Since the Patient Protection and Affordable Care Act (PPACA) was upheld by the Supreme Court at the end of June, there has been a great deal of concern as to how academic medical centers and other health care providers, as well as insurance carriers and consumers, will be affected. It is a complex issue, to be sure, but the fact remains that health care is expected to reach nearly 20 percent of the gross domestic product by 2019. As a nation, we spend nearly $8,000/patient, which is almost double the next highest country—much of this because of the high cost of wages, absence of value-based insurance co-payments, failure to do the right thing for patients and only the right thing, and our appetite across society to spend heavily on hopeless end-of-life care. We know something needs to be done to fix our health care system.
What is the value proposition for academic medical centers? While we make up only six percent of total health care providers in the country, we deliver 20 percent of the care, 30 percent of Medicaid care, and 40 percent of charity care. Studies also suggest research-intensive medical centers generate nearly all the basic science and translational research, leading to 44 percent of modern-day innovation. So it’s not a stretch to say we are an important piece of the health care environment. But we, like everyone else, are facing pressure from the federal government to do more with less, or as I prefer to view it, achieve efficiencies and more productivity with the resources we have.
One reason Northwestern Medicine® is on the list of top-tier academic medical centers is because we are good at adapting to our changing environment, which we have done again and again over the years. Although no one knows the full impact yet of the Affordable Care Act, we know we will adjust to whatever happens.
In many respects, the main pressure point for us will be the competition for resources. With downward pressure on growth of spending by the federal government, both health care reimbursements and research funding are under stress. Add to that the enormous cost of implementing and operating the Affordable Care Act. While implementation seems inevitable, some of these costs are competing for dollars that could go to support fundamental research to understand and improve human health before we get sick.
The fact is, even if health care was free today, we would still have many common diseases creating morbidity and taking lives. As a country, it’s imperative we strike the right balance in resource allocation. We have been in this spot before and when we solve this part of the equation, everyone will benefit.
With warm regards,
Eric G. Neilson, MD
Vice President for Medical Affairs and
Lewis Landsberg Dean