken sort of coverage for high cost conditions I think where in the sort of comparative question here I think where I differ is I think that having decent but imperfect coverage is better than having no coverage and I I think that is and obviously yes it may be right there are more people now having the decent rather than you know higher but better coverage I I agree there's trade-offs here uh I just think that is better than having a good chunk of folks who would have no coverage right between we before Medicare 50% of seniors were uninsured the book touches on some of that is because this everyone was in employer coverage I think that's right but it would be high there be it's we're talking probably like a quarter of the population here uh like it's just a lot of folks who have no coverage in that situation uh you know I think one of other point is there's a lot of talk about sort of shopping and sort of consumer shopping can reduce prices and I think that's true for the subset of services that were on that slide there but look most healthc care spending is on high cost hospital care in patient stays once you're you know have an expensive condition and you're at the hospital I think it's somewhat difficult to imagine the consumers doing that shopping such that you would end up with these insurance intermediaries that are envisioned in this world but I think you're inevitably having in some intermediary you can call an insurance company whatever but is doing the bargaining on the uh could be an employer whatever is doing the bargaining on their behalf um and I think s the first one I think an important thing here is the sort of comparison between losing coverage under employer coverage versus the sort of you know less regulated market is that's not really the relevant counterfactual anymore the relevant counterfactual now is employer Market plus you do have an option if you lose your employment and it's not just Cobra right you can go on an ACA plan and you have some or you know if you are low on of income you can go on Medicaid there are other options and you are kind of never there's no option where you can't get your condition um insured and then lastly which I think is really too hard to litigate on a stage like this is I I would object to the characterization that the sort of studies I highlighted on insurance and Medicaid's effect on mortality are anomalous I think basically every previous study is underpowered to detect changes in mortality it is very difficult to affect like not that many people die in a year um compared to sorry as a percentage of the population uh such that it is very difficult to detect uh effects on that on that margin um and such that I think the sort of more recent literature as econometric tools have gotten more sophisticated are really like the best studies we have like the medic the Oregon Medicaid experiment was I think seemingly pretty clearly underpowered to detect uh just like there weren't enough people basically in the randomization to tell uh whether there were effects on mortality I that's again I think two litigation to go into you know methods on the stage here but sort of let my my piece be known I think I I object interesting aspects of of Health uh Healthcare research that even where those studies did have sufficient power when they were measuring things like blood pressure levels and hba1c levels and all sorts of measures that were amenable to Medical Care within the time frame of the study where there were enough people with those conditions that if there were an effect of health insurance there should the studies should have been able to detect it with the Rand health insurance experiment and the Oregon Health Insurance experiment so experiments in Ghana sand control trial in India all found was that they measured for all sorts of uh Health outcomes that should have whe the studies had enough power to detect and and effect and they all found no effect on physical health outcomes this this isn't a situation where we should say oh well but the mortality effects uh uh or we shouldn't believe because the studies were underpowered what these studies should do is they should suggest to us that maybe there's something we're missing about Healthcare about how Healthcare works out there on the flat of the curve and maybe it doesn't impact uh Health as much as we should even where we expect that it would when it comes to mortality and so that's why I say that those uh studies are anomalous because there is a vast literature it's not not just randomized control trials although those are the most reliable studies out there there's also you know mefl look at Medicare in the first 10 years of its operation that found uh no detectable impact on mortality even where you had an enormous sample size and a research design that while not randomized um was uh uh plausibly should have picked up an effect of that health insurance expansion can I just jump in for a sec because I think I think one of the things as we can go back and forth I think two points one um you know there probably isn't time to go all into the depth of like social drivers of Health here and Community Health but I do think you know it's pretty well known and I think everyone kind of acknowledges like Health happens also outside of the doctor's office right and so right like the fact that I mean we do we have a little bit of an income inequality problem here and a poverty problem and a racial inequity problem in our country um when it comes to all of those things um and that's something that we need to deal with um so that's that's sort of that's sort of one um I I I think the other is like and the point I keep wanting to make is we can argue about the studies and the methodology like up here like till kind of the cows come home but I think that mostly what we need in our country is a little bit more of a values driven conversation about where can we maybe agree on some of the ideas and the ideology and I will say say you know one thing that I I think was sparked for me by by sort of um um your book Michael but also kind of some of our conversations is this idea that it's like who gets to decide right I mean Lauren you said well if someone loses their job they there's really you know pretty much everyone has an option well not in states that have not expanded medicaid right well can we like just be honest about the map and which states have an exp Ed Medicaid and like what choices we've put in the hands of government in those States versus in the hands of the people right so like I do think that that's something we need to think about I think that the the idea of you know how do you get to a system that's got a little bit less coercion and control over people's individual choice of where they want to put their money you know would I rather put my money towards more comprehensive insurance coverage or would I rather put my money towards I don't know you know like a healthier diet and more fruits and vegetables like I I do kind of see I can see where there can be some some give there right um and like the question is how do we how do we do that um you know but um you when you look at Medicaid redeterminations lots of people have lost their coverage for reasons you know maybe some of them really weren't eligible um anymore for Medicaid um but you know lots of people are losing coverage because they didn't fill out the paperwork correctly right and um I I I just think that's a problem we need to acknowledge is that we are not only um making choices as institutions that are different based on people's different life circumstances that they couldn't control but um that we're also um I don't think having a really honest conversation about that um and that might be I think that might be the next sort of 20 30 years of Health reform is like thinking about how do we solve for that and but I think you raised an important point which is that from the perspective of a an average consumer or a lowincome worker uh what might be most important to them uh might not be that last increment of health insurance uh it might be that the ability to buy fresher fruits and vegetables or move into a neighborhood where that's easier where they housing uh is in a safer place or a cleaner place so that their kids so the mold doesn't S into their kid to the emergency room uh with such frequency and and the the challenge there is uh as you say who decides who decides how to spend resources uh how to spend workers earnings and what I propose in the book is and I've mentioned here is taking that $4.7 trillion dollars that we spend on Healthcare and putting that in the hands of consumers letting them control that spending rather than having government control half of it itself and Delta gate control control over another third of it to employers uh all of whom's uh values might not reflect those of those low-income workers you trust them with that money uh you give that money to them you trust them to spend it and they might spend it on things other than health but they might spend it on things other than health that have a bigger impact on their health than other uh than that last increment of health insurance does and that's why I think you know why Lauren and I got drawn into this really wonky discussion about what all these studies say my read of all those studies is we can trust consumers with those decisions uh it's it's a little arrogant for me even to say we can trust them is their money and their decisions they should be able I think to make those to control that money and make those decisions themselves and if what you worry about is that it's going to have a negative impact on your health I think all the evidence po toward the conclusion that it will not have a negative impact one thing I I I have to jump in I know we want to get to question questions but I think we in the health policy community no matter what side of the aisle we're on or wherever we're coming from we have got to do a better job of asking people what they think like it is one thing for us to sit up here and I have you know I can say I have never gone a date without health insurance in my life you know knockwood like I have reasonable amount of security like if the copay is $40 instead of $25 like it's not a big deal you know um I can afford fresh fruits and vegetables I probably shouldn't buy as many Snickers bars as I do but that's that's my problem but like we have got to do a better job of asking people so you know one thing just um to me kind of a Shameless plug but I think it's relevant here is that um in the past year the alliance has been embarking on this effort to um that we've been calling envisioning a person First Health System and like what does that mean and sort of getting people together in a room to sort of say what does good look like and you know as it turns out when you get payers and providers and Farm and you know real people you know and Community leaders together in a room you know the articulation is people want a system that's seamless and um easy to navigate right like people want affordability they want to be able to stay healthy and well and have that be affordable just as much as the care is Affordable right now this isn't based on any kind of polling data this is kind of based on an idea of like what what does good look like right like what's the ideal but I think we need more conversations like that and more of actually bringing in people's voices to have real conversations about what these trade-offs are because fundamentally um and this was one of my key takeaways from the pandemic too fundamentally I just don't think we have gotten to a place where we agree on the trade-offs and the tensions or have had even a discussion about the tensions between life liberty and the pursuit of happiness like literally those three things which are you know might may sounds a little lofty I didn't make a I didn't make them up right but they're not always aligned they're in tension with one another like my Liberty to not wear a mask might impact on your life or your health right like or um vice versa so like where where are those tensions where are those dials and like can we have better conversations and if if anyone out there is funding Health policy work and I'm looking right at you like please fund more of these kinds of conversations like we need the analysis we need to get our facts right absolutely but like people in Washington arguing about what the facts are you know which is just layered on top of a pre-existing ideology is going to get us nowhere as a country and we've got to find a better way to have a conversation and we have to start now that's my pitch okay so I'll go to the questions uh that we're getting out if you have a question uh if you're our studio audience here and you have a question please raise your hand and wait for the microphone to come to you I see Joe antos has a question um I'll take one from the interwebs while we're waiting for the mic to get to Joe actually two questions uh one from a staffer in Texas and an anonymous uh viewer asked basically the same question which is uh what advice do you have for State lawmakers when looking at legislative Solutions on the state level and uh the book actually has uh not just chapters devoted to that but almost every chapter has uh suggestions for state legislator uh I'll single out the the uh broad strr suggestion is is remove regulatory barriers to cost-saving and quality improving Innovations uh I I'll give you one of them uh that I think any state could Implement tomorrow uh right now uh the uh patient protection and Affordable Care Act or Obamacare dramatically increases health insurance premiums for the vast majority of uh people in those in in the individual market for health insurance in the United States uh a lot of people choose to go uninsured rather than enroll that coverage so people who enroll in a in Obamacare coverage and face the full premium without a subsidy uh uh often report that it's unaffordable and so what states can do that wouldn't affect the ACA at all and could even improve the performance of the Obamacare exchanges is free their residents to purchase health insurance that uh is available in US territories in 2014 the Obama Administration Exempted territories from obamacare's costly regulations Community rating guaranteed issue essential health benefits and so forth which means that in those in the territories insurance companies can offer coverage that might cost 50 to the cost of an Obamacare plan or even less and without the source of perverts incentives that the uh that obamacare's pre-existing conditions Provisions create to make coverage worse for the sick and I'm glad that Lauren and I agree that basically what Obamacare does is make coverage worse for the majority of sick people in order to expand coverage uh for for a relatively small part of the population but if states allowed employers and individuals this Freedom then they could purchase uh less costly plans available in US territories uh and uh and if they uh when they purchase guaranteed renewable policies from territories they could stay in those plans and pay healthy person premiums after they got sick which could improve the performance of obamacare's exchanges by keeping sick people out of those exchanges so uh rather than kill those sorts of markets which is what the Biden Administration is currently trying to do states can expand those markets give people an alternative to Obamacare plans which would if nothing else allow us to compare how those markets perform relative to Obamacare uh if you want to respond Lauren I can feel you champing at the bit um and then we'll get to Joe's question sure uh I mean so I think disagree on the the characterization of my old statement but that's uh I think I'll I me you know I think I'm clearly G to have sort of opposite views on the ACA or you know I think my thing would be expand Medicaid uh would be probably on the high list but I think it might be helpful to sort of focus on the areas where there where I think we might agree uh and i' just say I mean it you know Michael teed it up a little bit but right in the book talks a lot about there are a hand full of would tend to be state regulations that I think inhibit in competition without the sort of positive sides that I view so uh sort of talked about them a little bit the outset but certificate of need laws that you know you got to comply with to get competition into the market a lot of States lately uh you know when there's an anti-competitive Hospital merger going on States will interject to say the the federal government can't stop that merger from happening through our Copa who cares about acronyms but basically it is the state protecting two hospitals who want to merge from antitrust uh scrutiny uh you know there's any willing provider laws that sort of uh there's a lot of State mandates that they put on you know they can only regulate the sort of so-called fully insured plans uh they can't tell they can't tell the sort of employer plans who self fund what they can sort of pay and stuff like that but for those PL there's a lot of man costly mandates that get thrown on them I actually thought it was very interesting I read this book a little bit as almost like a uh proponent of orisa which sort of stops the States from being able to tell sell plans to what they do I'm not sure that that's actually uh probably not his viewpoint but I have heard it from like Chris Pope and some folks on the right who is sort of the you know the argument is look states keep putting making health insurance more costly when they uh get the opportunity to do so but they can't do that to the self-funded plans uh and that actually uh I think there's a you know freedom on the other side to do what you want as a state uh which is an important uh consideration but a lot of the points that kind of get T teed up are things that only really affect the the sort of non-erisa protected uh side of things I'm not even taking a viewpoint on that but I thought that was sort notable I would say yeah I mean I would say to the questioners first I mean look at what is in your locus of control right and there is a lot that states can do um you know you you mentioned certificate of Need You also mentioned scope of practice in the book lure right like we've had we had a lot of um during the um especially during the pandemic kind of a relaxation of some of the restrictions you know tella Health went usage went from like pretty minimal to pretty high I know that's probably something that um States like Texas are looking at a lot especially with a lot of rural areas right I mean look at the health outcomes in your state and look at like what's driving those Health outcomes like what is your maternal mortality rate what is your infant mortality rate like look at what you can do from a perspective of life and health to actually um improve health and some of that's going to be um you know the the pieces that Michael and Lauren mentioned around like insurance coverage or you know um restrictions but I mean it's going to be your public health system as well so um I think there's a lot that can be done at the state level and there's also great resources that you can look at from the National Academy of State Health policy to ncsl and others that have um research and then on the risk pooling stuff I would just say like yes Medicaid is a big huge thing in the locus in your locus of control um you know the alliance doesn't advocate for specific policy positions but I'm just going to point that out um and then um you know look at the American Academy of actuaries like look at some of their issue briefs and like really try to understand these issues so um but what I'm hearing is BR on this panel is Broad pan ideological agreement the state should get rid of certificate of need the state should liberalize clinician Li allowing M Lev clinicians to practice at the top of their training well I think there's kind of a point point where the argument that like we have a shortage of this and that and we're burned out and we can't handle it anymore and then oh but don't let other people you know do like like at some point I also have teenagers um and addition my five like you know I mean so Physicians or maybe incumbent clinicians we're likening to teenagers okay Joe that teas you up pretty well is it on oh yes get trouble for that uh so uh I have comments about uh your first uh and argueably the most important slide not the true first but the first substantive slide and your last slide which is arguably the least important slide so so on the on the first one which is as people may remember it shows uh price decreases in markets where uh their uh consumers are made aware of prices and have the ability to um pick who they go to um that's uh you know that's a really good point uh but uh when I go to the doctor uh I don't claim to know all about medicine and so I think a critical question which I'd love to hear your comment on is uh how do we get doctors on the side of the patients how do we get doctors to be cost aware they're cost aware now they cost Weare on the wrong side wrong you know it's the wrong sign we want the right sign so uh actually I'd love to hear from many of you about how you solve that one and then on your last slide uh you want to pre-fund um VA right and so you're arguing for a trust fund now how did that work out with a Medicare program oh dear lord Joe uh pre fund through a trust fund No Such Thing pre prefunding there's no there's no such thing as prefunding I don't I don't even refer to the Medicare trust fund as a trust fund because it's no there no such thing so I certainly don't propose creating a new one for the VA so I'll take your second question first since we're here so the way and I'm glad you asked God bless Joe anos for asking a question about the VA whichever seems to think is not that important it's not really Health policy we'll just shove it over there which is why it's in such bad shape but the way I propose in the book prefunding uh veterans benefits is by increasing military pay increasing the pay of active duty service members enough so that all of them could buy private life disability and health benefits from private insurance companies at actu Fair rates that would cover them the moment they leave the service that would provide their veterans benefits that way and if there's an automatic mechanism that says that that that ties those increases in salaries to uh uh you know a benchmark premium for people in specific military jobs then when Congress commits troops to battle or even when the uh the president does it without Congressional authorization those insurance companies who are going to be on the hook for those additional veterans benefits expenses they're going to increase their premiums I got I got I got your point uh you you can't you can't tie pay to the UN unpredictable loss of function that someone uh incurs we War government payments to insur it's no no no this is the Affordable Care Act does that all the time uh raise raise military pay and they'll be able to buy the kind of coverage that they need serious uh life-threatening health problem that they incur in in battle and I would argue that uh they won't have enough money to cover that uh and if you're saying that do it through Insurance then I think you're you're adopting uh Lauren's uh General Point um anyway which is uh that that you need insurance to cover I think he's saying to buy insurance to be fair I think maybe we're undering how much higher you you should you should have said that military pay goes up sufficient to allow them to life disability and health insurance I did say that okay and and then they buy those that coverage which covers them from the moment they leave the service and you're right it might be incredibly expensive and that's good because we want people whose own money is going to be on the line to be pricing that risk so that Congress gets an act accurate picture of the expense the financial CA to which it is subjecting uh uh taxpayers in addition to the risk to life Finland is going to be uh to which it's going to be exposing active duty service members they don't have that picture right now which is why Congress is more willing to commit troops to battle than it should be and why it's more willing to keep them in uh uh uh areas of conflict than it would be if it had to face those costs themselves now you did ask another question it was about now I've totally forgotten what the question was on the first on the first slide how are we going to get the doctor on Joe his side so I think this will be an answer that appeals to you Joe which is that it doesn't matter what what kind of economic system we're talking about it could be uh total uh free markets on at one extreme or communism or socialism at The Other Extreme every economic system serves the people that control the money right now government controls half of the money in our health sector directly another third indirectly by delegating control to employers the system does not serve uh the the the consumer the patient because patient is not the one controlling the money if the patient is the one controlling the money that purchases their health insurance then the health insurance uh uh Mark the health insurance industry will serve patients in a way that it just doesn't right right now when it's getting most of its money from the government or from from employers that will lead to more competition for uh patients on the dimensions of quality that that matter to them like do we have doctors in our networks who actually care about what Joe antos cares about who are on Joe antos side because if we don't then we are going to uh lose him to another Health Plan and when people are purchasing their own health insurance they're probably going to purchase less coverage than they do uh than they do when government encourages them to purchase more and so more of the transactions between Joe anos and his doctor are going to be on a cash basis rather than on a third party payment basis which distracts the doctor's attention from what Jo anos wants so with that um if anyone else has wants to respond to Joe uh uh please do and then we can move on I I'll just be I'll be I'll be very brief um and and just say that when we talked about our envisioning person First Health System we also had a panel on Workforce and you know I think people um in the workforce really do want to be on the side of the patients it's like what is it going to take to get there so um happy to follow up with you we're also having a briefing at um Reserve officer Association on November one um on that note um right but like you're right that they're they're they're they're frustrated yeah yeah a longm ISS um okay I just say on the note of highlighting areas of agreement I actually you know the economist in me actually kind of likes the aversion of this sort of va policy and honestly regardless of whether it's sort of still done through a public system or through private insurance I I do think there is something to upfront funding what is clearly an unfunded liability that is like it's sort of a weird right now it's kind of this weird pay as you go kind of system where you're sort of paying for like the last round of uh you know but obviously when you are going to war that raises these premiums right like if you're going to start a war all of a sudden the premiums for whatever private pal policy is being offered here go up a lot um for understandable reasons both short and long term uh so uh I do think there is some attraction to the sort of you know this is you know externalities and all Economist loves uh things that they love so okay um uh another question in the audience here har young I have um an easier question than Joe's um so there's wide agreement that we do need to address health care costs let's say the easiest piece would be facility fees why why aren't those clear at this point we've had the Mandate from Congress we had the hospitals dragging their feet on this like why can't we get the simplest EAS easiest thing if you're charging a facility fee why isn't that right on the front desk so the most important chart in health policy was largely about I think about facilities fees and uh that's how you get them down and how you make them transparent uh right now uh uh Medicare and Congress are struggling mighy to do uh What uh price sensitive consumers did in just a couple of years the reason they're struggling is because it's not their money and they don't care very much uh if it were their money then they they would solve this problem as uh rapidly as consumers did but uh of all um uh sectors of the economy the one that spends the most on lobbying uh Congress is the health sector the reason they spent so much money lobbying Congress is because Congress controls so much of that 4.7 trillion dollars slashing around in the health sector and those they're not spending those uh lobbying dollars in order to get price competition or fiscal rectitude they are trying to keep their prices high and every time Congress tries to do something I think Lauren you've been following the progress of the uh legislation that's trying to reduce sight of service differentials which is largely a facility fees uh story through Congress and I'm I'm just sort of watching from afar uh watching that legislation get weaker and weaker and weaker as it moves through the legislative process because the industry is so successful at defanging Cost reduction efforts because no one in Congress and no in Medicare is spending their own money the way that the patients in these experiments are and I should I should add this is a point I didn't make about that chart it also shows why employers I think why employers can't bring those uh those prices down because when employers try to do so it's much the same situation that members of Congress face they can maybe exclude a Hospital from their Network and get the prices down that way but because the patient or the the worker or which is an analog to the taxpayer uh do doesn't see the benefits herself and so all she sees is the hospital I want is not my Network anymore they Rebel they take the side of the hospital who's charging these outrageous fees and no one can get anything done so if you give workers control of the money that purchases their health insurance as well taking that away from employers they will be price sensitive when puring their health insurance which will give plans that want to exclude that hospital and advantage in the marketplace and the ability to do so Lauren I mean I just I do enjoy uh uh when I ever I tweet about uh the site neutral uh payment Michael Kanan inevitably responds with a drip drip drip or about wa waiting for the incoming uh the onslaught of lobbying to to to weaken the propos inevitable failure of the Enterprise um I I would sort of argue that it is this sort of specific policy to me this is actually almost all a Medicare issue I actually think in the commercial Market we're kind of I think Micha sort of comments are really focused that it is it is sort of less of an issue I I think again there are shoppable Services where yes more you know cross sharing would uh would drive down cost but largely this is this is a policy where Medicare set up a what I would consider a dumb policy to pay hospitals more money to do the exact same service as a physician office uh and they should just undo that they're going to get some things right they're going to get some things wrong they have been slowly unwinding it very slowly CU you know that's how the government works uh but uh it is they have been moving slightly in the direction in theory there is a proposal out there still live that would take the tiniest of steps further in that direction but who knows what's going to happen with the shutdown and speaker and I just lost now Sarah I I would just add on on this or any other issue right I I would ask what is what are those facility fees subsidizing and like how do you sort of start to untangle the knot right of um like why are they fighting so hard you know get like we can all conjecture but but the point is like this is why it becomes like a game of whack-a-mole with like one thing and another thing and another thing and you know we don't have the holistic conversation like you take 340 beat like same thing right and so so what distortions is that revealing underneath and I you know Michael's solution is like we'll just give all the money to individual people and let them like let the market sort of figure it out as opposed to like Congress trying to untie the knot um maybe there's something to be said for that but you know I think again like if it's facility Fe today it's going to be something else tomorrow and something else the day after that when the reality is we're like dealing with this dynamic system and our policy levers don't always um account for that or acknowledge that or have a good way of um dealing with that okay and with that I think we have to bring our discussion to a close I want to remind everybody here here at Ko and at home you can order recovery at ko.org uh and uh I want to thank Lauren and Sarah for coming here and commenting on the book I want to thank all of you for attending in person and uh and at home or at work I want to thank K's staff for putting this event together um thank you all so much and if you are with us in person uh please join us for lunch upstairs in the conference center thank you [Music]
