In the opening keynote address at the NJBIZ Health Care Symposium, Dr. Jeffrey Brenner explained the way costs in the U.S. health system have spiraled out of control.
"Health care is an irrational market," Brenner said, citing the fact that the most expensive medical decisions come at times when the patient is least able to make a rational consumer decision.
Brenner told the crowd that cost doesn't follow quality, but follows size and geography of providers that have the strength to negotiate better fees for themselves.
Brenner's Camden Coalition of Healthcare Providers has made national news for increasing the quality of care and decreasing the cost of care for the city's poor, elderly and disabled population. He said the key for reducing the cost of care is for the business community to put pressure on the medical community to change, and to make health care data more accessible so the nation can pinpoint the high-cost users, the prices being charged and the variations in care across different providers for similar services.
Many of the points Brenner made were explored further during a panel discussion on whether the Affordable Care Act actually makes care affordable, led by moderator Joel Cantor, director of Rutgers University's Center for State Health Policy.
Christine Stearns, vice president for health and legal affairs at the New Jersey Business & Industry Association, said an ongoing decline in insurance coverage for employees at small companies reflects both the recession and the inability of some employers to continue to provide coverage.
"Small employers are the backbone of economy," and health insurance is one of the biggest expenses for employers, she said. And while it's a valuable benefit, she said, employees often are unhappy with the company health plan, so the ACA-provided insurance exchanges may be attractive for employers, who can get out of the health plan field, and workers, who can pick the coverage they want.
Larry Altman, who heads the office of health care reform at Horizon Blue Cross Blue Shield of New Jersey, said Horizon is working with providers around the state to find ways to improve outcomes and lower costs, but the ACA does more to increase access to care than it does to lower costs.
"Businesses are paying a lot for health care. We hear all the time from our clients: 'Why are my premiums going up 7 or 10 or 25 percent this year?' Premiums go up because health care costs go up," Altman said.
Altman said until now, employers faced with unsustainable increases in premiums have had little recourse but to shift more of the cost to their employee and "that is just shifting from one pocket to another." He said the American public is going to be upset to find out that premiums costs are higher in 2014, when the ACA goes fully into effect. In 2014, he said, costs may be 30 percent higher than when the law was passed in 2010, because of the underlying trend of health care cost increases, and because the ACA mandates that health plans provide a level of medical care higher than is now required in some states.
Dr. David Shulkin, president of Morristown Medical Center; James Robertson, partner in the health care practice at the law firm McElroy, Deutsch, Mulvaney & Carpenter; and Dr. Robert Brenner, chief medical officer of Summit Medical Group, also participated in the panel.
Donald Burdorf, of EisnerAmper, said the speakers confirmed his perception that the health care system is not as well as organized as it needs to be, especially when it comes to gathering data on patient outcomes and using that data to improve care.
"I'm hoping to see more ACOs" take shape, he said. "It will help control costs when people are more organized and more attention" is being paid to how care is delivered. ACOs, or accountable-care organizations, represent a new approach to health care delivery that seeks to coordinate medical care, engage patients in their own wellness, and improve health and control costs.
Amy Mansue, president and CEO of Children's Specialized Hospital, said doctors don't like being told to change, but the economy cannot sustain spending 20 percent of the nation's gross domestic product on health care. She said providers will either have to strive to deliver care more efficiently, or payers will "just reduce your reimbursement until you figure out how to live within it. The people who say it can't happen will be left out."
Mansue said for-profit hospital operators are now entering the state, which "tells me there is money to be made, and if I can figure it out, I can funnel that money back to my kids."
Contributing: Beth Fitzgerald