Changing the health care reform recipe

Yesterday I made cookies with my 7-year old. We swapped out some ingredients, changed the recipe and the results were … not as expected. They were tasty but much too crumbly -- some fell apart. It’s hard to predict how changing one ingredient will affect the whole.

Like our cookie recipe, the ACA has many inter-related ingredients – it created a system that was different than what existed before, better in many ways (e.g., more people covered, fewer limitations), but not flawless (e.g., too complex and costly to implement, flawed/unfunded stabilization programs).

Picking it apart will create a very complicated system that will have different flaws than the ACA. 

Time-pressure (whether driven by politics or valid health plan concerns about the need for clarity to make decisions for 2018) will make matters worse. My 7-year stayed cool during our cooking mishaps, but imagine trying to modify a recipe while cooking, with thousands of people who don’t understand baking screaming about how they want the cookies to come out. At the risk of over-playing this metaphor …. a recipe for trouble.

What can health plans, health systems and others do: First, watch what’s happening (of course). Second, learn from what has happened the last few years. Ask your teams specific questions about what happened over the last three years and why? Why did we attract the customers/patients we did? Why did they choose the products they did? Same for the competitors. Third, build a fact-based understanding of the economics of the business. Don’t settle for the superficial ‘unhealthy risk pool’ explanation. Why did we price the way we did? Why did we sign the managed care contracts we did? Which assumptions were right and which were wrong? The last three years provide a rare data set of competitors trying different approaches within the same market structure. Fourth, don’t forget people/consumers/patients (most of whom don’t understand the impact of what they may be arguing for or against). Ask your teams whether existing segmentation findings and price elasticity findings apply? 

For example, will high-value networks that rely on shifting patient volume work as currently structured if the rules change? And how will different benefits and premium credits affect delivery system changes that rely on people engaging with primary care, without waiting until they are seriously ill.

The next 12-24 months will definitely be uncertain, and possibly be a period of healthcare change as great as 2010 – 2017. So be ready with the information needed to make many decisions. And have a cookie!