The CEO of one of the nation’s largest health insurers said Tuesday, October 21, that health care reform must include an individual mandate to purchase health insurance.
Speaking to the Detroit Economic Club, Aetna Inc. CEO Ron Williams said he was optimistic that the next president would develop policies that would reduce the number of uninsured people, now estimated at 45.7 million, and also address quality and rising costs.
“There ought to be an individual coverage requirement,” said Williams, who became Aetna’s CEO in February 2006 after serving as chief of health operations since 2001.
“Some people can afford health insurance and choose not to be covered,” he said. “Others should get a tax subsidy or credits to purchase insurance.”
Williams estimated that 9 million of the uninsured are people who earn more than $75,000 annually. An additional 4.7 million of the uninsured are college students.
“We know where to find them,” he said.
Health care costs and quality can be better controlled if more people are insured, Williams said. Aetna insures about 17.5 million medical members, many of whom work for Fortune 100 companies, and had 2007 revenue of $27.6 billion.
“Insurance works best when there is a balanced distribution of people in a risk pool—the healthy and those who need [medical] services,” Williams said.
Under Aetna’s private-public approach to health care reform, Williams listed five other necessary steps:
● Increase enrollment of eligible people in Medicaid and the State Children’s Health Insurance Program. An estimated 9 million to 10 million adults and children nationally are eligible for Medicaid or the children’s program, but are not signed up.
● Revolutionize health information technology to enable patients, doctors, hospitals, insurers and government to share medical information. Sharing information can improve quality and reduce duplicative tests.
● Increase quality. Research should be conducted to further develop best practices and guidelines for doctors to reduce variability in health care delivery. For example, there should be little differences in outcomes and costs for the same procedure conducted in San Francisco or in Miami.
● Use the tax system to encourage people to purchase health insurance policies.
● Group individuals and small businesses into new risk pools—affordable health groups—to reduce costs in what traditionally has been the highest priced market.
“If we can collaborate, we can reach solutions to these problems,” Williams said. “There is no silver bullet. We want to be a part of the solution, not the problem.”
In a 20-minute question-and-answer session, Williams also made the following points:
● Republican John McCain’s health care reform plan has some good elements. However, McCain’s plan with its tax incentives would encourage a weakening of the employer-sponsored health insurance system, the backbone of the market. “What is good is that he encourages personal responsibility,” he said.
● Canada’s government-run system also has some good points. However, Canada has fewer people than California, and that system cannot be replicated in the U.S. “I don’t want to offend any Canadians in the audience, but they have a safety net called the United States,” Williams said. “If they can’t get [timely] care, they come across the border for it.”
Filed by Jay Greene of Crain’s Detroit Business, a sister publication of Workforce Management.
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