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Supporting Barack Obama for President
1. Democratic Presidential Candidate
Senator Barack Obama’s Health
Policy – An Opportunity for Change
Blackford Middleton, MD, MPH, MSc, FACP, FACMI, FHIMSS
Chairman, Center for Information Technology Leadership
Corporate Director, Clinical Informatics Research & Development
Partners Healthcare System
Harvard Medical School
2. Overview
• Introduction
• The Problems with US Health Care
• Three perspectives: Provider, Purchaser, Consumer
• The Opportunity with HIT
• The Obama HealthCare Plan
• Conclusion
3. The Provider’s Dilemma
• Unexplained variation, disparities in access and
utilization, medical error, patient safety, and quality
issues vex US Healthcare
– 18% of medical errors are estimated to be due to inadequate
availability of patient information.
– Patient data unavailable in 81% of cases in one clinic, with an
average of 4 missing items per case.
– Medical error the 8th leading cause of death
– 1 in 4 prescriptions taken by a patient are not known to the
treating physician
– 1 in 5 lab and x-ray tests ordered because originals can not be
found
– 40% of outpatient prescriptions unnecessary
– Patients receive only 54.9% of recommended care
7. Paper-based Medicine
• Prone to error
• Lots of information but no data
• Limited decision support, or measurement
• Does not integrate with eHealthcare…
• Will not transform healthcare
8. Why?
• “Instead of teaching doctors to be intelligent map
readers, we have tried to teach every one to be
a cartographer.”
• “We practice healthcare as if we never wrote
anything down. It is a spectacle of fragmented
intention.”
- L. Weed, M.D.
9. quot;By computerizing health
records, we can avoid
dangerous medical mistakes,
reduce costs, and improve
care.quot;
President George W. Bush
State of the Union Address
January 20, 2004
10. How Does HIT Save Money?
• EHR Effects
– Completeness, correctness, decision support, formulary, brand to
generic, duplicate/redundant meds and tests, charge display
– Workflow support, messaging (pt/provider), referral, A/R, team
• CPOE Effects
– Reduction in hospitalization/LOS due to ADEs, clinical decision
support
• HIEI Effects
– Reduction in unnecessary and redundant tests and procedures
– Labor cost savings
• Telehealth Effects
– Reduction in patient transport, utilization of hospitals, and
physician office visits
• PHR Effects
– Administrative time savings
– Reduction in hospitalizations and physician visit utilization
– Improved medication safety
– Reduction in redundant laboratory tests www.citl.org
11. CITL HIT Value Assessments
• Net US could save $150B with HIT adoption, or
approximately 7.5% or US Healthcare Expenditure
– The Value of Ambulatory Computerized Order Entry
(ACPOE)
• $44B US nationally; $29K per provider, per year
– The Value of HealthCare Information Exchange and
Interoperability (HIEI)
• $78B/yr
– The Value of IT-enabled Chronic Diabetes Management
(ITDM)
• $8.3B Disease Registries; Advanced EHR $17B
– The Value of Physician-Physician Tele-healthcare
• >$20B*
– The Value of Personal Health Records
• Approx. $20B
www.citl.org
12. VA’s Success with Healthcare
Information Technology
Data Source: Thomson TG, Brailer DJ. The Decade of Health Information Technology: Delivering Consumer-centric
and Information-rich Health Care. Washington, DC: US Department of Health and Human Services; 2004.
13. Rates of Positive Survey Responses on
the Effect of Adoption of EMRs, 2008
4% of physicians use fully functional electronic health records
13% use some form of basic electronic records
DesRoches CM et al. N Engl J Med 2008;359:50-60
14. Barriers to HIT Adoption
Source: The Commonwealth Fund National Survey of Physicians and Quality of Care.
15. National HIT Cost Savings to Providers
and Other Healthcare Stakeholders
Net, 89% of the benefit of HIT goes to others, and
HIT produces a significant public good – need for a Third Hand
Middleton B
Health Aff 2005;24(5):1269-72
16. Bones…
Captain –
I’m sick and tired of
it and I’m not
going to take it
anymore!!
Dr. “Bones” McCoy
(apologies to Albert Finney –
Network News)
17. The Purchaser’s Dilemma
• US healthcare is $1.7T, 16% GDP
– 5% in 1963; Industrialized societies average less
than 10%
– Costs rising 7-9%/yr, expected to double in 10yr
– 25% of premium is for administrative overhead
(limited value)
• Public expenditure on healthcare now 43%
of total (up 10% in past decade)
• GM healthcare costs now $1500/automobile,
most expensive component
• Where will additional value be found in,
or costs taken out of, the system?
19. Determinants of Health and Their
Contribution to Premature Death
• Purchasers are
paying into a
disease system
rather than a
wellness system
• 4% of health care
dollar is spent on
prevention and
public health
Schroeder S. N Engl J Med 2007;357:1221-1228
20. Health Care Costs Concentrated
in Sick Few
Distribution of Health Expenditures for the U.S.
Expenditure
Population, By Magnitude of Expenditure, 1997
Threshold
1% (1997 Dollars)
5%
10%
27% $27,914
50%
55% $7,995
69% $4,115
97% $351
www.cmwf.org
Source: A.C. Monheit, “Persistence in Health Expenditures in the Short Run: Prevalence and
Consequences,” Medical Care 41, supplement 7 (2003): III53–III64.
21. Cost Sharing Reduces Both Appropriate
and Inappropriate Hospital Admissions
Percent reduction in number of hospital
admissions per 1000 person-years
*Based on Appropriateness Evaluation Protocol (AEP) instrument developed by
Boston University researchers in consultation with Massachusetts physicians
www.cmwf.org
Source: A.L. Siu et al., “Inappropriate Use of Hospitals in a Randomized Trial of Health Insurance
Plans,” New England Journal of Medicine 315, no. 20 (1986): 1259–1266.
22. Americans Spend More Out-of-Pocket
on Health Care Expenses, 2004
Total health care spending per capita
United States
France Canada
a
Germany Australiab
Netherlands OECD Median
a
Japan
New Zealand
Out-of-pocket spending per capita
a2003
b2003 Total Health Care Spending, 2002 OOP Spending
Source: The Commonwealth Fund, calculated from OECD Health Data 2006.
23. The Consumer’s Dilemma
• Average American consumers $6240/yr of healthcare,
or $12,200 for the ave. family
– Health premiums rising 4x faster than salary over past 6 yrs
– 50% of personal bankruptcy due to healthcare costs
– 42% of the public have experienced medical error themselves
or in their family (24% with serious consequences)
• 45M Americans lack Healthcare insurance
– 80M lack at some time during each year
• A fractured and ‘unwired’ healthcare system
– Medicare beneficiaries see 1.3 – 13.8 unique providers
annually, On average 6.4 different providers/yr
– 90% of healthcare transactions in the US every year are
conducted via mail, fax, or phone
• Increasing exposure to tiered pharmacy plans,
consumer directed care, define contribution plans…
without transparency
– Absent reliable quality data
– No value-based choices
24. Majority of Americans Say Health Care System
Needs Fundamental Change or Complete Rebuilding
Only minor Fundamental Rebuild
changes needed changes needed completely
Percent reporting:
16 50 32
Total
Annual income
<$35,000 11 51 38
$35,000–$49,999 13 50 36
$50,000–$74,999 16 51 31
$75,000 or more 19 52 28
Insurance status
Insured all year 18 52 29
Uninsured during year 10 44 45
U.S. region
Northeast 13 51 35
North Central 16 50 32
South 15 51 33
West 21 48 29
Source: Commonwealth Fund Survey of Public Views of the U.S. Health Care
System, 2008.
25. Nine of 10 Americans Support
Well-Coordinated Care
Percent
96 94
93
92
Source: Commonwealth Fund Survey of Public Views of the U.S. Health Care System, 2006.
27. Health Policy Priorities for Congress,
According to Health Care Opinion Leaders
“How important do you think the following health care issues are
for Congress to address in the next five years?”
Top 10 Issues: Percent responding “absolutely essential” or “very important”
Note: Based on a list of 17 issues.
Source: The Commonwealth Fund Health Care Opinion Leaders Survey, Jan. 2007.
28. Obama’s Health Plan:
Foundations
• All Americans should have access to quality,
affordable health care
– Moral and economic issue
• Modernize healthcare system so that it improves
health, lowers spending, and makes medical
practice more effective and rewarding
– Lowest cost, highest value
• We need a public health system that works with
the medical system to maintain wellness,
prevent disease and improve population health
29. Barak Obama’s Health Plan
1. Universal Health Care
- Health Care Exchange with private and public payers
2. Health Care Reform
- Affordability, cost control, improved quality, efficiency
- Help patients receive better care: Investment in coordination of care,
disease management, and quality measurement and reporting
initiatives
- Help providers delivery better care: expanding research, including
comparative effectiveness research, to understand what works
- Reform our reimbursement systems, to align financial reward with quality
and not quantity of services, with good health outcomes, keeping
Americans healthy, and reducing disparities.
3. Promote prevention and strengthen public health
- Promote healthy lifestyles at home, school, and work places
- Improve public health infrastructure for community health and wellness,
and disaster preparedness
Health IT is the lynchpin to success for each part of his health
platform
30. Cost of the Obama Health Plan
• Net best estimate is $50-65B per year when fully
phased in
– Investments in information technology
• $10B investment for 5 years
• Funded by three means:
– Restoring the top two personal income tax brackets
and rates on dividends
– Restoring capital gains tax to Clinton era levels
– Retaining the estate tax with a $7 million exemption
rather than repealing it
31. Benefit of the Obama Health
Plan for Healthcare System
• Investments in information technology
– HIT Savings $78B (RAND) - $150B (net CITL)
• Reduced insurance industry overhead
– Commonwealth Fund est. $32-46B/yr savings
– Reduce uncompensated care (1% of private premiums)
• Improved disease management, care coordination, clinical
effectiveness research, and payment for excellence
– Enable comparative effectiveness, value-based purchasing
– RAND est. disease management could lead to an additional $81
billion of savings
• Net potential savings $120-200 Billion
32. Impact of Obama Health
Plan for Americans
• Insurance costs decline by $2500 for a typical
family
– Reduce private insurance premiums by 5%
• 10,000,000 more people with employer-based
coverage
• 98-99% of all Americans will have healthcare
coverage
• More rewarding practice environment for
providers and patients… less administrative
hassle and expense
33. “I conclude that though
the individual physician
is not perfectible, the
system of care is, and that Where are we?
the computer will play a
major part in the
perfection of future care
systems.”
Clem McDonald, MD
NEJM 1976
Thank you!
Blackford Middleton, MD
bmiddleton1@partners.org
