Former UnitedHealth exec Lois Quam supports public option

Though No. 1 insurer UnitedHealth Group has lobbied hard against a public option and is heavily influencing the health-care reform debate, former division executive Lois Quam says a public option "makes a lot of sense" and has a place in reform efforts.

Quam, who left the Minnetonka-based behemoth in 2007 after an 18-year stretch, chaired the commission that created MinnesotaCare, the insurance program for low-income residents. She also served on the Clinton administration's health reform task force in 1993. And, as president and CEO of for-profit UnitedHealth's public and senior markets division, she says she saw firsthand how Medicare and MinnesotaCare have "worked well" as public options. Her support for expanded access to health care dates to her teen years.

"I was with a woman in Becker County last week who talked about how important MinnesotaCare has been to her family," Quam says in a Q&A with me. "And I hear from people, age 61, 62, 63, who really wish they were 65 and they could get into Medicare. The very reason Medicare was created in the '60s, of course, was that the private health insurance market wasn't offering affordable coverage to seniors. So I think a public plan makes a lot of sense, and I would like to see that as a part of eventual health-care reform."

Quam now runs Tysvar, a privately held incubator focused on health-care reform and the new green economy. Between her stint at UnitedHealth and founding Tysvar (named after her grandfather's hometown in Norway), she worked at Piper Jaffray as head of strategic investments, green economy and health. In 2006, Fortune magazine named her as one of America's "50 Most Powerful Women."

Her support for a public option came in response to the last question I typically ask a thought leader for the "best hopes, worst fears" series: "Anything else you want to tell me that I haven't asked you?" The conversation couldn't stop there, of course.

She also compares and contrasts the health-reform efforts of 1993 and now. And she comments on an Aug. 6 BusinessWeek article titled, "How UnitedHealth and rival carriers, maneuvering behind the scenes in Washington, shaped health-care reform for their own benefit."
 
Quam and her husband, Matt Entenza, a gubernatorial candidate in 2010, live in St. Paul with their three sons.
 
MINNPOST: What are your best hopes and worst fears for health-care reform?

LOIS QUAM: My best hope is that a broad health-care reform bill will be passed later this year and that the bill will provide coverage for every American and that it will control health care costs for all Americans in a way that improves the quality of care. Extending coverage has been a goal that has been important to me for my whole life. I'm from Marshall, Minnesota, and when I was growing up I had asthma. My father's a Lutheran minister so we had health insurance coverage (though it had a high deductible), and that meant I got to go to a specialist in the cities that really turned things around me.

So by the time I came out of high school, expanding health care access was central to what I hoped could be a part of achieving in my life. Now I have three sons — one in college, two who are seniors in high school — and I think about their future. … You hear so many parents say their kids are going to have trouble getting health insurance when they get into the work force, and that was really on my mind when I was the chair of the Minnesota Health Care Access Commission.

I was appointed chair the week my oldest son was born. So that's my best hope — that we get this started. Another opportunity like this to reform health care might not come along again for a while, and we should see it through.

My worst fear is nothing will get done and that it will in fact further delay further improvement. As a result, we will see more insecurity for more families and it will make it more difficult for us to come out of the recession — both because it's really difficult for individuals as they look for work and it's really difficult for American companies now to compete with companies from other countries because the difference in health-care costs is so great.

This situation is much more severe than it was in '93 [during the Clinton reform effort] and it will not improve on its own.
 
MP: Based on the perspectives gained in each of your distinct roles, what will it take to achieve universal health coverage in the United States?

LQ: First, it will be important to have an effective public discussion about why health-care reform is important and the key steps that are required to achieve it. When I chaired the Health Care Access Commission [starting in 1989], I traveled around the state talking about the challenges that were faced in Minnesota because of high health-care costs or not having health insurance coverage and then later traveled around state outlining the key principles around a solution.

Two memories stand out: One is when I was driving between Worthington and Luverne and I heard rural radio stations talking about the commission report and how it made sense to them, and I thought that was so important. And then the outcome: Two-thirds of the members of the Minnesota House and Senate signed on as co-authors to the legislation that came from the commission. So I think that was really important.

Health care is by nature complex. It's important, despite that complexity, to put in very human terms why it's important and what it means. So, then I had the experience of working in Washington and that was a much more difficult setting to have a discussion. It's more heated. It's more complicated. There's less of a chance to sit down with people. That kind of shared sense of what we were trying to do didn't emerge in that process.

As I compare what's happening now to then in terms of the discussion, the encouraging piece is that there's been more collaboration between the White House and Congress and lots of different organizations around the discussion than in '93.

I think the difficult and disappointing thing is the tone of these town hall meetings that I frankly find disturbing. Good people can come to different conclusions with the same set of facts, and I think our strength as a country is when we use that as a basis for discussion to try to come up with something better. You can't do that if you're just trying to shout people down. Certainly in '93, there were sharp and heated discussions but there is much less respect and civility in these town hall meetings than anything I saw in town hall meetings in '93. I think that's very disturbing.

What I learned in working in insurance was first of all that health care is so deeply personal. Health care is about saving lives. Health care is about helping someone recover from a difficult illness or an accident and doing it in a way that families have financial security.

I just saw over and over again the opportunity to provide people with better care and to do it in a way that meant that they were able to not only get well but they could get well even if they were in the hospital for a while and could not work. They could do that and not get in financial trouble. I learned that especially because I had the opportunity to work with low-income families who get coverage through Medicaid. I worked with Medicare beneficiaries around the country and I worked with organizations like AARP who represent them.

What you're always taken back to in those settings is that in the end, this is about an individual family where something has gone wrong, someone's been in a car accident; someone just got a diagnosis of cancer. And it's about all the joys of having a new baby and all the sniffles and ear infections of a young child. …

The challenge that I saw year after year as health-care costs went up was the challenge that everybody experiences. As costs have gone up, it has been very tough for anybody to afford it whether that's a family or a company or a state or the Medicare program as a whole. So I think our challenge now is to cover everybody and be able to do it in a way that offers lower costs and lowers those costs in a way that improves care. I know that's hard, but from my experience, I don't think it's too hard to accomplish.

This is a great country that has done much harder things. I just have tremendous confidence that we can find a way to help everybody with health-care costs and provide coverage to everybody.

MP: Members of Congress have been sent home with talking points; the protests are taking over town halls, the spin machines are switched to full blast. President Obama has launched a website to counter the misinformation. Does it sound a little like déjà vu to you? Could you share some insights from the Clinton effort which might come in handy now?

LQ: Three things: The first is the problems in health care are much more apparent today than they were in '93. There are very few people with insurance coverage who aren't worried about their insurance coverage, and they're worried because their premiums have gone up year over year — way more than their hourly wages or their salaries have gone up. They have higher deductibles and they're not sure if their insurance is really going to be there for them if something happens. Will it be hard to use? Will there be a pre-existing condition thing that will stop them from being able to use it?

So, you see an awful lot of people who have insurance feel very insecure about it, to say nothing of the fact that so many people are losing their jobs or have lost their jobs and with that lose their insurance coverage. I talked to a friend who got laid off yesterday and her husband got laid off a year ago, so she's been providing the health insurance coverage. They're offering her a consulting role so she might get some income but how do you get coverage? Thankfully, there's COBRA in some options but those are expensive and they don't go on forever.

In '93 we heard from a lot of people who had health insurance coverage that they felt pretty good about it and they were pretty happy about keeping it. They were worried about people who were uninsured but they didn't really identify with them. Now, the people who don't have health insurance and a lot of people who do have health insurance feel pretty much like they're in the same camp.

The second thing that's really positive about this year is the broad range of discussion [between the White House, Congress and organizations]. I think that kind of discussion and collaboration is positive. It doesn't mean everybody's going to agree on every point but it's respectful, and I think sometimes in those respectful disagreements, you come out with a better solution. That is the function of a democracy, and I think there have been elements that have worked very well in this process.

In '93, the White House worked very hard to develop a plan. It talked to members of Congress and different people, but it was the White House doing it and touching base versus this much more collaborative process.

The third thing — the thing that is the big difference — is the tone. This kind of tone we're seeing in August I just never saw [in 1993]. I was certainly in some heated town hall meetings. I remember one in Montana in particular where many, many more came to the high school auditorium than there was space for, but there was a tone of respect and politeness. People acted in ways that I think we would all be proud of most of the time.

I'm actually really disturbed to see what's happening at these town hall meetings. I think that it is not good for the country. I think the tone started in some of the rallies that Sarah Palin had, and I don't think it's a healthy tone. I think it's very important that there is respect and civility and politeness in these discussions, and then we'll get to a better solution.

MP: Critics have said that the Clinton reform effort failed because the administration didn't get early buy-in from key industry players. Even though President Obama has won concessions from various players like Big Pharma, he's struggling to gain control of the overhaul. Even Harry and Louise, the couple in the ad often credited for killing the Clinton plan, have had a change of heart about health-care reform. Are there any misconceptions about the Clinton effort that you'd like to clear up, and what could Obama and Congress do to regain their footing?

LQ: There was a lot of touching base during the development of the Clinton plan, but there was a process that was more centralized in the White House. There's no question about that in the current effort. I think that people voted for Obama with an expectation that he would be good at reaching out to people he agreed with and people he didn't agree with, and I think he has done that in this process. In this country, I think that's very important: Our best ideas come from respectful disagreement and then coming up with a better solution.

I think the president and members of Congress should act as leaders in this situation and should call on people to have a respectful debate. They should seek the best ideas, they should be open-minded about incorporating those ideas into their current thinking, and they should call people to a respectful discussion. Then I think they should work toward pulling together a piece of legislation that's passed and signed into law, and then the hard work of implementation can begin.

MP: In your travels overseas, which country's health-care model has impressed you the most and which, if any, could work in the United States?

LQ: I think we need an American health-care system and we do not need to borrow any other country's system. Every country has a health-care system that has some good things and difficult things about it. But I think we have the opportunity in this country to create the best health-care system in the world.

Here in Minnesota, you look at what has been created at the Mayo Clinic. I think it is the best innovation in rural health care that has ever been developed. If the whole country provided health care coverage like the Mayo Clinic did, Medicare would cost about a third less. I think Mayo is where we all love to go. We have a fantastic resource in Hennepin County Medical Center. It's a hospital that serves low-income families. It's a hospital that does absolutely top-quality health care. I think we should develop our own system, and our goal should be to be the best in the world and a beacon and a model for other countries.

MP: What would that system look like to you?

LQ: I think it would have coverage for everybody. I think that it would have built-in ways to better reward the best doctors and hospitals and health care. I get frustrated that at times places like the Mayo Clinic aren't rewarded for providing better quality of care. Sometimes the way systems work, Medicare and otherwise, places like Mayo are disadvantaged for doing the right things. So I think we should cover everybody then develop ways that we pay and deliver that reward the best quality of care and in doing so consistently find ways to make health-care costs less for everybody.

MP: Any ideas about how that would happen?

LQ: We've got a lot of building blocks in place. If you look at the ideas Mayo has come up with for Medicare, they've developed an interesting road map. I think members of the House had a very good discussion on how to make sure places like Minnesota aren't penalized in Medicare for having lower medical costs than Florida, and that's a good one.

I think Evercare, which is a program I was involved in when I was at United and was developed by group of nurses at the old Bethesda hospital, has done a very good job with how nurse practitioners deliver care to the frailest Medicare beneficiaries and as a result of that, cutting their hospital visits in half because they're healthier. So I think we've got those building blocks and they need to be part of a system. I think everybody needs the security of being covered in that system regardless of what happens to their job.

MP: What, if any, concerns do you have about the individual mandate becoming a key route to universal coverage? There has been some talk in the Senate of backing off of an employer mandate.

LQ: The discussion about an individual mandate has occurred because of the changing nature of work. People change jobs much more frequently than they did 20 or 30 years ago, so the employer-based model doesn't work as well as it once did. That said, people who have employer coverage that works well for them should keep it. The key to making both individual and employer-based coverage affordable and sustainable is to improve the quality of care and make the entire health-care system more cost-efficient.

MP: Is there an idea you have that hasn't really been discussed much that might work?

LQ: I am really interested in developing a way that places like the Mayo Clinic and Hennepin County Medical Center, which are just spectacular, can be leaders in Medicare and the new health-care reform in a way that gives them more of an image…and that gives them the opportunity to train and coach other kinds of health-care organizations around the country so that they can do a better job.

MP: If I don't ask this question, I'm pretty sure some MinnPost readers will raise the issue in the comments section. So, I'd like to give you an opportunity to address it in our interview. A BusinessWeek story mentions that UnitedHealth was forced to stop selling "limited benefit" plans with capped payouts through AARP last year. Sen. Charles Grassley of Iowa found that UnitedHealth "paid as little as $5,000 toward surgery costing several times as much." Were these plans designed during your tenure at UnitedHealth's Ovations division, and what was the thinking behind them? Anything you'd do differently?

LQ: Thank you.

The plans that were referenced were designed prior to Ovations working with AARP, and I left United over two years ago. So, I wasn't there during the period that was referenced in the article.

The plans were designed before Ovations participated in them. Prudential had operated the AARP plans and had developed them, and then the contract was transferred from Prudential to Ovations by AARP. So, that's how that worked. With regard to the discussions with Grassley, they occurred after I left.

MP: Would you have been able to do anything about them as head of Ovations?

LQ: When I was at Ovations, I worked very hard to try to make a difference on everything I was a part of. Because I left United over two years ago, I don't know what the specific issues that were raised were or how they have been handled after my departure.

MP: Anything else you want to tell me that I haven't asked you?

LQ: In the current debate, one of the sharpest discussion points has been whether there should be a public option or not. This is a different discussion than occurred in '93, but it has been one of the heated parts of the town hall meetings. I support a public option because I feel that it has worked well within the current Medicare program. And, as you know, I played a key role in creating MinnesotaCare and that public option has worked well, too.

I was with a woman in Becker County last week who talked about how important MinnesotaCare has been to her family. And I hear from people, age 61, 62, 63, who really wish they were 65 and they could get into Medicare. The very reason Medicare was created in the '60s, of course, was that the private health insurance market wasn't offering affordable coverage to seniors. So I think a public plan makes a lot of sense, and I would like to see that as a part of eventual health-care reform.

MP: Why do you think there's so much resistance to a public option?

LQ: I don't know. Medicare is so popular and it's a public option and it has worked well. Here in Minnesota, MinnesotaCare is popular and it has worked well, so I don't really understand that [resistance]. I think that sometimes people will say, "Well, we don't think the way that Medicare pays doctors is the best way." I think it's a very good idea to develop better ways than Medicare has to reward providers for high-quality care. But I think what a public plan does is provide a kind of security for people and builds on the success in these other areas.

MP: Do you think it's more scare tactics at work?

LQ: I think there is an element of that because when you step back and you ask people whether they like their Medicare, sure people can think of things that might be a little bit different or better, but people like Medicare as a public option. When I'm in discussions, I constantly hear from people who say how important MinnesotaCare has been to them and they've thanked me for working on that because it's a public option that has provided people with security.

MP: Why couldn't public options like Medicare and MinnesotaCare work for everybody? Why is there so much resistance to a single-payer option?

LQ: Programs like Medicare or MinnesotaCare could work as a model for the public option.

Both programs are popular with the people who are enrolled in them. When we do enact universal coverage for a targeted population, like we did with Medicare, it works. When we do expand coverage, like MinnesotaCare, it works. As we expand coverage to all, we also begin the hard work to improve the quality of care and make the system more cost-efficient.
 
Historically there has been strong opposition to a single payer-system by organizations and groups who believe such a payment system would threaten their interests, or simply not work. Then there are also just some people on principle who oppose expanded government involvement in the health-care system.

MP: What has it been like for you to observe how MinnesotaCare funding has been cut, how eligibility requirements have been toughened over the years and to hear threats over raiding the Health Care Access Fund?

LQ: It really takes me back because I was sitting in Fairview St. Mary's hospital when I got a phone call from Rudy Perpich's office asking if I would meet with the governor later that day. They had tracked me down from my office. They didn't know they were calling a hospital. And I said, "Any other day I could rearrange my schedule but I just had a baby (12 hours before); could I meet with them in a couple of days?" [She chuckles.] There was just stunned silence on the other end of the phone.

So that was on a Monday morning and I think I met Perpich that Friday at the State Fair, which is when he named me head of the commission. My son, Ben, came with me to many commission meetings in his little bed. He is now 19 — he'll be 20 later this month — and he's 6-foot-4. When MinnCare was passed into law the first time and vetoed [by Gov. Arne Carlson], that was also very evocative for me because I went into labor with our twins when it was vetoed.

Then there was a very good effort by the Legislature and Governor Carlson to put together a new package, and it was signed into law. I think it has been a program that provided security to people; it's been well-funded. I would have very much thought it would have been possible to have everybody in Minnesota covered by now. ... I have been disappointed when [Gov.] Tim Pawlenty has cut it because I think it does so much good for people.

I give you that sense of the context because I think that 20 years is a long time, and it is time that we address this [universal coverage]. I think we can be very proud in Minnesota of MinnesotaCare and of having a public plan that has been so successful.

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