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Full Transcript of RCP Interview with Senator Ron Wyden

Full Transcript of RCP Interview with Senator Ron Wyden

By Senator Ron Wyden - March 18, 2009

RCP: After Tom Daschle withdrew his nomination, you were the only sitting Senator to have been rumored as a potential Secretary of Health and Human Services nominee. You've been a key player in the health care reform discussion for a long time and are an author of a leading Health Care reform proposal.

It may be counter-intuitive, but do you think you might have more influence as Senator to the final health care reform product than if you were HHS Secretary?

Wyden: I think I've got the best job around. I represent Oregon in the U.S. Senate and of course if you look at the history of the health reform debate, the place where it always got bogged down was the Senate Finance Committee. In other words, very often you could get it through various committees in the House or HELP. Senator Kennedy has been an extraordinary advocate, but it always went to the Senate Finance Committee and things would fall apart in short order.

[Senate Finance Committee] Chairman Baucus has gotten our committee out of the gate faster than the finance committee has ever moved in history. I think I'm ideally positioned to work with Chairman Baucus and Senator Grassley for a bipartisan reform package that can get through our committee.

RCP: Health care costs -- which accounted for less than 8 percent of America's economy in 1990 and less than 12 percent in 2000 -- now account for more 17 percent of GDP. This trend is the cause of great concern for many who regard health care spending as a potential nation-ruining issue. They fear that if we are spending more on health care, then we are by necessity investing less on infrastructure, energy and education - spending that contributes greatly to our economic prosperity.

How important is it for the future of our economy to get health care spending under control?

Wyden: Fixing health care and fixing the economy are two sides of the same coin. The fact of the matter is that the reason the take home pay of the American worker never goes up is because health care is gobbling up everything in sight. In fact if you look at recent years, employer spending keeps going up and it seems like the fastest rising part of that is health care. So containing health costs is absolutely pivotal, and of course what Senator Bennett and I have been able to do is bring 13 other members of the U.S. Senate together for a bipartisan effort to contain those costs.

RCP: You recently said that "We're spending enough on health care. We're just not spending it in the right places." Where are some of the wrong places that we are spending health care money?

Wyden: One that comes to mind over the last few days is that the people in the individual insurance market are just getting creamed right now, especially with all the layoffs. When those people lose their coverage, they move into the individual market. So probably one of the first things for containing costs is making sure that individuals are in the position to have their funds pooled, so they can be part of a larger group which has more bargaining power in terms of what they get for their health care dollar.

The insurance market is broken. For example, it discriminates against people who are sick. Certainly fixing that so that insurers compete on the basis of price, benefit, and quality rather than cherry picking is an opportunity to control costs.

A third area, in terms of health marketplaces, is that most people don't have a choice. They don't have a choice of options even if they have employer coverage, and most of the time they don't have a choice of plans. So giving them a choice and the ability to benefit financially as a result of a careful selection of their insurance coverage would be a third area where we spend a lot but we don't spend it in the right places.

For the amount of money that the country is going to spend this year on health care, you can go out and hire a doctor for every seven families in the US and pay the doctor almost $230,000 a year to cover them. Whenever I bring it up with doctors, they say "Where do I go to get my seven families?"

RCP: You also recently said that we need to reduce federal spending on procedures that have "little or no value." But value can be interpreted in different ways. How do you define value?

Wyden: Peter Orszag, the White House budget office director, already is on record saying "About one third of what Americans spend on health care is on procedures of little or no value." More than $700 billion is wasted on administrative paperwork and health care services that do not help people feel better or prevent future illness.

When you look at one third of $2.5 trillion, which is what we'll spend this year, you get a sense of what's at stake. You divide 305 million [American population] into $2.5 trillion and it comes out to about $230,000 for a physician.

RCP: Much criticism has been focused on the current pay-for-procedure structure that many argue financially incentivizes doctors and hospitals to perform unnecessary procedures. In other words, the more procedures, tests and surgeries performed, the more money hospitals, doctors and medical equipment vendors make, regardless if the patient gets better.

How should we change those incentives so that doctors and hospitals are performing only the necessary procedure for patients to get better?

Wyden: Pay-for-procedure or fee-for-service reimbursement rewards doctors and hospitals for volume -- not keeping patients healthy or being efficiency. Pay-for-Performance is clearly one tool that can change the incentives to reward quality. Patient decision aides can help guide people through their treatment options for the most careful kinds of decisions on their health that they might make: surgery, chemotherapy, and hospice. Patient decision aides lay out your treatment options and the medical evidence in an unbiased way.

Again we come back to the fact that right now there are no incentives really for providers or individuals to manage costs. The patient says "My employer pays for health care, I'll just have to accept what I have. I don't even know what I've lost out on in terms of wages in terms of purchasing health care." So, pay for performance on the provider side and patient decision aides on the patient side will send costs down, addressing regional disparities and rewarding areas that deliver quality.

Bundling services, or paying a flat rate for a set of services, is another option for squeezing waste out of the system. Episodic care is one of the best ways to get more value for the Health Care dollar. In the Healthy Americans Act we'll boost payments for the providers who coordinate care for patients with multiple chronic conditions.

And we now have examples from the states, from demonstration projects, and from the private sector in many of these areas relating to purchasing value that we ought to pick up on.

RCP: On the other side of this issue, how concerned are you that doctors are performing unnecessary [procedures] because they're afraid of getting sued?

Wyden: Defensive medicine certainly takes a toll on the system and increases costs. We have a strong malpractice reform plank in the Healthy Americans Act. I also think it's a question of fairness. If you're going to adopt tough insurance reforms, then you ought to have tough malpractice reforms. In fact, the Democrats are usually for the insurance reforms and the Republicans are for the malpractice reforms, and in the Healthy Americans Act we say both of these powerful interests are going to have to accept some changes.

RCP: Two weekends ago, the previous HSS Secretary, Michael Leavitt, addressed the National Governors Association in Washington. He said that the most important lesson he learned during his tenure was that the key to health care reform is reforming Medicare and that you cannot reform health care without dramatically improving the delivery of Medicare. He said that although Medicare only accounts for 15% of health care spending, "it is the only player that permeates ever piece of the health care community."

Is Leavitt correct? If we can't reform Medicare, will the rest of the system be impossible to change?

Wyden: It's striking that Jack Wennberg, who has been one of the leaders in terms of blowing the whistle on these regional disparities with Medicare dollars also points to the kind of focus we have on the private sector beginning to migrate to other systems. He says, as counterintuitive as it is, that he thinks that making some changes in the private sector can eventually start migrating to other parts of the system. It's interesting because it's counter-intuitive. Normally, you say everything happens in Medicare and then it will start migrating to the private sector.

RCP: You've been able to assemble a rather impressive bipartisan coalition around your bill, The Healthy Americans Act - which would essentially upend the current employer-based insurance system. Republican Senators Bob Bennett, Chuck Grassley, Bob Corker, Lamar Alexander and Judd Gregg are all co-sponsors of your bill.

Why is your plan attractive to Republicans?

Wyden: Both parties are moving to something of a philosophical truce in this country. I think that Democrats have been right on the idea of covering everybody, because if you don't cover everybody then the people who are uninsured will shift their bills to the insured. So I think Democrats have been right on that key point.

Republicans have had a valid point in terms of saying you shouldn't turn everything over to the government. That there should be a wide berth for the private sector, that there should be a wide berth for private marketplace kind of choices. I think we've melded the two of them together, and we have 13 senators as co-sponsors today -- seven democrats, five republicans, one independent -- and I think we'll be able to add more here before too long.

It's been attractive to both political parties for the reasons that I've outlined. That is different than 1993. In 1993 there were a few, certainly on the part of some conservatives, that believed anything that covered everybody was in some way kind of socialized medicine, government-run health care.

Now a lot of Republicans are saying to themselves that we have to get everybody covered for economic reasons. That's how you hold down costs; that's how you stop cost shifting. And a lot of Democrats are saying look we know what happens if you freeze innovation, if you have a one size fits all governmental standard. And I think Democrats are increasingly receptive to the idea that there ought to be a wide berth for the private sector and for innovation.

RCP: USA Today recently reported that the White House announced it will not overhaul the current employer-based insurance system, to which Donna Shalala, former HHS Secretary under President Clinton, agreed and said that "People who currently have health insurance and like it don't want you mucking around with it."

Is Shalala's criticism of your plan fair?

Wyden: I think that's right, and we've added a section to the new bill titled Guaranteeing You Can Keep The Coverage You Have. So we're going to write it into the law. I joke with people and say we can add it to the Pledge of Allegiance or have the military guard it at the borders. But people feel very strongly about being able to keep the coverage they have if they choose it. The harder one I'd like to do is to say you can keep the coverage you have, but if one of these private choices appeals to you, then you can pursue one of these private choices. And benefit from the savings you generate.

I don't know what you're talking about in terms of the White House wanting this. The President has been very gracious and we've appreciated his kind comments about tax issues at the Summit.

My sense is that if you tick off the major things that the President talked about in his campaign, you have it in our legislation.

Reformers are very much more in agreement than there are areas of disagreement. Let me kind of tick them off. One of them is you have to cover everybody for the reasons I've talked about. Second, you ought to be able to keep the coverage you have. Third, you've got to reform the private insurance markets, because it's broken. Fourth, you've got to reward prevention. Fifth, would be the value of Health Information technology, which we pursued in the stimulus. There are many more areas of agreement than there are potential points of disagreement.

RCP: The health care reform debate is nothing if not multi-syllabic and difficult to comprehend. How much of the challenge of this discussion is conducting it without going over people's heads?

Wyden: Well, I think it's understood that most of the Health Care lingo doesn't resemble English.

I just say that it's been shown that for the amount of money that we're spending today in America, all Americans can have good quality, affordable coverage. It seems to me that if you start to spend the health care dollar in the right places, and make the kind of tough choices that we're talking about here -- insurance reform, making sure you have the right cost containment tools, progressive taxation rather than tax rules that disproportionably reward the most well-off -- you can get this done.

RCP: Alright, last question -- and it's a moral and cultural question. As a society, we don't communicate about death very well, but it's certainly a component to this discussion. In calling for a national discussion about end-of-life care, Senator Mark Warner recently said, "We leave it to families to resolve these extraordinarily difficult decisions with little guidance."

To sustain our economic system - among other purposes - will it be necessary to have a more straightforward and honest discussion about death and how to die without incurring huge cost for our families?

Wyden: Most definitely. As a Senator who objected to the Terry Schiavo legislation going onto the floor of the U.S. Senate because I didn't want to turn the U.S. Senate into some kind of medical court of appeals, I very strongly favor the kind of discussion Senator Warner is talking about.

I also note that Senator Rockefeller who chairs the Health Subcommittee has done yeomen work on end of life care issues. I think his work is going to be part of any comprehensive reform package. The fact is that these end-of-life issues involve a very difficult mix of ethics, morality, religion, and personal values.

All these are issues for the individual it seems to me. We've tried to do this in the Healthy Americans Act in our end of life section. It provides as many choices as possible to American families. We do not want the federal Government in the position of dictating to families what ought to be done or setting up intrusive federal bureaucracy as the arbiter of these end-of-life judgments. We ought to be adopting policies that empower families and empower patients to make choices rather than have their care--their lives--dictated to them.

Ron Wyden is a U.S. Senator from Oregon.

Senator Ron Wyden

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