Setting the Table for Serious Healthcare Changes

President Biden’s address to Congress omitted little when it came to fundamentally changing the nation’s healthcare system. We heard about expanding enrollment and financial supports in the Affordable Care Act, affecting private insurance plans and state Medicaid participation. More child care and health workers would remake home-based care in a post-pandemic era. Drug prices would be reduced. Medicare coverage would be expanded either to those 60 and older, or 55 and older, or even 50 and older.

Do we need such changes? Your views carry as much weight as mine. How much of Biden’s healthcare agenda will be enacted? I have no idea.

What is clear, however, is that healthcare is more ripe for change than at any time in my memory. Since Medicare was enacted in 1965, the nation has for the most part has not been committed to major changes but has simply moved the healthcare chess pieces around the board, Even the ACA’s main impact was to get more players into the health insurance game, and not to change the game itself.

Four drivers of change stand out today as fundamentally more impactful than previous change agents: the pandemic, health equity, affordability, and acceptance of a broader role for government.

  1. Pandemic

People and institutions are more open to change during an emergency than when times are good. The pandemic has created an expanded role for government, a la point number four below. It also has changed the delivery of health care, providing a showcase for telehealth and digital healthcare tools that can be both better and cheaper than traditional forms of care.

These traditional channels have been under great stress and the pressure for finding better solutions is sending existing players back to the drawing board and drawing disruptive entrepreneurs in droves.

Big tech, in particular, is becoming ascendant in health care just as it has in other parts of our lives. We’re still in the first inning of this new game but it’s clear that it will not be the game we’re used to seeing played.

  1. Health Equity

The impact of the pandemic has been distressingly uneven on different groups of Americans, falling particularly hard on women, people of color, and those with low incomes. Cynically speaking, America has long worked this way.

This time around, however, the human toll of inequality has been displayed in public for everyone to see. Equally meaningful, it has occurred during an unprecedented reckoning with the effects of race-based differences in how police do their jobs and in the sustained public outrage over sexual harassment and assault.

Public support for more people and money to combat healthcare inequality is strong. Some Republicans may not admit that investing in child care and at-home caregiving is an infrastructure issue. Nearly everyone else does.

  1. Affordability

The nation’s healthcare bill was $3.8 trillion in 2019 – roughly twice as much per person as in any other developed country. The relentless increase in prices paused during the pandemic as people cancelled doctors’ appointments and elective surgeries. But the resumption of strong economic growth will also revive health care inflation. This trend is not sustainable and had already begun to drive business-led efforts to curb costs before the pandemic changed our healthcare priorities.

  1. Government

President Biden’s singular impact on health care may be reestablishing the federal government as a welcome and relatively trusted source of support for the nation’s citizens. His first 100 days has gone far to reassure many people that a motivated and focused government has been able to make a big difference in COVID vaccinations and provides a source of consistent and credible advice to Americans.

Expanding acceptance of a more active government role to other parts of health care is not a big stretch. The usual suspects here are opening Medicare to younger participants and using the government’s negotiating muscle to lower drug prices. So far, the White House is not using its political capital on these measures. It has more than enough to do to secure movement on the more than $4 trillion in infrastructure, education, and other child support initiatives.

While the public’s support of these measures has been strong from the beginning, the business community has lately emerged as a powerful and non-traditional supporter on the social equity and infrastructure fronts, both of which entail a degree of acceptance and support for stronger government roles.

Portraying corporate America as “woke” is certainly a stretch. But a survey of business attitudes toward healthcare costs produced a strong consensus that private business health insurance needs government help to combat rising costs.

The Kaiser Family Foundation was one of the organizers of the survey. According to its head, Drew Altman:

“87 percent of the corporate officers we surveyed said they believe the cost of health benefits will become unsustainable over the next five to ten years, and 85 percent said the government needs to take on a bigger role in controlling costs and providing coverage.

“78 percent expressed some level of support for government action on hospital prices, in areas where there is limited competition. And perhaps more significantly, coming from what has always been an anti-regulatory crowd, less than 5 percent opposed such regulations. . . .

“65 percent expressed some level of support for a public insurance option for their workers, and a large majority also supported lowering the age for Medicare eligibility.”

If employers begin using their influence in Congress to support such change, it will happen.