Exec's home | News | Site map | E-mail "Business Models for Quality Health Care" Keynote address by King County Executive Ron Sims to Seattle's National Survey of Employer-Sponsored Health Plans 2003 Seminar March 11, 2004 Olympic Fairmont Hotel, Seattle March 11, 2004 — King County Executive Ron Sims called on private and public sector leaders to embrace a far-reaching "business model for quality" to control the spiraling costs of health care in the state. Sims was the keynote speaker at a seminar on employer sponsored health plans put on by Mercer Human Resources Consulting in Seattle. Sims created the Health Advisory Task Force made up of innovators from medicine, academia, government, and the private sector who, under Sims' leadership, are developing cutting edge strategies to address the health care crisis, improve quality and produce significant savings. We face a crisis in health care and I see it from three vantage points: A consumer A purchaser A provider There is no silver bullet or magic pill – but something has to be done. The health of our families, the financial viability of government and business, and the medical and economic well being of our region depends on our collective actions. If we do nothing, at King County we are: Predicting a 15% annual cost increase for each of the next 5 years A doubling of the cost for health care for our employees during that period Costs escalating from $124 million in 2003 to $249 million in 2008. This is not a sustainable scenario for the financial health of King County. To the extent these cost trends King County is facing mirror what others are confronting, skyrocketing health care costs hits everyone in this room and in this region. But I refuse to accept that the only strategy is to dump the increasing costs all on employees or slash benefits. I know there are major employers and small shopkeepers out there who share my view. We can do better than that… We live in a region with tremendously skilled and caring physicians. We have one of the world’s finest medical schools right on the shores of the Montlake Cut. We have wonderful hospitals and staff nearby to provide first class care. As a region, we have the creativity and ability to tackle virtually any problem and find a solution. Health care should be no exception to the awesome problem-solving skills of our people. Now is the time for bold, innovative strategies that demonstrate we can deliver high-quality care and manage the cost of providing it. I will not accept anything less. And neither should you. Much of today’s discussion over health care centers on three factors: Normal market forces don’t work in the health care arena. Costs are overwhelmingly driven by chronic ailments and catastrophic events. And perhaps nearly a third of what is spent on health care doesn’t improve quality of care or extend life. For most employers, health care coverage is: Like giving the employee an unlimited credit card, Telling them to get whatever they need, and Neither the employee nor the employer pay much attention to the individual cost of services and medicine. The employee doesn’t really have the information on costs, quality and options to “shop” for the best deal. The provider is paid by the volume of patients treated – not for disease prevention or disease management. And the employer seemingly has no power over the quality, effectiveness or appropriateness of the care – you just pay the bill. It isn’t the routine doctor’s visit that threatens to bankrupt our health care system. The big drivers are chronic conditions, like diabetes, or catastrophic events, like a massive heart attack. Consider a couple figures: 15% of King County’s covered employees or families account for 70% of our total cost of care. Nationally, 1% of those covered cost 30% of what’s spent on health care because of chronic problems or that terrible unexpected event. Then there is the overuse, under use or misuse of various procedures and medicines. The Dartmouth Center for Evaluative Clinical Science and the Institute of Medicine indicate that 20% to 30% of health care spending goes for procedures, visits, drugs, hospitalizations and treatments that do not improve quality or extend life. These numbers, taken together, create a grim scenario for the future delivery and access of health care for all Americans. We cannot – and must not – become a society with health care available only on the basis of the size of your wallet. We can provide high-quality care and manage costs by pursuing a three-part strategy. I call it the triple “E” strategy: Educate Empower Evaluate First, we want to educate employees and provide them with the tools and information so they can invest their health care dollars wisely based on quality, cost, proven effectiveness and value. Second, we need to empower patients and physician providers to focus on wellness, prevention, disease management and active participation. Third, we need to evaluate health care provided based on evidence of effectiveness, safety and appropriateness of the treatment and medicine. We are already implementing this strategy within King County government through a Collaborative Labor-Management program: We’re educating employees about the personal impact of escalating costs. We’re educating employees about opportunities they have to affect their personal health and overall health care costs. We’re empowering patients and physicians with tools to help them make shared decisions on the most effective ways to manage wellness and chronic conditions. We’re empowering patients and their families with information that helps them know who in the community provides high-quality, cost-effective services. We’re evaluating and creating plans that provide incentives to reward employees for pro-actively managing their health and, in turn, health care costs. And, we’re evaluating best-in-class health promotion programs, ways to reduce risky behavior, and how to weigh outcomes in successful disease management. I want all our unions, employees, management and their families to permanently change the way we think and act on health and health care. It cannot end there. And the King County Health Advisory Task Force is driving us toward an innovative and achievable set of strategies that can improve the quality of care while easing the ever-escalating costs of health care in Puget Sound. The Task Force consists of physicians, health care policy and program experts and folks from other major self-insured employers in our region. Here are just some of the Task Force’s preliminary recommendations for designing a county plan: Develop an evidence-based set of standards for treatment built on proven effectiveness of treatment. Provide physicians up-to-date, easily accessible information on best practices for treating a wide range of conditions. Provide consistent, accurate, meaningful and clear information to patients so they can be well-informed health care consumers and a partner in their health care. Establish measurements to continuously monitor effectiveness of treatment, actual costs, cost variations, and outcomes in care that promote health while controlling costs. But the Task Force knows that the greatest opportunity for King County to succeed is to partner with others in the public and private sectors. In fact, one of the profound messages of this task force is that there is a business model for quality—and the way to implement this model is through a regional public/private partnership. There is a business model because we now know that the only way to make health care available, affordable and safe for all members of our community is by following the lead of the medical community and investing in systems that improve the quality of care. A regional partnership makes simple dollars and cents. By pooling our health care purchasing power with others, we gain leverage to help develop high quality, patient-centered care. By pooling resources, we can achieve two goals that might appear in opposition to each other: High quality care delivered more effectively Greater control of costs by focusing on preventive care, proven treatment regimes, and eliminating wasted or unnecessary costs. How does this happen? By developing standards for proven treatment methods, and educating physicians and patients alike, we make sure the most effective treatment is delivered first. And we can provide incentives to change behavior instead of trying regulate every thing and everyone. For example, if two drugs are equally effective – but one costs $100 a pill and is heavily marketed versus one that costs $2 a pill – why not give the patient a financial incentive to pick the cheaper but equally effective medicine? Reforming our health care delivery system won’t be easy. It won’t slash the cost of care; only slow the rate of increase. It won’t work if we’re all not willing to work together. But I know this region can work together. We have a proud history of working together to solve tough problems – from the clean up of Lake Washington to creation of Forward Thrust for regional parks to the recent success in winning final assembly of the newest Boeing jet. As a consumer, purchaser and provider of health care, we simply cannot afford the status quo. We must change the dynamics or be swamped by soaring costs. So timing and events are merging to make this an exciting possibility. We have a chance to make this a national model for quality, efficient, and effective health care. Let me leave you with one more reason to do this. I love this region. I don’t want to live anywhere else. We are a remarkable people. Out there right now is someone working on a cure for cancer, for HIV/AIDS. We have changed how the world travels and communicates. We can change how quality health care is delivered. We can do it with our collective innovation and skills. Health care may not be a constitutional right, but it is a moral one. Let us be the region that took on health care, created innovative solutions, and extended a caring hand to each and every one of us. Let us be a forth E…Extraordinary! That seems a goal worthy of our time and talent. Related information: Health Advisory Task Force Web site Updated: March 17, 2004 Executive's home | Executive's news Executive's schedule | Executive's e-mail King County | Executive | News | Services | Comments | Search Links to external sites do not constitute endorsements by King County. By visiting this and other King County web pages, you expressly agree to be bound by terms and conditions of the site. The details.