What would Mayo do? 'Pay-for-value insurance, how to cover everybody' are chief goals of policy center

President Obama pointed again to Minnesota's Mayo Clinic during his press conference Wednesday as an example of what's working in the American health-care system.

Even though Mayo has been in the news for its reservations about reform legislation and the Medicare payment system, Obama said that he thought Mayo appeared to be on board with a proposed independent Medicare panel that will come up with recommendations on improving the system.

Obama continually has singled out the Rochester, Minn.-based system's high-quality care delivered for lower costs. "That's the whole idea behind Mayo — patient care is the No. 1 concern," the president said during questions from reporters.

Early Wednesday afternoon, before Obama's conference, MinnPost did a Q&A with Jeff Korsmo, director of Mayo's Health Policy Center, as part of our "Best hopes, worst fears for health reform" series with thought leaders.

'Very, very much in favor of health-care reform'
After reading recent media coverage about Mayo, Korsmo says in the Q&A that he wants to make it clear that Mayo favors health reform.

"The way the news media have covered us the last few weeks sometimes makes it sound like we're against reform," he said. "We're very, very much in favor of health-care reform. It has to be done. There are some good things that are in the legislation so far, and we're pushing hard on the points where we believe we haven't reached where we need to go and that's this pay-for-value insurance and how to cover everybody."

This post in the Health Policy Center's blog about the House's tri-partisan bill ended up getting a lot of media attention in recent days:

"In general, the proposals under discussion are not patient focused or results oriented. Lawmakers have failed to use a fundamental lever — a change in Medicare payment policy — to help drive necessary improvements in American health care. Unless legislators create payment systems that pay for good patient results at reasonable costs, the promise of transformation in American health care will wither. The real losers will be the citizens of the United States."

Mayo's CEO also signed an open letter (PDF) to Congress this week.

MinnPost: The Mayo Clinic has been in the news this week because of objections to some health-reform legislation in the House, and it has been singled out by President Obama for its approach to providing high-quality care for lower costs. As director of Mayo's Health Policy Center, what are your best hopes and worst fears for health-care reform?

Jeff Korsmo: Let me start out by saying we believe strongly that there needs to be health-care reform. The system is broken and is not serving our patients well. So, our hopes are that we'll have reform that is patient-centered, that improves access to health care for all Americans and that it is a system that encourages the highest value to be provided by those who deliver care for patients. In other words, the highest-value care is the best care, the best outcomes at a reasonable cost — that is our hope and that is the goal of the Mayo Health Policy Center.

MP: Your worst fears?

JK: Our worst fear is that it won't be that, that it won't be patient-centered. Mayo's primary value is that the patient comes first, and everything we do here is based on that. We've had that since 1910 as our primary value. So, it has to be patient-centered, meaning whatever it is it's got to be the best for the people who need the care and it's possible that legislation could end up not meeting that value. I think it's likely that legislation will improve access significantly, but if it didn't that would be a fear and then we would end up with legislation that does not change the way we provide incentives in the health care system, meaning that we really pay for the inverse of value today. Our fear would be that we would continue that model.

MP: I must admit to assuming that because Mayo Clinic is regarded as the Rolls-Royce of health care that its costs would be out of reach for many Americans. What's Mayo's big secret in offering high-quality care for less money?

JK: There are a number of factors that we think create the culture that results in high-value care, meaning high-quality, lower-cost care. First, we're guided by that primary value: The needs of the patient come first. Literally every decision we make around here has that front and center. So it's really patient-centeredness.

We are also an integrated organization, meaning that our hospitals and physicians are all part of the same organization. We don't have artificial boundaries between us. We all work together in teams focused on the patients. So, in almost all of our sites we have what we call an integrated medical center. We're committed to delivering care that is team-based, so teams of physicians, teams of nurses and physicians, pharmacists and home health care — that people from all across the care spectrum deliver care as a team to patients. We draw on everybody's best skills and we try to create a system where we remove as many disincentives to do those things.

All of our people are salaried. Nobody gets more money for doing more surgery or less money for doing less surgery. They're paid a salary, but there's no incentive to either protect the patient from being seen by somebody else or for doing more than is appropriate for them.

Since 1908, we've had a medical record that is called a single medical record or unit medical record (it's all electronic now). But it's a medical record where everybody who cares for the patient sees what everybody else is doing for the patient. So that transparency among those who deliver the care is a very good thing both for efficiency as well as kind of a peer review process so that people know that they're always capable … of seeing exactly what their assessments are, what their test ordering is. It's just a natural way to create the right kind of balance and focus on the patient.

MP: How can that be replicated elsewhere, and how difficult do you think it will be to get doctors, clinics, hospitals, insurers and the government to do things Mayo's way?

JK: It's taken many, many years for this to happen at Mayo. The Mayo brothers and the Franciscan sisters started it. It's not something you can just make happen overnight. But our goal should not necessarily be to try to create a whole bunch of organizations that are exactly like Mayo Clinic. It's rather to really understand which of those things I described to you drive the high-value health care.

We think they all do, but how do we provide the right incentives for organizations to be more patient-centered, to remove the wrong incentives to provide more care than is needed, to have the IT infrastructure to connect them? Those are the sorts of things that need to be done in order to create an organization that's really patient-centered, that's connected, that has removed the wrong incentive to do the wrong thing, and ultimately we think that probably more organizations or providers should come together into what our terminology calls "accountable health organizations" to really focus on the patients.

But there are examples of organizations in the country who have achieved some of these things and they are not even part of the same organization. There's a group in North Texas. There's a group we've heard of in California. There aren't a lot that we know of, but there are some that have managed to replicate some of the features without actually coming together as an organization.

I think it's going to be difficult to do that because it means a lot of change but if we put the right positive incentives and potentially adverse consequences in place so that people see it is in their best interest to truly focus on the patient, if that means they need to come together to do it, well maybe we can begin to make progress on that.

Again, I'll just say our goal is not to create more Mayo Clinics per se because people will challenge us on that. … "Well, you can't possibly create more Mayo Clinics." We say, "Well, you can create organizations that are patient-centered, that remove the strong incentives, that truly encourage the teamwork, and you don't have to become just like Mayo to do that." It will be a challenge.

MP: Why does Mayo think that an individual mandate is preferable to an employer mandate, or to a public option or even a national single-payer plan? How do you align a patient-centric approach with an individual mandate? What happens when people lose their jobs and cannot afford to keep up their health-insurance premiums?

JK: Well, the starting point is that the prerequisite in this country to having access to health care is to have health insurance. You can get care through emergency rooms or whatever, but if you don't have health insurance your odds of getting good health care are not very high. So, we believe everybody should have health insurance. Now, you can go a number of routes. I don't think the way you asked the question is the way to ask it. To me, an appropriate question is, "Why an individual mandate vs. a government mandate?"

The reason we said we would support an individual mandate is we really believe the right thing is for people to be able to take their insurance with them wherever they go. So, if they lose a job or they switch jobs to another employer, that they have the ability to take that insurance with them. Now if they lose their job and don't have income, then one of the things we've supported is a government role to provide sliding-scale subsidies for people who are not able to afford their health insurance. That would be a role for government.

We're not saying the employer shouldn't continue to provide the insurance. We're fine with employers continuing to provide insurance; it's just that the insurance should be portable with the individual and that people ought to be expected to have insurance coverage.

The public-plan issue is very different. You could have a public plan that is employer- based, or you could have a public plan that is government-based, or you could have a public plan that is individual-based. There isn't just one public plan. There are at least five different options thrown out there as potential public plans, and our position has been that a government-run, government price-controlled Medicare-like program is not the right solution; it's what's gotten us into the problem that we're in now.

But we also believe the [private] insurance system needs to be reformed. There are some things in some of the bills that are coming through that begin to do that, that remove things like pre-existing conditions from exclusion — we think those are positive things. The insurance system should be reformed and there are good steps out there, but our belief is we really think the role of government should be to provide sliding-scale subsidies to people who can't afford it and let people have access through a reformed private insurance system.

But if there's a desire to create another kind of option, we think something like the federal employee health-benefit plan or the cooperative sort of model that some people are putting out there — we think those rather than a Medicare-like approach are the right way to go. We don't support a single-payer model but there's currently not much discussion about that point.

MP: What if Medicare were reformed along the lines of your proposals of emphasizing outcome vs. volume?

JK: First of all, it's going to take significant time for Medicare to really be reformed. We can pass legislation, but it'll still take time to know if the legislation has taken effect and has had the desired impact. Second, we are concerned — reasonable people can differ with us — but we're concerned about too big of a government role in health-care insurance overall. The government, between Medicare and Medicaid and other programs, is already a very large chunk of the overall market and we think expanding that even more is probably not the right thing to do. Again, I know there are people who disagree with us.

But even if we think it would be very good and we obviously believe strongly that the Medicare system needs to be changed, we also believe that expanding the role of government even further than it is where it's today by some measures I've seen at least 40 percent of overall market, to make government an even bigger player, we don't think that's a good idea.

MP: Is there anything you would like to add that I didn't ask you?

JK: The way the news media have covered us the last few weeks sometimes makes it sound like we're against reform. We're very, very much in favor of health-care reform. It has to be done. There are some good things that are in the legislation so far, and we're pushing hard on the points where we believe we haven't reached where we need to go and that's this pay-for-value insurance and how to cover everybody. Those are the two main points that we're pushing hard on now.

There are a variety of ways to pay for value; there are a variety of ways to get there, and we're open to working with people on different ways of doing it. But we do strongly believe that the health-care system has to be reformed.

Casey Selix, a news editor and staff writer at MinnPost.com, can be reached at cselix[at]minnpost.com.