I spent the morning and part of the afternoon at the Emerging Issues
Forum at NC State listening to people talk about what’s wrong with the
health care system. Some highlights:

Newt Gingrich, the keynote
speaker, shared his vision of “A 21st Century Intelligent Health
System” so called in part to make critics defenders of a “dumb” system.
He addressed a number of issues, but they all fit within the context
that the current system of health care is not fixable in part because,
“It is not a system, it is just a collection of activities,” which
helps increase costs. His main fixes are to make information more
available to consumers and providers. Consumers should understand the
cost and quality of providers and providers who make their records
known should receive some protection from litigation. Gingrich said
that open records is essential if providers are to be protected. He
predicted that the market for prescription drugs would soon have to
favor buyers over sellers or it would become price-regulated as in
Europe. The former Congressman provided examples from his consulting company’s
clients and also touched on the need to split Medicaid into four
programs focused on the young and healthy, the elderly (active healthy
aging), “capability” instead of disability, and long-term care.

Harvard professor and competition guru Michael Porter
described his research on health care. Porter said that the US market
for health care is the most competitive in the world, but that
competition takes place at the wrong level, so focuses on the wrong
things. Some hospitals have begun to organize institutes focused on a
specific disease or treatment area and Porter says this should be the
direction more health care moves. He wants competition on delivery
because it encourages specialization and measurable outcomes, improves
success and costs, and moves people from cost centers into process
teams. He also focuses on the need for information, but adds that
health care should be organized on a regional or larger basis instead
of at the local level, again because of specialization.

messages of Gingrich, Porter, luncheon speaker Pete Peterson (who
described the state of Social Security, Medicare, and the saving rate),
and BB&T’s John Allison (who gave concrete examples of how his firm
cut health costs for its employees by holding them persoanlly
responsible) contrasted starkly with those of form US Senator john
Breaux and UNC-CH professor jon Oberlander. Breaux said “health care is
a right” and Oberlander focused on ways to expand access to health care
although he claimed to understand the budget difficulties states face.

Easley noted that Medicaid costs are starting to eat into funding for
education and asked the federal government to use more of its buying
power to help the sates: “The Federal government is the Wal-Mart of
health care,” said the governor, who also stated that “rural economic
development does not happen without rural health care access.” Gov.
Easley did at least recognize that under the current system you either
have to cut services, people, or payments as a recent Spotlight
detailed. Although he did not offer any cuts, he said that the three
biggest parts of the state budget are corrections, education, and
Medicaid. “You can’t let out a lot of prisoners, and you can’t cut the
classrooms, certainly not in this economy, so that leaves health care.”