[Public Papers of the Presidents of the United States: George W. Bush (2006, Book I)]
[February 16, 2006]
[Pages 252-261]
[From the U.S. Government Publishing Office www.gpo.gov]
Remarks in a Discussion on Health Care Initiatives
February 16, 2006
The President. Thank you all. Thanks for the warm welcome. Thanks
for coming. We're about to have a discussion about how this country can
make sure our health care system is available and affordable. And I want
to thank our panelists for joining us. It's an interesting way to
describe and discuss policy. It's a lot better than me just getting up
there and giving a speech--you don't have to nod. [Laughter]
Do you want to kick things off, Mark?
Mark B. McClellan. I'd be glad to. I'd
like to welcome all of you to the Department of Health and Human
Services. As you know, there are many people here who are working day
and night to protect the public health, to help our health care system
work better.
We have the privilege of working with the best health professionals
in the world--
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doctors, nurses, others who have some great ideas about delivering
better care and about finding ways to do it with fewer complications and
at a much lower cost. But in many ways, our health care policies haven't
kept up with what our health care system can do, and we're going to
spend some time talking about that today.
So, Mr. President, we're very pleased to have you here today to lead
this discussion of some new ideas for improving our health care.
The President. Yes, thank you, Mark.
Thanks. Mike Leavitt--where are you,
Michael? Surely, he's here? [Laughter]
Dr. McClellan. He's in Florida, Mr. President.
The President. Oh, he's in Florida.
Okay. Surfing. [Laughter] Actually, I saw him this morning--now don't
make excuses for him. He's doing a heck of a job--he really is--and I
hope you enjoy working for him.
I am really pleased that Nancy Johnson
is here. Madam Congresswoman, thank you for coming. If you want to meet
somebody in Congress who knows something about health care, talk to
Nancy; she is a tireless advocate for making sure the health care
systems are efficient and compassionate. And I really want to thank you
for coming. It's a joy to work with you on these big issues.
I thank all the folks here at HHS. Thank you for working hard on
behalf of our fellow citizens. You've got a tough and important job, and
you're doing it well. One of the reasons why is because, you know, we've
clearly defined roles of government--with the role of Government in
health care. And one of the roles is to make sure our seniors have a
modern, reformed Medicare system. And I want to thank those of you who
are working on making sure that the Medicare system is explained to and
available for seniors all across the country.
We did the right thing when it came to saying that if we're going to
have a program for seniors, let's make sure it works as good as
possible. And part of that meant modernizing the system so it included a
prescription drug benefit. It's not easy to sign up millions of people
in a quick period of time to a new program, and there were some
glitches. The good thing about this Department, and the good thing about
Mike and Mark is that they have prioritized problems to be fixed and
have gone around the country fixing them.
Millions of folks--about 25 million people have signed up for the
new Medicare benefit. I don't know if you remember when we first had the
discussions about the Medicare benefit, people said, ``It will cost
about $37 a month per beneficiary.'' One of the interesting reforms was
not only making sure that medicine was modernized, but seniors actually
were given choices to make in the program. And Mark's done a fine job of encouraging providers to be in the
markets. And as a result of choice in the marketplace, the average per--
anticipated cost is $27 a month.
In other words, giving people a decision to make is an important
part of helping to keep control of cost. We have a third-party system--
third-party payer system. When somebody else pays the bills, rarely do
you ask price or ask the cost of something. I mean, it seems kind of
convenient, doesn't it? You pay your premium; you pay your copay; you
pay your deductible; and somebody pays the bills for you.
The problem with that is, is that there's no kind of market force.
There's no consumer advocacy for reasonable price when somebody else
pays the bills. And one of the reasons why we're having inflation in
health care is because there is no sense of market. We're addressing the
cost-drivers of health care, and this discussion today is a part of
helping to make sure health care is affordable. And as it becomes
affordable, it becomes more available, by the way.
A couple of ideas, other than the subject at hand, to make sure
health care is affordable is--and we'll talk a little bit about
information technology. I know there's a
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great initiative here at HHS to help bring the health care industry into
the modern era by implementing information technology reforms. And for
those of you working on the project, thanks, and we take it very
seriously at the White House, and I know you take it seriously here.
Secondly, I want to thank those of you who are working on community
health centers. One way to help control costs is to help people who are
poor and indigent get costs in places that are much more efficient at
delivery of health than emergency rooms. And so we're committed to
expansion of community health centers. Again, thanks on that,
Nancy, for helping in Congress. They work.
We're measuring results, and the results are good results.
Thirdly, lawsuits are running up the cost of medicine. The practice
of--the defensive practice of medicine or the practice of defensive
medicine--I'm a Texan--[laughter]--it costs about 28 billion a year when
doctors overprescribe, to make sure that they kind of inoculate
themselves against lawsuit. It runs up Federal budgets. It costs the
economy about 600 to 100 billion--60 to 100 billion a year.
And so we've got to do something about these junk lawsuits. I mean,
they're running good people out of practice. I said a statistic the
other day in the State of the Union that's got to startle you if you're
involved with the health care delivery in America: 1,500 counties don't
have an ob-gyn because lawsuits have driven a lot of good docs out of
those counties. And that's not right.
And so we've got to get medical liability reform. The House has done
a good job of passing it. It's stuck in the Senate. So for the sake of
affordable and available health care and if--is to get a good, decent
bill passed.
One other way to help control costs is to interject market forces,
as I mentioned. And one way to do that is through what's called health
savings accounts. Health savings accounts are an innovative product that
came, really, to be as a result of the Medicare bill that I was honored
to sign. And they're an innovative account that combines savings on a
tax-free basis with a catastrophic health care plan. We'll have some
consumers here of health savings accounts that will describe how they
work and whether or not they're working worth a darn.
But the key thing in a health savings account is you actually put a
patient in charge of his or her decisions and--which we think is a vital
aspect of making sure the health care system is not only modern, but a
health care system in which costs are not running out of control. And
part of making sure consumers, if they have a decision to make, can make
rational decisions is for there to be transparency in pricing. In other
words, how can you make a rational decision unless you fully understand
the pricing options or the quality options. When you go buy a car, you
know, you're able to shop and compare. And yet in health care, that's
just not happening in America today.
And so one of the--this discussion is centered around encouraging
consumer-based health care systems and strengthening private medicine
through transparency and pricing and quality. And I hope you find this
as interesting a discussion as I will.
I'm going to start off with Dr. Gail Wilensky. Do you know anything about health care? No. [Laughter]
She knows a lot about health care. You've been working the health care
industry for, what--tell us what you do.
[At this point, Gail Wilensky, senior fellow, Project HOPE, made brief
remarks.]
The President. Thank you for the lead-in. We spend a lot of money at
the Federal level, and you would expect that if we're sitting up here
talking about transparency then we ought to do something about it. I
mean, the Federal Government is the
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largest purchaser of health care--am I right--46 percent of all health
care dollars.
Dr. McClellan. That's right.
The President. Okay. What are you going to do about it? [Laughter]
Dr. McClellan. Well, Mr. President, we
are doing a lot about this already, as you know. With--before the
Medicare drug benefit, Medicare provided a drug discount card for
millions of seniors to enable them to save billions of dollars. And with
that card, we made available information on discounted drug prices for
all the prescription drugs and all the pharmacies around the country.
Seniors use that information to keep prices down. They shopped, and we
saw during the course of this program, savings actually increase over
time.
The President. Yes.
Dr. McClellan. G1We also saw lots of seniors switching to drugs that
they found out about that could meet their medical needs at a much lower
cost.
The President. One thing a person watching out there--what we're
talking about, for example, when it comes to putting information out on
drugs, a brand name drug and a generic drug do the same thing, but
there's a huge price differential. And what Mark is saying is, is that we made, as a result of our
Government policies, the providers to provide a shopping list, a
comparison for people to get on the Internet and find out whether they
can buy a drug cheaper or not.
Dr. McClellan. That's right. And many
people are saving 70 or 80 percent or more on their drug cost by
switching to generics. You can get this information on the Internet. You
can also get it by calling 1-800-MEDICARE. And we're doing the same
thing with the drug benefit. And that's one reason the drug benefit
costs now are so much lower than people expected, as you mentioned
earlier.
We're trying to make more information available on hospital quality,
on nursing home quality, on many other aspects of health care. But we
can't do this alone; we've got a public/private health care system, so
we need to work with health professionals, with consumer groups, with
business purchasers, and with the health plans in this country to get
useful information out. We started to do that through collaborative
efforts, like the Hospital Quality Alliance and the Ambulatory Care
Quality Alliance. These are groups that include all of the different key
stakeholders in our health care system working together to make useful
information available on quality and cost.
Some of that's happened already, but I think with the leadership
from the President and with the full backing of the Federal Government,
we can move this effort along much more quickly and much more
extensively to get information out about satisfaction with care, to get
information out about outcomes of care and complications, and to get
information out about cost. And, Mr. President, we're very pleased to be
starting right now a new program that will be piloted in six large
communities around the country, where all these different groups--the
health professionals, business groups, Government organizations,
including Medicare and the Agency for Health Care Research and Quality,
and health plans--are going to be working together to make useful
information available to consumers and health professionals in these
communities about the quality and costs of their health care. And
hopefully, we'll be able to move this project along very, very quickly.
The President. Good.
Dr. McClellan. We're working.
The President. Nice going. Yes, I know you are. You're working hard.
Mark also has been responsive to some of
the issues of the Medicare rollout. And they've been moving hard and
traveling around the State. And thanks for responding to what's going to
end up being a really, really important program for our seniors--let me
say, a revitalized, important program for
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our seniors. It's going to make a big difference. Thanks for working so
hard.
Robin Downey. What do you do,
Robin?
Roberta ``Robin'' Downey. I'm
head of product development for Aetna.
The President. Yes.
Ms. Downey. And I was
instrumental in launching our HSA program. We've been doing consumer-
directed plans since 2002. And so we're the first national plan to offer
an HSA in the health plan arena.
The President. Good move. I bet you're really selling a lot of them.
Ms. Downey. Yes, we are. The
adoption is higher in the HSA than it is in the HRA now. It's
increasing, and I'm probably one of Aetna's first members in the HSA.
The President. You and I both. We own an HSA.
Ms. Downey. Yes, yes, both in
it.
The President. Let me ask you something. Aetna, obviously, is a big
health insurance company. Do you--obviously you've got an opinion on
transparency, otherwise you wouldn't be sitting here--but give us from
your perspective, from the insurance company's perspective, tell us what
transparency means to you and how best we can work together to implement
the transparency.
[Ms. Downey, vice president and head of product development, Aetna, made
brief remarks.]
The President. Good. And I presume there was resistance at first?
Ms. Downey. Not resistance;
they wanted to know why. I think physicians are wondering why the
consumers need that kind of information. So they're getting used to
that. And then they were actually pretty helpful when we were talking
about how we were going to display it. They were saying, make it easy
for the patients to understand, so they're helping us take the medical
terminology, put it into layman's terms. They wanted to make sure it
wasn't going to create more work for them; were people going to be
calling their offices constantly. And that's what we want to do; we want
to put it on the web site so they don't have to constantly call. So we
want to provide easy access.
And so they were also concerned with, if you put cost information
there, and you don't have quality, then people will price shop on cost
alone, and they're very afraid of that--and they should be, because
people should understand the----
The President. So how do you handle that?
Ms. Downey. We're marrying that
now. We're going to expand that pilot. It was so successful, we're going
to expand it into more locations in the fall of 2006, and we're going to
be marrying that information with the quality information so the
consumer can go out and see what the unit cost is, what the efficiency
is, what the clinical quality is. And so they can look at the overall
value. We're pretty pumped about it.
The President. Well, I appreciate you doing it. It must be exciting
to be on the leading edge of an interesting innovation and to a--into
health care.
Ms. Downey. Very much.
The President. It's hard to believe that ours is a market society in
which people are able to shop based upon price and quality in almost
every aspect of our life, with the exception of health care. And it's no
wonder that we're dealing with what appears to be ever-increasing costs.
You know, it's really interesting, LASIK surgery is a good example
of a procedure that was really didn't--was not a part of a third-party
payer, just came to be. People could choose it if they wanted to choose
it, could pay for it if they didn't want to--would pay for it themselves
if they chose to use it. And more doctors started offering LASIK
surgery. There was more information about LASIK surgery, and the price
came down dramatically over time, and the quality was increasing. And
now LASIK surgery is eminently affordable for a lot of people, because
the market actually
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functioned. And I think what Robin
is saying is that they're trying to introduce those same kind of forces
in Cincinnati.
Thanks for doing what you're doing. I met with your old boss today.
Maybe he's watching out there. [Laughter]
Ms. Downey. He talks to me just
the way you talk to Mark--``just do it.''
[Laughter]
The President. A little bossy. [Laughter]
Ms. Downey. Yes. But you get
stuff done.
The President. Yes, that's right.
Dan Evans is the president and CEO
of Clarion Health Partners in Indianapolis, Indiana. Thanks for coming.
They're doing some interesting things. He's a hospital guy.
Daniel F. Evans, Jr. Yes. We're--
I'm the CEO of an academic medical center, so we have both a university
and a hospital. We have 4,000 peer review projects ongoing right now,
including----
The President. Tell everybody what a peer review project is.
[Mr. Evans, president and chief executive officer, Clarian Health
Partners, Inc., made brief remarks.]
The President. So how easy is it to establish a matrix, or a--
information for consumers to be able to really accurately understand?
[Mr. Evans made further remarks.]
The President. The--we're really talking about making sure each
American has an electronic medical record, over which he or she has got
control of the privacy. An interesting--another example was what
happened--the Veterans Administration, by the way, has implemented
electronic medical records. In other words, they're using modern
technology to bring this important agency into the 21st century. A lot
of files at your hospital still--probably not your hospital but the
typical hospital--are handwritten.
Mr. Evans. Well, you know, what
happens is, they may be electronic in the hospital, but handwritten in
the doctor's office----
The President. Yes, and the doctors can't write anyways, so--
[laughter].
Mr. Evans. Well, the pen is a very
dangerous thing.
The President. Yes, it is.
Mr. Evans. Yes, as you well know.
[Laughter]
The President. And so the idea is to modernize doctors' offices and
hospitals and providers through information technology. And so the
Veterans Department has done this. In other words, each veteran has got
an electronic medical record. And so when Katrina hit, a lot of veterans
were scattered, and they were just displaced. And you can imagine the
trauma to begin with, and the trauma is compounded if you're worried
about your record being lost somewhere, your medical record.
And fortunately, because the veterans at the Department had already
acted, these medical records went with the patient, and a lot of
veterans got instant help. And so a doc could just, you know, kind of
download their record, take a look at what was prescribed before, take a
look at other procedures, and boom, the medicine and the help was
brought up to speed quickly, which is great. And I want to thank you for
doing that.
Information technology is going to help change medicine in a
constructive way, and it does dovetail with price and equality.
Yes. Getting kind of adrift of what we're talking about here? I hope
so. If not, we'll go over to Jerry;
she'll help--[laughter]. Jerry, welcome. Where do you live? What do you
do?
Jerry W. Henderson. Mr. President, I
live in Baltimore, Maryland.
The President. Welcome.
Ms. Henderson. And I am a nurse, and
I've been in health care for over 30 years. And for the last 9 years,
I've had the responsibility of running an ambulatory surgery center in
Baltimore.
The President. Good. Called?
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Ms. Henderson. The SurgiCenter of
Baltimore.
The President. Very good. And tell us, you know, the transparency
issue--you--we had a little visit ahead of time, so it's not the first
time I've seen her; she gave me a little hint about what she was going
to talk about. Go ahead and share with people--small clinic, relatively
small clinic, big hospital guy, small
clinic person.
[Ms. Henderson, executive director, SurgiCenter of Baltimore, made brief
remarks.]
The President. Right. And the reason why they can't yet is because
you happen to be on the leading edge of what is an important reform.
Ms. Henderson. I think so.
The President. Yes, it is. Well, so do the patients, more
importantly. And thank you for sharing that with us.
You have--happen to have a patient here.
Ms. Henderson. I do.
The President. You've known Gail before?
Ms. Henderson. Gail
Zanelotti was a patient at our center, and I
think she'll tell you that probably it was a more convenient and
comfortable and patient----
The President. You're not putting words in her mouth are you? [Laughter]
Ms. Henderson. No, no. But I bet she
would tell you that. [Laughter]
Gail Zanelotti. It was more convenient
and comfortable. [Laughter]
The President. It was? Very good. [Laughter]
Ms. Henderson. See? [Laughter]
The President. You were diagnosed with what?
Ms. Zanelotti. With bilateral breast
cancer in October. And I had several procedures performed at the
Surgical Center of Baltimore. And they treated me as if I were the main
event. That's how I felt--socially, emotionally, physically. The whole
gamut was covered. And I chose the surgeon first for quality and then
went on to find the pricing and everything else through them----
The President. Sure.
Ms. Zanelotti. ----which they were very transparent about. It was a
very positive experience. And I'm still in communication with them
because--through the reconstructive process.
The President. Yes.
Ms. Zanelotti. And I would do it the same way again.
The President. And so how does--I mean, so you're the consumer. You
walk in, obviously, pretty well traumatized to a certain extent. You've
got this horrible disease that's attacked you. And you come to them, and
they--and you're asking what questions?
Ms. Zanelotti. I saw the surgeon that
night, and I think we were there at 10:30 p.m. at night.
The President. Oh, great.
Ms. Zanelotti. I mean, it's amazing how
dedicated some of these doctors are. And then they take you through the
process of different diagnostic steps that you have to take. And really,
you see how curable things can be if it's caught early. And I was very
lucky to be able to be faced with step-by-step approach to get back to
my journey of full health.
The President. Good job. Congratulations.
Ms. Zanelotti. Thank you.
The President. You've got that sparkle in your eye, you know.
[Laughter]
Ms. Zanelotti. Thank you. Very lucky.
The President. And so--no, I appreciate it. It's an interesting--the
transparency reform is going to take place in both large entities and
smaller entities, because consumers shouldn't be restricted to shopping
only in a large entity or a small entity. ``Shopping'' isn't the right
word, but you know what I mean--in other words, out there looking for
the procedure that fits their needs at the right cost and the right
price.
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It almost doesn't matter if we have transparency if consumers,
however, are not in a position to make decisions. In other words, if
somebody is making the decision for you, transparency only matters to
the decider.
And so Bruce is with us today--Bruce Goodwin. He's an HSA owner. Bruce, describe HSAs--well,
first of all, tell us what you do.
William ``Bruce'' Goodwin. My
company manufactures computer plate technology for the graphic arts
printing business.
The President. How many employees?
Mr. Goodwin. We have 20
employees. We're a small company.
The President. Yes. By the way, two-thirds of new jobs in America
are created by small businesses. And if a small business can't afford
health care, it's pretty likely they're not going to be aggressive in
expanding. And I presume you have some health care issues.
Mr. Goodwin. Well, I'm here as
an employer who is concerned about health care costs for sure, and a
strong advocate of health savings accounts. I'm a firm believer that for
employers, health savings accounts is probably the best weapon we've got
in the battle of these rapidly escalating health care costs. And I'm
very much hopeful, and I appreciate very much your leadership in trying
to help strengthen the health savings accounts.
The President. Yes, we'll talk about it in a minute. So tell people
what a health savings account is. This is kind of a foreign language to
everybody but the 3 million people who own one. It's just a new product.
And it's just beginning to happen.
[Mr. Goodwin, president, Glunz and Jensen, Inc., made brief remarks.]
The President. An insurance plan with a health savings account is a
high-deductible catastrophic plan coupled with a tax-free health savings
account to pay routine medical costs up to the deductible. That's the
way they're structured now. Many employees--I was at Wendy's yesterday.
Wendy's has now got 9,000 employees using health savings accounts. The
company pays for part of the premium, as well as the contribution into
the cash account to be paid by the customer for routine medical
expenses.
If you don't spend all your money in your cash account, you can save
it tax-free and roll it over to the next year, and then you contribute
again. Wendy's premiums rose this year, I think, at less than 2
percent--maybe even less than 1 percent, if I'm not mistaken. And they
were increasing at double-digit rates--I hope I'm not exaggerating--they
were going up quite dramatically, let me put it to you that way. And now
their premiums were significantly lower. And the savings enabled them to
put additional money into their employees' accounts, additional
contributions.
It's an interesting concept, because all of a sudden, it puts an
individual in charge of health care decisions. There's an incentive, by
the way, for people to make rational choices about what they consume--
like, if you don't smoke and drink, it's more likely you'll stay healthy
and not spend money in your account. If you exercise--I'd strongly urge
mountain biking--[laughter]--it helps you stay healthy. And by staying
healthy, you actually save money. There's a remuneration for good
choice.
And what Bruce is saying is
that it's helped his business afford health care. It's helped a lot of
small businesses. If you're a small-business owner, please look into
health savings accounts for the good of your employees.
Interestingly enough, about a third of those who've purchased the
new health savings accounts were uninsured. Many of the uninsured in
America are young people, kind of the bulletproof syndrome--you're never
going to get sick, so therefore, why buy insurance. Now, there's an
incentive to buy insurance because it means you can save tax-free.
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And so Bruce has used them,
and it's--and he reports that he's able to better control his costs,
which is really important for the small-business sector. And it's also
important for the large-business sector to say to their employees,
``Here is something that's really beneficial for you and your families
because when you saved the money, it's your money.'' Savings in health
care doesn't go to a third party entity; it goes to the consumer. It's a
new concept that's just coming in to be.
In order for it to work, there has to be transparency. How can you
expect somebody to make rational decisions in the marketplace if they
don't see price and quality? It's going to be a very important--what
we're talking here is a very important reform to really fit into a--
making sure the private medicine aspect of our medical system remains
the center of medicine.
There's a debate here in Washington about who best to make
decisions. Some up here believe the Federal Government should be making
decisions on behalf of people. I believe that consumers should be
encouraged to make decisions on behalf of themselves. And health savings
accounts and transparency go hand in hand.
There are some things we need Congress to do to make health savings
accounts work even better than they are. One is to make sure that one's
contributions into the health savings account is--can be--it will be
equal to the deductible, plus any copays that may have to be made. In
other words, we shouldn't cap the contribution, cash contribution at
where it is; it needs to be raised.
Secondly, we need to make sure the Tax Code treats employees in
large companies and employees in small companies equally when it comes
to purchasing health savings accounts. And thirdly, and a key component
of making sure health savings accounts works, that addresses one of the
real concerns in our society, and that is people changing jobs but
fearful of losing health care as they do change jobs, is to make sure
health savings accounts are portable in all aspects, a health care plan
that encompasses health savings accounts. Today, the rules enable one to
take with them the cash balances in their health savings accounts but
not the insurance in their health savings accounts. In order to make
these plans truly portable, so as to bring peace of mind to people,
we've got to make sure that health savings accounts are genuinely
portable accounts.
I look forward to working with Congress to strengthen, not weaken,
but strengthen these very important products that puts the doctor and
the patient in the center of the health care decision. Today we've heard
some interesting, innovative ideas that are taking place from the
insurance industry to the providers to the Federal Government. And we
will continue to implement transparency. And it's just the beginning.
And I predict that when this--as this society becomes more transparent,
as the consumers have more choice to make, you'll see better cost
containment. And as we're able to contain costs, we achieve some great
national objectives: One is to make sure health care is affordable, and
two, make sure it's available.
I want to thank you all for coming to join us. It was an interesting
discussion. Appreciate your time. God bless.
Note: The President spoke at 1:18 p.m. in the Great Hall at the U.S.
Department of Health and Human Services.
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