Let’s talk about rising health care costs for T-minus five seconds—costs, by the way, that bear little if any correlation to the quality of care delivered or the outcomes that patients attain. Getting what you pay for and no less is a rallying cry. That rallying cry should unify pretty much everybody who is writing checks for health care services. That includes taxpayers; it includes employers; it includes patients.
When I say taxpayers and patients, by the way, I also could mean unions. When health care costs too much and bosses resort to cost shifting, nobody wins. Businesses or public sectors with sick employees do not perform very well. Nor do businesses win when extraordinary health care costs push down wages—dollars disappear that were formerly used to innovate or reduce class sizes or any of a myriad of other things that money could be better spent on besides overly expensive health care.
In this health care podcast, I speak with Mark Blum from America’s Agenda. When I was talking with Mark, I kind of pictured him bearing a flag with a peace sign on it.
His point for unions and employers alike is this: Instead of ripping each other into shreds at the bargaining table over health care, maybe work together proactively. Clip the reasons for rising health care costs in the first place. These reasons include, but certainly are not limited to, excess middleman profits that do not contribute to patient value, private equity earning profits on the backs of patients and payers, a health care system that rewards volume over value … I could go on and on.
But here’s a way out of this tangled web we’ve been forced into: Instead of bowing and scraping at the boots of special interests driving up the costs of health care for Americans—and when I say Americans, I mean bosses or labor alike—instead of flailing at the mercy of these forces, change the game. Gang up together and proactively demand to get what you pay for.
Mark and I talk about two very concrete examples on how to do this. Mark and the team at America’s Agenda, for example, saved New Jersey $1.6 billion (that’s billion with a B) over the past three years on pharmacy benefits alone. That’s a whole lot more shekel than could have been generated by haggling over who pays for what of a pharmacy bill that is $1.6 billion too high. We also talk about direct primary care and how much direct primary care—not owned by a private equity, by the way—how much direct primary care can improve patient outcomes while, at the same time, reducing costs. Mark has some learnings here, too.
You can learn more at americasagenda.org and solidaritus.net.
Mark Blum is executive director of America’s Agenda, an alliance of labor unions, businesses, health care providers, and government leaders with a common mission of guaranteeing access to affordable, high-quality health care for every American. Under Mark’s direction, America’s Agenda has defined widely adopted principles of high-value care delivery design and achieved an unrivaled record of success in building winning statewide health care reform campaigns. Managed Care magazine recently featured an America’s Agenda–designed strategy that netted more than $1 billion in prescription drug savings for New Jersey’s public workers during 2018 and 2019 and is projected to save the state nearly $2.5 billion over five years without cutting public employee prescription benefits. Mark serves also as president and CEO of SolidaritUS Health, a leading-edge, labor-owned direct primary care provider whose innovative approaches to relationship-based care delivery were featured recently in Modern Healthcare magazine. SolidaritUS Health has revolutionized patient experience and improved quality of care while reducing employer health costs substantially and helping save thousands of US industrial jobs from being offshored.
Mark, who has served as a special adviser on hospital finances to leadership of the California legislature, serves currently as an appointee of Governor Phil Murphy to the New Jersey State Health Benefits Value and Quality Task Force. Mark was the first male ever elected to the board of directors of the American Medical Women’s Association. Internationally, he has served as adviser to Cambodian textile workers organizing the first labor unions in their country’s history.
03:17 Employers and unions—combining forces.
04:04 Rising deductibles at eight times the rate of inflation.
04:40 Creating and sharing savings, rather than fighting over cost shifting.
05:45 Working with New Jersey unions to have meaningful reduction in pharmacy benefits manager (PBM) spend—New Jersey Education Association (NJEA); Communications Workers of America (CWA); American Federation of State, County and Municipal Employees (AFSCME); Patrolmen’s Benevolent Association (PBA); among others.
07:57 Finding the next PBM to serve all these people in New Jersey using a “reverse auction.”
09:04 Designing a purchaser contract to eliminate hidden pricing in PBM contracting.
16:20 “There is no reason other PBMs couldn’t participate in reverse auctions like this.”
16:35 How reverse auctions like America’s Agenda’s auction in New Jersey are possible in virtually every state.
17:58 “The big obstacle to doing this … is that the PBM industry is remarkably profitable.”
19:25 Tactics among PBMs—Vinay Patel discusses in EP241.
20:26 Why PBMs don’t want to see this change.
21:51 “What stops them from reducing reimbursements to community pharmacies?”
22:05 “Best-in-class terms can build in requirements that PBMs may not spread price.”
24:37 America’s Agenda’s transformation of direct primary care.
26:56 America’s Agenda’s biggest innovation in labor direct ownership of direct primary care.
28:24 Aligning the interests of patients and physicians.
29:46 The big crisis in American health care—rising costs.