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Implementing Health Care Reform 'No Simple Task'

Health care economist Michael Chernew discusses the challenges ahead following the Supreme Court decision. 

The United States Supreme Court today broadly upheld the constitutionality of the Affordable Care Act, the 2010 health care reform law.

The American health care system has been strained in recent years by rising costs, and the trajectory of the growth of those costs, both in the public and private sectors, has been widely seen as unsustainable.

“The Affordable Care Act, as upheld by the Supreme Court, provides a basic framework for reforming the health care system,” said HMS professor of health care policy Michael Chernew in a phone interview. “The challenge for the nation now is to make that vision a reality, which is by no means a simple task.”

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Chernew shared his reactions to the ruling and his thoughts on how it will affect ongoing efforts to reshape the health care delivery system and the insurance industry in the United States.

 HM News: How is the world different after this ruling?

Chernew: The main thing that’s changed is the uncertainty about what the ruling would be. The policy that was passed in 2010 basically remains intact. The challenge the nation faces now is to implement the ACA and its provisions to the best of our ability.

HM News: Is this an end to the debate around the role of federal government in health care?

Chernew: It’s close to an end to the debate about what the federal government is allowed to do in health care, but no court case is ever going to settle the question of what the government should do.

HM News: What is the most important next step?

Chernew: The Affordable Care Act lays out a blueprint for how to go forward.  Now, the job will be to execute on that vision.

There still remain all the challenges about how the health care delivery system will be able to transform, how we can make individual subsidy programs work, how the state exchanges will operate, and frankly, the entire thing is intricately related to the entire picture of the federal budget.

HM News: How so?

Chernew: While the ACA did save money, it did so by taking a lot of money out of Medicare—money that otherwise might have been used for deficit reduction—and by raising certain types of taxes.

HM News: Is the ACA on its own enough to make the health care system financially sustainable?

Chernew: No, but outside of the ACA there's tremendous innovation happening in the private sector, things like the affordable quality contract here in Massachusetts, and other alternative payment plans, and widespread advances in the ways that providers are using data to manage people with chronic disease.

The private sector is working feverishly to try to address what is universally seen as a serious problem. The health care spending trajectory that we've been on for the past 30 years won't be the trajectory we're on for the next 30 years—we simply can’t sustain it.

We just don't know what set of initiatives will get us off that trajectory.

HM News: What role will health care providers play in this transformation?

Chernew: Providers are under tremendous pressure to improve the efficiency of care. They’re changing the way they relate to one another and to the organizations they work with. They’re innovating with new technology and completely rethinking their business practices.

It's a time of great change, with or without the Affordable Care Act. It’s crucial that we get this right, not just for the health of Americans, but also for the overall global economy.

This is a basic reflection of the fundamental problem that humans get sick and don't like it. We want to provide care for everybody, but we don't want to pay all that much.

How you design a system that works in an efficient way, in a moral way, that harnesses the decision making and autonomy of patients and markets, is a hard thing to do.

This is a topic that, either way, will be with us for a while.

Michael E. Chernew, is a member of the Medicare Payment Advisory Commission (MedPAC), which is an independent agency established to advise the U.S. Congress on issues affecting the Medicare program.  He is also a member of the Congressional Budget Office’s Panel of Health Advisors, the Institute of Medicine’s Committee on Determination of Essential Health Benefits, and The Commonwealth Foundation’s Commission on a High Performance Health Care System.