Monday, August 20, 2012

Affordable Care Act, Unleashing the Innovator and Entrepreneur

This is a post I have been thinking about writing for a long while. It is also a very hard post to write because this has been a very personal journey.

Back in the early days of, in 2008-09, there was a lot of speculation about whether the Affordable Care Act would be passed in to law. In 2012 the focus has been on the build up to the Supreme Court decision regarding the ACA. During those periods of uncertainty I often reflected on the need for if HealthCare was going to be "fixed." All I needed to do though was to listen to the participants who took part in each we held. The vibrant discussions, the diversity of views, the range of problems people faced, both in the medical and the patient community. It was abundantly clear that the status quo was not good enough with well over 15% of the US Population going without any health care coverage and for those with health care coverage the costs were rising at a dramatic pace with no sign of easing. 

The concept of people being able to keep the health coverage they were happy with is a quaint idea that has no real basis in reality. In a health care insurance world dominated by employer plans keeping your insurance depends upon keeping your job. In this day and age that is at best a crap shoot for many.  For those with secure jobs the idea of keeping the insurance you are happy with is still a mis-nomer when many employers shop around for the cheapest quote every couple of years and in order to contain costs they adjust the content of the health plan. In this day and age the only real solution is for individuals and families to purchase their own insurance. 

Eighteen months ago I left the safe and certain world of an employer provided health plan. For a period I was able to continue my existing health plan but when that ran out a switch to COBRA was out of the question. Without the employer subsidy a 10-fold increase in cost to maintain the same plan, with no stable income was simply un-realistic. So, probably like many others who lost their jobs in the recession, I found myself flying without a health care parachute. it is a frightening prospect I can tell you. You see, one of my jobs is as a part-time ski-instructor. It doesn't pay much but the rewards of teaching a new generation of skiers is immeasurable. Fortunately, while working as an instructor I was covered by Workman's Compensation if an accident was to happen. But practicing my skills on my own time was out of the question. It was too dangerous. One collision with an out of control skier or snow boarder and you could be facing a trip off the mountain to the emergency room where costs sky-rocket quickly.

Annual Preventative Physical Exams to get an early detection of problems - forget it. 

During this 18 months I have continued to take part in efforts to drive change in Health Care. Putting on HealthCamps, taking part in conferences and doing development work here and there. It has been an incredibly rewarding journey. But it got me thinking.

Innovation and Entrepreneurship is one aspect of the Affordable Care Act that has been given very little attention and it deserves some promotion. 

The ACA and the work of the dedicated teams at HHS, CMS and ONC are making big behind the scenes changes in Health Care. New payment methods are emerging that have enormous potential to change quality of outcomes in Health Care and bring costs under control.

The liberation of health data is improving transparency. This is an essential part of creating a more even playing field in the market place.

The establishment of Health Insurance Exchanges will also enable individuals and small companies to find affordable health plans. Plans that include preventative care.

I believe that the employer-based health plan model is a drag on the economic growth. Why do I say this?

The USA is an innovator economy. One built on entrepreneurship. However, as the cost of health care continues to spiral upwards the employer-based health plan acts as a discouragement to innovators and entrepreneurs to step out on their own and build their own companies for fear of losing health coverage for their families. 

I believe that in the next few years we will see more individuals taking control of their health insurance coverage. They, and not their employers, will control the relationship with both their insurer and their care team. Employers may still contribute to the care of their employees, but it is increasingly likely to be via Health Savings Accounts rather than by directly negotiating insurance deals. We will see this initially in the small business space but it may well spread in to the mid-size employer market and Employer-lnas may become the domain of only the largest employers.

One of the effects of this evolution may be to unleash a new wave of entrepreneurs to try their hand at building their own companies. Not only will they find providing health care for their employees to be a simpler process but they won't feel shackled to an employer-controlled health plan.

So this past 18 months has been a fascinating journey. is still relevant because there is so much to do in order to improve health care but we are only in the first early phases of a transformation.

It is an essential transformation. Health Care costs can't continue to grow as a percentage of the overall economy. It kills our competitiveness. Ultimately each of us has to become active in managing our health and vitality. Taking personal responsibility for our health and our health insurance will ultimately allow us to once again grow the economy, by eliminating one very significant barrier to entrepreneurship. 

I would love to get other's views on this topic. Why not join me at a