Leadership and Crisis (24 page)

But on this night there was no epidural, and the ambulance was nowhere in sight. As Supriya kept screaming, I tried to calm her down by telling a few jokes. (Bad idea, guys.)

“You know, if you want to stop teenage girls from having sex, show them a video of this,” I cracked.

She glared at me. “You’re making jokes? REALLY?!”

Supriya and I (more her than me) delivered Slade right there on the bathroom floor. I was tying the umbilical cord off with an old shoelace when the paramedics arrived. Childbirths on TV shows are always beautiful—the babies come out pink and cute and wrapped in a blanket. Sometimes, real life is a little different. Slade came out sort of off-color and covered with, well, while I’m certain there’s a technical term, let’s just call it “goo.”

“How does he look?” Supriya asked me when he first emerged. “How does the baby look?”

“He looks great,” I lied. What I wanted to tell her was he didn’t look done—and that maybe we needed to put him back in.

By this time, Supriya’s father and a police officer who had been nearby arrived at the house. I found out later these two brave men heard Supriya screaming and looked at one another. “Well, I’m not going in there,” said one.

“Well, if you’re not going in there, I’m not going in there,” replied the other.

When I handed Supriya our child for the first time, her pain instantly vanished. It was one of the most amazing moments of our lives; I don’t think I have ever loved my wife more. Now all she cared about was her newborn child. People later asked me if I panicked. “No,” I would tell them, “all I did was catch the baby.”

Later, the doctor had the hardest time figuring out the billing for our insurance. “I didn’t deliver the baby,” she said.

Slade’s birth was a reminder to me of the greatness of God and the gift of life. Again, God had given Supriya and me the strength together to bring our own child into the world.

Every American cares about healthcare because it’s a life and death issue that determines how we care for our society’s most vulnerable people. As I said earlier, it’s personal.

The federal government is uniquely
unsuited
to manage healthcare. Washington is full of big proposals dealing with national policy. A lot of these policies are geared toward hitting macro-level targets, like Obamacare’s goal of 16 million new Medicaid enrollees. And often, few have really contemplated the unintended consequences of these policies on an individual level. Is this a chance we should be taking with our healthcare system—something so personal, and yet also representing one-sixth of our economy?

Our Founding Fathers created a federal system because they understood everyday political issues should be handled at the most local level possible. The national government was meant to handle large-scale problems like national defense, not to dictate which medical procedures individuals can get and at what cost.

Government is most likely to threaten your life and liberty when it sees you as a number instead of a person. It’s not that Congress has bad intentions—it’s got its share of corrupt members, but the majority in each party means well. And it’s not that bureaucrats are inherently lazy, dishonest brutes, either. But the bureaucracy is designed to behave slowly, dispassionately, and without regard to the individual circumstances of each person its decisions effect. And that is where government can become disconnected from the individuals it is supposed to serve.

Here’s a simple illustration of the incredible inertia and bureaucratic disconnect that characterizes our healthcare system. While I was an
assistant secretary at the U.S. Department of Health and Human Services, I convinced Secretary Tommy Thompson to cut the paperwork and red tape that burden medical professionals. There was a form that was supposed to measure the quality of a home healthcare agency. The evaluation contained some rather odd questions: How often do you have sexual relations? How often is foul language used in the home? Asking why irrelevant, intrusive questions like these were necessary, we were told some researcher theorized they were correlated with better healthcare outcomes. We followed up: Did the data prove it to be true? We received a stunning answer: We don’t know, that researcher doesn’t work here anymore. They were asking the questions only because they were supposed to ask the questions!

Americans want healthcare reform that reduces costs, improves outcomes and real access, and puts consumers in control. It’s useless for us to bury our heads in the sand and pretend reform isn’t necessary. The Democrats have chosen a reform program based on a massive expansion of the size and scope of the federal government. Republicans have offered a variety of ideas and plans with a consistent theme of smaller government and a robust private sector.

I reject the claim among some Republican strategists that healthcare is a Democrat issue. It may seem that way, because prominent Democrats such as the late Senator Ted Kennedy worked doggedly toward a specific vision of reform. I disagree with that vision—a single-payer government scheme—but at least they know where they want to go. They’re winning this battle because conservatives have failed to present our own clear, consistent vision for reform.

You could see this even before the debate over Obama’s healthcare bill, back when we were discussing SCHIP expansion. Democrats said they wanted to cover more kids. Republicans opposed the plan by saying
they wanted to cover more kids, but not as many as the Democrats. That’s not a winning argument. Republicans should have argued we wanted children to have coverage too, but instead of relying on a government-run system that crowds out existing private coverage and wastes taxpayer dollars, we should introduce tax credits, voluntary purchasing pools, and other private sector incentives.

Healthcare is not a Democrat or Republican issue. It’s an American issue, and we need to apply tried and true American principles to fix it. But make no mistake—despite all the strengths of our system, we urgently need reform. How will we provide good, dignified care for persons with developmental disabilities as their current caregivers age? As the population of Americans over fifty-five nearly doubles in the next twenty years,
⁹
how will we ensure there are enough doctors to care for them? As healthcare consumes a growing percentage of our GDP, how do we reduce costs while also expanding real access?

As I said before, I believe healthcare is a right. The issue is not whether or not to expand and improve healthcare—especially for the poor and other vulnerable groups—but whether the instrument of reform will be the government or the private sector. In my view, the government’s role should be ensuring a robust marketplace that is competitive (so consumers have choice), transparent (so consumers can make informed decisions), accountable (so resources are lever-aged to reward good clinical outcomes rather than simply paying for the process of care), effective (by engaging consumers in making good health choices for themselves and their families), and accessible (so healthcare is affordable). Moreover, the system has to be based on sound, proven economic principles—the government simply cannot suspend the law of supply and demand. When government inserts itself into a marketplace and makes bureaucratic
decisions about paying for services, the inevitable result is shortages and fraud.

So the government can play a constructive role, but it should be a limited one, consistent with the view of our Founders, that maximizes the participation of states, local communities, and individuals. When Washington politicians claim their plans provide “choice,” they imply
they
are giving us this choice and so they are on “our” side. Folks, I believe the choice is inherently
yours
, and no one has a right to take it away.

Perhaps the most surreal element of the Democrats’ healthcare bill is the bizarre notion that an expanded federal role with a trillion dollar price tag will save money. This argument contradicts the fundamental principles of the American economy, in which competition and choice have always been the drivers for lower cost and innovation. Why do cell phones work better but cost less than they did fifteen years ago? Why are the flat screen TVs on which America watched the Saints win the Super Bowl larger, better, and cheaper than only a few years ago?

The fact is, scientific advancement is not linear. The pace of innovation is growing so rapidly that in twenty-five years, we won’t even recognize a lot of today’s cutting edge technology. The government is not responsible for this. Rather, companies are investing in research and development because they want better, lower-cost technology that will attract more customers. Sure, the government participates in research, but its most useful role is in leveraging the capacity and efficiency of the private marketplace.

An outsized government role damages the healthcare marketplace. For example, government-run Medicare and Medicaid are so dominant in the healthcare market that their government-driven payment
policies spill over into the private market, as some private payers link their own payment policies to them. And Medicare and Medicaid don’t pay based on outcomes—they pay based on volume. These one-size-fits-all policies are harmfully rigid, since not every doctor, hospital, or patient is the same.

Let’s consider a few examples. If one neurosurgeon is much more accomplished and skillful than another, should the two be paid the same? Of course not, but that’s the government’s policy—it pays for the procedure rather than the outcome, because it lacks the apparatus or capability to respond to real market conditions.

Let’s apply this example to the car market. Imagine that the government ran the entire auto industry (I know, I know, the government would
never
take over private car companies), and it charged the same price for a Cadillac and a Chevy. Most people, of course, would buy the Cadillac. Well, the guys making Cadillacs will eventually figure out they don’t need to invest heavily in making a better car, because they don’t get paid for it. So quality would deteriorate. We are seeing this same thing play out in medicine. More doctors are choosing not to serve Medicaid patients, more doctors are choosing not to care for high risk cases, and fewer people are going into primary care medicine.
¹⁰
We must stop paying for process and instead leverage the private marketplace to help us recognize and encourage value.

Dartmouth College has done some fascinating research showing there are huge differences in how much money is spent on patients in different parts of the country based solely on the historic spending patterns for process—not outcomes. In Manhattan and Miami, for example, Medicare patients receive far more expensive and more aggressive treatment than similar patients in places like Rochester, Minnesota, or Salt Lake City, Utah. But here’s the interesting thing:
patients in Manhattan and Miami don’t do any better than the others. In fact, their outcomes are often
worse
. A 2006 study by the Dartmouth Center for the Evaluative Clinical Sciences (CECS) concluded that in these high-use regions, “patients with the same disease have higher mortality rates, very likely because of medical errors associated with increased use of acute-care hospitals.”
¹¹

Let’s look at birth outcomes as another example. In 2009, there were more than 10,000 premature deliveries in Louisiana, and Medicaid funded more than two-thirds of them. A healthy, full term delivery costs Medicaid less than $4,000, while a premature delivery costs more than $33,000. So in Louisiana, we paid more than $212 million for the poor outcomes. Additionally, we know that premature kids have three times the likelihood to develop cerebral palsy. Perversely, everyone gets paid for this bad outcome.

What are the incentives in the funding system to go upstream and reduce the number of poor birth outcomes? In a system where providers are paid more for more services, doctors are actually penalized financially if they choose to do fewer procedures. Similarly, a hospital can only survive financially if more people are admitted. The funding system is so upside down that we actually pay more if a hospital patient gets an infection or some other bad outcome. In Louisiana, our proposals have sought to bring sensibility to how we pay for services.

America’s health system also lacks consumer engagement. When consumers do not share in the cost of the care, when they have no “skin in the game,” they have little incentive to make decisions that help reduce costs. Consider two sectors of the healthcare system where costs have
not
exploded over the past fifteen years: plastic surgery and laser vision surgery. Why? Because neither one is traditionally covered
by third parties such as health insurance plans or the federal government. The people receiving the services pay for them directly, and they are price and quality sensitive.

We need to remind ourselves that health insurance is
insurance
. The purpose is to cover treatments that we normally couldn’t afford by pooling risk across time and a large number of people. But we often think of it as something like prepaid dollars we need to spend. If we have fire insurance, we don’t burn down a room in our house at the end of the year because we didn’t have a fire. Yet when it comes to health insurance, we often make unnecessary doctors’ visits or perform needless tests at the end of the year just to “spend” our health insurance money.