Ted Simons: Good evening and welcome to "Horizon." I'm Ted Simons. The national debate over healthcare reform has been generating more heat than light and ideas have been hard to hear above the shouting. Tonight we take time to listen. We'll hear from the AARP, the Arizona chamber of commerce and the dean of the ASU school of nursing. But first, Roger Hughes tell us what he would do to improve our healthcare system.
Roger Hughes: Healthcare reform, is it necessary?
Roger Hughes: It's absolutely necessary. I think what's frustrating for somebody like me who has studied healthcare reform for years, is that I think what we're going to get out of Washington is not healthcare reform. It's going to be nibbling around the edges of healthcare reform but basically continuing the status quo.
Ted Simons: Why is all of this nibbling going on around the edges?
Roger Hughes: Well, it's political -- and I voted for President Obama, I think he's got a lot of wonderful characteristics, but I think his primary goal is getting a healthcare reform bill passed that he can declare as a political victory so he has to please all of the stakeholders and give them something come to the table and frankly all of the big stakeholders are primarily interested in continuing the status quo.
Ted Simons: Why is healthcare as it exists right now, so expensive?
Roger Hughes: Well, there's a number of factors, but primarily the analogy I like to use is imagine you were buying a car, but you didn't know how much cars cost. And imagine you were concerned about the quality of that car, but you had no way to find out what the quality of that car was. And then you found out that you couldn't actually buy the car yourself. But somebody else was going to buy it, and by the way, it was going to cost you $20. And basically, what I've just described is the way we pay for healthcare. We have a third-party, you know, system that essentially is -- is a way of paying for healthcare. It's not health insurance at all. And it insulates the customer in this case, from the true cost of that care. And somebody else, you know, allegedly is picking up that tab. It happens to be the American taxpayer but somebody thinks it's the government or the employer that's providing this benefit. It encourages over-consumption, which in turn, encouraging over-production and that creates a vicious cycle of rising prices.
Ted Simons: And critics will say along with consumers expecting X, you have providers expecting Y in terms of profit. Is the profit motive helping to push us toward this crisis?
Roger Hughes: Well, let me just say parenthetically that when you look at other systems of healthcare, both those where there's some profit motive and those where there is not a profit motive, public plans, you'll see lower cost in those systems than you will in the U.S. system. But the fact remains is that the cost in European countries and America has roughly kept apace over about the last 10 years. The difference, of course, is the that the prices in the U.S. are two to three to four times higher than they are any place else in the world and that's not true just for healthcare, that's true for practically everything.
Ted Simons: There's a higher percentage of those in the United States who simply don't have insurance?
Roger Hughes: Yes, yeah, in Arizona, it's about 17%-18% of people between 18 and 64 years of age. But, you know, I think what's even more problematic, at least to me, looking at this over the long term, is that what's coming out of Washington today is still wanting to hitch health insurance to an employer based model and in my estimation, until we move way from that model and then begin to consider what I think are the other two main alternatives, either some type of a single payer system and that doesn't need to be government owned and operated, but something like Medicare for all. Or some kind of a system where health insurance and costs are in the form of individual vouchers and tax credits. But, you know, as a small business CEO, it kind of bothers me that my health plan can raise my costs, as they did this year, my premium costs, 72%. And what is if I worked for a thousand, 2,000-member firm, I wouldn't see those kind of raises and to me, that's inequitable.
Ted Simons: Can there be enough in the way of taxes -- tax credits and vouchers to help you?
Roger Hughes: There can be but not the way the Republicans have constituted it today. They're talking about tax vouchers and things in the $5,000 range for individuals and such and frankly we do not have a sufficiently mature individual healthcare market to provide kind of a broad breadth of products for that kind of cost. But if you do something like a value-added tax and then you have government self-insure under it for the 20% of the people that are consuming 80% of the cost, I think you can get there.
Ted Simons: It sounds as if you see employer-based health reform and healthcare, I should say, basically on the way out. If that's the case, is there any other option but a public option?
Roger Hughes: Yes. You know, I -- I think you can make a strong case for actually going to a true insurance model where everybody is required to have catastrophic coverage, just like you buy it on your house or on your car. And then for the people that can't provide that, that is publicly subsidized and what you take way is first-dollar coverage and then you allow people to provide various kinds of plans, depending on their resources and their ability and their interest on the private insurance market. Some people -- I mean, the only thing that everybody has to be in the system, but individuals can still choose from a variety of individualized plans on what they want to purchase.
Ted Simons: Quickly, you've got to make sure everybody is covered and that includes preexisting conditions.
Roger Hughes: It has to be mandatory. Whether for a single-payer or some individualized plan it has to be mandatory.
Ted Simons: Very good. Thank you for joining us tonight.
Roger Hughes: It's my pleasure.
Ted Simons: Is healthcare reform necessary?
Suzanne Taylor: It is necessary. It represents employers of all sizes and all industries and the providers as well as the insurers and thing they agree on is we do need to reform the current system.
Ted Simons: How urgent is the problem?
Suzanne Taylor: We believe the problem can be addressed in an incremental fashion. We're dealing with something that affects about a sixth of the United States economy, so we’d like to focus on the areas where we could see the greatest gains.
Ted Simons: I would guess that the chamber would like the idea of free market ideas being used as far as reform is concerned. The concept of free market delivery, payment, these things, is that how the chamber sees the reform should move?
Suzanne Taylor: Well, that's correct. We would really like to see the focus of reform be on how we bring down costs. First of all. That's a huge issue from a global competitive standpoint and we'd like to see the issue of the uninsured as well as access to care addressed.
Ted Simons: How would you like to see the free market involved?
Suzanne Taylor: We believe it's important to see everybody involved in the system. Everyone should have insurance and we think that can be accomplished through the free market. It may be necessary to provide some sort of sliding scale of subsidies to low-income people or that work for small employers but rather than creating a new government plan, we think that could be accomplished through private insurance.
Ted Simons: And critics will say that the free market and private insurance is there right now but preexisting conditions and other things are keeping people -- whatever the number is, 30, 40, 50 million, from having insurance. How do you address that?
Suzanne Taylor: We do not have a truly free market system now. The system is heavily regulated and we have a lot of people not in the system. We have a lot of healthy people that don't have insurance right now because they think they don't need it and we have a serious issue with preexisting conditions. The insurance industry has actually said they're willing to do away with that and provide coverageto anyone regardless of their conditions as long as everybody is in the system.
Ted Simons: I was going to say, way back at the beginning of this debate, the idea of everybody has to have health insurance was floated out there and the shots started being taken. What does the chamber think about that idea?
Suzanne Taylor: We believe everyone should have health insurance. It's a tough issue to deal with because you're saying -- you're putting a mandate on people. But we think there's a way to accomplish that with a variety of incentives and a variety of ways to reduce the costs so it's more affordable.
Ted Simons: But back when the debate first started, the idea was if it's not mandated, it's never going to work. The dam will not hold it if there's a few holes here and there.
Suzanne Taylor: I think that's exactly right, because if we do move down the pact of what's called guaranteed issue, that means an insurance company would have to provide coverage would have to provide coverage regardless of preexisting condition and could not charge more for that, we need something to bring the healthy people into the system so they're not just purchasing it after they get sick.
Ted Simons: The public option plan, against it?
Suzanne Taylor: We are, that's the area we have the greatest concern. We do not believe a government-run health plan will do anything to improve cost or access to care.
Ted Simons: Explain, please.
Suzanne Taylor: Well, there's a number of reasons for that. One is that the government plans that we have right now, meaning Medicare and Medicaid which provide insurance to a large number of Americans, are actually under-paying providers significantly for the care that's rendered. In Arizona, Medicare pays about 89% of cost and Medicaid about 79%. What happens is the incremental difference between what they pay and what it costs is shifted to the private sector by way of increased premiums. It's over a thousand a year. If we move to a full government plan we'll see that skyrocket and at the end of the day that's going to mean a couple of things. Increased taxes, we’ll have to pay for it somehow, and probably rationing of care. Neither of those are attractive solutions.
Ted Simons: Administration, I believe says that the cost would bind up coming down for healthcare if the public option were included. You disagree.
Suzanne Taylor: I disagree, because it doesn't address the issue of cost. It's an attempt to bring more people in. We think there are better ways to do that that would be more effective in lowering the costs.
Ted Simons: Vouchers and tax credits, and these things, can there be enough to get those tens of millions who don't have insurance right now and will never be in a position to get employer-based insurance, is there enough of vouchers and tax credits to take care of those folks?
Suzanne Taylor: Possibly, it's depends on how it's structured. We don't have a great model right now. That's why we're concerned about the complete overhaul all at once. There's some pilot projects in different states that we would give a little more time to look at to see how they work. But I do believe there's ways to bring everyone into the system.
Ted Simons: The concept of employer-based insurance, health insurance, how does the chamber look on not only where it is now, but the future?
Suzanne Taylor: Well, the majority of large employers, about 97%, do offer health insurance to their employees as a benefit. It makes sense for them to do that. Healthy workers are productive workers. Smaller businesses generally are struggling to do that. So what is working well we want to see kept intact and not dismantled but we need other options to make it for affordable for those small businesses to offer.
Ted Simons: What would an option be?
Suzanne Taylor: Some cases it will have to be somewhat subsidized. There are folks that have serious preexisting conditions that aren't going to be able to opt in. That's one thing. But also making more choice available so that these smaller companies can buy a policy that makes sense for them, rather than being told what exactly they have to buy, which may not be affordable.
Ted Simons: About 30 seconds left. The profit motive needs to be erased from healthcare. Your thoughts?
Suzanne Taylor: Well, you know, healthcare is an industry. We have for-profits and not-for-profits. It's part of the system. I don't think it's the focus of the problem right now.
Ted Simons: Very good to have you on. Thanks for joining us.
Suzanne Taylor: Thank you, Ted.
Ted Simons: We continue our series of conversations with Ritch Steven, chairman of the AARP Arizona advocacy network. Thank you for joining us.
Ritch Steven: Thank you for giving me the opportunity.
Ted Simons: Before we get into this, talk to AARP and who we're talking about.
Ritch Steven: Well, a lot of people don't realize that AARP is 40 million members but they aren't all retired. You have to be 50 and older to join. So about half of our members are 50-64. And half are above 65. So we have a lot of working members who have jobs, who have insurance, who have health coverage issues. And we also have many people who are in Medicare, and they have a whole set of other issues.
Ted Simons: Let's talk about some of those issues. We'll start with healthcare reform. Does AARP believe that healthcare reform is necessary?
Ritch Steven: We have been very consistent in our policy and our message and in our work. For years, saying that healthcare reform is a vital necessity, we must make health reform start now.
Ted Simons: What needs to be reformed?
Ritch Steven: Well, we've got a couple of things. We do not endorse any pieces of legislation currently being discussed. What we do is ask our members as a member-driven organization, what's important to them? What do you want us to advocate for on your behalf? What do you want us to look for in legislation to make sure that your needs are represented? And again, we have a broad membership. So we have a couple of things. And what we've heard is that they want us to say let me be free to pick the doctor I want and work with the doctor and make sure that my needs are met. They want to make sure that they aren't discriminated against by insurance companies. They don't want to be discriminated for preexisting conditions. They don't want to be discriminated because I'm older and have a pay a lot more. They want their drug costs brought under control. Most people over the age of 50 start getting on some forms of drugs and they need that help.
Ted Simons: With those priorities, I guess, in place, the Obama administration has talked about public options. That's a little bit off the table now. But in general, from where the AARP sits, a public option, is it viable? Is it something that AARP would look at offering all of these things that the members are looking for?
Ritch Steven: We have not endorsed the public option approach but we've not said no to the public option approach. What we've said and our research has said is we will look at -- and there are a variety of ways you can deal with the issues that public options would provide. What we're looking for is really for the insurance companies to be able to give us some degree of security in the insurance they offer us and control of costs that we experience.
Ted Simon: Is that security and that control of cost lacking right now?
Ritch Steven: We believe it is. We believe in a variety of areas it is not working as well as it should.
Ted Simons: So would the answer be more government regulation of these insurance companies? Or a more unfettered market for these insurance companies? I mean, there has it be a road traveled, doesn't there?
Ritch Steven: It would appear that the government could set rules kind of like in a football game. What are the rules of the game and they can come back and they can talk to insurance companies and healthcare providers, they could talk to customers, like us. And say we need to change our behaviors, or we need to do business differently but we cannot continue to spend the kind of money we're spending in this country and watch that number double in the next 10 years. It would just be very detrimental to things we need to do.
Ted Simons: Obviously, you're being careful because you're representing an organization with a huge membership. Considering that and all of the options on the table and not endorsing any option, is AARP in almost at the point where you're losing some relevance by not coming out and saying that's the way we need to go?
Ritch Steven: I think this is a very confusing issue and it's being introduced in a very confusing way and when you have 40 million members not everybody is going to agree. 50 plus and $16.50 are the criteria. And you get people who join for a variety of reasons. We've lost a few members, very few members over this issue. That say I don't support where the organization is on it. But at the same time, while I know the news media said we've lost 60,000 members, we gained 400,000 during the same period who joined us. So it's an ebb and flow issue and we work hard as an organization to communicate with our members through the written word, the emails, AARP.org. We really work to listen to them and to talk to them.
Ted Simons: Last question, very quickly, of those who said I'm out of here, I disagree, what's the biggest concern?
Ritch Steven: Usually they think we're trying to endorse a socialized system. Interestingly enough, what we find out is usually about three to six months later, half the people who resign call us up and say why am I not getting the magazine. Or why can't I get my auto insurance. And we have to say you get the whole package for $16.50. You don't get to pick and choose.
Ted Simons: Thanks for joining us. We appreciate it.
Ritch Steven: It's my pleasure. Thank you, Ted.
Ted Simons: Is healthcare reform necessary?
Bernadette Melnyk: I believe it is necessary, specifically in certain areas. Probably the most important is primary care. And providing the access that we need in primary care and preventive services.
Ted Simons: Now, when you mentioned primary care and access and these things, is it the idea that if we go ahead and make sure the 40 some odd million who aren't insured get insured, you'll need more healthcare providers?
Bernadette Melnyk: Absolutely. There's a critical shortage right now, particularly in rural and under-served urban America. 70% of Americans right now who are insured cannot get a same-day appointment with their primary care provider.
Ted Simons: Ok. So how do we -- granted, if healthcare reform succeeds, then you've got a whole new problem here. How do you get healthcare reform to succeed. How do you get those 40-some odd million insured?
Bernadette Melnyk: We have to increase the supply of primary care providers. Physicians and nurse care practitioners and assistants. Recently, we had the news that very few residents getting out of her programs are choosing primary care as a specialty. So nurse practitioners can fill a tremendous gap in terms of access to care.
Ted Simons: What makes the most sense to you from what you've heard? Is it a public option? Is it single payer? What makes sense to you?
Bernadette Melnyk: What makes sense to me is the opening of more primary care healthcare homes. So that would expand access definitively, but in those homes, again, you would have continuity of care, across a variety of services. You would have continuity of care for people who have chronic illness. If you think about all the people who are seen in the emergency room, 50% of those people seen in the emergency rooms could be handled beautifully in primary care settings. If we had enough primary care healthcare homes.
Ted Simons: How do we pay for it?
Bernadette Melnyk: We pay for it, again, I believe, through a restructuring of what we are currently doing. Again, the cost that we put in to managing all of these chronic illnesses, we could save so much more money if we reimbursed more for primary care prevention services. We'd lessen the amount of costs we're paying for people who develop all of these chronic and terminal illnesses.
Ted Simons: As far as paying for what you see as a pretty good solution, is it going to be done primarily through the insurance industry? Is the government going to have to take a stronger role here? Again, how are we going to pay for it?
Bernadette Melnyk: I think it can be paid with helping people, maybe even providing them with a certain stipend, that they get a chance to choose their plan.
Ted Simons: Thanks for joining us.
Bernadette Melnyk: Thank you.
Ted Simons: Thank you for joining us on this special edition of "Horizon." You have a great evening. Captioning Performed By LNS Captioning www.LNScaptioning.com