Michael Leavitt, the former Utah governor and federal government official tapped by Mitt Romney to head his healthcare transition team, has been under conservative fire for embracing some aspects of the Affordable Care Act such as health insurance exchanges.
But speaking at the closing session of the Third National ACO Summit in Washington, D.C., last week, Leavitt was quick to align himself with the free market powers of the healthcare system. Along the way he provided some insight into how a Romney administration might tackle healthcare reform.
Leavitt said the engine that is driving healthcare reform now isn't the Affordable Care Act, the upcoming Supreme Court decision, or even the outcome of the 2012 election. "The real driver is what I call global economic dispassion—the economic forces that are making this an absolute imperative. Health reform has become economic reform."
To meet this global economic dispassion "we have to be able to move more quickly," said Levitt.
He said that when people think about the American healthcare system they talk about "a race car that can go 200 miles an hour" but government is "still building a go-cart."
Leavitt offered the development of accountable care organizations as an example. "The ACO movement is a process. It wasn't initiated by legislation. It's been spontaneously developing for a long time."
His firm, Leavitt Partners, a Salt Lake City, UT–based healthcare intelligence business, has identified 221 ACOs across the country of which more than 73% are commercially affiliated. "This is a movement that's being powered outside of government payers. Activities I have observed in the ACO movement demonstrate to me that government payers are relatively slow innovators. I have fond memories if my time at HHS, but it is just the nature of government that it has a difficult time being an effective innovator. It's very good at powering innovation once it gets behind it, but it's not a particularly robust innovator itself."
Leavitt leveled some pointed criticism at the Center for Medicare & Medicaid Services. "I think CMS can be a helpful backer of innovation but there's evidence in the way CMS is going about it that there are times when it oversteps its appropriate role in this movement." He added that "it seems unproductive for CMS to be heavily involved in dictating how groups govern themselves. It would be a better role for CMS to help create performance criteria."
CMS's formal rules process makes "it very difficult to quickly innovate, Leavitt suggested. If you're going to get from a go-cart to a race car, you're going to go through a lot of iterations. You have to be able to experiment, refine, and figure out the different ways to do it."
Like the airline industry, Leavitt suggested that the healthcare industry needs an environment where it can balance competition with its need to cooperate and form networks. "There are barriers right now. We need to sort through the anti-trust burdens. It needs to be done before something breaks."
As for his support of health insurance exchanges, Leavitt noted that they will help increase small group and individual purchasing power in the health insurance market but "I passionately believe they [HIEs] should be market-oriented not active purchasers."
Instead of the federal subsidies and the mandated benefits of the Affordable Care Act, Leavitt sees employers shifting from the defined benefit health insurance model to defined contributions where the exchanges would be portals where employees could shop for their own benefit coverage.
"We need to be less prescriptive and more empowering," said Leavitt.
Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
