This post originally appeared on U.S. News and World Report’s Policy Dose blog.
On October 13, former Florida governor and candidate for the 2016 GOP nomination Jeb Bush released his plan for reforming America’s health care system. Aligned with core conservative values, he insists on repealing and replacing the Affordable Care Act (or Obamacare) with a system that focuses on an individual’s choice to bear risks by encouraging them to buy catastrophic or high deductible insurances with less coverage and doubling the maximum allowed contribution to health savings accounts. Interestingly, unlike Hillary Clinton, he seems to be a firm supporter of Obamacare’s so-called Cadillac tax and does a pretty good job in explaining the economic reasons behind the tax in layman’s terms.
But Bush’s plan is not limited to an expansion of health insurance coverage; it also lays out a very sound strategy for fostering information and medical technologies to, respectively, increase efficiency and quality of health care services. Considering the political consequences of tossing 17 million people off their insurances leads me to believe that Bush’s plan for repealing Obamacare will be impossible to implement. However, his proposals for promoting innovations are exceedingly well-suited to be coupled with Obamacare’s value-based payment models.
Bush promises to terminate the meaningful use program – the government incentives and penalties that were designed to encourage providers to adopt government-approved electronic health records. Over the last decade, we have not received significant returns on our $30 billion of investment on government-led efforts to promote electronic record adoption through the meaningful use program. As I have discussed before, this failure is due to the fact that the meaningful use program does not focus on outcome measures, and rather persists on process metrics that are irrelevant for many medical providers. Instead of increasing efficiency, cumbersome mandates on data entry have led to frustrated physicians who spend more time with their computers than with patients.
By introducing a poorly designed source of revenue, the government has interrupted the natural way in which the business ecosystem should have functioned in the health care sector. Meaningful use incentives have led medical providers to adopt information technology as a final goal rather than a means to address a specific problem. Bush understands this problem very well and proposes to solve it by eliminating its root cause: government intervention and heavy-handed regulation.
Reducing government’s role in Bush’s plan goes beyond the meaningful use program. Unlike his brother, he believes that standards of interoperability between different health IT systems should be led by the private sector and developed by industry rather than government. As I have also discussed before, just like other sectors of industry, universal standards can be successful and widely accepted only if they are set by the entities within that sector. By demanding government spend taxpayer’s money on designing interoperability standards, we will only be doing a big favor for the health IT industry by picking up its R&D tab.
Bush also promises to allow patients to take ownership of their own records and push the Centers for Medicare and Medicaid Services to publicly release de-identified claims data. These policies together will create unprecedented opportunities for developing new products and services within the health IT domain. If the law considers patients as the owners of their data, approaches to interoperability will fundamentally change and instead of focusing on provider-to-provider connection, will put the emphasis on patient-to-provider connectivity.
The proposals outlined in Bush’s plan can be successful only if the economic incentives of different entities in the health care market are correctly aligned towards decreasing inefficiencies and eliminating waste. Obamacare has created an unprecedented opportunity for re-aligning the economic incentives of providers. Instead of being rewarded for volume of their services, they will be rewarded for the value and thus they will have a clear incentive to adopt and meaningfully use information technologies.
While Obamacare is here to stay and will continue to expand insurance coverage in America, it does not have concrete and actionable solutions for controlling the increasing costs of health care services. Bush’s proposals on health IT complement Obamacare by outlining clear steps for utilizing technology to increase both quality and efficiency in the health care system.