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After US Health Reform—What Comes Next?

Guest blog by Gavin Yamey, lead, E2Pi (Evidence-to-Policy initiative), Global Health Group, University of California San Francisco.

The dust has now settled on the passage of America’s new health reform law.

As argued in my recent editorial in the BMJ, I believe that this is the most the most important social legislation since the 1965 creation of Medicare and Medicaid (the US social insurance programs for the elderly and those living on a low income, respectively).   But a lot will depend on how it is implemented.

So what comes next?

That was the crucial question addressed last Thursday by Dr Mark McLellan, director of the Engelberg Center for Health Care Reform at the Brookings Institution, when he gave the prestigious Chancellor’s Health Policy Lecture at the University of California San Francisco.

McClellan, a physician and health economist, is one of the few “rockstars” of health policy. The lecture hall wasn’t big enough to hold the huge crowd of clinicians, academics, and students, who spilled into an overflow room.  McClellan previously led the Centers for Medicare and Medicaid Services (2004-2006), was the Commissioner of the US Food and Drug Administration (2002-2004), and was a member of the President’s Council of Economic Advisers (2001-2002).  He has served as a health policy advisor to both Democratic and Republican presidents (Bill Clinton and George W Bush).

McClellan speaks with an incredibly rapid Southern drawl, and packed an enormous amount of information into his allotted 45 minutes.  But there was one single, overarching message in his lecture—health reform is doomed unless the US gets serious about giving incentives to health professionals and hospitals to provide better quality care.

A few parts of the new law, he said, have garnered most attention.  These include the insurance market reforms (e.g. insurers are no longer able to deny insurance to people with pre-existing conditions), the mandate to buy insurance, and the subsidies to assist people in purchasing a plan.  But McClellan thinks that these are not the parts we should be most excited about.  These alone, he said, won’t “bend the “cost curve, and he doesn’t consider them to be “real reform.”

The good news, he said, is that the new law “has lots of opportunities to move to where we want to be”—a vision of providing higher quality care at lower costs.  The law supports health providers to conduct pilot studies of ways to tie payment to quality and not quantity of care.  In his opinion, that would constitute real reform.

McClellan laid out a variety of elements that he said will be crucial for the US to move towards this vision, including better measures of high quality care, reforms to the payment system, and comparative effectiveness research (CER).

We need more robust measures of quality, he said, and gave a few examples of what these might be—prevention of diabetes complications, blood pressure control in people with hypertension, and patient satisfaction with the quality of care.  Once these measures are in place, the next step is to reform the way that providers get paid, something that the new law strongly supports.  And, building on the $1.1bn for CER in the 2009 stimulus bill, the new law establishes a Patient Centered Outcomes Research Institute to help build an evidence base for quality care.

I agree with McClellan that the new law’s support for pilot studies of delivering better quality care is enormously exciting.   As the surgeon,  health policy expert, and New Yorker writer Atul Gawande said, the law  “offers to free communities and local health systems from existing payment rules, and let them experiment with ways to deliver better care at lower costs. In large part, it entrusts the task of devising cost-saving health-care innovation to communities like Boise and Boston and Buffalo, rather than to the drug and device companies and the public and private insurers that have failed to do so.”

But I am more optimistic than McClellan about other parts of the law.  In particular, I think the online “exchanges” for purchasing insurance, which will be up and running by 2014, could be transformational.  Individuals and employers will be able to shop here for insurance—they can compare the prices, benefits, and consumer-rated quality of different plans.  The exchanges will be like the Amazon (or  Consumer Reports) of health insurance, and could be a driver towards better quality, better value health plans.

Competing interests: GY volunteered for, and donated to, Barack Obama’s 2008 presidential campaign, and donated to the congressional campaigns of several Democrats. He is a member of Organizing for America, a community organizing project of the Democratic National Committee. He receives employer based health insurance from the University of California San Francisco.


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