Alaska has unique health care challenges

COMPASS: Other points of view

July 20, 2011 

Alaskans are paying significantly more for health care this year.

However, Alaska's unique circumstances make it possible to break through barriers to real health care reform, to improve outcomes and to reduce overall costs.

This is possible due to Alaska's remoteness from the Lower 48 and geographic dispersion of its population. How do these Alaska factors help? 1. Geography justifies Alaska's creative use of new technologies and care models for which government and commercial insurance do not yet reimburse; 2. Insurance companies can't impose Lower 48 mechanisms that cut out profit margins necessary for innovation and investment in real reform; 3. Alaska can seek legitimate exemptions to federal regulation uninformed about Alaska's circumstances.

Let's review real reform that will reduce health care costs:

Construction, staffing and regulatory requirements make it significantly more expensive to get care in a hospital rather than in an outpatient setting. Yet many reimbursement rates have declined for outpatient procedures, resulting in the elimination of some outpatient services. This forces patients into an acute care setting that may charge three times that of an outpatient option. Solution: Incentivize development of more outpatient care options as technology proves quality is equal to or better than that in an acute care hospital.

Good health care availability means an Alaskan has access to primary and specialty care providers in the community where he or she lives. The challenge is 710,000 people spread across 570,380 square miles. A telemedicine infrastructure is essential. Why does it matter? Because expensive treatments and procedures as well as longer hospital stays follow delayed diagnosis. Research clearly shows faster treatment results in faster recovery reducing overall costs. But telemedicine is much less developed than technology allows. Why? Because reimbursement is practically nonexistent.

Reimbursement exists for remote monitoring of cardiac pacemakers and defibrillators. Telemedicine for heart rhythm abnormalities exists because it is reimbursed. Remote monitoring and diagnosis avoids the cost of more expensive procedures, increases quality of life and eliminates travel expenses. Solution: Expand telemedicine reimbursement.

Alaska Native Tribal Health Consortium has telemedicine capabilities. So, health care data roads exist; but, they are private. Why don't we joint-venture? Sharing is made difficult due to complex rules about for-profit use of subsidized data lines. Sharing data is another problem. Solution: Get exemptions for Alaska health care.

Alaskans know that Medicare price controls reduce access, not cost. Poor access delays diagnosis and increases costs. Fair reimbursement with incentives to coordinate care will reduce overall costs. Solution: Get an exemption to allow patients to pay the fee difference.

I came to Alaska as the CEO of a large medical group. Within the first six months I talked with CEOs of Alaska's largest hospitals about collaboration on an inpatient-outpatient plan to coordinate care. The good news is their willingness to collaborate.

Who will lead such an effort?

Alaska state employees and retirees are a large percentage of insured Alaskans. Add in Medicaid patients and the state has significant leverage to move the health care model in a new direction. The state also can influence the following:

• Get exemptions to Stark Laws that create barriers to collaboration between hospitals, physicians, suppliers and buyers.

• Insert individual responsibility into health care insurance like other insurance types. (e.g. auto, life)

• Re-evaluate regulation and its heavy cost to health care. Research indicates no improvement in health care outcomes with increasing regulation. Only costs increase.

• Re-evaluate scope of practice guidelines. These guidelines are not updated with new technologies that allow quality work to be performed by lower cost staff.

• Maintain profit margins in order to allow for investment in care models and technology that reduce overall cost.

Real health care reform must meet Alaska's unique circumstances. Managed care and hospital/physician consolidation are not solutions that will satisfy Alaska's unique needs. Who will collaborate in Alaska solutions? Hospitals have expressed willingness to participate, physicians want to avoid federal mandates that might be imposed upon them and insurance companies will support solutions that reduce costs and maintain profit margins.

Alaska must seek real solutions for real Alaska circumstances. Who will lead?


Brent A. Fisher is a fellow in the American College of Healthcare Executives, a fellow in the American College of Medical Practice Executives, and an assistant clinical professor at Loma Linda University-Health Policy & Management. Email, bafisher@byu.net.

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