Managed Healthcare Executive - October 2008 - (Page 1)

{ FOR YOUR BENEFIT } Cost controls can’t be sidestepped in 2009 Health plans the natural shoo-in as change agents in the post-election healthcare system BY JULIE MILLER Julie Miller is editor-in-chief of MANAGED HEALTHCARE EXECUTIVE. She can be reached at julie.miller@ advanstar.com stimates from the nonpartisan Tax Policy Center indicate that Republican candidate John McCain’s healthcare plan would only cover an additional 5 million lives but would o er more exibility and choice. Democratic candidate Barack Obama’s plan would cover 34 million people but would include more government regulation. The center emphasizes the fact that its estimates are preliminary because neither campaign has provided enough information to draw a more complete analysis. The momentum building up to election day and the uncertainty for your business’s future probably keeps you and other managed care executives up at night. Georganne Chapin, president and CEO of Hudson Health Plan, a managed care Medicaid provider, says candidates appease the public by saying everything is going to change, but neither candidate has opened meaningful dialogue about the most needed change of all—reducing costs. “You’re going to have to make some choices, do something about runaway healthcare costs and talk about meaningful cost control,” she says of the candidates. “Discontinue payment for things we shouldn’t be paying for. Make sound judgments about where we get the most bang for our buck and don’t just turn around and blame the next guy. Somebody has to take some leadership and make those decisions, and I don’t see enough of that at this point.” At the state level—even in Massachusetts—the “hard stu ” has not even begun, E she says. Politicians and others driving reform haven’t even scratched the surface of meaningful cost-control decisions. Chapin also agrees with analysts’ attitudes regarding the richness of bene ts as a determinant of higher premiums. Obama’s government-run plan, which is proposed to compete with private plans, would set minimum bene t standards that could drive up premium costs and make it more di cult for Americans to a ord the products. Likewise, McCain’s plan could result in administrative costs rising as more members enter individually into the private market. “Because it’s now seen as a patriotic thing for people to have insurance…we’re going to end up with a lot of really awful insurance programs and tremendously underinsured people,” Chapin says. This, too, does little to control costs. WORK TO DO According to our own State of the Industry survey, which included nearly 500 responses from readers of M H E, more than one-fourth (25.9%) of respondents believe health plans will make the most progress on healthcare reform in 2009 rather than state governments (16.6%), the federal government (16.2%), consumer advocacy groups (10.6%), or providers (8%). The indicator makes sense for several reasons: because competition will insist that health plans continue to reinvent themselves; because government progress tends to be slow; and because providers have less incentive to reform the system. “Everybody in the developed world has some type of planning process and ongoing discussion about where it makes the most sense to put healthcare money and how to a ect the health of the population, not just the health of the various institutions,” Chapin says. “We’re really far from that here in the United States. It’s cost shifting on steroids.” Your challenge and opportunity in 2009 is to further your role as the voice of reason in controlling runaway costs. MHE OCTOBER 2008 1

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Managed Healthcare Executive - October 2008 For Your Benefit Editorial Advisors Contents News Analysis State Report Politics &�Policy Healthcare Reform Trends in 2009 Cost Control Strategies Predicted Premium Increase Top Challenges in 2009 IT System Integration Technology Innovation Disease Management Health Management Pharmacy Best Practices Technology Desktop Resource Ad/Edit Index Managed Care Outlook Statement of Ownership

Managed Healthcare Executive - October 2008

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