When it comes to health coverage, businesses know the tipping point is not far away, and we need an innovative approach to health reform that realigns the incentives. That was the message of the seven-member health system reform panel held at the Governor’s Health Summit that included Salt Lake Chamber Director of Public Policy Wesley Smith (pictured, far left).
Smith says the good news is businesses realize the magnitude of the challenge.
“We can’t afford to be the Yankees,” he said. “We have to play Moneyball. We have to be more innovative to make this work.”
“Innovation means new but I think it should also mean new and better,” said Edmund Haislmaier, senior research fellow of health policy studies at The Heritage Foundation. “People are searching for silver bullets. They may be new, but they are not necessarily better.”
For years, businesses have been sounding the alarm about the unsustainable costs of health coverage. Gov. Gary Herbert hosted the summit and laid out three goals for heath reform.
1. Stabilize the rising costs of health care
2. Increase access to health care
3. Increase quality of care
“We have a long way to go when it comes to health reform in this state and in this country,” said the governor. “I want to have a robust discussion, frank and open, to see if we can’t find some solutions.”
One innovative solution is the Utah Health Exchange, which allows employers to give a defined contribution to their workers who then go purchase health insurance on their own with the same financial advantages that traditionally come only from buying in bulk for an entire organization.
The governor shared the story of Le Bus, a Salt Lake City-based transportation company that joined the Utah Health Exchange. The move saved Le Bus significantly on health insurance and ultimately led to more employees taking advantage of health care opportunities.
Rich McKeown, the CEO of Leavitt Partners and the panel moderator, said past efforts to reform the health system have demonstrated “the desire of this country to extend its compassion to allow everyone to have some type of health coverage.
He says that while that compassion has driven our decisions in the creation of Medicare and Medicaid, the biggest driver today is the economy.
“The place we are at now is a significant fork in the road,” he said, pointing out Medicare and Medicaid began as a 0.25 percent of GDP only to see that rate skyrocket to nearly seven percent today. “The economy is going to drive remarkable change. It normally drives us to either compassion or reality and this time it needs to be reality.”
“This is a train wreck waiting to happen,” said Scott Hymas, CEO of RC Willey and former chair of the Chamber’s Health System Reform task force. He says there are three types of CEOs when it comes to health care: small business owners who face the high cost by declining to provide coverage for employees, those that are frustrated and don’t know what to do and those that are trying to solve the issue.
“For many businesses this is to the CFO and CEO level—not the human resources level,” he said. “This involves strategy. They just want good health care at an affordable cost.”