Health policy experts sound off on SOTU

With a short 54-minute State of the Union address Tuesday, President George W. Bush addressed a broad span of issues, including foreign affairs, national security, marriage and healthcare, kicking off his re-election campaign in the new year.

 

But for many healthcare experts at Duke, the president's message was not comprehensive.

 

"There was a lot of discussion of terrorism and the country's response to that," said Frank Sloan, J. Alex McMahon Professor of Health Policy and Management in the Fuqua School of Business and professor of economics. "That limited the amount he could say about other issues. He touched on healthcare so briefly that it was hard to follow."

 

With Bush's "piecemeal" proposals, including tax-free medical savings accounts and risk pooling for small businesses, Sloan found much of the plan lacking.

 

He noted that it was difficult to ascertain how much money Bush was committing to healthcare. "If he's not committing any resources, he won't do anything," Sloan said, adding that he was uncertain about the probability of change resulting from Bush's speech.

 

There has been evidence that medical savings accounts have not been very popular, so take-up rates are not likely to be high, he said. Furthermore, there are no barriers to risk pools in the market place, and states that have tried such plans have encountered difficulties.

 

Paul Vick, associate vice president of government relations for Duke University Health System, seconded Sloan's view of the State of the Union, adding that few proposals have been added since last year.

 

"Most of them dealt with insurance payment structures, and obviously if more people had more insurance, it would have a positive impact on the hospital, because we would see fewer uninsured patients," Vick said.

 

In 2003, DUHS provided $41.8 million in charity care and $87.2 million in uncompensated care, which is a significant share in a billion-dollar budget.

 

As the presidential election approaches, two major healthcare issues will be at the forefront of the campaign--the continued growth of the uninsured and the increasing costs of healthcare, said Dr. Kevin Schulman, professor of general internal medicine and director of the Center for Clinical and Genetic Economics.

 

"Will it be addressed before or after the election? That depends on how much pressure the president is under," Schulman said, although the chance of any further legislation being passed is minimal.

 

From a Republican perspective, emphasis will be placed on the plight of the underinsured--middle class and working class Americans who find their insurance covering fewer services and their out-of pockets continually increasing.

 

Many of the provisions of the landmark Medicare Prescription Drug Modernization Act, which Bush signed into law Dec. 8, will take effect in several years. Specifically, the prescription drug benefit--which will aid senior citizens in purchasing medications--will be in place in 2006. The bill also revised the fee-for-service payment system, which Vick said would have a positive financial impact on DUHS, although the prescription drug benefit will not have much of an effect.

 

Schulman said the bill will not affect Duke directly, in regards to the prescription drug benefit. However, because the federal government will be covering drugs, the hurdle to get payment will increase, he said.

 

"Medicare as a centralized payer may create high standards of evidence for determining which [drugs] are the preferred agents, potentially higher standards than in the market today," he said. While the private insurance market makes choices about therapies based on clinical results and rebates, the federal government will rely primarily on clinical and economic evidence.

 

The legislation thus reinforces the importance of having the Duke Clinical Research Institute review data from clinical trials, Schulman said.

 

"We've really got big questions before us," Sloan said. "Those questions were not addressed [Tuesday] night."