There are few issues that are more important or pressing for Mississippi businesses and consumers than the question of health care. As most of us are aware, the Magnolia State ranks far down the list in terms of the health of our population. Obesity, heart disease, diabetes, cancer — these are generally more impacting on Mississippians than in many other states. As a result, health insurance in Mississippi is far more costly here than in many other surrounding states (based on a comparative study we ran recently), and thus, we have a very high number of uninsured people.
Given the recent ruling on the Affordable Care Act by the U.S. Supreme Court and the ancillary issues raised by that ruling, we think it is important to take a look at the future of health care and what might be in store for our state (and the nation as a whole).
To begin with, for the state, for its businesses and for all of us who live here the question of affordability and access to care is vital. In looking at the issue, we looked at some of the research published by the Kaiser Family Foundation. For instance, consider this stunning statistic: in 1970, total health care expenditures in the United States represented about 7 percent of our entire gross domestic product. The estimates are that this number in 2012 could top 19 percent of GDP. What that suggests is that health expenditures have grown nearly three times as fast as our economy.
Interestingly, too, health care expenditures in the U.S. have grown far faster than those in other developed countries, including Canada, the United Kingdom, France, Germany, Japan and so on.
If the trend is carried forward for another 20-30 years without significant changes, that 19 percent could well balloon to as much as 30-40 percent of our total GDP. The headline on a story in Forbes recently was “The U.S. does not have a debt problem….it has a health care cost problem.” Looking at the preceding numbers, it’s hard to argue with that conclusion.
How have things come to this point? What does the future hold? Are there solutions that will reconcile the seeming gulf between the need to control cost and the delivery of quality health care to our population?
We talked with a number of professionals and leaders from several different sectors to ask these questions and gain some insight on where we’re headed, in Mississippi and beyond.
Therese Hanna is the executive director of the Center for Mississippi Health Policy, a non-profit and non-partisan agency which conducts research and analysis on important health policy issues. A Mississippi native, Therese served with the state Health Department for 17 years, and managed the health insurance program for state employees during a phase of her career. We asked her what she saw as the key issues confronting our state.
“Certainly, we have major challenges in Mississippi, with childhood obesity, diabetes and other issues that compromise lives and reduce life expectancy,” she said. She believes that while much effort and expense is devoted to primary care in these instances, much more attention needs to go to preventive care, healthier lifestyles and educating consumers about how to make positive and constructive changes to improve wellness.
CMHP has worked with the state in studying the implementation of a Mississippi health exchange under the Affordable Care Act, and in a recent report estimated that 275,000 Mississippians are anticipated to enroll in coverage when the exchange is fully implemented. Many of these consumers will receive subsidies in the form of tax credits.
What about the extension of Medicaid, which the ACA mandated but the Supreme Court rejected, so that states may elect to take — or refuse — the federal money earmarked for covering new Medicaid patients during the first few years after implementation?
Therese was careful to emphasize that hers is a non-partisan role, but acknowledged that they are working with state economists to study the potential impact of the Medicaid extension. “One important issue in this process is that a part of the ACA process is the reduction in payments to hospitals for the uncompensated care they provide. If this happens, and there is no expansion in Medicaid eligibility, it could be a real squeeze on health care providers.”
What does the future hold? From Therese’s point of view, consumers will necessarily have to become better educated, more involved in their own care and learn to understand their options.
“We may see a change in how health care is paid for — that is, payment may be made for outcomes and quality versus quantity.”
For the perspective of a health care professional, we talked with Sherry Pitts, CEO of Woman’s Hospital. A Mississippi native who has worked in health care throughout her career as a nurse and then in recent years as a hospital administrator and CEO, Sherry offered some suggestions as to how we have arrived at this point in health care.
“You have to consider the technology,” she said. “Just look right here at Woman’s where we are now using high-tech processes such as robotic surgery. The machines and technology are extremely expensive.”
What about other costs? “Our supply cost is a huge piece of our budget, as is the need to pay competitive wages to our staff,” she said. She also sees continually increasing costs from compliance with government rules and regulations and the need to maintain their accreditation.
Sherry agreed with Therese that there is currently more focus on primary versus preventive care. “Consumers will inevitably have to become more involved in their health care. We’re going to see value-based purchasing, more emphasis on pay for performance and better access to important information by consumers.”
What will happen if the payments are stopped or reduced for providing uncompensated care, and if the Medicaid expansion does not happen in Mississippi?
“If that should happen,” she said, “I’m not sure how we can maintain the current care levels throughout the state. That would be a big conundrum.”
When asked what health care might look like in the next 10-20 years, she said her hope will be to see a more educated consumer who takes more responsibility for their lifestyle choices.
“As far as we’re concerned,” she said, “we’ll continue to focus on providing the best care we can for our patients and their families.”
For a multi-perspective overview, we talked with State Rep. Mark Baker, who represents District 74 (Madison and Rankin counties). Mark is also a lawyer and small business owner. He’s served since 2003, and was minority leader of the House during one phase in his career.
While acknowledging that many of the increased costs in health care have come about as a result of technology and increased life expectancy, he was candid in suggesting that a lot of the problem should be laid at the feet of government.
“The key is allowing the market to function as it should,” he suggested. “As Medicaid is currently administered, for instance, only 10 percent of patients are eligible for a managed care option.”
He pointed out that Medicaid is a regular topic of discussion in the Legislature, and asked his views on whether Mississippi would accept or reject the proposed Medicaid expansion, he responded, “Based on what I know now, I would have to vote to decline. That expansion is problematic on many levels, and it’s a complicated problem.”
On the other hand, he seemed to feel that the health exchange concept would help to insure many more Mississippians and also to help bring down costs, by increasing the competitiveness in the marketplace and extending the risk across a far larger area.
“I think you’ll see more and better options for consumers down the road, if we just let market forces come into play,” he said.
While the viewpoints of the professionals we spoke with tend to vary somewhat, there was general agreement about what has brought us to our current status — technology, life expectancy (and the resultant need for more and longer care) and the incidence in obesity, diabetes and other major illnesses that require expensive treatment.
In a sense, the viewpoints were also consistent as to where we are headed in health care during the next 10-20 years. All agreed that big — very big — change is on the horizon, and it is going to influence just about everyone. As to how that change will unfold and the impacts it will have — well, the crystal ball is quite clouded on that score.