There is no doubt that the single most contentious topic I can bring up in a small group discussion or speech is the Affordable Care Act, otherwise known as Obamacare. You can feel the tension rise, as everyone has an opinion they want to express – most of them based essentially on preconceived philosophical positions, nearly all of which can be can seen through their own eyes as reasonable and consistent with civilized behavior. And the facts that can be trotted out to support their positions, pro and con, could fill up a document almost as long as the original 2,300+ page bill. I have avoided writing about the Affordable Care Act (ACA) for a variety of reasons but primarily because it is so difficult for us to get our heads around the economic implications.
Today I will try, though some of my readers may conclude that I have failed, to avoid coming to political conclusions about the ACA. Instead, I will aim to dwell simply on the economic ramifications of the implementation of the bill as it exists today. We are changing the plumbing on 17.9% of the US GDP in profound ways. Many, if not most, of the changes are absolutely necessary.
This letter has grown out of a rather lengthy, ongoing conversation I have had with my very close friend and personal doctor, Mike Roizen, about his perceptions of changes that his institution, the Cleveland Clinic, and others like it have to make concerning the delivery of medicine in the near future, and the Clinic's expectations regarding the income they will receive for providing their services. The Cleveland Clinic is one of the largest and most respected hospital groups in the world (heck, Obama and Romney even cited it in their first debate as an institution providing great care very efficiently – the only institution so cited). The Clinic has 43,000 employees and a healthcare budget of over $6 billion. Looking at the future budget considerations of the Cleveland Clinic and similar institutions outlined below, there is both reason to be both optimistic and reason to be deeply concerned about the changes that are coming to US society in the immediate future.
I asked Mike if he would be willing to provide me with some notes concerning the future of healthcare in our nation and the Clinic's own future. He kindly obliged, and I have edited and expanded upon what he wrote and shared with me in our conversations. This following should not be read as a policy statement or an official analysis from the Cleveland Clinic itself; instead, it is an essay that grew out of an exchange between two friends, a doctor and an economist, trying to make sense of how things will change.
For those not familiar with Mike, he is quite the medical celebrity. He is an anesthesiologist and an internist, an award-winning author, and the chief wellness officer of the Cleveland Clinic. He has completed a tour of duty in the US Public Health Service and has written more than 170 peer-reviewed papers and 100 medical chapters, filed 14 US patents, started 12 companies, served on Food and Drug Administration (FDA) advisory committees as a committee member or as a consultant to them for 16 years, and chaired an FDA advisory committee. He also co-invented a drug that is now FDA-approved.
He first became famous for developing the RealAge concept and has authored or coauthored five number-one New York Times best sellers, including RealAge and three titles in the YOU series, with Dr. Mehmet Oz. Possibly, he is best-known for being Oprah’s doctor. He has been praised for encouraginge Americans to exercise, eat healthier, manage stress, and live healthier lives. He has been an outspoken critic of politicians who use healthcare funds for other purposes, and particularly of states’ taking tobacco settlement money and using it wrongly for projects in no way related to tobacco prevention programs. Besides advocating for a healthier lifestyle today, Dr. Roizen has controversially speculated that by 2023 one of the 14 areas of aging research might see a breakthrough that will allow us to live until 160 with the same quality of life we enjoyed at age 45.
Mike wants to be sure you know that we are talking here about what may happens to hospital systems similar in size to the Cleveland Clinic. The views he expressed in preparation for this letter are his and his alone and are not necessarily reflective of anyone else's at the Cleveland Clinic.
This letter is somewhat longer than usual, but I was simply not willing to break it up into two letters. It was written to be read as one essay, and this topic is too important and timely to serve up by halves. I think you will find the conclusion thought-provoking, as we come at this issue from a bit of a different angle than you normally encounter. Mike and I welcome your comments and will read them and perhaps do a follow-up letter with our responses.
We want to make something very clear right at the beginning. The US healthcare system as it stands is dysfunctional and can no longer continue as it currently operates. With or without Obamacare, profound change is required to deal with the dysfunctionality, and that change will happen, one way or another. Obamacare is simply one method for “encouraging” that necessary change.
The US currently…