The “C-suite” executives — the chief executive officer, the chief financial officer and every other chief — must band together if they are to overcome the power of the health care industry and rein in health care costs.
That was the message Thursday from Brian Klepper, CEO of the National Business Coalition on Health, who was the keynote speaker for Pittsburgh Business Group on Health’s annual symposium at the Downtown Marriott. The business coalition represents 53 regional health care coalitions, including the Pittsburgh business group.
Rising health care costs have eaten up any recent growth in the national economy, Mr. Klepper said, while absorbing more of families’ incomes. Since 2009, the average out-of-pocket cost that a family of four pays in health care premiums and additional contributions has grown from just under $17,000 to $23,000.
“This is absolutely devastating to families,” Mr. Klepper said. Worse, he said, much of the added cost — an estimated $1.6 trillion annually — “provides no value at all. It is spent on nothing, just because we’re allowing the special interests to do that to us.”
He blames a pricing structure that, despite the 2010 Patient Protection and Affordable Care Act, still rewards providers for doing more procedures, as well as more expensive procedures.
He specifically cited the Relative Value Scale Update Committee, a group of American Medical Association physicians and specialists that makes confidential recommendations to Medicare officials regarding the value of specific medical services and how much physicians should be paid for providing them.
As a result, Mr. Klepper said, the health care system overvalues specialists and undervalues primary care physicians compared with other developed nations, while the industry’s influence in Washington blocks attempts to manage the rising costs.
For example, he said, the average cost of an angiogram is $35 in Canada but $915 in the U.S. A single tablet of the cholesterol-lowering drug Lipitor that is $6 in New Zealand costs $124 here.
Looking at the nation’s overall health costs, he said, “We pay double what everyone else pays for middling results, and that’s a real scandal.”
Instead of addressing the structural weakness in the system, he said, employers have shifted more of those costs to workers or simply dropped coverage.
Mr. Klepper, whose talk was sponsored by Cigna, said business leaders need to develop “a national health care data warehouse and analytics platform” that will arm them with information showing which plans and providers produce the best value for the money as far as quality, safety and cost.
“They have to come together to work as one, to be a counterweight to the health care industry.”
Steve Twedt: email@example.com or 412-263-1963.