Cathy Schoen, Sr. VP of the Commonwealth Fund

(Music)

Mark Masselli: This is Conversations on Health Care. I am Mark Masselli.

Margaret Flinter: And I am Margaret Flinter.

Mark Masselli: Well Margaret, T hanks giving is behind us, Hanukkah is underway
and Christmas is around the corner . We are o fficially in the holiday season.

Margaret Flinter: Well Mark it’s probably not all that festive with the White
House . They fix ed much of the trouble with Federal Exchange
www.healthcare.gov but you know , the re are still a lot of problem s to be worked
th
out and I think that November 30 target date may look a little bit ambitious for a
problem so la yered and complex . They have come a long way since the initial
trouble drove out there.
Mark Masselli: Well Margar et, the pace of insurance customers being able to
sign up on the Federal Exchange ha s accelerated dramatically . A few weeks
ago, only 27 ,000 customers were able to complete the process on the Federal
si t e
www.heal thcare.gov , the next week the number had doubled and as these
issues with the website continue to be hammered out , there should be a dramatic
increase in business through December.
Margaret Flinter: Well the irony of this of course , business on the stat e
exchanges has be e n going quite smoothly and been quite robust and if all states
ha d gone th at route, this might have been a smooth er rollout . And we are seeing
that pa ce accelerate as more folks become familiar with the idea of buying
insurance in the o nline marketplaces and have done their sort of self - education
and comparisons .
Mark Masselli: A number of state insurance commissioner s are still milling over
whether folks whose insurance plans were cancelled by the end of the year will be able to keep those plans . Some news though out of California , they said , “ No ,
you can’t keep your plan ”. Our exchange ha s been up and running and I think
that bo des well for the way th e c ountry might h ead .
Margaret Flinter: So once again , something that w ill be dec ided on a state - by -
state basis, Mark , and we wish everybody well in their decision making . But it
does b eg the question why are people so eager to hang on to plans that really
don’t protect them all that much . I think it’s one of th os e situation where pe ople
aren’t sure what they are paying for , or as somebody recently said , as long as
you don’t get sick you think it ’s go od insurance.
Mark Masselli: Insurance is complex and that’s something our guest today can speak to . Cathy Schoen is the S enior V i c e P resident at the C ommon wealth
Fund . She just completed a study of 11 wealthy nations , including the United

States , comparing our respective insurance industries , and you can imagine the
US didn’t sta c k up as well in terms of affordability or efficiency.

Margaret Flinter: And for those who are interested , that study was published in
this month ’s edition of Health Affairs .

Mark Masselli: Lo ri Robertson, Managing Editor of FactCheck.org will be
stopping by to s hine a spotlight on mis statements about healt h policies spoken in
the public domain

Margaret Flinter: A nd no matter what the topic , you can hear all of our shows by
Googling CHC Radio .

Mark Masselli: And as always , if you have comments, please contact us at
www.chcradio.com or find us on Facebook or Twitter ; we would love hearing
from you.
Margaret Flinter: Now we will get to our interview with Cathy Schoen in just a
moment.
Mark Masselli: But first , here’s our p roducer Marianne O’Hare with this week’s
Headline News .
(Music) Marianne O’Hare: I am Marianne O’Hare with these Health Care Headlines .
Well November 30

th
has come and gone and there are still some sticking points
on the F ederal H ealth E xchange . Analyst s had predicted the problems with the
site were simpl y t o o complex to fix in so gr a nd a scale and in such a short period
of time . Experts say the amount of information coursing through
www.healthcare.gov dwarfs that of any other government website , m aking it
m ore similar to a high traffic e C ommerce operation like Amazon or e Bay . Just
days before the October launch date, the www.healthcare.gov site failed to
handle even 500 test customers logging on at the sa me time . But looking at the
long view , analyst s also predict the site will ultimately be running smoot hly
because “ i t has to”.
Meanwhile, states are weighing in differently on the President’s fix for the
cancelled health insurance policy , telling folks t hey can keep their plan for
another year . Well state insurance commission ers in California and Vermont,
among others, say they won’t allow insurers to offer those cancelled plans back to customers . They say it will undermine their robust state - based insu rance
exchanges and ra te and benefit controls for their state ’s residents . Meanwhile ,
the President has insisted that all letters of renewal to those cancelled customers
must come with a clear warning that the policies they are reinstating don’t protect
t he consumers against discrimination for gender , preexisting conditions , which

lead to higher rates . Most of those canceled policies don’t cover the Health Care
La w ’ s 10 essential benefits .

A nd the guy who bec a me a billionaire creating Microsoft is now ta king his
innovations skills from the bathroom to the bedroom. The Bill & Melinda G ate s
Foundation has already launch ed a competition to build a better toilet, now they
are turning their attention t o reducing unwanted pregnancies and reducing the
spread of STDs by building a better condom . Some of the more inventive
solutions among the 800 plus entries into th i s competition include condom s made
from cow’s tendon or fish skin with the key ingredient collagen being called from
those sources . Others of the p olyurethane variety will come in one size fits all
mode with antibacterial nanoparticles to fight the spread of STDs . Winners of the
first round of the competition received 100 ,000 bucks to continue their research.

I am Marianne O’Hare with these Health Care Headlines .

(Music)

Mark Masselli: W e are speaking today with Cathy Schoen , S enior Vice President
for Policy , Research and Evaluation at the C ommonwealth Fund in New York.
Ms. Schoen is the Former R esearch Director of the Fund ’ s Commission on a
Hig h Performance Health System . She has taught health economics at the
University of Massachusetts ’ School of Public Health . Prior to that , Ms. Schoen
served on President Carter’s N ational H ealth I nsurance T ask F orce. She has
authored numerous publications on health policy issues including a recent Health
Affairs report on health insurance cost and complexities in 11 countries including
the United States and is co - author of the book Health and the War on Poverty .
Ms. Schoen , welcome to Conversations on Hea lth Care .

Cathy Schoen : Thank you for inviting me . I am glad to join you.

Mark Masselli: Cathy , to say that this has been tumultuous times for the
A ffordable Care Act and that the American public is learning about the
complexities of the health insura nce system with the online marketplaces having
really an inconsistent rollout , some great successes in certain states , and the
Federal system still not ready for pri m e time but they are working on it. So we
thought this w ould be a good time though to look at the insurance industry itself .
Your recent report published in Heath Affairs compared insurance complexities in
our country with 10 other wealthy nations . So how did the US i nsurance i ndustry
stack up in your findings against with those other countri es ?

Cathy Schoen : We stack ed up very poorly actually, despite spending far more
than any of the other 10 countries in th e study . And this included Germany,
France, United Kingdom, Sweden, Norway, Canada. The US stands out for far
more negative experien ces based on reports of what American adult s are

experiencing on virtually all our measures of a ffordable a ccess , burdens paying
medical bills, time - consuming insurance complexity, Americans far e poorly.

Margaret Flinter: Cathy , I know that at a fundamen tal level , these two areas ,
affordability and access are so critical and so basic and your report noted that the
lack of affordability really ha d the most profound i mpact on primary care and of
course if people can ’t afford it th e n they have issues with ac cess to care . So , we
know that that leads people to for e go care longer , to defer seeking care when
they need it and then seeking care in the emergency room . What’s the real c ost
been according to your study to our nation ’s health as a direct result of th is
i nsurance system and can you quantify how you think this is going to change
once the Health Care Law is fully deployed ?

Cathy Schoen : When you hear that nearly 40% of adult s , so not just sicker
adult s , 40% said that they w e n t without care because of c ost . They didn’t get
recommended care, they didn’t fill a prescription, they didn’t go to a specialist,
compare d to 4% and 6% in some of the other countries . We pay a lot out of
pocket , a $ 100 ,000 or more even when we have i nsurance , A ffordable Act says
is a key part of our concern s. If you can’t get in, you are not going to get quality
care. As you noted, we more often wait for primary care and 1 out of 4 say they
waited six days or more . This is all part of ro ot causes going back to an
insurance syst em where we often have much higher deductibles , much higher
cost sharing and we have huge numbers of people who ha ve no insurance
altogether . So the only place whose doors are open is the emergency room ,
where people with a high deductible avoid going to see the doctor but they know
in the middle of the night if they get really sick the emergency room door i s open .
So we are really distorting our health care systems , building emergency rooms
and we are not investing in primary care and comprehensive care for people with
chronic disease to avoid complications . We really can do much better if we keep
our eyes on the price.

Mark Masselli: Let’s get down in the w eeds a little . And your report focuses on
the administrative cost of insurance in America , and part of the Affordable Care
Act limits the percentage of premium cost that can be spen t on non - medical
expenditures . How much d o these administrative issues impact health care cost
in this country and what can we learn from other countries?

Cathy Schoen : The Institute of Medicine estimated that we spend in excess of
$ 300 billion a year , much of it wasted on administrative cost s . And those insurer
administrative cost s are just the tip of the iceberg . Inside a doctor ’ s office , there
is anywhere from one to two extra people in terms of time , of nurses, doctors,
administrative staff dealing with paperwork and it’s partly because we just never
ha ve standardized, we have different reporting forms , things change all the time,
no two carriers do things the same way and we don’t see this in other countries ,
even countries like Switzerland and Netherlands and Germany which have
competing private i nsurance plan s, just the way they have reached near

universal coverage , they do much more standardization than we do an d the
result is less time for d octors, pati ents, hospitals and I might add, a lot less
administrative cost.

Mark Masselli: Cathy , w ould that be true for Medicare in this country?

Cathy Schoen: Absolutely . Our Medicare system operate s a t much lower
adm inistrative cost , much lower administrative cost .

Mark Masselli: That’s right . Is that more comparable to what you see in th e
countries that you looked at?

Cathy Schoen: Much more comparable . And if you talk to senior c itizens who
have been on Medica re for a while, it doesn’t change every year , so they know
more what to expect . Even if it’s complicated when they first get in, it’s going to
be that way next year . So this notion o f i nsurance surprises doesn’t happen as
much , where you thought the plan was going to pay and you get your bill and oh,
for some reason you didn’t do the right thing, you didn’t make a phone call . It’s
very unusual that that would ever happen in another country and it doesn’t
happen for most Medicare beneficiaries.

Margaret Flinter: Well Cathy, you have certainly be e n looking at the American
h ealth care system and health insurance issues since going back all the way to
your days working in the Car t er Administration , where you served on the
President’s National Health Insuran ce Task Force . Taking that long view , I would
be curious of your thoughts about the r ole that lack of transparency may have
played and wh at it will play going forward and how much it has the potential to
change things.

Cathy Schoen: Well it certainly wi ll help you to have prices that you are going to
face as a patient or as a physician when you are about to recommend treatment
be a secret, is not the way any market works very well. We need to know what
things are going to cost us before we get the servi ce not afterwards when people
can ’t explain it . We are a n amazingly non - transparent system right now . So it’s
a starting point . But I think we need to start asking why are prices so high in the
United States and why does the same thing cost five times a s much in one place
as another place , and that’s where transparen cy will help us start to ask those
questions and start to direct our energy on making a much more coherent
system, not just transparent but one that makes more sense.

Mark Masselli: We are speaking today with Cathy Schoen, Senior Vice President
for Policy , Research and Evaluation at the Commonwealth Fund in New York .
She served o n the C arter Administration ’s National Health Insurance Task Force .
Cathy , let’s look at the online insurance ma rketplaces and the y are still working
out the flaws in the Federal Exchange www.healthcare.gov and clearly we are
seeing mixed realties with these new online insurance public marketplaces but

th is is sort of a new experience for Americans . So what ha s your research at the
Commonwealth Fund shown about the public ’s perception of th ese public or
private marketplaces and how will that change overtime ?

Cathy Schoen: We are clearly at the very early stages. The good news is kind
of an interesting piece of news . People are not aware there are reforms in place .
Some people , before this happen ed, thought the Affordable Care Act ha d been
re pealed .

Mark Masselli: Well that’s good news.

Cathy Schoen: And part of the initial problem on Federal Exchanges wh ere the
Federal government is now running in far more states th an expected to , millions
of people tr ied to get on . They had not expected that kind of turnout in the first
few weeks and the flaws in the web became qu ickly available as it just couldn’t
hand le the volume . So we think that’s going to be the re. People , when we
surveyed them , if they had tried to enroll or find information , w ere frustrated ,
we re intending on coming back . There is a real eagerness in the United States
to have decent insurance . I f you are uninsured , you want a policy , and for the
first time it’s being offered at fairly af fordable rates , and if you have awful
insurance , you would like it to be better . We have a lot of people who have
poli cies that just fail them when they need them . They h it a thousand dollar cap
on a drug benefit ; they run out altogether of an insurance benefit . (14:26
inaudible) define insurance the way every other countr y says, and you shouldn’t
be surprised . Insuran ce should be giving you access and protect ing you when
you get sick. They don ’t all look alike ; they didn’t agree let’s just make this
simple . So the complexit y is still there of our private insurance system so we
think it’s going to iron itself out ; we hope it will iron itself out .

Margaret Flinter: Well I want to go back to this issue of what is a high performing
health system and high performance primary care . And we talked about
accessibility and affordability but Cathy , maybe share with our listen ers what are
some of the other characteristics of high performance health care and how do
those characteristics make a difference on some of our most vexing issues like
health disparities.

Cathy Schoen: We spend by far the most, nearly 50% more than the next
highest country . So it’s not that we are not spending enough . We have a wealth
of resources but we ha ve never really invested in primary care . And when you
think of what is primary care , that’s the place you go first when you have a
concern . Hopef ully you can stay with that practice over time if it’s a place you
like and they get to know you and your medical history. When you need more
complicated care and specialist care , they help you navigate the care system. If
you have a chronic disease , alo ng with nurses increasingly , remind you on what
medication s you are taking . So when primary care is work ing well, it’s at the hub ,
and if you call someone, you can get in quickly. We often wait . More than half of

the Americans in our survey said last ti me they need ed care , they couldn’t get in
the first or the second day , and a quarter of them said they waited six days or
more before they could be seen. If you call a t 10 o’clock at night , that’s
considered after hours care . It’s not after hours care fo r being sick , but you are
told just go to the emergency room. There are other countries that have said that
shouldn’t happen . There is an always an after hours care system . The vision
should be you can get in quickly , including by phone, we know it work s ,
e mergency room use goes down, people get to special ists when they need to but
you don’t bounce around the care system as much and the management of
chronic disease improve s, outcomes improve.

Mark Masselli: I wanted to take a look at the regulations a nd our comparison
against other countries because we have the lowest number of insurance
regulations against the 11 countries that you p o lled and I want you to tell us
about this lack of regulation in the American system . Is there a difference
between the counties that you studied, th at might have had a Federal system
w here we really have 50 state insurance commissioners and maybe other
entities that really pose lots of problems ? Tell us a little more about the lack of
regulation here.

Cathy Schoen: All of the other countries we a re comparing ourselves to have
either universal or near universal coverage . And where they have private
insurance system and several of them do , years ago they said you cannot turn
anyone away because they are sick, you cannot charge them more because they
are sick or because they are female . They have everyone in. So people also
know everyone will have insurance and understand it ’ s there for a lifetime. So
just at that starting point of how not so much we regulate the privat e insurance
industry but the fact that we have a universal system or we are trying to aim for it,
enables us to say let ’ s change the rules of the game. Insur ers can’t turn you
away anymore starting in 2014, they can’t charge you more if you are sick , can’ t
happen , can’t ask you questions about your health when offer ing you insurance.
So that basic change will mean that people who market and people who are
actua ries, al these hidden people will have less to do. We have removed a layer
that shouldn’t reall y be necessary . And overtime , what you have pointed out , we
50 different states , they could be more similar ; there is no reason not to be. Yes,
there is no reason why we wouldn’t have common standards for insurance
across the United States.

Margaret Fli nter: Cathy , you co - authored a book that was a very pivotal book I
think for many of us in health care and community health , title d Health and the
War on Poverty , and in it , you examine the impact of programs like Medicaid and
Medicare on leveling out at least a piece of the health care playing field . How far
have we come since that book was published back in the late ‘ 70s?

Cathy Schoen: When Medicare and Medicaid first came in, the book we wrote
said let’s look at those 10 years what did we get . We go t dramatic improvements

in health outcomes. The Medicare program itself became an engine for
innovation for the entire United States , investing in our academic health centers ,
building up clinical knowledge . It’s been the innovator for us all . And the w ay
hospitals are paid, doctors are paid , private insur ers often wait for Medicare to
act and then follow. So I think we had the opportunity to be innovative again
looking forward particularly if we finally bring everybody in so that it ’ s no longer
going t o be okay that the way you save money i s just by not serving certain
people. We have la gged behind other countries . They have improved faster
than we have . That doesn’t have to be the story. We ought to be able to do
better.

Mark Masselli: We have be en speaking today with Cathy Schoen, Senior Vice
President for Policy, Research, and Evaluation at the Commonwealth Fund in
New York. You can learn more about this report and the ir work by going to
www.commo nwealthfund.org . Cathy , thank you so much for joining us on
Conversations on Health Care .
Cathy Schoen: Thank you for having me on.
Mark Masselli: At Conversations on Health Care, we want our audience to be truly in the know when it comes to the fact s about health care reform and policy.
Lori Robertson is an award - winning journalist and managing editor of
FactCheck.org, a nonpartisan, nonprofit consumer advocate for voters that aim to reduce the level of deception in U.S. politics. Lori, what have y ou got for us this
week? Lori Robertson : Well we recently looked at a claim from Kentucky Senator, Rand
Paul , who said the Medicaid expansion in the Affordable Care Act may bankrupt
rural hospitals in the state . But Kentucky health care leaders say the hospital s
stand to benefit because the expansion would extend insurance to those who
otherwise wouldn’t be able to pay their hospital bills. Senator Paul has
introduced legislation to repeal the Medicaid expansion. He said the state
hospitals could be ov erwhelmed with new Medicaid patients and may go
bankrupt , but state health care officials have supported the expansion partly
because it would financially help the hospitals.
In addition to extending Medicaid to those earning up to 138% of the Federal
pov erty level the Affordable Care Act also slowly reduces Federal funding for
uncompensated care that goes to hospitals. The uncompensated care payments will be cut by $18.1 billion over seven years nationwide to help pay for the Medicaid expansion . In Kent ucky, the state estimates the Medicaid expansion
would cover an additional 308,000 state residen ts . A past president of the
Kentucky Hospital Association said that not expanding Medicaid would financially
hurt hospitals and that the hospitals supported th e expansion. The state Cabinet for Health and Family Services issued a report recommending expansion saying
our hospitals will suffer without it. It estimated that the cut in uncompensat ed

care payments would total 287.5 m illion over eight years . And th at’s my fact
check for this week. I am Lori Robertson, managing editor of FactCheck.org.

Margaret Flinter: FactCheck.org is committed to factual accuracy from the
country's major political players and is a project of the Annenberg Public Policy
Center a t the University of Pennsylvania. If you have a fact, that you would like
checked, email us at www.chcradio.com . We will have FactCheck.org's Lori
Robertson check it out for you here on Conversations on Health Car e.
(Music) Margaret Flinter: Each week , Conversations highlights a bright idea about how
to make wellness a part of our communities and everyday lives. An estimated 26
million Americans suffer from diabetes or pre - diabetes and that number is
expected t o triple in the coming decades. D iabetes is responsible for more
deaths in this country than AIDS and breast cancer combined , but managing
diabetes in such a large and diverse population remains one of the most pressing chronic health issue s that face us. A pilot program launched by the American
Pharmacists Association Foundation has indications for a new tool in the ar senal .
Pharmacist, and Foundation Vice President Benjamin Bluml created a pilot
program that was deployed in 25 communities and 17 states , all focused on the
underserved population , those who are homeless living at or near the poverty
line , the uninsured, people who often have the most difficult time complying with
diabetes management direct ives . Pharmacist s were deployed as front line
mon itors of the patient s ’ A1C levels, blood pressure, cholesterol, BMI .
Benjamin Bluml : The patient often time see s their pharmacist as much or more
than all of the other health care providers combined and so what a natural point
of access in our health car e delivery system.
Margaret Flinter: The initial results of the pilot program project IMPACT Diabetes show ed some pretty significant improvements in the compliance , in diabetes
management of more than 2000 participants.
Benjamin Bluml : So we ask ed each one of the communities to implement a
collaborative care program that included pharmacist s and we saw statistically
significant improvements in A 1C s, in L DL cholesterol, in systolic blood pressures
and in body mass index.
Margaret Flinter: Based on the success of the pilot program , the foundation
plans to rol l - out project IMPACT Diabetes to more communities around the
country who are in need of better diabetes management. Pharmacist s working in
concer t with a care team of clinicians, dieticians, medical providers , offering one
more layer of intervention for patients who struggle to manage their chronic illness, hel p ing to yield better health outcomes and a better quality of life , now
that’s a bright idea.

(Music)
Margaret Flinter: This is Conversatio ns on Health Care. I am Margaret Flinter.
Mark Masselli: And I am Mark Masselli, peace and health.
Conversations on Health Care, broadcast from the campus of WESU at
Wesleyan University, streaming live at www.wesuf m.org and brought to you by
the Community Health Center.