Second Guessing Managed Care

President Clinton is about to return to the health-care wars with a brand new blue-ribbon commission. Will he have any more success this time? His chief health advisor explains why he just might.


Marcia Stepanek
March 13, 1997 1:00AM (UTC)

WASHINGTON -- managed care, America's 7-year-old national experiment to muffle exploding health-care costs, has been a financial success: Last year's 3 percent national rise in costs to employers was the lowest in 30 years.

But patients say they're getting fed up with the quality of care, and with stories of health-care plans pushing women out of hospitals hours after childbirth or minutes after mastectomies. Politicians are starting to have a field day bashing the system. Some physicians have quit the managed care system entirely. Others are trying to set up their own plans. The physicians' trade journal Medicine & Health named the "crisis of confidence in managed care" the top story of 1996.

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Not surprisingly, the emerging backlash is starting to show up in the White House's political polling data, and dozens of proposals are starting to surface on Capitol Hill to make managed care more voter-friendly. The last Congress required health insurers to pay for at least two days of care after childbirth. This spring, two new bills would give patients more say in the kind of care they get from their HMO.

Managed care officials argue that laws aren't needed: They say the vast majority of health plans provide excellent care. But deeper intervention from Washington appears inevitable. Though President Clinton has yet to weigh in on the debate publicly, his advisors say he is likely to do so any day.

Salon spoke with Chris Jennings, President Clinton's domestic policy advisor and point man on health care, about the growing backlash against managed care -- and what his boss may or may not be able to do to improve it.

How strong is this backlash against managed care? Could it derail the whole system?

It's a wake-up call to the whole health-care industry. It's saying, look people, we're seeing unprecedented and extremely rapid changes in the health-care delivery system and people are wondering whether it's making the quality of health care worse. The administration still believes that quality managed care is the way to go, but we want to make sure that patients don't get lost in the shuffle. So the president is going to name an advisory commission on quality to help ease mounting public anxiety over HMOs and other managed care plans.

What are the White House's chief concerns?

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We're seeing a lot of nervousness inside this White House about how costs are being restrained under managed care. Is it because care is being delivered more efficiently? Are they investing more in prevention? Or is it by reducing access to needed care, reducing benefits and increasing co-payments? And are there adequate grievance procedures in the various health plans so that patients and their families can appeal health-care decisions?

How are you going to get answers to these questions?

The lesson from the last four years is that you can't move on health care unless you have broad-based consensus. So far, Republicans and Democrats have responded quickly to particular concerns, such as early discharges of women who've just given birth or who have just had a mastectomy. The big questions now are, how do we agree on a definition of quality, and how to enforce it? Is there an appropriate government role? If so, is it at the state level or the federal level? We think that the president's commission may be able to help forge a consensus in some of these areas.

What specific quality issues do you think the president's commission should address?

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One of the issues is whether managed care works as well for the sick as for the healthy. There are 100 quality issues, like how to review and assess the use of technology. When I was in Minnesota recently, there were people in the medical equipment world asking how the Health Care Finance Administration judges what kind of equipment is appropriate technology to be used for particular procedures. In their view, there wasn't a consistent application of a reimbursement approval process.

How many members will the commission have, and who will lead it? How long will it take to come up with suggestions for the president and Congress?

There will be at least 20 members on it, made up of consumers, health care providers, physicians, nurses, hospital folks, managed care plans, insurers, state and local representatives, experts in urban and rural health-care issues, experts in geriatric populations as well as non-elderly populations. The co-chairs will be (Health and Human Services Secretary) Donna Shalala and (Labor Secretary nominee) Alexis Herman. There will be public testimony and the commission will probably meet around the country. I think, realistically, you'd need a good year to get it right. But this won't be a multi-year thing.

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Health-care reform was the president's No. 1 priority in his first term, and he got burned. What kind of priority is it for him now? Does it engage him?

Very much so. He writes notes to us on it all the time, wondering how we're reaching out to Republicans, how we're developing policy options that in the context of the balanced budget can expand coverage to more Americans. He wants more detail and is interested in what's going on up on Capitol Hill. He's very engaged.

What about the Republicans in Congress?

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I think the Republicans feel it's not a pie-in-the-sky issue, that it's potentially workable. But they have their priorities, too. The question will be, can there be consensus on expanding coverage in terms of a balanced budget?

Some critics would say these White House moves are driven by the polls.

I don't make policy for pollsters. The polling data does show growing concerns about quality health care, but the polls aren't driving our legislative or regulatory initiatives.

Still, the last time the White House took on the health-care industry, it got beaten badly. Aren't you afraid of the same thing happening again?

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It's important to realize that this is not HMO-bashing. We're not saying managed care is bad. We can't return to the days when we had growth in health-care costs that doubled, tripled and sometimes quadrupled the general inflation rate. So we think there is appropriate managed care. But it shouldn't be just as a means to constrain costs. We think if you do it the right way, you can find ways to achieve savings and improve actual medical outcomes. That's the goal we want to achieve. That's not singling out HMOs. It's saying that whether you're an HMO or a provider service organization or a fee-for-service provider, that we've got to figure out a way to increase the public's confidence that the type of care they're receiving is high-quality.


Marcia Stepanek

Marcia Stepanek is a national affairs correspondent for Hearst Newspapers. She previously interviewed the White House technology chief about "Internet 2" for Salon.

MORE FROM Marcia Stepanek

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Bill Clinton




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