Medicare, Medicaid Must Change, Says Former Head

Donald Berwick resigned as administrator of the Centers for Medicare and Medicaid Services in December. Berwick explains why he thinks much of the spending in the U.S. health care system is wasted, and the need to reform Medicare and Medicaid to improve coordination of care.

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NEAL CONAN, HOST:

Until the beginning of this month, Donald Berwick served as administrator for the Centers for Medicare and Medicaid Services. Dr. Berwick's nomination got caught up in the partisan politics that accompany passage of the health care law, and he took office under a controversial recess appointment. His mission was to make the centers more efficient, to cut costs and to deliver more patient-centered care. On his way out of office, he said that as much as a third of the money spent on Medicare and Medicaid is wasted.

We want to hear from health care professionals in our audience. Where do we need to go next in the overhaul of Medicare and Medicaid? Give us a call, 800-989-8255. Email us, talk@npr.org. You can also join the conversation on our website, go to our npr.org, click on TALK OF THE NATION. And Dr. Donald Berwick joins us now from the studios of member station WGBH in Boston. And nice to have you on TALK OF THE NATION today.

DR. DONALD BERWICK: Thanks for having me, Neal.

CONAN: And we want to talk about the delivery of Medicare and Medicaid services, but let me start with politics. Given your experience, would you recommend to anybody that they join government service?

BERWICK: Absolutely. It was maybe the most thrilling part of my whole long career. I loved working there. It was a great privilege. And I'm glad that I had the time I had.

CONAN: Yet you were personally attacked by people who should have known better. Your appointment was held up and eventually denied.

BERWICK: Oh, the attacks didn't bother me. They didn't make any sense and they kind of - I just tried to ignore them. But the chance to work with Medicare and Medicaid and the great people who work in the federal government was eye-opening and really motivating. And after all, this is a time of such enormous promising change in health care. It was mostly fun.

CONAN: Mostly fun, OK. I think that will be the headline: mostly fun.

(SOUNDBITE OF LAUGHTER)

CONAN: As you - because you were only able to serve a truncated term, could you give us - if there was one thing you accomplished, what would it be?

BERWICK: Well, you have to give me two things. I mean, internally I tried to focus on the agency, CMS, the Centers for Medicare and Medicaid Services. I mean, I tried to tell the people there that not only do they pay bills, but they can really help lead improvement of American health care, which is my lifelong endeavor. They rose to it. It was just amazing to work with them as we discussed patient safety and patient-centered care, much more reliable care, efficiency in care. And you know, we discovered together how we - how Medicare could be - and Medicaid could even be better leaders for improvement of care, which is the point.

Externally it was a series of programs that mainly the Affordable Care Act, the new law allowed us to launch a massive national effort on patient safety, for example, the largest ever, which if it works - and I think it will - is going to reduce deaths from infections and other complications in hospitals by tens of thousands in the next couple of years and will also smooth transitions between hospitals and home. We worked a lot on seamless care, coordinated care. We launched the Accountable Care Organization program, which is a kind of technical program within the Affordable Care Act, but what it really means is that people are really going to have doctors and nurses who now can follow them through their journeys through care and experience much better coordinated care.

We also worked on prevention. We launched a campaign called the Million Hearts campaign that if it works - and I think it will - is going to reduce heart attacks and strokes in the country by a million over the next four to five years.

CONAN: I wanted to get back to patient safety for just a minute. This is an issue that you've been working on in various positions since - well, tell us about the experience of your wife and how that has changed your attitude towards the delivery of medical services.

BERWICK: Well, anyone who's been in health care for any substantial period of time has experienced errors in care. They're not intentional. The doctors and nurses, they're really trying to do their very, very best, but the care system was built in a very fragmented and unreliable way. So people get complications. They get infections. They get pressure sores. They get medication mix-ups. So when they go home there isn't good communication with the home about what's going on, you know, what medications they should be on, and as a result people get sicker and costs go up.

So patient safety, to me, it's almost - it's like a hallmark issue. Can we really make care as safe as I know it can be? And that will reduce costs and improve quality. And the tantalizing or maybe frustrating thing is we really know how to do it. There are places all over the United States that have reduced infection rates close to zero, that have almost eliminated pressure ulcers, that do very, very fine coordinated care. And at CMS and before that and after it, it seems to me if we know how to do something well, it should happen everywhere. I call it bringing excellence to scale, and that still remains, I think, a big agenda for our country.

CONAN: Is that a big part of the waste that you were talking about?

BERWICK: Yeah. Waste appears in many forms. In your introduction, you said something I just want to correct. It's not waste in Medicare and Medicaid we're talking about. I think they're actually very efficient programs, if compared to others. It's waste in health care delivery. And Medicare and Medicaid and private insurance and states, they're all sort of shareholders in the health care system. And what that system is wasteful, when it has complications that could be avoided, or when there's failures of coordination or safety issues, or just administrative complexity, well, everybody pays that bill. And it's a mistake to say it's a Medicare and Medicaid problem. It really isn't. It's a health care delivery challenge, and I think we all need to be up to it.

CONAN: One thing that we're all familiar with is that the system seems to reward the administration of tests, whether they're needed or not.

BERWICK: Yeah, yeah. The system is rooted in an old tradition of silos of fragmented care that possible - that gets paid when you're in the hospital. The doctor gets paid when he sees you, or she sees you. A lab gets paid when you do a lab test. It's all paying in fragments. And the question is, well, who's paying for what we want, which is health? We want to have our pain controlled. We want to have our healing occur. We want to be able to get back to work. And this outcome-based payment, payment for the results is a much more modern way to think. But it's not the way we're thinking yet.

The Affordable Care Act, the new law has a lot of shifts - they call it shifting from volume to value. That just means paying hospitals and doctors and others for the results of what they do so they can focus on those results, instead of having to just turn the wheel all the time in order to make their incomes.

CONAN: We want to talk with health care professionals about where we need to go next in providing Medicare and Medicaid services. 800-989-8255. Email: talk@npr.org. We'll start with Julie, Julie with us from Raleigh.

JULIE: Thank you for taking my call.

CONAN: Sure.

JULIE: And thank you to your guest for your service to our country. I'm an emergency physician. And I'd like to comment on, you know, my perspective on the really incredible and kind of shameful waste that is involved, particularly with Medicaid, you know, as a result of, you know, patients in the emergency department. Unfortunately, you know, we in the emergency department see Medicaid patients, you know, really abusing what has become, you know, their entitlement program. They seem to have no sense of responsibility in terms of, you know, managing costs because they have no co-pay.

You know, when they have to come to the emergency department, there's no cap on them. And that's - they can receive - we see patients who, you know, are able-bodied and have a vehicle, you know, just for the sake of convenience, calling 911 and taking an ambulance to the emergency department to be evaluated for a cough.

And certainly, Medicaid, you know, provides primary care providers to all of their patients. I mean, it's - you know, you have to have a primary care provider as a Medicaid recipient. However, you know, if it's just simply inconvenient for one to schedule an appointment with their primary care provider, Medicaid patients come to the emergency department and they get whatever care, how much ever care they want to for free. And it's a big problem, and it's costing our government a lot of money, and it is waste, and it's shameful. So I'd like to hear your guest's comments on that, and how it can be changed, then. And actually, I'm curious why there is no Medicaid co-pay for even $3, $5 for use of the emergency department services.

CONAN: Dr. Berwick?

BERWICK: Well, Julie, thanks. And first, bless you for your work, because, you know, emergency room is an essential part of our system. And I'm sure you're seeing all of the symptoms of care. Everything kind of settles on the emergency department, so I understand what you're seeing. I'm not quite sure I agree with you about the remedy.

I took care of Medicaid patients mostly in my career. For the majority of the time, I saw kids. I don't really think the problem of abuse is as widespread as what Julie's referring to. But it - or let me put it this way. I think most people don't intend to abuse the service. They're following the logic. They're going where it's logical to go. If we strengthen primary care for Medicaid patients, if we develop medical homes for them and health homes, if they really have a better place to go, they'll go there. And I think that the symptoms that Julie's talking about are symptoms of the lack of proper structures of health care systems.

We have to be very careful with co-payment. A lot of Medicaid patients are very much on the edge, and that co-payment may be the thing that dissuades them from coming in to have a symptom treated in early stages. They get worse. They crash. And suddenly, they're worse off, and we're paying a lot more money. So, yes, of course there can be abuses. But I'm not sure I'd use co-payment as the mainstay. We need to build a stronger primary care system for Medicaid patients, better coordinated care. And we'll see costs fall and quality go up. And I think Julie's practice will make a lot more sense to her.

JULIE: Mm-hmm. Well, thank you very much. It just seems to me like, you know, as with any entitlement program, if you give something to someone for free and they have no personal investment in, you know, in terms of, you know, managing the cost of what you have given them, in terms of, you know, managing the cost of their benefit, they just have no incentive to do that. And I really think that, you know, if we're going to continue this program and not bankrupt our country further, we need to consider, you know, introducing some type of incentive to Medicaid patients, you know, (unintelligible) responsibility.

CONAN: Or, as Dr. Berwick suggested, perhaps an alternative, somewhere else to go. Julie, thanks very much for the call.

JULIE: Thank you.

CONAN: Let's see if we can go next to - this is Leslie, Leslie with us from Orlando.

LESLIE: Hi. I just want to say that I believe that CMS is doing a wonderful job in revolutionizing the health care delivery system in our country and providing leadership to the entire health care community. I have a question about the accountable care model. I know that the rules came out about a month and a half ago. And I just wanted to know what your plans were or what CMS' plans were to engage more providers into participating in the structure. I'm very motivated, but I know a lot of the providers that I service are apprehensive because they say they don't think it's going to work. And they also worry about the compensation structure. And I'm just interested to know - and one of the other things that I hear they're mentioning is monopoly, you know, or the potential for monopoly and the liability that comes with that.

BERWICK: Well, thanks, Leslie. First of all, your comment, CMS isn't alone, you know. A lot of the things that are going on in CMS are happening in the health care world - the greater health care world. And good example is ACOs, accountable care organizations. It would probably take the rest of our time for me to explain it in detail. But briefly, here's what's going on. Probably, most of us are better off when we're in systems of care that are coordinated - where one doctor talks to another doctor and they coordinate their work, when you go from the hospital to home, somebody to watch - got your back. You know, they're making sure that everything is in order. So we - I think I would argue we want to be in coordinated care. But when we pay for care in fragments, it's not coordinated, because everyone's just focused on what they do.

So the traditional way to deal with that in the past 30 or 40 years has been health maintenance organizations, HMOs, which can be good or can be bad. Those are coordinated care systems, but you're kind of locked into them. You have to go to that HMO, or it costs you more money to leave it, so that - that's one of the mainstays in coordination. A lot of people don't like that. Three out of four Medicaid beneficiaries don't want to be in a health plan. They want to go wherever they want.

The accountable care organization lets them do that. Providers of care, primary care providers can band together, say, with hospitals, and they say, OK. We'll watch where the patients go. And the patients that come to us, we'll coordinate their care, even though they still can go anywhere they want. And if the costs of their care fall, we get to share some of the savings. It's shared savings. The Medicare trust fund shares, the patient shares, and the provider shares. Of course, then you're worried. Well, are they going to skimp on care? Well, the answer is no, because under the Medicare rule, they're watched really, really closely, 33 different quality measures, a lot of reporting, a lot of special governance rules.

So it's a very interesting play for this country, to allow doctors to band together to form accountable care organizations. The patients still can choose to go anywhere they want, but the accountable care organization gets rewarded if the patient chooses to stay with them, and if the costs of care fall and the quality goes up. It's a terrific idea. We'll see if it works. I think it will, but it's a kind of national - it's a big national experiment right now, one that I think is very, very promising. That's what I'd want. I'd want coordinated care, but free choice.

CONAN: Leslie, thanks very much for the call. We're talking with Dr. Donald Berwick, just left as the head of the Centers for Medicaid and Medicare Services. You're listening to TALK OF THE NATION, from NPR News.

And we have this email from Judith in Grand Junction, Colorado: In another year, I'll be eligible for Medicare. I have a nearly phobic fear of becoming involved in that system. It's a fear of chaos. Currently, I have access to affordable indigent care from the State of Colorado. But when I turn 65, they're going to toss me into the Medicare pool. I'm terrified. Doctors hate Medicare patients. Save me.

(SOUNDBITE OF LAUGHTER)

BERWICK: Well, Judith, first of all, you're lucky to be in Grand Junction, Colorado. That's a really interesting town, where everyone's gotten together to make sure everybody has health care. It's a great story in America. I hope people study Grand Junction. Don't be scared, Judith. Medicare's system really is there for you. There are all sorts of terrific beneficiary support systems. Just try calling 1-800-MEDICARE. Just call the 1-800 number and see what kind of response you'll get. You'll find a person ready to help you and reach out to you. I think you're going to find it a good experience when you become a Medicare beneficiary.

Doctors do have some troubles with Medicare. Those are around payment, because Medicare payments are set according to certain rules, and doctors wish that they would pay more. And they're worried right now because under the law, there's an impending decrease in physician's payments. There's a pretty large - luckily, the president and Congress both seem committed to making sure that that dramatic cut in pay does not happen.

But, Judith, call back when you're in Medicare, because I think you're going to say it wasn't so bad after all. And after all, what happens to you is going to be much more determined by the health care system you're in, which is a good one in Grand Junction. And you're going to - and nothing's going to change. If you're in good care, you're going to stay in good care.

CONAN: If I could ask another question of politics: I wonder, from the standpoint of health care reform, what do you see at stake in this upcoming elections in 2012?

BERWICK: That's a big horse race, a big horse race. I mean, we all know the major American health care problem at the moment is cost. It's unsustainably costly, double the costs of other countries, rising much faster than the gross national product. So everyone, no matter what side of the aisle they're on, they're looking for ways to reduce cost. The race is between people who think the only way to cut cost is to cut care - that is, you know, to take things away from people, cut back on Medicaid, cut back on Medicare benefits and so on, which really scares me. I don't think that's a good idea. But we'll have to do it if we can't find another way to get costs under control.

My way, the way I think we can do it, the way I believe in is to improve care. That's what we've been talking about. If care were more seamless, if it was safer, if it was more - if it followed science more closely, if some of the administrative nonsense went away, if we really fight fraud and abuse. I mean, there's hundreds of billions of dollars of costs that could be reduced while patients get better off, and that's the race.

In the presidential election, if people win who say take away the affordable care and go back to the old way, I don't think that's a good plan. And if people win who say, cut back on care, I don't think that's a good plan, either. I think the winners ought to be people that say let's improve care, that that's way - make it more patient-centered. Put the patient in charge, really. Give them power. And I think we'll see things get better. But I don't know. I'm holding my breath.

CONAN: Doctor Berwick, thanks very much for your time today. And I hope you have a mostly fun time after this, too.

(SOUNDBITE OF LAUGHTER)

BERWICK: Thanks a lot, Neal. I'm sure I will.

CONAN: Donald Berwick, former administrator for the Centers for Medicare & Medicaid Services, with us today from member station WGBH in Boston.

Tomorrow, Political Junkie Ken Rudin's back with the latest on the Republican field contending for the country's top job. This is TALK OF THE NATION, from NPR News. I'm Neal Conan, in Washington.

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