KFF Health News’ ‘What the Health?’

Episode Title: Our 300th Episode!

Episode Number: 300

Published: June 1, 2023

[Editor’s note: This transcript, generated using transcription software, has been edited for style and clarity.]

Julie Rovner: Hello and welcome back to “What the Health?” I’m Julie Rovner, chief Washington correspondent at KFF Health News. Usually I’m joined by some of the best and smartest health reporters in Washington. But today is our 300th episode, and we have something special planned. Instead of our usual news panel, I’ve invited some of my very favorite health policy thinkers, to cast the net a little wider, and talk about what’s happened to the health care system since we began the podcast in 2017 and what the future of health care might look like for the next, I don’t know, decade or so. So let me introduce our panel. We will put their full bios in the show notes. Otherwise, it would take our entire episode to talk about all that they have done. But it’s safe to say that these are not just some of the smartest people in health care, but also among the most accomplished, with experience making government health policy, private health policy, and, in two of the three cases, also practicing medicine. First up, we have Zeke Emanuel. He’s currently the vice provost for global initiatives and the co-director of the Healthcare Transformation Institute at the University of Pennsylvania. Hi, Zeke. Thanks for joining us.

Ezekiel Emanuel: Great. Wonderful to be here.

Rovner: Next, we have Jeff Goldsmith. He’s president of Health Futures, a health industry consulting firm and a longtime thinker, writer, and lecturer on all things health care — and, I must confess, one of the people who’s implanted many things in my head about what I think about health care. Thanks for joining us, Jeff.

Jeff Goldsmith: It’s a pleasure.

Rovner: Finally, we have Farzad Mostashari, who’s the founder and CEO of Aledade, a company that works with primary care physician practices that he modestly describes on his LinkedIn page as, quote, “helping independent practices save American health care. Thanks for coming, Farzad.

Mostashari: Pleasure to be here, Julie.

Rovner: So I want to divide this conversation into two main parts, roughly titled “Where We’ve Been” and “Where We’re Going,” and where we’ve been in this case means things that have happened since 2017, when the podcast began. For those of you who don’t remember, that was the first year of the Trump presidency, in the middle of the ultimately unsuccessful Republican effort to repeal and replace “Obamacare” and President Trump’s various executive decisions to try to undermine the Affordable Care Act in other ways. Anybody remember that fight over cost-sharing reductions? Let us please not recap that. So let us start not with cost sharing, but with the state of health care in 2017. I want to go around. What does each of you think is the biggest change in the health care system since 2017? Zeke, why don’t you start?

Emanuel: I think probably the biggest change is the growing dissatisfaction by every player in the system. I often say that if you remember back to 2010 — Farzad and I certainly remember, because of passage of the ACA — a lot of people were dissatisfied with the system. But frankly, the upper-middle-class hospitals were not dissatisfied with the system. And mostly the upper middle class could still call — get, you know, VIP care and make sure that they got their needs met. I don’t know anyone — anyone — in 2023 who is happy with the system; maybe there are a few people in the insurance industry who are for this very moment because their profits are higher. But everyone else, including every upper-middle-class and rich person I know, is pissed off and doesn’t think they’re getting good care and is just — doesn’t like the system. And I think that bespeaks very deep structural problems with our system. Different parts are actually doing fantastic, if you want to know the truth, in my opinion, like Farzad’s company giving great primary care, but the whole system sucks. And that I think is probably the biggest change. And again, it bespeaks burnout, it bespeaks payment problems, it bespeaks lots of other underlying problems.

Rovner: I feel like I know that that was growing leading up to the Affordable Care Act, how much the industry and everybody else just didn’t think the system was working, but I think it’s turning into anger. Jeff, what do you think is the biggest change since 2017?

Goldsmith: Well you know, for me, I guess the biggest surprise for me would be we finally got a “SuperMed.” You remember … [unintelligible] … thing about how we’re going to have 10 health systems that — you know, the entire country will be divided into 10 health systems. I think the biggest change has been the arrival of our first SuperMed, which is UnitedHealth Group. It’s doubled in size since 2016. It’s closing in on 3 billion a month in cash flow. So, I mean, I think we may not get another one, but we’ve certainly got one. And it’s on its way to being 10% of health care.

Rovner: And it’s very much — I mean, for people who don’t know — it’s very much more than an insurance company now.

Goldsmith: Yeah, it is. The insurance company is kind of a drag on earnings compared to several other pieces.

Rovner: Farzad, what do you think has changed most since 2017?

Mostashari: I remember in 2017, it really felt like UnitedHealth Group, what they were doing with Optum, was like a secret almost, and it certainly is not anymore. I think I would say covid happened, and one of the main things that has absolutely changed as a result of that is the availability of urgent virtual care. And pretty much all of us now — my mom, through her health system portal; my daughter, through her college portal; me, through my health plan portal — have access to basically hit a button and pretty quickly be able to see someone, usually a nurse practitioner, within a short amount of time. The consequences of that are going to be really interesting. I think, net, it is one of the few things that I think Zeke would agree is pleaser for people to be able to do that. But on the flip side of that, which is to be able to see a primary care doctor, for my parents, is three months out, and they’re 86 and they need to do it. So I think we’re seeing on the one hand, kind of a tale of two cities — like urgent, convenient care with someone who has no idea who you are is more available than ever, and longitudinal primary care with someone who has a long-term relationship with you is getting squeezed.

Rovner: I want to go around again. What’s the most unexpected change? And you don’t get to say the pandemic this time. Jeff, why don’t you start.

Goldsmith: Well, certainly the most unpleasant, unexpected change was the sudden flameout of Geisinger. That’s a really ominous development.

Rovner: Which we haven’t — we haven’t even talked about on the podcast yet. So you better give that a sentence or two.

Goldsmith: Well, Geisinger is — was — one of the elite multi-specialty clinics in the country. It was a follow-on to Mayo, 110-year-old, absolutely superb quality, and done everything in the integrated delivery system playbook. They had a large health plan. They had a widely distributed primary care network. They lost $840 million last year and were losing 20 million a month on operations — that’s arterial bleeding — and about six weeks ago announced a combination of some kind — don’t call it a merger — with Kaiser. It’s still not clear to me what they’ve done. But the big surprise to me was a $7 billion system that did everything you’re supposed to do ended up not being able to remain independent. That’s really scary to me.

Rovner: Yeah. Zeke, what surprised you the most?

Emanuel: I would say two things have surprised me the most. The first one was the fact that we got drug price regulation. Even that little bit we got, I think, very, very surprising. And I have to give credit to the administration. They’re using the small camel’s nose under the tent to really push it as big as they can, jawboning on insulin prices, etc. It’s far from ideal. You know, I’ve been as critical as anyone about the kind of compromises we had to make. But I think that we got something, and I think that’s really changed the psychology. So that would be one thing. The other thing, and here I may be attacked, is we’re still at 18% of GDP for health care spending. Predictions in 2010, even predictions in 2017, were to go over 20%. And we have actually — and it’s not because the economy has gone haywire on us; we’ve been growing at about 2% of GDP. Something is out there that is not as macro that has kept it — some of it’s high deductible, multifactorial. I do think that we also, you know, some of the things that Farzad mentioned, we’ve got virtual that is lower-cost. We do more home care. You know, hospital admissions continue to go down. Anyway, I do think that’s still a surprise. Now, people are feeling it because of high deductibles, because employers are transferring a lot more cost. Nonetheless, as a percent of GDP, it has remained flat for a decade.

Goldsmith: Right. It’ll be lower in ’22 than it was in ’21 when we finally get the numbers out.

Rovner: Farzad.

Mostashari: I want to continue on a little bit. It’s so easy to be pessimistic in health care and health policy. But again, some things that were a little bit — if you are so jaded and so scarred that you have very low expectations, even small victories, like Zeke said, end up being surprises to the upside. So I was surprised to the upside that the Trump administration, despite a lot of — you mentioned, a lot of efforts to undo the Affordable Care Act — were actually pretty good on value-based care and pretty good on turning attention to administrative simplification and to site-neutral payments and thinking about competition in health care markets. And those are obviously, all three of those, are things that the current administration’s support and is also continuing to push. So that was a pleasant surprise, I guess, to the to the upside.

Rovner: Also price transparency, right?

Mostashari: Yeah, I put that in the competition category. The other surprise is, for a long time — I spoke at a pharma group once, a bunch of CEOs, and I said, “Name me the drug that if I use more of it, there will be fewer hospitalizations.” And they kind of drew a blank, and they were like, “Well, vaccines?” And I was like, “OK, that’s pretty sad, right?” But now we actually have SGLT-2s, we have GLP-1s, like there’s actually a bunch of drugs that are going to be, I think, rightfully blockbusters that actually are making a big difference. And I think, in particular, the SGLT-2s I’m really excited about. They’re massively underutilized and I think —

Rovner: What are the SGLT-2s?

Mostashari: Zeke, you want to take this?

Emanuel: No, no, that’s you.

Mostashari: It’s a drug class that has proven to be pretty effective at reducing hospitalizations for people with congestive heart failure, with diabetes. And the more it’s studied, like — there’s a trend in pharma, right, or really anything, that, not what’s the first study with a second randomized trial, but what’s the fifth and sixth and seventh? Do they end up making the evidence stronger or reverting to the mean? And with these drug classes, they seem to be getting stronger and stronger and stronger and more and more generalized in terms of the potential benefit that they can bring. They’re expensive. But I remember a time when a lot of the drugs that are now generic were expensive. So if we take the long arc on this, I think this is going to be very good for health care.

Emanuel: Well, also, to the extent that they preempt hospitalizations, their cost-effectiveness — I don’t know what it is; I haven’t looked it up recently — but the cost-effectiveness is more reasonable, let us put it, than many other drugs that we get, particularly cancer drugs … [unintelligible].

Goldsmith: You know, there’s an even bigger one lurking out there if you’re talking about reducing hospitalizations, and that is the likelihood that we’ll have a dialysis-like solution for sepsis. There are a whole bunch of companies in this space. They’re attaching different molecules to the fibers. But we began seeing during covid, using some of these tools to take virus out of the blood, sepsis is a huge chunk of hospital utilization. It’s a huge chunk of expensive hospital utilization. And what, a third of the deaths, at least — if we could dialyze someone out of sepsis, I mean, it would be an enormous plus, both for health spending and for people’s lives.

Emanuel: I was just going to add one political element to what Farzad said first about the Trump administration, and this gets to how policy is made and the importance of personalities and people. There’s a whole school of history that people don’t matter, the blah, blah, blah. But the Trump administration’s interest in these various things, like price transparency, competition, site-neutral payments, and such, occurred only after they fired Secretary [of Health and Human Services Tom] Price. Secretary Price was sort of a health policy Neanderthal in that he wanted to go back to the 1950s. Many of your listeners will remember he greatly reduced their bundled payment experiments and randomized controlled trial by chopping it in, I think, half, or getting rid of a lot of places. He was totally for the old fee-for-service system, as an orthopedic surgeon, and I think once they got rid of him, actually the focus on, you know, how can we make this a better marketplace, which brings you, you know, not everything liberals can agree on that because many of the things go in, regulate prices and regulate access. And it’s an interesting thing. He had to be moved out for that change to actually happen.

Mostashari: But I’ll also say, though, putting political philosophy back in, not just personality, you look at what’s happening in Indiana, of all places, Zeke, where the legislature have been, I think, pretty forward on on some really great health policy stuff around, again, competition policy, noncompetes for doctors, certificate of need — like a whole bunch of stuff that have been anti-competitive, hospital price increasers they have taken square aim at. And I think that it aligns with like, if we’re going to have a market, like either we’re going to regulate really heavily, or we’re going to have a market-based approach that actually works, and you can’t have a market-based approach that works even a little if you have basically anti-competitive behaviors. So I think it actually does make sense.

Rovner: While we are on the subject of politics, the thing that I think most surprised me in the last seven years is that the pandemic did not convince everybody of the need for everybody to have some kind of health coverage. At the beginning, I thought, well, this is what’s going to get us to a national health plan, because everybody can get sick. And that didn’t happen. In fact, it feels like things got even more polarized. Did that surprise any of you guys or am I just being naive?

Goldsmith: We did get to a 91-million-person Medicaid program and a significant expansion of the exchanges. So it’s not like there wasn’t a realization that covering people had a salutary effect on the overall health of the population. It’s not clear that it lasted. I heard Sarah Huckabee Sanders on the radio the other day saying that throwing a bunch of people off of Medicaid was going to be liberating them from dependency. That was one of the most amazing Orwellian statements I’ve ever heard in my life. But it’s —

Emanuel: She thought if we got rid of her health insurance, it would liberate her from dependency?

Goldsmith: Oh, absolutely.

Mostashari: I do think that one of the things that took away that stink, though, Julie, was really pretty expansive and brave government action that made tests free, that made vaccines free, that made treatment, including monoclonals, free. If the concern was specifically the driver around covid, these programs that — 100% paid, regardless of your ability to pay, just like covered it at all, right? — I do think took away some of the drive that you were describing.

Rovner: And yet we’re peeling them all back one by one, you know, including —

Emanuel: Well, they were all emergency. I mean, all they have expansion was emergency. And, you know, that has to do with the way Washington budgets and all of that. I do think if we’re going to get to universal coverage, we’re going to have to get it in a way that keeps the costs under control. My own interpretation is we’ve reached the limit, and 18% is the limit. And if you want to get to 100% universal coverage, I can’t —

Mostashari: Oh, God, I can’t believe he just jinxed us like that.

Emanuel: I think that’s what the political economy says.

Rovner: You mean 18% of GDP?

Emanuel: Yeah. Yeah.

Goldsmith: But, Zeke, people are saying that when we got to 8, we were going to hit the wall. OK, you have a long enough memory, I mean —

Emanuel: I do, I do have that memory. But I do think you have seen more drastic action, as when things have gone up by employers to make it look less and less like insurance, frankly. And I do think that tells you where the limit is. And I think we’re going to have to think within that. And one of the things we have to do is be much more serious about areas where we have good evidence about cost savings. And we just haven’t done that. And for the last decade, every hospital — and I always talk about cost — but it’s a lot easier to negotiate higher rates from commercial than it is to actually be more efficient. And so what do they do? Focus on negotiating higher rates and have much more brains focusing on that than doing the time-motion studies to get efficient. Until they are forced, they’re not going to do that kind of efficiency. And that’s the thing. And you can’t do it on a dime. That’s the other thing, I think, partially that the Geisinger says: You can’t do the efficiency on a dime.

Goldsmith: Isn’t losing $20 million a month sort of a goad to action? I mean —

Emanuel: Well, Jeff, Jeff, here’s the question. I agree. But it couldn’t induce Geisinger to change fast enough. I mean, they didn’t have enough runway. If they were losing, that’s the first thing. And whether other hospitals and health systems are going to say, “Well, we have to get serious today,” I don’t know. I’m not privileged to their internal deliberations. I will say that, over the last decade, they’ve just continued the old playbook, as I’ve argued.

Mostashari: But I think that’s right, Zeke. But that’s what doesn’t give me hope in terms of your 18% political economy ceiling, because who’s going to make it, you know, like — and I don’t see the employers. I’d say if there’s one thing where there hasn’t been much change has been the employers continue to disappoint.

Rovner: Actually, Farzad, you’ve walked right into my next question, because I want to pivot to what’s going to happen, which is, who’s going to drive the health care train for the next decade?

Emanuel: I think employers are brain-dead on this. They are the worst part of the legion because they control all the profit and they have been terrible. They have chased very short-term profits or very short-term savings. What? Yeah, I know, I, well no, but —

Rovner: Farzad, Farzad’s making air quotes.

Emanuel: Farzad’s making the quotes, but absolutely it’s not been savings, but they’ve been listening to consultants who sold them a bill of goods and they haven’t been serious. And you know, to be honest, when you get something like Haven and you’ve got companies like J.P. Morgan and Amazon and Berkshire Hathaway making a hash of it, “What could I do?” is I think the response, and what they have to do is they have to get together and get out of health care in a responsible way, and that they are — they just, they can’t focus enough mind share on it.

Rovner: Even with, what was it, Amazon and J.P. Morgan? And I forget what the third one was.

Goldsmith: But Zeke, you know, right now the most profitable service line for those insurers isn’t commercial insurance; it’s Medicare Advantage

Emanuel: Yeah.

Goldsmith: And if I were to be a forecasting person, which I tend to do sometimes —

Emanuel: You are?

Goldsmith: I think, I think the profit is rapidly disappearing from commercial insurance, not only because more and more insurers are self-funded, or employers are self-funded and taking themselves out of the equation, but because the government can’t say no to its contractors — state governments, federal government. So I’m actually very concerned about the disappearance of the lever that commercial insurance represented in the emergence of a kind of a rent-seeking health insurance system.

Mostashari: That underscores the need, if more and more employers are self-insured, then they’re going to need to act. They can’t rely on the insurer; they need to demand something different than what they’ve been demanding from the TPAs [third-party administrators]. And I think that’s the opportunity, if I was going to be an optimist. I think that’s the opportunity. To Zeke’s point, from the beginning, everyone is unhappy. And if someone did come up with a TPA that promised cost corridors, as an example, more predictability, free stop loss, you know, like those kind of things and actually delivered slower trend, guaranteed lower trend on your rates. I think there’s room for that, but as Zeke said, not if they just keep listening to the same consultants.

Goldsmith: But Farzad, what seems to me has held them back is that their interest in health benefits cost is cyclical. When they’re awash in cash, they’re mainly interested in more cash; they’re not interested in tuning their health benefit and chasing away scarce workers. And right now, that scarcity of workers is one of the things that’s holding employers back from tightening down or fundamentally changing the logic of their health coverage — is that they are competing, particularly in the skilled part of our economy, for workers that they’re really having trouble getting. And to walk in the door and saying, “Well, we’re going to place all these conditions on, and we’re going to make you do X, Y, and Z,” they’re not going to do it.

Mostashari: I think the TPA 2.0, though — I agree with you that there’s typically been a zero-sum game around this between the employer and employee when it comes to less benefits, higher copays, higher deductibles, like, you’re taking something away from them. But you mentioned Medicare Advantage. What I think the promise has been there is you get more; the member gets more access to primary care or more benefits but for the same cost. And I agree with your facial expression there that our —

Goldsmith: I’m on Medicare Advantage. I mean, it’s just been a great big whoop. The main user experience has been robocalls, and I get about one every two months to send a nurse to my house to upcode me. That’s my Medicare Advantage experience. Big whoop.

Emanuel: So let me just say two things, one of which is I think the fact is that employers don’t have to go down the punitive route to have lower costs; they could focus on the provider and reorganize that system. And the problem of everyone in the system is just thinking about how do I screw the other provider, right? You know, how do I make doctors go through all this prior authorization so they won’t order that drug or they won’t order that MRI? That’s not a way to improve the system. That’s a way to make everyone pissed off.

Rovner: It’s doing a very good job at that.

Emanuel: Yeah, including the patient. Everyone hates it, and no one’s willing to get rid of it. I think Farzad is right; you need a total reconceptualization of how you’re going to deliver care so the answer is yes, not no. And what you get is better thinking so we’re more efficient and we get rid of the unnecessary stuff so that we can actually devote our time and attention and resources to people who need it. The second thing I would say, Jeff, is I think the wallowing and, and getting all the cream from Medicare Advantage is going to come to an end. I think the administration has sort of — you know, when you’re over 50% of the people and there’s all these articles coming out over and over again, you — I mean one of the things they haven’t realized — you end up in Washington putting a big target on your face. And Washington likes nothing more than, “These people are ripping off the government, and now we’re going to penalize them.” And I will say, you know, personally, we’ve started a very large project to try to fix the risk adjustment mechanism. We also need a large project, in my humble opinion, on fixing the fee structure, which is totally perverted.

Rovner: The fee structure for everybody or the fee structure for Medicare?

Emanuel: Well, if you fix it for Medicare, you’re going to fix it for everyone since they take Medicare prices and just inflate ’em. But I think those two things are going to happen, actually, if I had to say, over the next decade, and I do think the days of just getting tons of profit from Medicare Advantage are numbered.

Goldsmith: Well, but the way that’s going to work is, to sustain the 5% and to prevent their stock prices from falling, they’re going to come after providers hammer and tongs.

Rovner: They [being] the insurers, the Medicare Advantage companies.

Goldsmith: They’re just going to cut the rates. They’re not going to really, fundamentally — they’re not going to shift risks, Zeke. They’re not going to capitate them; they’re just going to cut the rates. So I think part of the dynamic there is you’re going to have the hospital folks kind of behind the scenes going, “Don’t cut Medicare Advantage, because we’re the people that are eventually going to bleed for it.” So I think the politics of doing this is actually a whole lot more complicated. You’re dead right; the mask is dropped. There’s a lot of games being played. But fixing it is going to be really hard politically.

Emanuel: Jeff, I agree with you. I think one of the major issues hospitals have to do — look, during covid, one of the tragedies is the government handed out $70 billion to hospitals and asked nothing in return. There was no, “Change this,” “focus on —”

Goldsmith: They asked them to stay open, Zeke They asked them to stay open 24/7 and to, you know, have their emergency room burn out and to suspend their elective care. What do you mean they didn’t ask them to do anything? They had to do those things to respond to the, the pandemic. Now, you’re saying you didn’t attach additional conditions about efficiency. Dead right, they didn’t.

Emanuel: Yeah.

Goldsmith: You’re right.

Emanuel: There was no structural change. $70 billion is a whole lot of money. And we ask no structural change for it. So we’re actually in a worse situation with hospitals today than we were before. And $70 went out the window.

Rovner: 70 billion.

Mostashari: Zeke and I first met when I was at the White House, the NEC [National Economic Council] or something, and we were arguing about $28 billion to take health care from paper and pen to electronic health records. And it seemed like a lot of money, 28 billion, to digitize American health care and, as Zeke is saying, 70 billion went out the door.

Goldsmith: Well, but, but remember what was going on. There was an authentic, bottomless national emergency. And we ended up throwing $6 trillion, $6 trillion, forget about 70 billion. We ended up throwing $6 trillion worth of money that we borrowed from our grandkids at that bottomless problem — not only covid, but the economic catastrophe that covid produced, the flash depression that the shutdowns produced. So there wasn’t a lot of time for fine-tuning the policy message here; it was shovel it out the door and pray.

Emanuel: Jeff, I agree. We had to rescue a very desperate situation. But it’s not as if the last decade hadn’t given us plenty of things that we could have asked the hospitals to do. Unlike —look, look, in 2009, when we were crafting the Affordable Care Act, I called around to everyone. I said, “All right, we got to change off fee-for-service to … [unintelligible]. What’s the best method to get doctors to do the right thing, to get standardized care, to reduce the inefficiencies,” blah, blah, blah. We hadn’t tried anything. 2021, 2020, we had actually better ideas about how we could implement change and actually make the system better. And we implemented … [unintelligible]. And that, I think, was a missed major opportunity.

Rovner: And actually that is sort of my next question. I want to bring this back to the patient. Zeke, you referred to this; the patient experience has gotten worse. We’ve heard it from everybody here. The more we can do to help people and cure them and treat their ailments, the more differentiated and diverse the system becomes and the much harder it is to navigate. I mean, is there any hope of doing something to improve the patient experience over maybe the next decade?

Goldsmith: Well, I’ll tell you. You asked Zeke; I got sick during 2015 to 2017. So after being a big expert on our health care system for 40 years, I actually used it: five major surgeries in 29 months. And my experience was very different than the picture you guys have been painting. Only three of the people that touched me were over the age of 40. That was a big difference. Getting rid of the boomers might help a lot, but I was astonished by the level of commitment and the team-based care that I got. They were all over it. It was really encouraging to me, scared to death though I was, that the level of service that I got — and I’m not an elite patient. I mean, in a couple of those instances, it was my local community hospital; it wasn’t the University of Chicago that was taking care of me. I was really pleasantly surprised by the level of teamwork and the commitment of the care teams that took care of me. It gave me hope that I didn’t have before.

Mostashari: And I think we always get into this when we start talking about organizations versus people, and the people — and there’s no one like the people in medicine, and they would do anything for their patients, they love their patients, and they’re trying to work against a system that structurally is against doing the right thing for the patient, that we know can help the patient. And there’s no doubt that once someone has a stroke, we spring into action. The question is, did that person have to have a stroke? How well are we doing at controlling blood pressure, Jeff? We suck at controlling blood pressure: 65% control rates. And we know that that’s going to prevent heart attacks and strokes. Once we — once someone has a heart attack, like, we will deliver excellent customer service to the person with a heart attack, and they will be grateful and they will say, “Doc, you saved my life,” but we won’t invest in allowing people to have Medicare to pay for blood pressure cuffs at home, right? Like, that’s what we are grappling with in health care and medicine, is that disjunct between the organizational incentives and delivery system that follows from it versus the dedication and the compassion of the people in it every day.

Emanuel: So, Julie, one of the things I would say over the next decade that we have to do, and here you have a specialist bowing to Farzad, which is we have to pay more for primary care. Right now, the system pays something like 7%. And in some markets like mine, in Philadelphia, it’s under 5%. It’s outrageously bad, that amount. We have to give primary care doctors more and expect more out of them. What do we have to expect? Chronic care coordination. The primary care doc ought to be your navigator, and we need to have them or someone in their practice, is the first line for mental health and behavioral health services, right? That kind of package, including, you know — and we could go on — extended office hours, etc., etc. That has to happen. And us specialists, my kind of folk, we need to be less. And I think that has got to be one of the shifts we make that will make the patient experience better; I think it’ll make the management of these chronic illnesses like hypertension — I’m completely on board with Farzad; that should be focus, focus, focus. I think that’s a critical change. And what gives me hope — again, I’m by nature a very optimistic person — what gives me hope is Farzad’s company and the 20 others in that space that are doing a bang-up job of primary care and showing that it can be done and it can be done well and cost-effectively and better for patients, and I think we have to embrace that. And one of the things that’s going to be critical is more value-based payments, changing the physician fee schedule, and things like that.

Goldsmith: Well, not to disagree at all that there’s an absurd pay gradient between primary care physicians and specialists, but think about why we have so many specialists in the first place and why they have so much political power and influence in our health policy environment. A lot of the young people that are coming out of medical training today are carrying 3 or 400 grand in debt. That is very different than Europe, where we’re not expecting people to bear this huge burden in going into medicine. Wouldn’t it be easier for people to go into primary care if they didn’t have to worry about the fact that if they go into primary care, they’re going to be 65 and on Medicare before those debts are paid off, and maybe not at all. So we’ve created some of this by how expensive medical education is, by how expensive general education is, for that matter. And we’re not going to do anything about that.

Emanuel: And the solution to that is trivial, right? It might be a $30 billion solution, which would be, you know, whatever — .07% tax on every dollar poured into a fund to fund education. It’s idiocy.

Goldsmith: But politically, Zeke, what you’re doing is giving $30 billion to the wealthiest professional group in the country. That’s the way it’s going to play politically. How are those folks in Alabama, you know, that are, they’re on Medicaid, going to view taking $30 billion and giving it to your kids or grandkids that want to be doctors?

Emanuel: I totally agree with you. It needs to be … [unintelligible].

Mostashari: I don’t disagree that there’s a big difference in cost of medical education here versus other countries. I do wonder, though, in that hypothetical where we make medical education free, if you still have the kind of disparities in pay between the anesthesiology and the surgeon and the primary care doc. I still think we’re — we would be in a place where primary care slots went unfilled this year.

Goldsmith: Not surprising.

Mostashari: Right.

Goldsmith: Not surprising at all.

Mostashari: And we have a big shortage. And, you know, we have urologists who employ 17 nurses and other people to increase the throughput of the practice, right? And a primary care capacity, a lot of that could be augmented. You don’t need necessarily to wait until we graduate a whole new crop of doctors. We could actually supplement our primary care capacity if there was more money in primary care. And as Zeke says, I don’t mean just increasing the fee schedule or just paying more, although that would be nice, but tying it to outcomes that actually make it so that we can pay more for primary care in a way that’s budget-neutral.

Emanuel: But it’s a crazy thing because all we would have to do is spend 3% more of total medical spending on primary care. And guess what? You’d increase their revenue 50%. And that would, Farzad’s — that would make — that would be transformative. And you could get that 3%, you know, 1½ from hospitals, from specialists, from other, and they would barely — well, … [unintelligible] … hospitals might notice. But in general, it wouldn’t be a tragedy to any other part of the system. And that’s the insanity of where we’re at. And as Jeff, I think correctly, points out, is, you know, the political optics of this and the political power of these various different groups going to marshal against it — I mean, you could take 1% of it from pharma, easy, maybe even 2% from pharma, easy. The thing which makes me pessimistic now — I was optimistic, now pessimistic — the thing which makes me pessimistic is the sclerosis which makes these kind of structural changes impossible, and that’s basically interest group politics. And it doesn’t cost much. That’s what’s crazy. You know, United can spend $1 billion a year running ads against various congresspeople to keep its position, and its profit margin wouldn’t be affected.

Rovner: All right. We can go on all day. I would love to go on all day, but I know you guys have places to get, so I want to ask one last question of each of you. If there’s one piece of low-hanging fruit that we could accomplish to, I won’t say fix the health care system, but to make it better over the next decade, what would it be? If you could wave a wand and just change one small part of the system?

Goldsmith: We need a Medicare formulary. I’m sorry, we need a Medicare formulary, and we need to basically put a bullet in the PBM [pharmacy benefit manager] business on the way to doing it. That would be mine. And that would free up tens of billions of dollars that we could use to finance some of the stuff that Zeke and Farzad have been talking about.

Rovner: I think that may be the one thing that Congress is actively looking at, so —

Goldsmith: We’ll see how far they get.

Rovner: Yeah. Farzad.

Mostashari: I think we talked about it: competition. I think there’s a — there needs to be a coordinated government regulatory, DOJ [Department of Justice], [Department of] Commerce, CMS [Centers for Medicare & Medicaid Services] response to competition policy — FTC [Federal Trade Commission], obviously — that looks at all the different issues: the payment policies that are digging the hole deeper, like site-neutral payments. I think you need to look at the nonprofit hospitals and which jurisdiction applies to them. I think you need to look at transparency. I think you need to look at transparency around ownership of physician practices. I think there needs to be noncompetes. I think there needs to be a whole set of things that tilt the field towards more competition in health care markets, because if you are big and have, you know, the will to use that market power to say all-or-none contracting, no tiering, no steering, no — none of that, right — then there’s just no purchase for any health care payment or delivery reforms, because you’re big and fat and happy and you don’t care.

Rovner: And you’re making your shareholders happy. Zeke.

Emanuel: Let me give one clinical and one that’s more policy. So the clinical is, Farzad already mentioned it, if we would focus on controlling blood pressure well in this country. We’ve got more than a hundred guidelines, you’ve got cheap, 200 drugs for this. It would both improve longevity, decrease morbidity, and reduce disparities, that single thing. And Farzad is the one who turned me on. I know exactly the place on our walks that he put the bug in my ear about it. We should be focused on that because, among other things, it’s a huge producer of disparities between Blacks and whites in terms of renal failure, blah, blah, blah. The one policy thing I think is we know we spend a trillion dollars on administration. It’s a ludicrous amount of money. We know what the solutions are, and a lot of them don’t require that much policy. What we need is someone in the federal government whose job it is to wake up every day and get that money going. Now, the federal government wouldn’t make that much of it, by the way. That’s one of the reasons the federal government hasn’t taken this on, because they do have standardized billing and blah, blah, blah. But everyone agrees that’s a ridiculous amount of money and it’s producing no health benefit. If anything, it’s producing stress, which is not a good thing. And I think the conservative estimates by David Cutler and Nikhil [Sahni] are, you know, we’re talking $250 billion. I mean, that’s real, real money. And it’s no health benefit, and no one likes that stuff. And a lot of it’s about gaming. And so I think that’s a place — and you’d, again, have to put some serious government backbone, including threats, behind it. But I think that’s free money.

Rovner: Well, we will see if any of this happens. I could go on all afternoon, but I promised I would let you all get back to your day jobs. As always, if you enjoy the podcast, you can subscribe wherever you get your podcasts. We’d appreciate it if you left us a review; that helps other people find us, too. Special thanks, as always, to our ever-patient producer, Francis Ying, for helping gather all of this together. As always, you can email us your comments or questions. We’re at whatthehealth@kff.org. Or you can tweet me. I’m @jrovner. We will be back in your feed next week. Until then, be healthy.