Steven Brill, Author of “America’s Bitter Pill”

Mark Masselli: This is Conversations on Healthcare, I'm Mark Masselli.

Margaret Flinter: And I'm Margaret Flinter.

Mark Masselli: Well Margaret another big name is stepping down Marilyn Tavenner is
leaving her post as Administrator of the Center for Medicare and Medicaid Services.

Margaret Flinter: Well she manage to hold on that for that bumpy ride through the initial
rollout of the first open enrollment and she oversaw a dramatic increase in t he number
of Medicaid recipients across the country, you know, she had some reporting issues
though that run covered in the congressional analysis.

Mark Masselli: She had to admit that there were over reported the number of
Americans who signed up for ins urance by around 400,000 of peers patients who
signed up for both health coverage and dental coverage separately were actually
counted twice.

Margaret Flinter: We know that with so much of the Affordable Care Act the rollout has
been about optics and well things are going incredibly well this time around that was
unfortunate lingering black eye.

Mark Masselli: That was, Tavenner has been loaded as a highly capable administrator.
She was acting administrator since 2011 was officially confirmed as the head of CMS in
2012. This is one of the most demanding post in government the CMS administrator
oversees insurance coverage for one in three Americans with an annual budget of $800
billion.

Margaret Flinter: Well HHS Secretary Sylvia Mathews Burwell praise T avenner's
tenacity and her professionalism. She allotted her efforts to write the ship after the
problem plagued launch of the insurance market place. And she also announce d that
Andrew Slavitt the number two person in CMS will be the acting administrato r moving
forward. And I think her praise of Marilyn Tavenner was well put.

Mark Masselli: Our guest today has done a deep dive behind the scenes of the creation
of the Healthcare law, Steven Brill is a award - winning journalist and author of America's
B itter Pill. He focuses on the need and act more reforms that actually contain cost in
healthcare and stem the exorbitant and cost of pharmaceuticals and hospital care some
of the biggest drivers in the $ 3 trillion year healthcare industry.

Margaret Flint er: And Lori Robertson, Managing Editor of FactCheck.org's stops by,
she's always on the hunt for misstatements spoken about health policy in the public
domain.

Mark Masselli: And as always if you have comments email us at [email protected]
or find us on Facebook or at CHC Radio on Twitter we'd love hearing from you.

Margaret Flinter: We'll get to our interview with Steven Brill in just a moment.

Mark Masselli: But first here is our producer Marianne O'Hare w hit this week's headline
news.

(Music)

Marianne O'Hare: I'm Marianne O'Hare with these Healthcare Headlines. Marilyn
Tavenner is out at CMS the Administrator at the Centers for Medicare and Medicaid
Services had weathered the storm of the initial rollout during the problem plagued
launch of the online insurance exchanges. Facing the initial issues head on and still
managing to oversee enrollment of some 10 million uninsured Americans first go round.
And while the second open enrollment has been a breeze comparatively conflicts still
lingered. Her office erroneously reported some 400,000 additional signups only to
discover Americans who signed up separately for health coverage and dental coverage,
she'll be replaced by Andrew Slavitt the number two perso n at CMS.
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And February 15 is the end of the second round of open enrollment, millions more
Americans have already signed up for coverage or re - up their health plans from last
year with few of the problems experienced the first time around. HHS secretary Burwell
is attempting to h ead off problems of a political nature, she's reached out to the GOP
leadership to seek ways to find common ground in health policy. Burwell feels there will
be common ground, I'm finding ways to continue funding for children's health insurance
program kn own as CHIP and finally fixing the sustainable growth rate formula the
reimburses physicians for Medicare patient treatment.

Meanwhile the Com mon Wealth Fund has done a study of newly insured and their
impact on hospital use and cost -- hospitals reported 22% drop in the number of
uninsured patients, a significant drop in one year. And do you want to just zap the fat
off you? FDA has approved disordered paste maker to battle obesity researchers in St.
Saint Paul, Minnesota found obese patients using the V - Block which blocks the Vagal
never inhibited hunger messages from stomach to brain. But interestingly people in the
control group lost weight as well. I'm Marianne O'Hare, with these Healthcare
Headlines.

(Music)

Mark Masselli: We're speaking today with an attorney and award - winning journalist
Steven Brill, author of several critically claimed works including the recently published
America's Bitter Pill money politics, backroom deals and the fight to fix our broken

healthcare system. Mr. Brill's 2013 in vestigative time magazine special report Bitter Pill
which won the National Magazine Award sought to expose the murky world of
healthcare and hospital pricing. Mr. Brill co - founded Journalism Online a resource
assisting online newspaper publishers, he's a professor of Advance Journalism at Yale
University where he earned his law degree, Mr. Brill welcome back to Conversations on
Healthcare.

Steven Brill: Thank you.

Mark Masselli: I think the last time we have on -- we were talking about charge masters
an d I think everybody in the country started talking about charge masters. So you made
a lot of hospital administrators quite upset but I think you illuminated something for the
public. And now you've turn your attention to the Affordable Care Act and how it was
crafted, I take (inaudible 5:32 ) the law does indeed extend healthcare virtue as it was
intended. But does nothing to cap and contain rising health cost, could you expand on
that for our listeners?

Steven Brill: The good news is that it does solve one of the two problems in American
Healthcare and that is that alone among the develop countries in the world we do not
provide access to healthcare to tens of millions of our fellow citizens. And this does do
that, that's the good news. The bad news i s that the way it does it is by having the
government subsidize health insurance for those people at the same high prices of care
that I talked about in that Time Magazine article the same, you know, charge master
prices, the same high prices for prescript ion drugs. So the lesson of all this and the
reason I wrote the book was to sort of talk in a more sweeping way about what are the
real challenges facing our country and major challenges that would passes for reform.
The only kind of reform that will com e out of Washington is reform the powers that'd be
in the American healthcare industry will allow to come out. And guess what? What they
allow to come out is so called reform that just makes them richer. We are now paying
significant subsides for people to buy health insurance so they can become the
customers of the drug companies who are selling their drugs at the same sky high
prices they were selling at them before which are, you know, typically 50% more than
the price of the exact same drug in Germany , France, Canada, Japan you name it. And
we've done nothing to curb the high profits that so called non - profit hospitals all across
the country enjoy. And when they enjoy those profits they pay their administrators, their
chief executives, their marketin g directors the kinds of salaries that you usually don’t
even see in private industry.

Margaret Flinter: Well Steven your book America's Bitter Pill has been receiving quite a
bit of critical claim would be a real understatement.

Steven Brill: Well thank you.

Margaret Flinter: Just to -- everywhere. And Bob Woodward called the a landmark
study with brilliant insights and then New York Times says that you've pulled up
something extraordinary crafting a thriller about market structure government
organizat ion billing practices ---

Steven Brill: Yeah go figure.

Margaret Flinter: -- and you know that most Americans just don’t understand nor would
they have had much opportunity to understand the complexity of how policy is made in
Washington. So maybe dist ill some of those findings for us.

Steven Brill: Well it starts in the context of, you know, enormous complexity.
Healthcare is by far the largest industry in the country, it's one sixth to one fifth of the
economy. But it's enormously complex, no one can really understand it. And when you
have something that no one understands that involves a lot of money that's where
lobbyist do very well. So for example, there is a provision in the bill allowing for biologic
drugs to enjoy a certain period of pat en t protection. What it means is basically every
year protection they enjoy may had 10 to 15 billion dollars to our healthcare bill that
goes into the pockets of those companies. Now there are good arguments for why they
should have patent protection but t hat's the kind of arena we're playing in. And almost
every paragraph of this 965 page law was heavily lobbied by people whose economic
interest are direct, they lose the money. Now we all have economic interest as tax
payers and as consumers but our inte rest isn't as direct. The health industry lobby in
Washington spends four times as much as the next largest high spending industry and
that's the military industrial complex. So you can imagine the power that they have.

Mark Masselli: It sound like this is a regular sausage making that everybody thinks
about that's going on in Washington normally.

Steven Brill: Well it is exceptive, you know, in every case it's something that people can
understand. It's the formula for how, you know, Medicare reimburse s some aspect of
kidney dialysis changes that affects millions of people. It's also about the simple
complexity and challenge of governing as implementing the law which the Obama
Administration said to say did a terrible job of as witness by both the laun ch of the
website that also is witness by their affiliate to write regulations that would have helped
lots of people just simply sitting down and writing the regulation. It took them five years
to write a regulation that limits the kind of bill collecting and lawsuits that the so called
non - profit hospitals can do for financially needy people who end up in an emergency
room can't pay the exorbitant bill. And get pounded into bankruptcy often. There's a
good provision in the law that changes that that the hospitals lobbied against, this is one
of the rare things that they were unable to keep out.

Mark Masselli: You know, your focus has been on many thing in the book but certainly
the lack to contain the astronomical cost of healthcare we've had Governor D eval on the
show and Jonathan Gruber and others who said hey no, no, no really the strategy was
we thought politically this is what we could get done. And then the next round which
Massachusetts is going through is that this is the time to do cross contro l.

Steven Brill: Well the very candid about is, is just the questions how is that next round
going? And the answer is it's not going and it's not going to go. We are the only country
in the world that does not control the price of prescription drugs that the government as
awarded a patent to. The irony here is that in the political climate we have with the
republicans bitterly oppose to Obama Care even the slightest improvements are not
likely to happen. What passes for the notion of an improvement in O bama Care lately is
a repeal of a so called medical device tax which is a 3% tax on what is probably the
highest profit margin industry in the country. That controversy proves that the
democrats are as susceptible special interest as the republicans are, you know, among
those who support a repeal of that tax are Elizabeth Warren, Al Franken and Amy
Klobuchar . The most prominent medical device maker is a company in Minnesota
called Medtronic, since the day Obama Care was passed its profits are up 67% and i ts
added 5000 people to its payroll. You know, the reason they put the taxing in the first
place was the rational was the medical device industry's going to get all these new
customers because all these new people are suddenly going to have insurance. Th ey
can pay for all these devices and that's exactly what has happened.

Margaret Flinter: When we had on the show the first time you are shining that spotlight
on the irrationality of healthcare pricing. But I think you've been quite open that you
found y ourself in an emergency situation requiring open heart surgery. Your bill came
to a couple of $100,000, what did you learn in examining your own bill and the cost of
your own unexpected experience?

Steven Brill: Well this happened ironically on the last day of enrollment in the Obama
st
Care exchanges last year March 31 . My doctor discovered something and I had a
couple of test and it turned out that I had something called neurotic (inaudible 13:07 )
and if it burst you die. So there I was in the hospital , you know, having, you know, open
heart surgery and first of all it gave me some perspective, you know, I had written in the
first article that we overuse things like MRI test but it was an MRI test that save my life.
So the second was, you know, I had c onsidered myself a pretty savvy customer when it
came to healthcare, none of that mattered I wasn't a savvy customer, I was a puddle.
And, you know, when you're in that situation you are not a consumer, you are not saying
gee do I really need that extra X - Ray do I need that blood test? And that's why this isn’t
a market place. And the other thing it taught me was how dysfunctional it is after I got
out of the hospital I got 36 different explanations of benefits from United Healthcare my
insurance company. And the third envelope I open said amount billed zero, amount

paid for by insurance company zero, amount you owe a $154.20. Well as it turned out I
had scheduled before I went into the hospital and interview with the CEO of United
Healthcare and I went out and asked all those questions and then at the end I took that
explanations of benefits out of my suit pocket handed it to the CEO of United
Healthcare, could you explain this to me? And he looked at it and then he looked up and
said, I could sit here a ll day and I couldn’t deal with ---

Mark Masselli: That's great.

Steven Brill: And, you know, here is the single largest consumer product in the United
States and yet the communication that goes to consumers more than any other
communication, the explan ation of benefits the CEO of the company he doesn’t even
understand what it means. So how are we suppose to understand what it means.

Mark Masselli: We're speaking today with attorney and award - winning journalist Steven
Brill author of several critically acclaimed works including the recently published
America's Bitter Pill. You know, Steven some economist have said you might over
simplified the notion that the Affordable Care Act could magically erase decades of
uncheck growth in the profit driven healt hcare system. And we had conversation with
Professor Ryan Hart talking a little bit about the GDP and the impact on economy.
Would you care if we were paying 20% if we in fact had a healthy population?

Steven Brill: I mean I wouldn’t tell outcomes to an y of this because what we know is
that for all the money we spend our outcomes are not any better. So the notion that if
we only spend more on this instead of that, you know, that H epatitis - C drug costing, you
know, on a $1000 a pill if only cost $1200 a pill our outcomes would be better I think if
our percent of GDP for healthcare is 18% let's remember that in most of the countries
the countries, you know, we compete with globally it's 10%, 11%, 9%. So we're taking
this big chunk out of the economy to do what all the countries that are compete with us
do just as well if not better for a lot less money. But where the conversation really gets
difficult is that there's no way to judge the quality and God knows you can't judge the
quality of any procedure or any hospital or any doctor based on the cost. There are
zillion studies that say that there's no relationship to quality there.

Margaret Flinter: Well Steven we talked about perspective a few moments ago and our
perspective perhaps from within the world of primary care is you just got acknowledge
how much change for the better in the last year or so in terms of so many more people
being insured, many on Medicaid. And certainly, you know, in area where we just used
to see such suffering people with pre e xisting conditions who, you know, their entire
livelihood was going by insurance. So that's sort of the positive side, the other side we
couldn’t agree with you more and we are confronted with this reality as our state
Medicaid directors and people who ha d a corrections facilities. And, you know, the folks

who have come up with a very effective treatment for Hepatitis - C will just have to bear
with being the poster child for how can this be, right? How can a pill for something like
Hepatitis - C cost a $1000 and what do we do about it when it clearly is tied to life saving
and life changing medication. If we gave you the magic wand for Washington where
would you focus your efforts next?

Steven Brill: A couple of things, one is that Hepatitis - C drug is an e xample. That
company would make a lot of money if they sold it for $300 a pill which is what they sell
it for in every other country. And we're the only country that doesn’t act to control the
price of those drugs and that's because of the pharmaceutical lobby in Washington.
When it comes to hospital care one other thing I suggest is that we allow hospitals are
expanding they're buying up other hospitals, they're buying up doctors practices and
exerting, you know, market control. We should encourage the m to do as some of these
hospital systems are now starting to do which is sell their own insurance.

If the Cleveland Clinic dominates healthcare than much of Ohio they should be selling
insurance which in fact they just file to get a license to do so. If I bought my insurance
in the Cleveland Clinic they have a brand name, they have accountability so if I paid
them $8000 or $10,000 a year to insure me then they would have no incentive to over
test to, you know, keep me in the hospital longer or do anything , you know, because
they'd be the insurance company, I mean in fact they wouldn’t want to build themselves
for anything they don’t need.

Second , they're the kind of brand name that is accountable mummified by health
insurance in Ohio I have to hope that th ey're in my network and my health insurance
company going to be fighting with them all the time over whether this was necessary or
that was necessary. Now having said that the only way to do that without having all
kinds of abuse regulate heavily what the y do because they in a fact would become a
monopoly and you can regulate them, you can regulate their profit margins, you can
regulate the salaries of the executive. And you can have ombudsman who are available
to make sure that, you know, that once they take your money to the insurance they're
not skimping on your care.

But if they were the brand then they could open up the walk - in centers that proliferating
around the country to take the place of emergency room so the urgent care centers.
And I'd much r ather go to the urgent care center in Ohio that has the Cleveland Clinic
brand and accountability than I would, you know, going to an unregulated urgent care or
walk - in center, you know, that's been financed by some private equity company.

Mark Masselli: We've been speaking with attorney journalist and writer Steven Brill
author or America's Bitter Pill. You can learn more about his work at

Americasbitterpill.com, you could also follow Mr. Brill by going to @Steven Brill on
Twitter. Steven thank you so m uch for joining us on Conversations today.

Steven Brill: You're quite welcome it was fun.

(Music)

Mark Masselli: At Conversations on Healthcare we want our audience to be truly in the
know when it comes to the facts about healthcare reform and policy. L ori 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 US
politics. Lori what have you got for us this week?

Lori Robertson: Let 's take a look at some of the numbers on the Affordable Care Act.
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The open enrollment period last until February 15 and those who buy their own
insurance are renewing or selecting new polices on the state and federal market places.
Those market places now have more than 25% more insurance companies than they
did in 2014. The average cost of a benchmark silver policy went up by 2% according to
the nonpartisan Kaiser Family Foundation. The benchmark plans are the second lowest
cost of the middle tier si lver plans. The cheaper bronze plans went up an average of
4%, but the price changes very widely geographically. In Southeastern Alaska for
example the benchmark silver plan went up 34% while the same level plan went down
by 45% in Summit County, Colorad o.

The New York Times analysis shows that it pays to shop around, last year's second
lowest cost silver plan is not necessarily the same as this year's. So many policy
holders could see a more substantial premium increase if they stick with their current
plans as oppose to switching policies.

The ACA's basic tax penalty for not having insurance has doubled for 2015 going from
1% of household income to 2%. And the minimum penalty for those with very low
income has more than tripled. Going from $95 per adu lt last year to $325. There are
solid evidence that millions have gained insurance coverage under the law but we won't
have firm estimates of how many or how many will remain uninsured for some time.
And that's my fact check for this week, I'm Lori Rober tson 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 at the
University of Pennsylvania. If you have a fac t, 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 Healthcare.

(Music)

Mark Masselli: Each week conversations highlights a bright idea about how to make
wellness a part of our communities and to everyday lives . In the emergency room the
ICU clinicians are confronted with ameliorative unpredictable medical crisis that
sometimes can be challenging to diagnose. Most of the clinicians are now
communicating w ith colleagues via their smart phones often sending images of a
patient's unique symptoms or chest X - Rays to one another for share diagnosis. ICU
physician Dr. Josh Landy was noticing a growing trend of image sharing via smart
phones to crowd source secon d opinions from friends and colleagues across the
country. But he also was concerned about the potential violation of HIPAA regulations.
So he developed an app for that, he created Figure 1, a sort of Instagram for doctors in
which images can be de - ident ified but shared across a dedicated social media platform
that would allow input from clinicians within their network.

Doctors are using the app to communicate not only with colleagues within their hospital
settings but around the world where someone might have superior expertise with a
certain condition. The app was recently used to share a chest image of one of the
pati ents who presented with the Middle Eastern Virus MERS. Dr. Landy says the apps
get about a half a million image views a day with about 80 million total view so far, he
sees the potential for this platform only growing as more young digital natives enter t he
medical workforce. Figure 1 is a free download through Apple app stores and Google
play. A free downloadable app offering secure HIPAA compliant image sharing among
clinicians around the world to reduce the time it takes to zero in on a diagnose by
ta pping the collective expert instantly. Now that is a bright idea.

Margaret Flinter: This is Conversations on Healthcare. I am Margaret Flinter.

Mark Masselli: And I am Mark Masselli. Peace in health.

Conversations on Healthcare broadcast from the campus of WESU at Wesleyan
university. Streaming live at wesufm.org and brought to you by the community health
center.