The GOP Viewpoint

A two-time cancer survivor and obstetrician who has delivered thousands of babies, U.S. Sen. Tom Coburn (R-Okla.) has a unique perspective on healthcare as a provider, recipient, and influential advocate for change. Minutes after voting to repeal the Patient Protection and Affordable Care Act of 2010—an effort that ultimately failed in the Democratic-controlled Senate—Dr. Coburn talked with The Hospitalist about his objections to the existing law, his views on the main drivers of upwardly spiraling healthcare costs, and the Republican Party’s alternatives for achieving the elusive goals of better quality and cost control.

Question: What are your main concerns about the healthcare reform law?

Answer: I think, first of all, the healthcare reform bill doesn’t fix the problem, and the question is, what is the problem in healthcare in America? Is it quality, is it outcome, is it access, or is it cost?

If we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate this bureaucracy.—U.S. Sen. Tom Coburn, R-Okla.

And the problem is we spend twice as much per capita as anybody else in the world on healthcare to get 30% better outcomes on average. So the problem with healthcare in our country is it costs too much, and there’s a lot of reasons it costs too much. But the number-one reason is that everybody in the country, except those without insurance, thinks somebody else is paying their bill. So there’s no consumer discretionary choices that are made once you’ve met your deductible.

Having practiced for a long period of time and cared for the Amish, they always bought healthcare about 40% to 60% less than everybody else, because they pay cash for it and they deal [with] it, and they ask, “Why am I having this test?” and “Where can I get this test done more cheaply?” and “Are you sure I need this test?”

Being trained in the early 1980s and late ’70s as a physician, we’re trained different than the way doctors are trained today. Doctors today don’t think a thing about utilization. … What this bill did was expand coverage but didn’t fix the system, except that Washington’s now going to tell your hospitalists who they’re going to treat, how they’re going to treat them, and when they’re going to treat them.

Q: How do we fix the right problem?

A: You have to reconnect the purchaser with the payment; that’s No. 1. No. 2 is, you cannot continue to allow people to think somebody else is paying their bill, even when they’re not. If you work for a large company or you work for the government, the fact is, you’re paying money out every year for your portion of the coverage, and your employer is paying it out. They’re paying, in most instances, the vast majority of it, and so once you’ve met a deductible, you’re no longer a discretionary consumer because your assumption is, it’s going to get paid for.

And the other side of this is, how do we put in the doctors’ hands cost consciousness? In other words, can I do this and get the same outcome without spending this money? And quite frankly, we’ve trained a generation-and-a-half of physicians not to think about that.

Q: How else can we reduce costs?

A: It’s amazing what could happen if we start driving toward cost reduction. We have veterans who have to drive … to get to a VA. Give the veteran a card. If you’re service-connected, you can go wherever you want. Why should a veteran only be able to get access at a veterans’ healthcare center where the care isn’t as good, the outcomes aren’t as good, when they can go in their own hometown and buy something that’s better? So, you know, it’s about real freedom of choice and it’s about letting markets allocate scarce resources.

We’ve got a whole host of things that we’ve talked about on how to do this. The [Patients’ Freedom to Choose Act], it saves the states billions in terms of cost.

Q: Do you have any optimism that Congress can work together in a bipartisan way to address some of your concerns with the existing law?

A: No. This isn’t fixable in the way that they have it. To make this fixable, you have to take out the individual mandate, you have to take out the employer mandate, and you have to go to a system of risk reallocation on the insurance industry. If you want to really cover people with pre-existing illnesses, what you have to do is keep the insurance industry from cherry-picking. And what they tried to do is to get everybody covered so you could actually indemnify the whole population.

Our other problem is we’re spending money. You know, if we spent a lot of money on prevention that actually worked, we would in fact save some dollars. But we haven’t created a situation where the insurance industry is interested in keeping you as a long-term insuree, so, therefore, I don’t have any incentive to work on your wellness. Now they’re doing a little bit of that, but they’re not to a great extent. And if you knew you could buy your health insurance over a period of 20 years and be with the same company and they’d actually help teach you, get the things that are going to lower your risk and your cost, they’d both save money.

So there are all sorts of things, but what we’ve done is we’ve abandoned the thing that we use in the rest of the country to allocate scarce resources, and that’s market forces. Ask yourself why the best hospitalists in the country get paid the same as the worst. Well, why wouldn’t we want to incentivize and pay for higher quality and pay less for poorer quality and poorer outcomes, to the point where we promote excellence rather than mediocrity? But we don’t do that.

Q: What’s the next step for Republicans in trying to push forward some of your own ideas?

A: We’re going to take our [Patients’ Freedom to Choose Act] and we’re going to modify it somewhat and we’re going to introduce it and have, you know, “Here’s what we believe. You all believe this, we believe in individual freedom and personal responsibility and accountability,” and we’re going to try to do that. That won’t go anywhere because we don’t have the votes to have it go anywhere. What we’re going to wait for if the court cases. My suspicion is the president loses the court case when it gets to the Supreme Court.

Q: Do you believe the entire act will be struck down or just the individual mandate?

A: No, no. I think the entire act will be struck. The bill doesn’t work without the individual mandate because you don’t get enough revenues in to cover what—and the bill is scored so stupidly anyhow. I don’t know if you know much about government budgeting, but this thing’s a farce in terms of its cost. It’s going to cost fully $600 billion to a trillion dollars more in the first year [2014] than they’re saying it will.

Q: What’s your view on accountable-care organizations?

A: Accountable-care organizations (ACOs) aren’t going to work, and let me tell you why they’re not going to work: because the ACOs are going to be grouped in the large metropolitan areas and you’re going to have less competition rather than more. And so what you’re doing is you’re seeing hospitals buy physician practices, and then they’re going to get into this accountable care, and what they’re going to find is it’s not going to save them any money because you’ve got less competition.

Just go look at Boston; it’s happening right now. Prices aren’t going to go down with ACOs—they’re going to go up because you’re forcing.

What we really need is groups of physicians who say, “We’ll bid outside of the hospital; we’ll bid to make this care available.” In other words, you take 100 cardiologists and say, “Here are our rates to do these things for these people, on average.”

Let the physicians compete outside of being owned by the hospital. If you know anything about hospitals, their bureaucracy is amazing. It looks just like the federal government.

Q: What about bundling payments around episodes of care as a way to try to align incentives?

A: Well, why not let cost and outcome align incentives and let individuals do it? In other words, you’re talking about: “Here’s another system. The American consumer isn’t smart enough to buy their healthcare, so therefore, we have to have somebody else tell us how to do it.” And I would tell you, if we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate all this bureaucracy.

So what you’re suggesting is: “Here’s all these things that we can do because of the problem,” but that’s fixing the wrong problem. The problem is there’s no market force in play to control or check the cost. We’re just always looking for another gimmick. TH

Bryn Nelson is a freelance medical writer based in Seattle.

A two-time cancer survivor and obstetrician who has delivered thousands of babies, U.S. Sen. Tom Coburn (R-Okla.) has a unique perspective on healthcare as a provider, recipient, and influential advocate for change. Minutes after voting to repeal the Patient Protection and Affordable Care Act of 2010—an effort that ultimately failed in the Democratic-controlled Senate—Dr. Coburn talked with The Hospitalist about his objections to the existing law, his views on the main drivers of upwardly spiraling healthcare costs, and the Republican Party’s alternatives for achieving the elusive goals of better quality and cost control.

Question: What are your main concerns about the healthcare reform law?

Answer: I think, first of all, the healthcare reform bill doesn’t fix the problem, and the question is, what is the problem in healthcare in America? Is it quality, is it outcome, is it access, or is it cost?

If we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate this bureaucracy.—U.S. Sen. Tom Coburn, R-Okla.

And the problem is we spend twice as much per capita as anybody else in the world on healthcare to get 30% better outcomes on average. So the problem with healthcare in our country is it costs too much, and there’s a lot of reasons it costs too much. But the number-one reason is that everybody in the country, except those without insurance, thinks somebody else is paying their bill. So there’s no consumer discretionary choices that are made once you’ve met your deductible.

Having practiced for a long period of time and cared for the Amish, they always bought healthcare about 40% to 60% less than everybody else, because they pay cash for it and they deal [with] it, and they ask, “Why am I having this test?” and “Where can I get this test done more cheaply?” and “Are you sure I need this test?”

Being trained in the early 1980s and late ’70s as a physician, we’re trained different than the way doctors are trained today. Doctors today don’t think a thing about utilization. … What this bill did was expand coverage but didn’t fix the system, except that Washington’s now going to tell your hospitalists who they’re going to treat, how they’re going to treat them, and when they’re going to treat them.

Q: How do we fix the right problem?

A: You have to reconnect the purchaser with the payment; that’s No. 1. No. 2 is, you cannot continue to allow people to think somebody else is paying their bill, even when they’re not. If you work for a large company or you work for the government, the fact is, you’re paying money out every year for your portion of the coverage, and your employer is paying it out. They’re paying, in most instances, the vast majority of it, and so once you’ve met a deductible, you’re no longer a discretionary consumer because your assumption is, it’s going to get paid for.

And the other side of this is, how do we put in the doctors’ hands cost consciousness? In other words, can I do this and get the same outcome without spending this money? And quite frankly, we’ve trained a generation-and-a-half of physicians not to think about that.

Q: How else can we reduce costs?

A: It’s amazing what could happen if we start driving toward cost reduction. We have veterans who have to drive … to get to a VA. Give the veteran a card. If you’re service-connected, you can go wherever you want. Why should a veteran only be able to get access at a veterans’ healthcare center where the care isn’t as good, the outcomes aren’t as good, when they can go in their own hometown and buy something that’s better? So, you know, it’s about real freedom of choice and it’s about letting markets allocate scarce resources.

We’ve got a whole host of things that we’ve talked about on how to do this. The [Patients’ Freedom to Choose Act], it saves the states billions in terms of cost.

Q: Do you have any optimism that Congress can work together in a bipartisan way to address some of your concerns with the existing law?

A: No. This isn’t fixable in the way that they have it. To make this fixable, you have to take out the individual mandate, you have to take out the employer mandate, and you have to go to a system of risk reallocation on the insurance industry. If you want to really cover people with pre-existing illnesses, what you have to do is keep the insurance industry from cherry-picking. And what they tried to do is to get everybody covered so you could actually indemnify the whole population.

Our other problem is we’re spending money. You know, if we spent a lot of money on prevention that actually worked, we would in fact save some dollars. But we haven’t created a situation where the insurance industry is interested in keeping you as a long-term insuree, so, therefore, I don’t have any incentive to work on your wellness. Now they’re doing a little bit of that, but they’re not to a great extent. And if you knew you could buy your health insurance over a period of 20 years and be with the same company and they’d actually help teach you, get the things that are going to lower your risk and your cost, they’d both save money.

So there are all sorts of things, but what we’ve done is we’ve abandoned the thing that we use in the rest of the country to allocate scarce resources, and that’s market forces. Ask yourself why the best hospitalists in the country get paid the same as the worst. Well, why wouldn’t we want to incentivize and pay for higher quality and pay less for poorer quality and poorer outcomes, to the point where we promote excellence rather than mediocrity? But we don’t do that.

Q: What’s the next step for Republicans in trying to push forward some of your own ideas?

A: We’re going to take our [Patients’ Freedom to Choose Act] and we’re going to modify it somewhat and we’re going to introduce it and have, you know, “Here’s what we believe. You all believe this, we believe in individual freedom and personal responsibility and accountability,” and we’re going to try to do that. That won’t go anywhere because we don’t have the votes to have it go anywhere. What we’re going to wait for if the court cases. My suspicion is the president loses the court case when it gets to the Supreme Court.

Q: Do you believe the entire act will be struck down or just the individual mandate?

A: No, no. I think the entire act will be struck. The bill doesn’t work without the individual mandate because you don’t get enough revenues in to cover what—and the bill is scored so stupidly anyhow. I don’t know if you know much about government budgeting, but this thing’s a farce in terms of its cost. It’s going to cost fully $600 billion to a trillion dollars more in the first year [2014] than they’re saying it will.

Q: What’s your view on accountable-care organizations?

A: Accountable-care organizations (ACOs) aren’t going to work, and let me tell you why they’re not going to work: because the ACOs are going to be grouped in the large metropolitan areas and you’re going to have less competition rather than more. And so what you’re doing is you’re seeing hospitals buy physician practices, and then they’re going to get into this accountable care, and what they’re going to find is it’s not going to save them any money because you’ve got less competition.

Just go look at Boston; it’s happening right now. Prices aren’t going to go down with ACOs—they’re going to go up because you’re forcing.

What we really need is groups of physicians who say, “We’ll bid outside of the hospital; we’ll bid to make this care available.” In other words, you take 100 cardiologists and say, “Here are our rates to do these things for these people, on average.”

Let the physicians compete outside of being owned by the hospital. If you know anything about hospitals, their bureaucracy is amazing. It looks just like the federal government.

Q: What about bundling payments around episodes of care as a way to try to align incentives?

A: Well, why not let cost and outcome align incentives and let individuals do it? In other words, you’re talking about: “Here’s another system. The American consumer isn’t smart enough to buy their healthcare, so therefore, we have to have somebody else tell us how to do it.” And I would tell you, if we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate all this bureaucracy.

So what you’re suggesting is: “Here’s all these things that we can do because of the problem,” but that’s fixing the wrong problem. The problem is there’s no market force in play to control or check the cost. We’re just always looking for another gimmick. TH

Bryn Nelson is a freelance medical writer based in Seattle.

A two-time cancer survivor and obstetrician who has delivered thousands of babies, U.S. Sen. Tom Coburn (R-Okla.) has a unique perspective on healthcare as a provider, recipient, and influential advocate for change. Minutes after voting to repeal the Patient Protection and Affordable Care Act of 2010—an effort that ultimately failed in the Democratic-controlled Senate—Dr. Coburn talked with The Hospitalist about his objections to the existing law, his views on the main drivers of upwardly spiraling healthcare costs, and the Republican Party’s alternatives for achieving the elusive goals of better quality and cost control.

Question: What are your main concerns about the healthcare reform law?

Answer: I think, first of all, the healthcare reform bill doesn’t fix the problem, and the question is, what is the problem in healthcare in America? Is it quality, is it outcome, is it access, or is it cost?

If we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate this bureaucracy.—U.S. Sen. Tom Coburn, R-Okla.

And the problem is we spend twice as much per capita as anybody else in the world on healthcare to get 30% better outcomes on average. So the problem with healthcare in our country is it costs too much, and there’s a lot of reasons it costs too much. But the number-one reason is that everybody in the country, except those without insurance, thinks somebody else is paying their bill. So there’s no consumer discretionary choices that are made once you’ve met your deductible.

Having practiced for a long period of time and cared for the Amish, they always bought healthcare about 40% to 60% less than everybody else, because they pay cash for it and they deal [with] it, and they ask, “Why am I having this test?” and “Where can I get this test done more cheaply?” and “Are you sure I need this test?”

Being trained in the early 1980s and late ’70s as a physician, we’re trained different than the way doctors are trained today. Doctors today don’t think a thing about utilization. … What this bill did was expand coverage but didn’t fix the system, except that Washington’s now going to tell your hospitalists who they’re going to treat, how they’re going to treat them, and when they’re going to treat them.

Q: How do we fix the right problem?

A: You have to reconnect the purchaser with the payment; that’s No. 1. No. 2 is, you cannot continue to allow people to think somebody else is paying their bill, even when they’re not. If you work for a large company or you work for the government, the fact is, you’re paying money out every year for your portion of the coverage, and your employer is paying it out. They’re paying, in most instances, the vast majority of it, and so once you’ve met a deductible, you’re no longer a discretionary consumer because your assumption is, it’s going to get paid for.

And the other side of this is, how do we put in the doctors’ hands cost consciousness? In other words, can I do this and get the same outcome without spending this money? And quite frankly, we’ve trained a generation-and-a-half of physicians not to think about that.

Q: How else can we reduce costs?

A: It’s amazing what could happen if we start driving toward cost reduction. We have veterans who have to drive … to get to a VA. Give the veteran a card. If you’re service-connected, you can go wherever you want. Why should a veteran only be able to get access at a veterans’ healthcare center where the care isn’t as good, the outcomes aren’t as good, when they can go in their own hometown and buy something that’s better? So, you know, it’s about real freedom of choice and it’s about letting markets allocate scarce resources.

We’ve got a whole host of things that we’ve talked about on how to do this. The [Patients’ Freedom to Choose Act], it saves the states billions in terms of cost.

Q: Do you have any optimism that Congress can work together in a bipartisan way to address some of your concerns with the existing law?

A: No. This isn’t fixable in the way that they have it. To make this fixable, you have to take out the individual mandate, you have to take out the employer mandate, and you have to go to a system of risk reallocation on the insurance industry. If you want to really cover people with pre-existing illnesses, what you have to do is keep the insurance industry from cherry-picking. And what they tried to do is to get everybody covered so you could actually indemnify the whole population.

Our other problem is we’re spending money. You know, if we spent a lot of money on prevention that actually worked, we would in fact save some dollars. But we haven’t created a situation where the insurance industry is interested in keeping you as a long-term insuree, so, therefore, I don’t have any incentive to work on your wellness. Now they’re doing a little bit of that, but they’re not to a great extent. And if you knew you could buy your health insurance over a period of 20 years and be with the same company and they’d actually help teach you, get the things that are going to lower your risk and your cost, they’d both save money.

So there are all sorts of things, but what we’ve done is we’ve abandoned the thing that we use in the rest of the country to allocate scarce resources, and that’s market forces. Ask yourself why the best hospitalists in the country get paid the same as the worst. Well, why wouldn’t we want to incentivize and pay for higher quality and pay less for poorer quality and poorer outcomes, to the point where we promote excellence rather than mediocrity? But we don’t do that.

Q: What’s the next step for Republicans in trying to push forward some of your own ideas?

A: We’re going to take our [Patients’ Freedom to Choose Act] and we’re going to modify it somewhat and we’re going to introduce it and have, you know, “Here’s what we believe. You all believe this, we believe in individual freedom and personal responsibility and accountability,” and we’re going to try to do that. That won’t go anywhere because we don’t have the votes to have it go anywhere. What we’re going to wait for if the court cases. My suspicion is the president loses the court case when it gets to the Supreme Court.

Q: Do you believe the entire act will be struck down or just the individual mandate?

A: No, no. I think the entire act will be struck. The bill doesn’t work without the individual mandate because you don’t get enough revenues in to cover what—and the bill is scored so stupidly anyhow. I don’t know if you know much about government budgeting, but this thing’s a farce in terms of its cost. It’s going to cost fully $600 billion to a trillion dollars more in the first year [2014] than they’re saying it will.

Q: What’s your view on accountable-care organizations?

A: Accountable-care organizations (ACOs) aren’t going to work, and let me tell you why they’re not going to work: because the ACOs are going to be grouped in the large metropolitan areas and you’re going to have less competition rather than more. And so what you’re doing is you’re seeing hospitals buy physician practices, and then they’re going to get into this accountable care, and what they’re going to find is it’s not going to save them any money because you’ve got less competition.

Just go look at Boston; it’s happening right now. Prices aren’t going to go down with ACOs—they’re going to go up because you’re forcing.

What we really need is groups of physicians who say, “We’ll bid outside of the hospital; we’ll bid to make this care available.” In other words, you take 100 cardiologists and say, “Here are our rates to do these things for these people, on average.”

Let the physicians compete outside of being owned by the hospital. If you know anything about hospitals, their bureaucracy is amazing. It looks just like the federal government.

Q: What about bundling payments around episodes of care as a way to try to align incentives?

A: Well, why not let cost and outcome align incentives and let individuals do it? In other words, you’re talking about: “Here’s another system. The American consumer isn’t smart enough to buy their healthcare, so therefore, we have to have somebody else tell us how to do it.” And I would tell you, if we had no insurance in this country, none whatsoever, and we had no Medicare and people were buying their healthcare, I guarantee the prices would go down drastically, and we’d eliminate all this bureaucracy.

So what you’re suggesting is: “Here’s all these things that we can do because of the problem,” but that’s fixing the wrong problem. The problem is there’s no market force in play to control or check the cost. We’re just always looking for another gimmick. TH

Bryn Nelson is a freelance medical writer based in Seattle.