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Introductory remarks of Charles O’Brien, president and CEO of West Penn Allegheny Health System:

There are a number of national medical issues that affect Western Pennsylvania. Look at Medicare. It’s a major national program that’s lowering reimbursement on the one hand and changing expectations of what it will cover on the other. And, for example, the balanced budget act made really dramatic changes quite beyond what the Congress expected or intended it to have. Part of the difficulty of the last six or seven years is there is almost no intelligent discussion of Medicare or health policy at the national level. It has literally turned into political rhetoric. For example, you are either for or against cutting Medicare -- there is clearly not a lot of intelligent discussion.

The second area that backs up into Western Pennsylvania substantially is the lack of consensus regarding how to cover the 40-plus million without health insurance.There is not even a consensus on whether it is a structural problem, with people who are chronically uncovered, or whether it is a transitional problem, with people going through certain periods of time where they take a bet: "I’m not going to buy health insurance because I believe I’m healthy."

Just from our own experience of trying to identify people in the East End who don’t have coverage for their children and trying to get them into a program -- we have found it substantially more difficult than we had anticipated. There is a substantial cultural reluctance to seek those kinds of programs out. And that addresses one of the three health guide points that you look at, infant mortality among blacks. If you look at some of the other indicators in Western Pennsylvania, I think the declining population of the industrial base has an impact in terms of utilization of health services and the costs. If you look at the Medicare population, there clearly is a very high utilization. It may have to do with the fact that, in general, the Northeast tends to have a higher utilization, perhaps because of this old industrial base. These are questions that I think a lot of us really don’t have the answers to.

Clearly, the research funding is substantial. Just like a Silicon Valley has a critical mass, we think it’s important for our region to have a critical mass of research institutions to bring a talent pool to our region.

We think our region will strongly benefit by having several strong health service systems that compete on the basis of quality of service. From our own perspective, we believe that the model we are seeking to focus on is one that has a very heavy emphasis on private practice as well as the high quality academic side.

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