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Mary GrealyPresidentHealthcare Leadership Council

Women Leaders in Healthcare ConferenceAugust 7, 2012

Consensus Building in an Era of Extraordinary Challenge

Mary R. GrealyPresidentHealthcare Leadership Council

WWW.HLC.ORG

Healthcare Leadership Council

• Coalition of leading executives from insurers, hospitals, pharmaceutical manufacturers, medical device manufacturers, other sectors

• Shared vision of innovative, consumer-centered healthcare system defined by quality, affordability, accessibility

Once There Was Just One…

• Women leaders active inHLC decision making:

– Vicky Gregg, BlueCrossBlueShield of Tennessee

– Patricia Hemingway Hall,Health Care Service Corp

– Susan DeVore,Premier healthcare alliance

– Adele Gulfo, Pfizer

– Patricia Simmons, Mayo Clinic

– Christine Jacobs, Theragenics

– Heyward Donigan, ValueOptions

– Colleen Conway-Welch,Vanderbilt University School of Nursing

– Marion McCourt, AstraZeneca

“Scholars find that women, compared with men, tend to excel in consensus-building and certain other skills useful in leadership.”

--Nicholas Kristof, New York Times

“When Women Rule”

Where We Need Consensus

• The direction of health reform– Kaiser July tracking survey: 38%

favorable, 44% unfavorable

• Entitlement reform• Deficit reduction and healthcare• The role of medical innovation

Conflict in the Political World

• Elections may not lend clarity• Presidential race will likely

leave half of U.S. unhappy– CBS/NY Times poll:

Romney 47-46%– Gallup tracking poll:

consistent 1-2% margin• Obama maintains slight lead

in key swing states

A Closely Divided Congress

• U.S. Senate based on current polling: 47 D, 45 R, 8 tossups (6 D seats, 2 R seats)– Neither party will have 60 votes

needed to pass major legislation

• U.S. House based on current polling: 214 R, 172 D, 49 tossups– Analysts: Majority unlikely to

change, but Democrats could tighten margin

Defining Success in Health Reform

• Continuous quality improvement• Vibrant innovation• Eliminating health disparities• Improved cost-effectiveness• Sustainability

Where Do We Focus Our Ideas, Our Voices?

• Implementing health reform– Preserving the best, fixing the

problematic

• Deficit reduction that doesn’t undermine American healthcare– Reforms that add value, not cuts

that hurt quality and access

• Strengthening entitlement programs for the long run– Understanding that the status

quo is not sustainable

The Best of Health Reform

• Addressing the uninsured crisis a historic achievement

• Takes steps in fixing the volume-not-value approachto healthcare– Centers for Medicare and

Medicaid Innovation

• Improved prevention and wellness features

• Closing the Medicare Part D “doughnut hole”

Health Reform Concerns to Address

• Independent Payment Advisory Board (IPAB)– Ax to cut spending with no focus

on value or quality– No accountability to public

• Medicaid expansion– Low reimbursement rates present

access concerns– Will all states participate?

• Taxes, fees and payment cuts– Almost all health sectors take a hit

– Impact on quality, access, innovation?

Deficit Reduction and Health Care

• Healthcare will be a focus of budget cuts• Simpson-Bowles ideas raise concerns

– Global healthcare spending limits– Beefed-up IPAB– Resurrection of the ‘public option’

• Reconcile two goals – spending reductions and improved health outcomes

Private Sector Providing Answers

• Companies in every health sector demonstrating how to improve care, curb costs

• HLC Value, Wellness Compendiums– Providing metric-supported

examples of cost-effectivecare, disease prevention

WWW.HLC.ORG

Medicare Reform

The Problem

• National debt rapidly increasing, burden for future generations

• Aging population requires more healthcare

• Current entitlement structure cannot stand without tax increases, provider & benefit cuts

The Challenge

• Ensure economic growth and jobs today; opportunities for children, grandchildren tomorrow

• Maintain access to healthcare for current, future Medicare beneficiaries

Medicare’s Future

• Projected insolvency date: 2024• Over 10,000 baby boomers

turning 65 each day– Beneficiary population: 45.2 mil

today, 70 mil in 2030

• Medicare 3.6% of GDP today; 6.4% in 2030

• Average baby boomer couple will pay $114,000 in lifetime Medicare payroll taxes– Receive $350,000 in medical care

Some Options on the Table

• Denial (“Keep Medicare as we know it”)

• Provider cuts– $575 billion in Medicare

payment reductions in PPACA

• Let IPAB do it• De facto price controls

Is There a Better Answer?

• HLC Approach:– Inject Medicare with consumer

choice and competition– Private health plans compete

on cost, value• Beneficiaries would have option of

staying in conventional FFS Medicare

– Cost savings generated by competition, not price controlsor government-mandatedpayment cuts

Consensus Building: The Tasks Ahead

• Present compelling visionof innovation-based,accessible healthcare

• Make clear that statusquo cannot stand

• Communicate the answersfound in new private sector approaches

• Build agreement that cost containment, quality improvement are notmutually exclusive

Women Leaders in Healthcare ConferenceAugust 7, 2012

Mary R. GrealyPresidentHealthcare Leadership Council

WWW.HLC.ORG