Transform Medicare Rather Than Reform It

August 12, 2003

Transcript prepared from a tape recording

1:30 p.m.	Registration and Technology Exhibition
2:00	Panelists:	Joseph Antos, AEI
		Carolyn Clancy, Agency for Healthcare Research and Quality
		Walton Francis, independent consultant
		Rick Ratliff, SureScripts
	Moderator:	Newt Gingrich, AEI
4:00	Adjournment

Proceedings:

MR. GINGRICH: [In progress.] --and I'm going to be moderating this and doing a presentation in my own right, but I first want to introduce and say thank you to the panelists who are here with us today who have just done a tremendous job, and I'm very excited that they could all be here.

First, who will speak after me is Walton Francis or Walt Francis, a self-employed economist and policy analyst expert in the analysis and evaluation of public programs. He developed regulatory, budgetary and legislative reforms for many policies and programs while working at the Office of Management and Budget and in the office with the secretary at the Department of Health and Human Services.

He won awards for eliminating unnecessary burden from regulations and making regulation of health services more cost effective. He pioneered the systematic comparison of health insurance plans, from a consumer perspective, and has, for two decades, authored the annual "Checkbooks Guide to Health Insurance Plans for Federal Employees."

He has written and testified before Congress on reforming the federal employees insurance program and on reforming Medicare. He recently co-authored, "An Evaluation of Compliance with the Regulatory Flexibility Act by Federal Agencies," and a study of ways health plans could use the Internet to improve health care.

He was co-webmaster of the Health and Human Services Departmental website in the mid-1990s and co-designed on-line versions of, "Checkbooks Guide," which I commend to anyone here or watching us.

If you go to www.RetireeHealthPlans.org or www.GuideToHealthPlans.org, you will see how it's possible to bring information to the consumer in a way that is really powerful, really clear, and allows people to take control of their own choices, and we look forward very much to hearing from Walt about his views of how to design the right reforms for the baby boomers in Medicare.

Second, we're very privileged to have with us today, Joseph Antos, the Wilson H. Taylor Scholar in Health Care and Retirement Policy at the American Enterprise Institute and an adjunct professor at the University of North Carolina, Chapel Hill, School of Public Health.;

He was the assistant director for Health and Human Resources, the division providing Congress with analysis of proposed change to federal programs and policies in areas such as health, income, security, education, employment and housing at the Congressional Budget Office.

Mr. Antos was the director of Office of Research and Demonstrations and deputy director of the Office of the Actuary at the Health Care Financing Administration, now the Center for Medicare and Medicaid Services. He was the deputy chief of staff and the principal deputy assistant secretary for Management and Budget at the Department of Health and Human Services.

I just have to say that Joe Antos here at AEI and the work that he's been doing up on the Hill is a real pioneer in developing better choices in how to rethink the Medicare system and how to provide more choices for citizens as they retire.

Third, we're delighted to have Rick Ratliff, the executive vice president of Technology and Alliances for SureScripts. In this capacity, Rick oversees all technology development, implementation, customer support, and technology advancement efforts for SureScripts, in addition to responsibility for the development of alliances with a strategic position in pharmacy stakeholders. SureScripts was founded by the National Community of Pharmacist Association and the National Association of Chain Drug Stores to encourage and promote true electronic prescribing connectivity between physicians and pharmacists.

Before joining SureScripts, Mr. Ratliff was co-founder and senior vice president of Health Vision, Inc., where he created the original business and strategic plan for the company's clinical messaging business.

His responsibilities included managing the company's sales and marketing organization, developing and implementing business plans for customer relationship management services and e-health consulting services and creating the e-commerce strategy and business plan.

Previously, Mr. Ratliff served as vice president of Health Care Information Technologies for VHA, Inc. While at VHA, he managed the development and roll-out of VHA SecureNet, a nationwide private network designed as a web-based health information utility for the VHA health care organizations across the United States.

He began his career two decades ago as a systems engineer at IBM Corporation and advanced through a succession of management positions, with increasing responsibility, including leadership position on IBM's health care team as segment manager and client executive.

Finally, but by a very long way not least, Carolyn Clancy, M.D. Dr. Clancy serves as the director of the Agency for Health Care Research and Quality. Before her appointment as director in February 2003, Dr. Clancy had served as AHRQ's acting director since March 2002, and before that, director of AHRQ's Center for Outcomes and Effectiveness Research.

Dr. Clancy is a general internist and health services researcher and a graduate of Boston College and the University of Massachusetts Medical School. Following clinical training in internal medicine, Dr. Clancy was a Henry Kaiser Family Foundation Fellow at the University of Pennsylvania. She was also an assistant professor in the Department of Internal Medicine at the Medical College of Virginia in Richmond before joining AHRQ, which was then named the Agency for Health Care Policy and Research in 1990.

Dr. Clancy has published widely in peer-reviewed journals and has edited or contributed to five books. Her work in women's health was recognized by an award from the Women's Caucus of the American Public Health Association. Active in multiple professional organizations, she has been recognized as a leader within the Society of General Internal Medicine.

Before becoming the director of COER in 1997, that is, the Center for Outcomes and Effectiveness Research, Dr. Clancy served as director of the Center for Primary Care Research. There, she helped develop the U.S. Public Health Service Primary Care Policy Fellowship and led research initiatives on the interface of primary and specialty care, the impact of health care reforms on primary care and the evaluation of strategies to implement clinical practice guidelines in primary practice.

Now, what we're going to discuss today is I think extraordinarily important. This is Medicare bill is the largest single change in U.S. domestic policy since Lyndon Johnson's great society in 1965. Health is the largest single sector of the American economy and it's a matter of life or death. And I want to talk about to lead into this panel is the opportunity we have to create a 21st century Medicare system of more choices, with higher quality and lower costs.

Those of you who have come here to the American Enterprise Institute today saw outside some examples of that. We had displays of a variety of firms. Health Hero Network was here with a health buddy, which plugs into patients' telephone lines and electric outlets.

Every day the buddy calls and asks patients questions about vital signs, symptoms and behaviors, then, responds with education reinforcement and messages that prompt patient action. After midnight, the health buddy, silently and automatically, dials a toll-free number and sends the information to the patient's health care provider so the next morning the doctor or nurse knows whether or not the diabetic or the person with heart disease is, in fact, on track, in compliance and taking their medicine.

Second, we have, from InstantDX, Practical Solutions in Medicine, on-call data. It provides a convenient way to write prescriptions using mobile phones, desk-top computers or any other web-enabled device. It also views the patient's laboratory results as soon as they're available on the same devices, it eliminates time spent waiting on hold with the pharmacy and chasing down lab reports.

We also have HealthShare, which selects quality care decisions. It enables health plan members and employees to compare and select the best hospital for their individual needs. It has unique side-by-side comparisons based on crucial evidence-based measures, such as patient volume, mortality rates and unfavorable outcomes.

We also had outside LSTAT, the Life Support for Trauma and Transport, an individualized portable intensive-care system and surgical platform, providing resuscitation and stabilization capability through an integrated suite of state-of-the-art medical devices. The third-generation LSTAT features a ventilator, suction, oxygen system and fusion pump, physiological monitor, clinical blood analyzer and defibrillator all in one bay.

Finally, we have VitalSpring, which provides for the analysis of health benefits. It has four solutions, each calibrated for providing employers, human resource executives and benefit administrators with valuable information about where the health care cost drivers are and how their vendors and suppliers are performing in regard to specific business objectives.

The four solutions are supply chain analytics, supplier performance management, beneficiary relationship management and financial performance management. Our purpose here in having them outside was that people could actually see that there are existing companies, existing products, existing systems. None of this is theoretical. None of this is based on what could someday be developed in a blue sky future.

I want to propose that the key in this city in the next 90 days is for an effective Medicare Conference Report. The key to that effective Medicare Conference Report is to decide if the president, the House and the Senate conferees are starting with boundaries or building blocks. Everything in this city on whether or not we reform health and transform it into a better system and whether or not we transform Medicare starts with this decision, and let me show you what I mean.

If the two bills are boundaries, then all of the improvements are outside the boundaries. The work has already been done, and we get to pick and choose, cut and paste between the House and Senate bill.

On the other hand, if the current House and Senate bills that went to conference are building blocks, then over the next 60 to 90 days, a series of very key things can be added, which can mean that by the time the legislation is completed, we have a dramatically better bill.

And let me hasten to point out, since I am here in my scholar role at the American Enterprise Institute, I spent four years as speaker of the House choosing on major conferences whether they were boundaries or building blocks. And whether it was the first consecutive balanced budget sine the 1920s or it was welfare reform or it was a host of other issues, the boundaries model doesn't work in conference, and the building block model works dramatically better.

And so as a practitioner, I hope the administration, the speaker of the House and the Senate majority leader will decide they are leading a building block conference and looking for dramatic improvements. The right conference report will save lives, save money, prepare Medicare for the baby boomers' retirement, create the right type of drug benefit plan, improve America's ability to respond to a biological threat.

And the key is to think of this as a very large-scale change, as a transformation, not just marginally improving an existing system, but transforming it into a dramatically better system.

I'm not going to go through the list. You've got them on your hand, but if you look at what we mean by moving Medicare into the 21st century, it is a very significant series of shifts, each of which multiplies against the other in a synergistic way to create a dramatically more powerful system that saves a large number of lives, avoids a large number of bad outcomes, minimizes hospital-induced illnesses, minimizes medication errors, and as a result, actually saves money while saving lives.

Whether you can CBO to score it or not, I'll let Joe Antos comment on later on, but there is no doubt in my mind, you can build a system which will, over the next decade, prove to be dramatically less expensive than current projections.

Now, we see transformational increases. This is a chart from the National Imagery and Mapping Agency's briefing on lessons learned in the Operation Iraqi Freedom. In 1943, it took 1,500 B-17 sorties, with 9,000 250-pound bombs, for one target. In 2003, one B-2 can hit 16 targets. So, in functional equivalency, one B-2 is now, technically, the equivalent of 2,400 B-15s--I'm sorry--24,000 B-15 sorties, in terms of effectively taking out a specific single target. That is an astonishing improvement in productivity.

Transformation doesn't just occur in defense. It occurs all around us. Here, you have Travelocity, which some of you probably use or Expedia--I'm not trying to pick a particular one--Hotels.com, all of the 24/7 services. You have ATMs, where you get cash automatically, routinely, you don't even think about it, 24/7. You have self-service gas stations.

At the briefing by the National Imagery and Mapping Agency, they show a picture of a map repository in Bahrain which cost $20 million and has 33 million paper maps. In January, they went on-line with a credit card and bought, on the commercial market, this device. It holds 250 gigabytes of information. That's 250 billion bits of information. All of Iraq, including pictures, maps and pictures, can be loaded onto this, handed to somebody. On the market in January, it cost $399, without any bulk purchasing, and today it costs under $300.

So, when people tell you about the cost of IT, just be aware it depends on how complicated they want to make purchasing it. If you buy it through the Defense Department on a 9-year contract, with a 12-tiered lead time, it's amazingly expensive. If you hand somebody a credit card and say go on-line, it can be amazingly--

[Laughter.]

MR. GINGRICH: This is 250 gigabytes. We think that it'll be less than a gigabyte per dollar in storage space by the end of the year. That's how rapidly the changes are occurring in the nonhealth world.

Now, we caught the other day, and I don't want to pick any fight with Florida, a wonderful state I visit often. I have a daughter who lives in Key Biscayne. But Florida, in June, passed the perfect 20th century model health bill. This is what the bill says, "A written prescription for a medicinal drug issued by a health care practitioner, licensed by law to prescribe such drug, must be legibly printed." They also allow for typing.

They said, in the Naples Daily News, "The law doesn't list disciplinary actions. So consequences for a messy scrawl are left up to the State Board of Health. Maureen Doherty, a spokeswoman for the Florida Department of Health said, `Most likely a pharmacist would file a complaint when they've had to call one doctor several times to clarify a prescription.'"

I just want to suggest to you this one provision tells you as much as you need to know about why traditional health reform inside the traditional health system doesn't work. The idea of getting doctors to print legibly is, at best, a 1955 model.

[Laughter.]

MR. GINGRICH: By contrast--and you're going to hear more about this in a few minutes--look at the notion of replacing both printing and the pen. Two examples we have today, Tufts Health Plan and Zix Corporation announced an alliance. They're going to give 5,000 wireless prescribing devices to their physicians.

And in Rhode Island, which we'll hear more about in a little while, they have launched a, with the Rhode Island Quality Institute, has launched, with SureScripts, a program which will allow virtually everybody in the state, every doctor in the state, to prescribe in a wireless manner. So that by the time you left the doctor's office, the pharmacist was already preparing the prescription accurately, so by the time you got to the pharmacy, it was already waiting for you. A totally different model than teaching people to print better.

Now, as an example you experience all around you, look at the move to a paperless system in the airline industry. Both American Airlines and Continental Airlines recently increased their fee for a paper ticket from $25 to $50. Interestingly, if you look at the data, Continental, one year ago, had 85 percent of their tickets being issued electronically. In June of this year, it had jumped to 97 percent. Only 3 percent of their tickets are still paper tickets. Again, I just want to suggest to you, now, why should government take the leadership role? This may surprise you coming from a conservative. Because it is far and away the largest single purchaser. It's 45 percent of the system, and its capacity to define best and most intelligent purposes is dramatically greater than any other potential purchaser.

And by the way, there's a lot of potential money available. Notice this. This chart is a little busy, but if you take the second line from the top, that's the consumer price index from 1990 to 2002. If you look at the line on top, which went up even faster, that's the index for Medicare. If you look at the line that is third from the top, that is cosmetic surgery. Notice that in cosmetic surgery, where people pay out of their own pocket, prices have actually, in constant dollars, gone down; that is, cosmetic surgery rises at a price less than the price of the cost of living.

And, finally, notice laser eye surgery which has actually been dropping. It's not a question of rising slower. Laser eye surgery dropped 35 percent in costs in three years. Now, that proves you can have high-technology systems, properly incentivized to get better outcomes, and you can do it with high technology, and it actually could cost less, but it can't be done inside the current system the way the current system incentives behavior.

There's a deeper reason to focus on this, and that is that the current system creates needless suffering and death--death, literally. An estimate from the Institute of Medicine, between 48,000 and 98,000 people die every year from medical errors--this is actually in hospitals--88,000 die from hospital-induced illnesses; that is, if you go to the hospital, and you stay more than four days, the odds are even that you will get a disease from the hospital, which the hospital will then charge you to cure.

Now, there are, and this is not a small number, there are 2 million hospital-induced illnesses a year, a million-and-a-half nursing home-induced illnesses, and our estimate is that--this is a typo here. The number should be 100 billion, not 100,000 billion--there are $100 billion a year in patient errors that could be avoided, in terms of both saving lives and saving money. So you could literally take $100 billion a year in cost out of the system by eliminating things that threaten patients, which would then give you healthier patients getting out earlier at a lower cost, which is sort of a virtual circle.

To put this in perspective, I used to serve on the Aviation Subcommittee. You are 2,000 times more likely to die in a hospital than an airplane due to medical error. Obviously, people who go in a hospital with a terminal disease die legitimately. But you are 2,000 more times likely to die from a medical error in a hospital than you are from flying in an airplane.

And we just broke that down. A second way to look at it. It's staggering. If we announced that aviation was going to lose one shuttle from New York to Washington a day, we would be in a panic. That is less than the number of people killed annually by medical error.

And yet we have totally different psychological reactions, and so a lot of what we're talking about is how do you focus on saving lives and what are the systemic changes you need, often using information technology and systemization in order to maximize people's likelihood of having a good outcome.

We have a list here, which Dr. Clancy is going to go over later. I won't spend much time on it, except to say to you, I think there is, if you measure on 10-year numbers, which is what Washington likes to do, so the Medicare bill is going to cost $400 billion as a 10-year number, which nobody up here actually believes is accurate, but at least it's a number. This will be a trillion dollars in 10 years, to give you a comparable number. So it begins to be real money, even by the standards of the federal government.

I want to, very briefly, without taking much more time from my colleagues, suggest to you the components of a transformational Medicare bill. Let's start with simple things that people just need to remember.

First, do not frighten the current generation of retirees, and I've said this in part to some of my colleagues back on the Hill. Ensure that current retirees will be able to get traditional Medicare without threat or cost beyond current law. Ensure that they will get equal access to a drug benefit so they're not pressured to leave traditional Medicare. Make the benefits simple and clear. They, the seniors, correctly assume complexity is bad for them.

Now, I put this first because I believe, if you can satisfy the current generation of retirees that they're not threatened, they are quite happy to have very bold reforms for the baby boomers. And you're going to hear in a few minutes, from both Walt Francis and Joe Antos, about the kind of reforms we've got to have, all of which I believe can be done this year. It's not a political problem with senior citizens, once you reassure them that they're not going to be threatened. It's only a political problem on the Hill.

Second, you have to develop a Medicare information system that creates the baseline of daily information technology needed in health care. It would also create the biocommunication system needed to meet a biological threat to the nation. It would meet patient safety and patient outcome requirements, which would save literally tens of thousands of lives a year and tens of billions a year in Medicare alone.

It creates the data system for an outcomes-based medicine and efficacy-based drug system. It creates the internal efficiencies of the administration, payment, et cetera, common to banking and other industries, and it creates the systems architecture, national standards and incentivizes a universal electronic health record owned by the patient.

Now, this is the sine qua non of really breaking through. We're either going to have an information-rich system, where we have real data and real efficiencies, or we're going to remain in an archaic system, where people are killed unnecessarily and money is wasted.

Third, bring the best modern practices in medical care to both traditional medical care and the new systems by establishing, as required, components, incentives for health management for chronic diseases, longer, healthier lives, and savings in the billions. For example, diabetes is the largest cost driver in Medicare, every seventh dollar. With good health management, 21,000 people a year could avoid blindness, 19,000 could avoid kidney failure, 69,000 could avoid losing their leg or foot to amputation. Those are Centers for Disease Control numbers.

Apply co-morbidity management with an incentive program. Five percent of the Medicare population absorbs 50 percent of the money. That is a 20-to-1 expenditure ratio between that 5 percent and the other 95 percent. Virtually all of the 5 percent have multiple problems, but they are currently dealt with individually, yet it's the same human being. You gain enormous energy and enormous efficiency and get dramatically better outcomes when you take that one person and treat them as a complete person and deal with all five to seven problems simultaneously.

Lastly, we need specialized care for high-cost, complicated problems, such as kidney dialysis or cases costing over $50,000.

Now, number four, and this is where we're going to hear from Walt and Joe, create a genuine choice in Medicare. Now, let me explain how big the difference is. This is the Federal Employee Health Benefit regulation. I'm going to put this here, and I'm going to put the other option right there. Now, this is 64 pages. It takes care, as Walt Francis will describe, this is what everybody talks about as the great program federal employees and their families have.

Now, you'd say wow. Let's look at Medicare. You'd say that's a lot different, right? Now, the current bill is a thousand pages in the conference. Let me suggest there's a hint. This is a real challenge because it's very hard for politicians to give up power, and it's very hard for bureaucrats to give up regulations. This, by the way, is not the Medicare regulations. These are the federal national CMS regulations, not counting the regulations issued by 10 regions, which we have not yet been able to get, but hope at the next conference we'll have printed copies of.

So this is, I think, important to understand the difference in what you're going to be talking about today.

Now, the right kind of choice in Medicare for seniors, particularly for the baby boomers, will create an open-entry system of multiple types of offerings with minimum government interference, maximum choice by seniors, so long as the plans meet a Medicare-defined minimum set of benefits and are financially stable. It will permit payment of bonuses to the Medicare participant if the plan is less expensive than traditional Medicare.

I'd propose 75 percent of the savings would go to the Medicare participant, 25 percent back to the taxpayer in lower fees, and it's monitored by a new Agency for Medicare Choice, which is coordinated with, but separate from, CMS, because obviously a system used to this is never going to be able to implement this. The first thing they'll do is issue 400 pages of interpretation of the 64 pages.

Five, make traditional Medicare financially affordable by bringing fiscal accountability to people entering traditional Medicare born after 1953, and this will require some argument, but I think it's important to win this argument. As the baby boomers retire, it will be financially impossible to sustain an open-ended commitment and transfer of money between generations.

If it proves true, notice the caveats, that after risk adjusting for age and health conditions, that traditional Medicare becomes significantly more expensive the newer and more modern alternatives, then the difference should be incurred by people born after 1953. This proposal allows 15 years to perfect the system of risk adjustment so that traditional Medicare, and I also notice that traditional Medicare will become less expensive through the various improvements that we outlined above, in terms of patient safety, co-morbidity, health management for chronic disease, et cetera.

This also would give the baby boomers born after 1953 the opportunity to adjust to having choices in personal responsibility if they choose the most expensive plan. Remember, it only costs more if they choose the most expensive plan. We protect current Medicare--

[Tape change to T-1 Side 2.]

MR. GINGRICH: --born in 1953 or earlier would have any expenses greater than those existing in current law, and this system who protects those who are retired or are close to retirement, while protecting the children of baby boomers from an open-ended entitlement system, no matter how expensive and how inefficient.

The secretary of Health and Human Services should develop a relationship with the Administration for Health Research and Quality--I'm not putting you on the spot today. I will not ask you to comment--and with the Institute of Medicine to monitor new experiments and new offerings in Medicare Choice and Medicare Advantage. They should then recommend applying those medical breakthroughs and new systems, which clearly improve outcomes, improve the quality of life and save lives, to traditional Medicare.

Seven, rural America should be brought into 21st century information-rich health and health care. The challenge of distance and density should be recognized in health and health care as it was in developing rural electric co-ops, rural telephone cooperative, rural mail routes, and other efforts to ensure that families living in rural America had all of the advantages of the 20th century. It is time to recognize openly the increased cost and complexities inherent in bringing the best outcomes and the best knowledge to rural areas in small communities. Specifically, provisions should be made to ensure that every American has access to best outcomes medicine and best practices in health and health care.

Eight, these steps will actually increase the amount of money available to the drug benefit and should enable the conferees to eliminate the donut of noncoverage by bringing to bear the resources saved through better outcomes practices and information technologies.

Nine, the new drug benefit should not simply be the ensuring of a 1965 payment system for prescription drugs. The new Medicare drug benefit should be designed for a 21st century model, using an information technologies format, which maximizes individual information, choice and responsibility, while providing best outcomes at lowest cost.

The right drug benefit requires recognizing key facts about the current system.

First, co-pays actually maximize the cost of the drug chosen in a given class. Let me make this clear. If you've got to pay 10 bucks and your choice is a $40 drug or a $70 drug, you will instinctively pick the $70 drug because you think of it as a return on your investment. So co-pays, ironically, incentivize the cost within a class. Used as a tier, they may lower the cost overall, but they incentivize the cost of the drug you pick.

Second, rebates actually incentivize the drug manufacturer to price their initial offer at the highest possible level to maximize the rebate. If my choice is a $100,000 car at a Ford dealership with a $60,000 rebate, so I'm only paying $40,000, or a $45,000 car at the Chrysler dealership, with a $5,000 rebates, so I'm only paying $40,000, guess which one sounds better and which one gives the manufacturer a better chance to negotiate.

Third, the physician knows from memory a smaller and smaller percentage of the appropriate drugs available. That's just a statistical reality.

Fourth, paper prescriptions are both dangerous and stunningly inefficient.

Fifth, prescription drugs is the easiest place to begin building an electronic health record because the data already exists from the pharmacist level on in electronic form.

Sixth, more and more medically appropriate drugs are available over the counter, where they cease to be part of the prescription subsidized payment world. In effect, as soon as they become inexpensive, they're dropped from the system--Claritan being the best example. Second most prescribed drug in the world, then it got cheap, and then it disappeared.

Tenth, the new Medicare system should change the doctor payment system to reflect reality and cost, including litigation insurance and drug usage. It should also incentivize health management, co-morbidity management, specialized care, use of information technologies, continuing medical education to bring all of the best practices to doctors within a year of determination and reporting of errors and outcomes.

Since doctors are at the heart of our current medical system, a Medicare reform bill which ignores doctors, ignores the heart of modernization. As doctors' lives become more difficult and their incomes decline, the quality of applicants for medical school is declining. This is a real challenge to the kind of health system we want for all Americans. The cost of this section should be outside the Medicare bill's $400 billion cap because that amount we'll set aside for a drug benefit, but there's no reason you can't have this improvement inside the same bill, but simply score it as a free-standing object.

These facts, by the way, on drugs--and this is slightly out of place, should lead the conferees to design a Travelocity-style drug benefit which gives the doctor full electronic information about every appropriate drug, including over-the-counter drugs;

Would have the government pay the subsidy for 95 percent of the costs of the least-expensive prescription drug in that group, creating a market-based reference price determined by consumer behavior in the market;

Create an open formulary in which the individual could buy any medically appropriate drug, but would have to cover the difference between that drug and the government subsidy;

Include over-the-counter medications when they are a medically appropriate substitute for a prescription;

And allow the individual to apply the subsidy to the least-expensive prescription drug, to pay up to 95 percent of the over-the-counter cost;

Provide every senior citizen with an electronic card, which would begin to turn their drug purchasing into the beginnings of an electronic health record which they would own;

And where efficacy indicates a more expensive drug is uniquely valuable or where the doctor concludes the patient has unique requirements, then the drug would be prescribed, and the government would subsidize it without competition.

So that is a sweeping overview, and I apologize to my colleagues on the panel for taking quite so long. But on the largest change in domestic policy since the Great Society, I couldn't figure out how to quite get it shorter.

What I'd like to now to begin to flesh out some of the key parts of this general approach is to call on Walt Francis to talk about the tremendous opportunity we have to get a much simpler system for the baby boomers.

Walton?

[Tape change to T-2 Side 1.]

MR. FRANCIS: We'd could skip this and go directly to the questions.

Seriously, I do have actually a secret to tell you about Newt Gingrich, and that is that there's a field of fiction called "alternative" fiction, "alternative" history, where you'd start with a hypothesis like the South wins the Civil War and sort of play out the implications. And he's written such a novel. It had to do with a Nazi commando team trying to steal the A bomb from Oak Ridge. I convey to you it's a good book. Everyone should read it.

Well, I want to talk to you about some alternative history about Medicare. And it's really a very simple proposition, and it is simply why can't we keep the same health plans we're in at age 64, when we turn age 65? It's really incredibly simple. Does something magic happen when we turn age 65? Do our health care needs change? Do our preferences change? Do our preferred doctors change? Do we want a radical change in our dealings with health insurance?

None of the above. There's no reason why at age 65 we should change health plans. Why not let the Medicare subsidy be made available, the government subsidy--it's about 7,000 bucks a head--be made available to any health care plan I wish to stay in or join, and I'll talk a little bit more about these details, without regard to my age.

The current Medicare system says, in effect, no, we're not going to let you do that. You only get the $7,000 subsidy if you join this special government health plan designed vintage 1960. It's got a Part A that doesn't work very well, it's got a Part B that works fairly well. It doesn't have a drug benefit. If it has one, it's likely to have a donut in it, and, you know, you take it or leave it. You don't have a choice. You're forced into that system. A lucky few are unable to stay out of it, federal employees among them, but most people don't have any real choice, and they're in that system come willy-nilly. Some people get to join a Medicare+Choice HMO. There are a few sort of "get out of school" options, but, by and large, you're stuck, and there's no reason for this.

It's a little-known fact of American social history that up until about 40 years ago, we didn't have a food stamp program. We had a commodities distribution program. It was a government-run program where, if you were poor, you got to go down to the food warehouse once a month, and you could get a bag of flour, a wheel of cheese, literally, a tin of butter. I mean, they had a whole set of stuff you would physically cart away. They still run this system today in Iraq. That's how the people get their food in Iraq, from the government. This is insane.

Food stamps replaced it. Food stamps says we'll trust people to buy their own food at a grocery store. We'll give them the voucher to subsidize that purchase. And the food stamp program, we made the right choice. We didn't say we're going to regulate grocery store prices, grocery store brands they carry, how many and so on and so forth, what hours they're open and all of the rest. We don't have that huge stack of regulations, and by the way, the missing regulations, Newt, are real high, that you haven't gotten your hands on yet.

And the food stamp program works like a charm. It's simple, it's straightforward, it's cheap to administer, and it simply says, the fact that you're poor, shouldn't put you into an alternative food distribution system that the rest of us enjoy. Well, I submit to you the fact that we turn age 65 shouldn't put us into an alternative health care system, and it is an alternative health care system because Medicare, as a health plan, if you want to call it that, is radically different from most health care plans in America today in some extremely important ways, and I'm going to lead into the safety, and life saving and other aspects of what we're talking about.

By the way, nothing in this idea requires the government to pay any more money than it now pays. You can either directly say we'll tie the cost to what we're paying under traditional Medicare, and there are ways to correct for adverse risk selections and some other factors. They are not a problem. People worry about them, but they're not a problem. The government doesn't have to pay a cent more.

Nobody is forced to join another health plan. People who want to stay in traditional Medicare can do so. It needs to have a prescription drug benefit added. As bad as it is, it's even worse than it would be with a donut program added, for reasons that will be clear when people talk about what you can do with prescription drugs to improve health.

This kind of program can be started immediately. There can be an open season in the fall of 2004. The program can start enrolling people in the year 2005. It doesn't take the year 2010, as in the House bill. It doesn't take a set of demonstration projects, as a news story in the Wall Street Journal suggested this morning. It's easy and simple to implement because the health plans are out there.

The crucial point about it, and the fundamental point is that the health plans remain separate, individual, private health plans. If they have to comply with Medicare regulations, that immense set of red tape that accompanies Medicare, the Medicare claims forms, the Medicare reporting, the coverage restrictions, the benefit restrictions, the provider restrictions, they won't be those same private health plans that you or your parents or your friends are in today.

They will be something different. They will be agents of Medicare, and there is no reason for that. The government didn't need to take over the grocery stores to provide food stamps. It doesn't need to take over private health insurance to give old folks a choice.

Now, there are two major ways to save money in the health care system over the next decades to come. Neither of them is easy to achieve, if achieved at all, under traditional Medicare.

Method number one says we're going to harvest market incentives to make people and plans become frugal purchases. About 30 years ago, there was a revelatory experiment, the RAND health insurance experiment, that showed that with substantial co-insurance and co-payments, but not income or life-threatening levels, people could reduce their health care utilization costs by about 40 percent without affecting their health. But if you gave people incentives to minimize unnecessary doctor visits, to minimize wasting prescriptions, et cetera, to avoid unnecessary tests, you could save a lot of money and not hurt health status.

There's been a lot of research since then that confirms the basic proposition--market incentives work. There's a simple example in the Federal Employees Health Benefits program that applies to our subject today.

Ten years ago, most of the health plans--there are about 200 of them available to federal employees--paid a percentage basis of your prescription drug costs. You pay 25 percent, the plan pays 75 percent. That turned out not to be an efficient way to control health care costs or to discourage utilization of unnecessarily expensive name-brand drugs.

They've all moved now to three- and six-tier payment systems. I won't go into the details. They're complex. You'll get a better deal if you buy mail order and so on. But the basic proposition is to give people incentives to be frugal purchasers, but not to make it exorbitantly expensive if they really do need the latest name-brand drug because they have an adverse reaction to some other drug. You're not making it unaffordable. You're just making the patient and the physician think twice before they blithely prescribe the more expensive drug.

Research has shown that that kind of payment system saves somewhere between 25 and 50 percent of the costs that otherwise would be spent on prescription drugs. It's a huge effect, from a very seemingly simple and straightforward change in payment method.

Well, these are the kinds of payment changes that occur in each health plan, maybe not every year in each plan, but frequently among the Federal Employee Health Benefit Program plans, as they try to maximize the advantage they offer to prospective enrollees, they want to have good benefits, they want to have low cost, they want to have good service. These are competing objectives. They're always striving to create the right balance and attract customers, and they're tinkering, and they are successful. They have held down costs better than Medicare, substantially better than Medicare, taking into account benefit improvements over the last three decades.

So we'd like to be in a system in which, unlike traditional Medicare, plans and the people enrolled in them, have evolving incentives to control costs through good purchasing decisions, using your own natural desire to get the most bang for your own buck. We can get that if people can stay in traditional private health plans. It's very hard to get that in Medicare, where it literally takes an act of Congress and really almost an act of God to change any of the co-insurance or co-payment provisions in the program. There's no--once this Medicare drug benefit is written into law, if it follows this percentage of your cost approach, which is embodied, to varying degrees, in both House and Senate bills, they're not going to change, they may improve it, they'll fill the hole in the donut, but they're not going to go to a three- or a six-tiered co-payment system. It would be too radical. There are alternatives, though, to get to the better payment systems from day one and let them evolve because, as has been suggested, there are alternatives that may be better than what private health plans are using today.

My final point about future ways to save costs over time in a significant way has to do with health care management to reduce costs. Now, managed health care is a bad term these days, though maybe we've recovered some from the HMO fiascos of the early '90s, and there are many forms of managed health care. There is care management, there are things that look for safety improvements, which you're going to hear a lot about today from the other speakers.

The point I want to make is that health plans have an incentive, a natural incentive, to look for cost- and life-saving improvements in the way they deliver health care because it's in their interests. It helps them keep their costs down, it helps them provide better service, it helps them attract more customers.

In the Medicare system, it's almost impossible to make improvements of that kind because no one has control of the whole action. For example, if I need an inexpensive prescription drug to control my imminent diabetes or my borderline diabetes or maybe it's my congestive heart failure, which sounds worse than it has to be if you take the right medications or any of a host of other maladies--it could be asthma, it could be anything--if I'm in a health plan that covers both prescription drugs and physician and hospital costs, it's in the incentive plan of the health plan to make sure I get the right prescription drug to keep me out of the hospital.

Medicare doesn't have a structure that allows that. Even when a prescription drug benefit is added, it won't have that structure because the prescription plan isn't going to get the cost savings from the hospitalization that was prevented.

I'm going to stop there. But internalizing those externalities, creating incentives to get from here to there, are extremely important ways to keep down costs and prevent looming Medicare insolvency, and we're not going to get them unless people can enroll in private-sector health plans that use modern management technologies.

The government is a great bully pulpit, but it isn't going to be able to do it unilaterally, and it isn't going to be able to do it well, though it can do some pieces through the traditional Medicare structure.

I might add, as an administrative matter, the Office of Personnel Management, which runs the Federal Employees program, encourages the plans very strongly to undertake lifesaving safety measures. They've signed on in a major way with AHRQ and other federal agencies in doing that.

The way they operate, unlike the CMS people who run Medicare, is not to issue another set of regulations. They call in the plans, and they use the bully pulpit, and they encourage plans to innovate in ways, and they say, if you include these ways, it facilitates next year's annual contract.

One last thought about reform and how it affects things. In the Federal Employees Health Program, an individual enrollee typically has 15 or 20 plans to choose from in an annual open season. You might think that leads to a lot of shifts among plans, a lot of movement, a lot of instability--wrong. Ninety-five percent-plus of the enrollees stay in the health plan, the same health plan, year after year. It becomes, the health plan finds it in its interests to take steps with me today that are going to keep me healthier two or three or four years down the road because I'm likely to be in that same health plan two or three or four years down the road.

In a system, as some elements in the House and Senate bills include, where you have annual bidding, only three plans allowed to compete in a given year for my enrollment, you're going to have a lot more instability, a lot more turnover than you would get in the Federal Employees Health Program.

This is not an academic concern. A recent article in one of the leading medical journals found that estimated savings from managed health care, in disease management programs like diabetes control programs, we're realizing only 10 or 20 percent of the projected savings because the people who are getting the early treatments weren't staying in the same health plan. They were gone by the time the hospitalization or whatever was prevented.

So stability in health plan enrollment and freedom of choice by the consumer and by the health plans themselves as they compete are huge elements in bringing the health care monster under control and are huge elements in creating incentives for the kinds of reforms that we seek. We're still in the kindergarten level on these marvelous things that are about to come down the road, and you're going to hear about, but they're coming, and we need to create a system that allows them to naturally evolve and co-evolve with health care insurance and with habits of health care, and traditional Medicare simply isn't up to the job.

MR. GINGRICH: Good.

Joe Antos?

MR. ANTOS: Thanks. That was a great introduction for me, Walt. We divided up the tasks here, and I just want to say that, as someone who has participated in the Federal Employees Health Benefits Program, as probably most of the panel, I think we would all agree that it is far superior to really any other kind of organized health insurance plan that at least I'm aware of. But I'm going to focus no a consumer-driven Medicare drug benefit.

Much of the debate over Medicare prescription drugs can be reduced to two simple questions: How much does it cost, and how much do I get?

As Newt said, Congress is getting ready possibly to enact a $400-billion benefit. And Newt is right, we can all be skeptical of that number. The Congressional Budget Office does not have a crystal ball--nobody does. We don't know what it's going to cost. We do know that it's an open-ended entitlement. There's no limit to how much this could cost us. I think, realistically, we could expect to use up all of Carolyn Clancy's trillion dollars over the next 10 years. So, Carolyn, get to work.

There's a lot of money on the table, and everyone has a stake in it. Seniors, of course, you know, we hear from AARP, and we hear from individual seniors that the new subsidy--that's what it is--the new subsidy might not be good enough.

I just want to say that we've all heard that the bill is going to produce a drug benefit that will cost $35 a month in a premium. Well, that's not necessarily the case. This isn't a hard-coded number. This is the CBO estimate of the average premium that people would pay. Average means there's some above, some below. If you tie that fact with the virtual inevitability that costs will be higher than CBO predicts, well, speaking of transformation, I think this could really be transformational for some political careers by 2006 or 2007.

Who else has something here to gain or lose? Well, employers, you know, they'll either drop their retiree coverage or they won't, depending on which study you want to believe. We don't know, but we'll certainly find out.

States, they'd love to be relieved of at least part of their Medicaid spending. Pharmacists are happy to give discounts to people as long as they don't have to pay for the discount themselves. Pharmacy benefits managers, these are the companies that manage the drug benefits for most people who have employer-sponsored coverage, they see new business opportunities. Health plans, clearly, there's an opportunity here for some higher reimbursements in the Medicare program, and perhaps a chance to expand their currently dwindling market share.

Drug companies, they hope to capture a chunk of the $400 billion, but they don't want price controls. Future taxpayers, now, here's the silent majority, most of these people are kids or they're not born yet. They'll have a lot to say about what this Congress does in about 15 or 20 years.

And then, you know, perhaps fairly soon, Canadians will take a real interest in this, and they may actually have more to lose than anybody else, certainly more immediately. Anyway. With all of these competing interests and the complex technical issues that these interests bring to the table, it'll be difficult I think for the Conference Committee to reach a final agreement based on the bills that they have before them.

But whatever happens there, Congress, indeed, has an unprecedented opportunity to promote better health outcomes, reduce unnecessary spending and give consumers more control and more personal responsibility over their health care. The drug benefit I think is a key in achieving those goals. So what should be done?

First, design a sensible drug benefit that is not overburdened with regulation and red tape. Red tape will strangle consumer choice and competition among health plans or among drug plans.

Second, mandate the best use of information and information technology to improve consumer choices and physician prescribing, reduce errors and reduce costs. Now, when I say mandate, I don't mean that I think the government should tell everybody exactly what to do and issue regulations that would dwarf that file.

I think that's a bad idea. But I do think that there's an opportunity for some government leadership, but it should also be smart enough to get out of the way. It should say what it wants as an end result, but it shouldn't say how we're going to get there. So let's clear away the existing regulatory hurdles and don't micro-manage the process.

Third, don't avoid the real cost problem in Medicare--the failure of the program to integrate and optimize the health services used by persistently high-cost patients. Those are people with multiple, chronic conditions who intensively use all health services, including prescription drugs. By the way, they do that now even without a drug benefit.

The traditional Medicare program pays for, but does not coordinate any health care services. That often means inappropriate use of services, excessive costs, and poor quality of care that could be achieved by managing those resources more intelligently. Walt made this point. I think it's a good one.

Our objective here, when you think about costs, our objectives should be to minimize the overall cost of providing health care, rather than focusing on drugs exclusively. That's the wrong target. The target is the whole apple, not one of the slices.

The failure to cover prescription drugs has been an important missing piece that has made patient management strategies problematic in traditional Medicare. We're now in a position to do something about this. Since traditional Medicare will be with us for a long time to come, a drug benefit would simply add to Medicare's runaway costs, unless we were to resolve the larger problem of chronic illnesses. This, of course, isn't the only problem, but it's certainly a big one. In other words, go where the money is, as Willy--was it Willy Horton or Willy Sutton?

MR. GINGRICH: Willy Sutton.

MR. ANTOS: Willy Sutton once said, "Go where the money is."

Who's Willy Horton?

[Laughter.]

MR. ANTOS: Oh, he's a criminal from Massachusetts. Well, they're all criminals.

MR. GINGRICH: I'll introduce you to Michael Dukakis some day.

[Laughter.]

MR. ANTOS: All right. You know, I knew there was a connection here, Newt. I just wasn't sure what it was.

Let me move to the drug benefit more specifically and just say that, of course, a sensible Medicare prescription drug benefit, as Walt said, would be integrated into comprehensive health benefits, and Walt gave good reasons why that's the case. It is a fact that there are no stand-alone, separate voluntary prescription drug benefits offered in the insurance industry today. There's a very good reason for it. If you have a voluntary separate program like that, that just invites adverse selection, and that would, in fact, cause great instability in this program. People would act in their own best interests, which in this case would destabilize the system.

But even if we move to a thorough reform, such as the kind that Walt outlined, we still have to create a stand-alone drug benefit for Medicare. We can't avoid it because that's what Medicare is. It's a collection of stand-alone benefits. And if we're going to have fair competition among all of the health plans in Medicare, including traditional Medicare, you've got to bring the traditional program up-to-speed, otherwise it's completely unfair. So we've got to do something about this.

Now, let me talk about two specific issues here.

First of all, how can we structure the benefit to make the enrollees, the people who participate in this program, to be more cost conscious?

And, second, can we, in fact, enlist the power of individual consumers to do a better job of harnessing that consumer power to keep the cost of prescription drugs better in check?

Let's go to the first issue. If we're to have any hope whatsoever of constraining the cost of prescription drugs in Medicare, the benefit must maintain cost-consciousness on the part of seniors, pure and simple. If you don't pay anything for what you get, then you don't care what it costs. It's pretty obvious.

So that means, in the context of the current debate, deductibles, co-payments or other kinds of payments directly tied to the purchase of the drugs. Those payments that come out of the pocket of consumers have to be large enough to encourage seniors to seek low-cost alternatives, but they can't be so large that seniors do without necessary drugs. So it's a very difficult balancing act that has to somehow be resolved here.

The House and Senate bills, as Walt indicated, have their own complex and confusing way of solving this problem, but I won't go through it, other than to define what donut means. It basically means that there's some early dollar coverage, after a deductible, there's some coverage, and then there's some spending.

After you've used $2,000 worth of drugs or as much as $4,500 worth of drugs, in the case of the Senate bill, then, after that, some of that spending is just not covered at all. You pay 100 percent for it, and then the coverage picks up again either at about $4,900 for the House or $5,800 worth of spending in the Senate. So that's what that donut means. There's a hole in the coverage.

And the way to get around the problem of low-income people not being able to afford this is they basically eliminate the need for low-income people to pay much, if anything, for their drugs.

This donut hole approach is certainly confusing. Everybody knows that by now. It puts a gap in the coverage at a point where prescription drugs are beginning to feel expensive to most of the seniors who will be in the program. That's exactly the wrong place to do it.

It also provides nearly free prescription drugs to low-income enrollees, which sounds all right to a lot of people until you realize that this blunts their cost sensitivity, which inevitably leads to the kind of restrictions on their access to drugs that we see in the Medicaid program. So that doesn't actually seem like a very sensible thing to do.

There are other ways to handle this. An alternative approach that I particularly favor would simplify the benefit greatly. Push the bottom part of the donut, the early dollar coverage, push that up to fill that hole. Now, that means require a larger deductible. That's what it means, but at least it eliminates the coverage gaps and people can understand this, and it would be more like what insurers and economists think is actually insurance.

Now, if it's a large deductible, we have to find some way to help people pay for that additional cost that's imposed on them, so why don't we give a subsidy, as we're going to anyway, why don't we give a subsidy to low- and middle-income people, give them a cash subsidy in a Medicare drug account?

And that's really pretty much what we're going to do with first dollar insurance coverage, but there's a difference here because if you give people money, and you let them keep it, if you let it roll over to the next year, then they'll act as if that's their money because, by golly, it is their money. And when it's your money, you get to be a pretty smart shopper. That's the principle. For higher-income people, why not let them contribute on a tax-free basis into a similar kind of account?

If you had everybody spending their own money for that early dollar prescription drug use, they'll purchase drugs in a more sensible fashion. If you give them use it or lose it insurance coverage, then they'll use it because they certainly don't want to lose it.

Now, we could go further to harness individual buying power and reducing costs. I just want to clarify one thing that Newt was talking about and try to connect it to what's going on with the House and Senate bills. Under the House and Senate bills, they're really talking about competing drug plans that operate like pharmacy benefit managers. There's some differences, but think of them as PBMs. PBMs acts as agents to negotiate price discounts based on that plan's ability to shift sales to preferred products.

So this is an agent model, and the agent model has proven to be very effective, as Walt has said, but it isn't the only way that one could think of to get low prescription drug prices and to limit costs. We could also have an option that allows beneficiaries to do their own comparison shopping.

Now, I know that's pretty strange, just because we all go to the supermarket, and we price Rice Krispies, and we price Wheaties, and, well, people might not be able to do that with drugs, but when you think about drugs, you know, prescription drugs are commodities. They're not services like physician care or hospital treatment. So they're inherently easier to understand after you get to a certain point, and that point is at the point where your doctor prescribes the drug for you.

At that point, a specific compound prescribed by your physician from a specific manufacturer is the same, regardless of where you buy it or what you pay for it. So, in that case, you should look for the lowest price, and if we open up a system that allows you to look for the lowest price, you might do that.

Now, people do that now with the drugs. If you're in the market for Viagra or for Accutane, these are drugs that are typically not covered by insurance. And, in fact, people shop around. So it's not impossible. In fact, it happens in the drug market right now. However, it's really complicated and difficult. Comparison shopping could be inconvenient or may be impossible for some people if they had to go physically to these places. Computer technology could solve that problem. I think we'll hear some of that with the next speaker.

But the point is that if you could go on-line, if there was some easy way to compare prices for the drug you need among hundreds of retail outlets, among all of the manufacturers that there are that are available to provide this drug or perhaps even substitutes, then you could make an intelligent decision. It would be even better if you were sitting next to your doctor when you were doing this and were basically making a combination of a therapeutic decision and a purchasing decision at the same time.

Separating these two things out doesn't make any sense to me. If somebody tells me to buy something and has I hope my best interests at heart, I'd hope he'd also help me think about what it's going to cost me and whether going for the lower-priced product makes sense for me.

Now, there are a whole bunch of details that will either make or break this kind of an idea. Let me mention a key one, which is something that Newt mentioned, which is how would you set the reimbursement for the prescriptions? Newt mentioned I think 95 percent of the lowest-cost prescription drug as a possibility, and I think he mentioned that he would include in the system some way of reaching out to get over-the-counter drugs if those were appropriate for someone's condition. Certainly, that's one approach.

There are other approaches. One could actually just set a flat fee. Humana is testing out this very idea as an option for their own employees in their health plan starting this summer. And if it's successful, they will offer this to employer-sponsored health plans next year or the year after.

You could also tie the reimbursement, in some fashion, it doesn't have to be 100 percent, it could be 95 percent, it could be any percentage really, it could be tied to the lowest-price drug appropriate for the patient's illness, including over-the-counter preparations. In other words, it could be the lowest price. It could be tied to the lowest price or it could be set higher. If it's set higher than the lowest possible price, would it be reasonable for individuals to be given a rebate if that individual chooses a less-expensive drug? I think the answer is yes.

Whatever the reimbursement scheme, would we want to give an additional subsidy to low-income people or those with high drug costs to give them additional flexibility in what they purchase? We don't want to drive everybody to the lowest price, necessarily.

Anyway, these are important details that have to be worked out, but I think the point is that with some effort, this idea could work. However, we don't know whether the agent model, the PBM model, or electronic comparison shopping would result in lower costs for Medicare beneficiaries. We can speculate about how it might work, but we really don't know. If very few people were to take up the comparison-shopping model, it wouldn't work at all. Bluntly, it doesn't work if nobody does it.

But there's every reason, so just because we don't know, there's every reason, however, to allow these kinds of innovations and all sorts of other innovations to be tried by plan sponsors in the new Medicare drug program, and there's every reason to allow Medicare beneficiaries an unrestricted choice of drug plans.

Restrictions that would limit these types of innovations should be removed, and consumers should decide what specific type of drug benefit best meets their need. We don't want some bureaucrat deciding what meets my need. I want to decide. Open the competition to all plans and let the best plan win.

MR. GINGRICH: Thank you, Joe.

Let me mention, in passing, you can go to Rxaminer.com -- R-x-a-m-i-n-e-r -- and see a pilot example of what Joe is talking about. There's actually a firm called Rxaminer, which allows you to comparison shop if you're buying your own drugs. It's a very interesting beginning model that Joe was referring to.

Now, let me turn to Rick Ratliff.

MR. RATLIFF: We're going to shift gears. It should be interesting. We're going to talk a little bit about technology.

One of the initial points that Newt made at the beginning of the session was that this is not theoretical, this is real. And what I'm going to try to do is to bring home that these technologies are really having some impact in the market. We're seeing some real results. And although we're kind of in the initial phases of driving widespread adoption, we are actually seeing some tremendous results from the efforts at this point.

Just a quick commercial on SureScripts because I think this is important for why we think that electronic prescribing, as an example, is going to work as we move forward and that widespread adoption will start to happen. Once again, this is our perspective.

But we're an organization that was founded by the major associations that represent all of the chain drug stores and independent community pharmacies across the United States. Our focus is on improving the prescribing process. So a number of the things we've been discussing today about open choice, as an example, and where should choice be made on a particular medication is a key focus of a lot of our research efforts as we start to launch electronic prescribing across the United States.

But the most important aspect of what we're doing, going back to the building block concept, is laying the foundation. So our initial focus is on laying the foundation to connect physicians to pharmacies. So we want to be able to ensure that physicians can send prescriptions electronically to the pharmacy and they are received electronically, eliminating the paper. So we're eliminating the handwriting, and it makes it very easy to go into Florida, where you need legible handwriting to be able to send scripts. We can now easily do that in an automated fashion.

Our opportunity is around the 3.4 billion scripts that are written annually or at least projected in 2003, going to around 4 billion. Specifically, there are around 1.9 billion prescriptions written that have some level of interaction between the physician and the pharmacist and, in a lot of cases, with the patient themselves. And basically this is around new prescriptions and what we call refill requests, and I'll talk about that in a minute.

There is also a significant opportunity around an area where patients are not actually picking up their prescriptions. So we know, based on the data coming through the different sources of information, that there are a large number of prescriptions that are not picked up by the patients. This creates a huge issue relative to compliance and a significant issue relative to downstream costs in the health care system, and we think automation can definitely have some impact on that.

The key to the whole process is focusing on connecting the three stakeholders in the prescribing process. These are the individuals that touched those prescription transactions that I mentioned on the previous slide: the pharmacist, physician and the patient. Currently, our efforts, well, I'll talk about Rhode Island specifically in here in a minute, are focused on connecting the physician and the pharmacist.

The key long-term opportunity, and this was mentioned by Joe a moment ago, is the fact that the patient can definitely have access to information on-line and in electronic fashion to be able to start communicating with their physician, potentially their pharmacist, to really become part of that team that's making the medication decisions. But what we have to do, once again, is connect these individuals. We've got to get to the point of being able to really focus on the opportunities for time savings, and I'll talk to some specific findings here in a minute, in reducing medical errors, et cetera.

As we look at the automation, the key is that today 90-plus percent of prescriptions are written, handwritten. So most prescriptions are written by the physician, provided to the patient, and the patient takes those prescriptions in to the pharmacy.

There is some levels of automation that are happening. There are about 9 to 10 percent, depending on the information that you look at, of physicians that are actually doing some form of electronic prescription writing. And I'm real careful to say electronic prescription writing because they're using a tool to actually capture the electronic prescription.

The electronic prescription is typically either printed, provided to the patient, and then once again they go to the pharmacy or it's potentially faxed to the pharmacy directly or the pharmacy of choice for the patient. There is still paper involved in this process. There's still duplicate keying that's going on inside of the pharmacy, as an example.

This process, and we've already hit some of these issues, but it definitely is fraught with opportunities for not only errors, but issues related to productivity in the physician's office, and in the pharmacy, et cetera, just the eligibility component of the prescription writing process leads to around 150 million calls that go into the pharmacist's daily activity. So the ability to reduce those calls, as we can automate and create a true end-to-end electronic process is significant.

In addition, we have the opportunity to understand when a patient has actually picked up their prescription or not. If we can do a true electronic end-to-end connection between the physician and the pharmacy, then when the new prescription is sent from the physician electronically and shows up at the pharmacy, the pharmacist is taking action on that particular medication.

If after a certain period of time that medication has not been picked up, there is an opportunity for an automatic electronic communication to go back to the physician, and that can then trigger some type of a communication back to the patient, as an example. We call those compliance or adherence-type programs.

To really touch on the technology, before I talk about Rhode Island, what is happening in the market, there are a large number, approximately, like I said, 9 to 10 percent of the physicians are using some type of PDA, some type of a personal digital assistant-type device. They might be using some other type of a tool in their office for writing an electronic prescription. The key is that we ensure that that continues to happen.

We are finding that physicians now have, approximately 86 percent of physicians do have Internet connectivity in their office. The price is coming down for Internet connectivity and for the technology in general. So we see this continuing to evolve. But it is absolutely critical that the physicians have their tool inside of their office that they're used to using that works with their particular work flow.

On the other end of the equation is the pharmacy. The pharmacy systems are currently in the process, as I'll highlight in a second, in upgrading their systems to be able to handle prescriptions electronically that are coming in from the physician's office. So it's very important, and we're working with some of the larger chains currently and software vendors, in ensuring that their software is able to handle that electronic prescription, so that that manages the pharmacist's work flow.

So what we do is we connect these two components. We have actually, if you think about the ATM network, I think this was mentioned earlier, and you think about the physicians using their devices, they're using some type of a device. It's not a SureScripts' device. It is whatever they choose to use for writing prescriptions.

Behind the scenes, there is a network that connects all of these pharmacies. You could think of that as all of the banks. When you ask for money, the money comes in, they reduce it from their account. It happens all automatically. What we are basically doing is when that prescription goes into the network, we're ensuring that the physician uses the device that they choose that gets to the pharmacy of choice, either their choice and/or the patient's choice, which is typically the matter. So we're ensuring that that connectivity happened.

On the reverse side of that, we're also allowing the pharmacy's ATM, if you will, to be able, when a refill request comes in from a patient, so a patient has run out of refills, and they want--they call typically the pharmacy to ask for a renewal on that prescription, what typically happens is the pharmacy calls the physician's office.

So what now the pharmacy can do, through their ATM-type device, is they can capture that call electronically, send that through the ATM network, if you will, and it shows up automatically in the physician's office, and then the physician's office can respond to that particular request.

We see that because of the pharmacy connectivity, we're starting to break down some significant barriers to adoption. I mentioned 9 to 10 percent a moment ago. Approximately, 40 percent of physicians today are using some type of a PDA for finding some clinical information. So they're already using tools in their practice to find that, to find that clinical information, and I think, and we believe that that's going to grow significantly.

What now needs to happen is we need to turn those devices into electronic prescribing tools. So we think that because the usage is going up, because the technology and prices are coming down, are improving and coming down, and we have widespread pharmacy connectivity, we've got an opportunity to drive widespread adoption.

Focusing on the building block approach and why we think that we can drive adoption beyond what I've just described, there is a component I went through in detail a moment ago called renewals. The renewal process requires pharmacy connectivity. So the pharmacies have to be able to communicate through a network to the physician's office. This is a component of the process, the electronic prescribing process, if you will, that has a significant amount of overhead inside of the physician's office.

We're finding, in some cases, that a physician's staff spends anywhere from one to three hours a day just handling phone calls associated with refill requests that come in to the office. With our initial findings, with the electronic connectivity, you can reduce that to a very minimal amount, and in some cases, we have a large practice in Rhode Island where they actually have a nurse that's saving two to three hours a day, that she is now taking and using to spend on patient care.

That tells you that the technology can be implemented into the office. The communications is driven from the pharmacy, and the physician's office or their staff now can manage that work flow on the refill requests, and it doesn't always involve the physician.

The physician themselves does eventually get involved in the new prescription side, and so we see this once again as a step-wise approach. And this is where some of the issues that were alluded to a moment ago, when the physician is actually writing a prescription, there are tools in the market that allow the physician to review a patient's formulary.

There's a wide variety of ways to review that formulary, and we propose that the best approach is to ensure that there is open choice, that all options are available to the physician and to the patient for making their choice on a particular medication--same thing for the pharmacy side.

This is also an opportunity to drive additional information, to ensure that there are no interactions, once again, where we have opportunity to reduce medical errors.

In the future, we mentioned a minute ago the refill process or the unfilled prescription process issue, and we have an opportunity to automate that in the future if we have the connectivity between the physician and the pharmacy in that we now can alert a physician that the patient is not taking their medication.

We started the beginning of electronic prescribing, if you will, in Rhode Island. For a number of reasons, I won't go into that at this point in time, but basically, by the end of this year, we'll have a large percentage of the pharmacies in the United States connected electronically into this ATM network, if you will, and then our challenge is to provide incentives, and break down barriers and those types of things to bring physicians on board.

In Rhode Island specifically, we launched with CVS, and Walgreens, and a regional chain called Brooks Pharmacy. We'll be connecting in Wal-Mart and Stop 'N Shop and several other pharmacies. We'll have over 80-percent connectivity of the pharmacies in Rhode Island in the very near future.

We started our initial testing with a small group of physicians that were across specialties, and in some cases, the physicians' offices actually only did renewals in their office. So they were only automated in the renewal process. This is something, once again, the staff can adopt and take on. And in a few cases, the physicians actually saw what was happening and started to take on the new prescribing.

These physicians are actively engaged in moving prescription messages through the system. Once again, it's a secure transmission of the new prescriptions and the refill requests through the system. And what we are seeing with the assistance of our partner, On-Call Data, who is actually the physician electronic prescribing tool, is that there is a significant improvement in efficiency in the pharmacy, and the pharmacists are able to reduce their time that they are having to communicate with physician's offices in understanding illegible prescriptions and/or understanding particularly potential formulary issues and those types of things, and that's a significant advantage on the pharmacy side.

Relative to the staff productivity itself, I did describe a moment ago the fact that some of the staff actually have seen the ability to go back and spend more time with patients because they are now no longer having to manage the prescription renewal process. And I'll conclude it with that.

Suffice it to say, we're going to announce the national roll-out of electronic prescribing later this month and look forward to seeing this widely adopted.

MR. GINGRICH: Electronic prescribing I think is a very good starting point because it combines patient safety in a medication error sense, efficiency in the sense of doctors, nurses and pharmacists actually saving a great deal of time, dramatically increased accuracy. It begins to allow you to interface with an electronic health record automatically so you can find out whether or not the patient should not be taking that drug at all because they may already be taking something which contraindicates it or have a health history. All of this I think is the right background to go to Dr. Clancy because she now broadens this into a much broader zone. The Administration for Health Research and Quality has done very pioneering work.

Dr. Clancy?

DR. CLANCY: Thank you and good afternoon.

What I want to talk about, as Newt just said, more broadly is the power of health information technology to improve the delivery of health care beyond providing prescription drugs, but very, very broadly.

So what I want to spend a few minutes with you is just highlighting some key opportunities to improve the quality and safety of health care. And then I want to review with you, and I think that you all got a copy of a table that we have summarized from recent studies, what we know now about the costs and benefits of health information technology.

I also want to end by being as honest as possible about the state of our information and speculate with you about some future opportunities.

So a few of you in the audience may be confused, so I do want to clarify one point. Much of health care is computerized, but that would be the billing side. This would not be the clinical care enterprise.

In essence, cheap computing power helped to launch the establishment of the Agency in 1989, and what you see here is a map showing various--

[Tape change to T-2 Side 2.]

DR. CLANCY: --relations. You don't need to have a lot of clinical insight. All I can tell you is anyplace that it's read, they're doing a whole lot more of them. The challenge here is that while this approach has given us a great deal of insights about variations in practice and given us very important directions about where to focus our research agenda, there's insufficient clinical detail from these administrative billing claims, which isn't surprising, that's not what the systems were created for, to understand very much about how to improve the quality of their care.

Now, about six weeks ago in the New England Journal of Medicine, there was a landmark study on the quality of care provided to adults in America, and this is just a small sample of some of the headlines. The take-home sound bite was that adults in America from 12 communities across this country received recommended care just over half of the time. So I don't think I need to make a long-winded case to you that we have some very important quality challenges in our health care system today. And I will make one brief public service announcement to say that the Agency, on behalf of the Department of Health and Human Services, will be publishing the first annual report on quality of health care in this country this fall. So stay tuned.

Now, the stakes here are very, very high. And as both Walt and Joe alluded to, the challenge facing our health care system by the growing prevalence of chronic illness is quite dramatic. We have a health care system that is really structured for sprints. Whereas, we actually need one that knows how to do marathon running.

As Joe antos pointed out, coordination of services across multiple settings remains a critical challenge. In fact, the vast majority of people shown here on this graph, if you ask them what their number one challenge is, it would be coordination of care. So enter health information technology, the wave of the future, a potential bumper sticker, if you'd like one.

Now, just a very, very practical, concrete level, information technology, as we think about assessing the quality of care, can actually help us enhance the precision and make the enterprise much more efficient, can help us get to the right measures. That's on the assessment side.

On the improvement side, fairly simple strategies can help us achieve substantial improvements in care through decision support, clinical reminders, and so forth, and very importantly, it can help us enhance the timeliness of data collection and feedback to all who are providing care so that they can understand how they're doing and know where they need to improve, rather than getting reports six months to two years later, which is often the case right now.

More on how information technology can improve quality. One very big study from Brigham & Women's Hospital in Boston showed the computerized physician order entry can reduce drug adverse events by over 55 percent. We know, in many domains of clinical are, that reminder systems can improve compliance with recommended guidelines and best practice. They can even, surprisingly enough, remind physicians and patients to discuss their patients' preferences for end-of-life care.

Very, very importantly, information technology can support getting to really patient- or consumer-centered health care in a way that simply is not possible right now. And as Newt pointed out in his opening remarks, the same information system that improves the safety and quality of health care can also serve to help us develop early warning signs of potential bioterrorist or other events threatening the health and security of the nation.

However, as Daryl Royal once pointed out, potential is what you have when you haven't done it yet. Secretary Thompson reminds me, almost on a daily basis, that we have wonderful technology, but most grocery stores are--have better technology than our hospitals and clinics. When I was making a presentation to some of my colleagues in the Department recently, I showed them a picture of Marcus Welby and reminded them that, although Marcus Welby went off the air in 1976, most of what happens in physicians' practices has changed very, very little since then. It's still paper, phone calls. Fax is actually a bit more popular now than it was in 1976.

So I'd like to, having given you an overview of how health information technology could be a very important part of the solution to the problems facing the health care delivery system, turn your attention now to the costs and benefits of health information technology.

Now, we think it's critically important to be as concrete and specific as possible. So, in our search of the literature and for any available information, we've tried to be as specific as possible. So, on the in-patient side, we've looked at computerized physician order entry systems. Now, these do not require a full electronic medical record.

We've looked at clinical decision support technologies, automated medication dispensing systems, and barcoding technologies. On the ambulatory side, we've looked at e-prescribing that Rick Ratliff was just telling us about, again, clinical decision support, ambulatory computerized physician order entry, as well as full electronic medical records. So what I'm sharing with you are just some highlights from the studies that we've examined.

For computerized computer order entry, and I must say that I had the enormous pleasure, when I was at the medical college of Virginia, of being at what is now considered a pioneer system because it had a CPOE system on the hospital side.

A number of studies have demonstrated a significant impact on patient safety and quality--again, a 55-percent reduction in patient injuries due to adverse drug events. The rate of potential adverse drug events was decreased by 84 percent, increased adherence with clinical guidelines and decreased variance in drug dosing.

Now, in terms of cost, if adverse drug events are reduced by 17-percent nationally, as was observed at Brigham & Women's, then this would be allowing us to avoid 656,000 preventable adverse drug events per year and a savings of $654 million. That's just one small slice of health care and how it could help us improve both quality and costs.

Implementation of these systems we believe would lead to a per-hospital savings of between $5- and $10 million a year. Now, a real trick--I'll anticipate Joe Antos's question here--is who's savings are they and who gets to recoup the savings, and that is going to be a big challenge as we go into the future.

Now, in terms of clinical decision support, Latter Day Saints, now part of the Inter-Mountain Health Care System, has really been in the forefront here and over a decade ago showed us that a relatively simple reminder system could help clinicians remember to prescribe antibiotics preoperatively, leading to significant and substantial decreases in surgical infections.

In addition, their studies have shown reduced incidence of patients receiving drugs to which they're allergic, fewer orders with excess dosage, fewer orders with the wrong antibiotic is being given, and in terms of the impact on cost, reduced hospital stay, lower hospital costs and lower costs of antibiotics.

What you begin to see here is a picture that understanding the incentives for investing in health information technology and who gets to, which parties get to recoup the savings is going to be a critical part of getting this puzzle solved.

In terms of impact on prevention, we've seen improvements in just about every domain of clinical preventive services. Automated medication dispensing systems actually simply allow one to automate many of the manual steps currently performed by nursing personnel, and we believe are also associated with substantial savings.

In one study, a drop was found in medication error rates from 16.9 percent to 10.4 percent, and some studies indicate a savings for individual hospitals between $1- and $2 million per year over five years. Now, if you think about it, this is on the lower end of the hierarchy, if you will, of health information technology, but nonetheless quite important.

And at a time when we're looking at a nursing shortage and shortages of other key health care personnel, the decreased labor costs are hardly trivial.

Now, barcoding is something that the Department of Health and Human Services has been terribly interested in, and it's very helpful because it allows for quick and accurate linkages and makes sure that the drug dose is actually linked to the patient who's supposed to receive it, which again sounds fairly simplistic until you start to look at the numbers of times that that simply does not happen.

Very importantly, barcoding of medications by the pharmaceutical industry will allow such organizations as Veterans Affairs and others who have made the investments in the barcoding readers and now have to put their own barcodes on medications to get out of that business.

Again, from the VA system, there have been fewer errors by giving the wrong drug dosage, the wrong drug, and fewer errors from giving the right medication at the wrong time or from giving the wrong medication to the wrong patient. Again, these are situations that are way too pervasive in health care right now.

And in terms of cost, we believe there could be an annual net savings of $190 million in treatment costs. This is from an estimate of $29,000 per hospital and a net annual benefit of about $2 million per hospital.

Now, turning from in-patient care to outpatient care, I think Rick has given us a very complete and full picture of what e-prescribing could actually permit. So I'm not going to go over some of the same points, but just in terms of hitting the high points on the impact on quality through reduction in medication errors and the increased use of generic drugs, I think Joe Antos started to say something to the effect about patients getting prescriptions from someone at the point of care, and that's correct.

I think what many people underestimate is that the person doing the prescribing also has fairly limited access to up-to-date information, and that really remains the Holy Grail, in terms of making health information technology a part of health care delivery.

For ambulatory computerized physician order entry, the Center for Information Technology Leadership has estimated that implementing advanced ambulatory CPOE systems would eliminate over two million adverse drug events a year. And I need to call your attention to the fact that the occurrence of adverse drug events in ambulatory settings wasn't even part of the Institute of Medicine report because we simply did not have good studies at the time that they did their report in 1999.

In addition, this center has also estimated that ambulatory CPOE would help avoid nearly 1.3 million physician visits, 190,000 admissions and over 130,000 life-threatening adverse drug events per year, and that, nationwide, adoption could save $44 billion per year.

And this just shows the same information in graphical form. The smallest bar is savings attributable to reduction in adverse drug events. The biggest part is from choosing cheaper medications. The sort of olive-colored bar is from avoidance of redundant laboratory tests, and the following segment, 10,420 listed on this graph, is from avoiding duplicate radiology tests.

So the Holy Grail, of course, for primary care and outpatient care is actually having full electronic medical records to replace the paper medical charts because that way it could all be in one electronic place and up-to-date and secure. We are a long, long way from being in that kind of place right now.

In one study, it has been found that this would result in a 34-percent reduction in adverse drug events, a 15-percent reduction in drug utilization, a 9-percent reduction in lab utilization, and a net savings of $86,000 per provider over 5 years. Now, that is a ratio. That does not, as I mentioned earlier, mean that that money necessarily comes back to the provider, which is part of the incentives challenge that we need to get right. So that gives you a broad overview of some of the high points about what we know right now.

Now, a big, big question many of you I think should be asking right about this time is if this is such a great idea, then why aren't we there yet? What are we waiting for? It's very important to recognize that most of the fundings that I've shared with you today and that we've been able to identify come from leading-edge organizations in health care delivery, and that is great. We have a lot to learn from those organizations, but it does raise some questions about generalizability.

Even the most successful hospitals right now use multiple vendors and have some internal interoperability challenges; in other words, the lab system may not speak to the pharmacy system, and so on and so forth. And if you read the experience of one very large hospital in Southern California earlier this year, you'll know that, to put it politely, implementation of these systems can be a bit challenging.

Many of these systems actually cost the doctors, in terms of time spent per transaction, and if that isn't made more efficient, then many physicians are likely to continue to be resistant. And of course we all know that physicians in our health care system are independent contractors.

Some of the critical challenges that it will remain very important to get right are continuing to focus on developing and deployment of IT standards, as well as common data elements and definitions in building the capacity to make improvements over time. We don't have to design the perfect system to take the first steps. I think Rick Ratliff's presentation was very helpful in giving us an idea of how we could be taking this in a step-wise fashion.

Very importantly, at a time when many, many people are concerned about the privacy of their personal health information, we need very clear rules of the road--who owns the data, who decides what's in a record, who can make changes for the purposes of learning from the clinical care enterprise what is research and what is operations and so forth, so that the transparency and purpose of data collection and use needs to be foremost as we move forward, and it needs to be made as easy as possible.

If you are saying to a stressed health care professional, "Work for us. Have we got a great solution for you. And by the way, you can add a couple of hours to your day every day," I don't have to tell you that that will be a tough sell.

I wanted to just end by highlighting some future opportunities.

First, just to let you know that along with our colleagues in the Assistant Secretary for Planning and Evaluation office, we are co-sponsoring a systematic, rigorous review of evidence on the costs and benefits of HIT.

I have shown you studies of variable quality, and we know that there are others out there that we have not been able to identify. So the RAND group will be putting this on to prospectives for us, and we think that this will be very, very helpful as we try to think systematically through trying to make this a bigger part of health care delivery.

I think one overlooked opportunity has been what is the role of the nursing workforce because, after all, doctors are, and will remain, independent contractors. Nurses, for the most part, are employees of health care organizations, and that may be some untapped potential.

And I want to agree with my colleagues, in terms of preparing now for consumers' decisions about costs and the benefits of medications, as well as other health care interventions.

So I wanted to end just by reminding us that almost a decade ago the speaker of the House, when discussing a medical problem faced by a member of his family, said, you know, in theory, we ought to be able to go on-line and find out about the risks and benefits of alternative treatment strategies, what it costs, which doctors and organizations provide the best quality of care. And the bottom line is sort of what you see on this slide--what is the best strategy for people like me? Technically, we know how to do this, and the big challenge ahead is making sure that we can array the information in such a way that consumers and patients can make truly informed decisions.

Thanks for your attention.

MR. GINGRICH: It's a little sobering to be sitting on a panel being quoted from 10 years ago.

Let me just say, in terms of an example of "Saving Lives and Saving Money," in addition to everything that Carolyn just laid out for you, take a look at today's New York Times article about several hundred unnecessary heart operations in Northern California and realize that had we had real-time information technology reporting a variety of things, this would almost certainly have cropped up as an outlier very early in the process. And there apparently were literally several hundred people who were giving heart operations for the economic benefit of the doctor and the hospital in a way, which is just a stunning article, but reminds you that in the absence of data and in the absence of connectivity, you have to assume people follow incentives, even if sometimes to perverse and destructive links.

So I suggest that as an example of a different kind of patient safety, and we appreciate all of you listening to all of this material, which has probably been pretty overwhelming, but let's toss it wide open to questions.

You have to wait for the microphone to get to you or you're a bad person, and we don't allow you to talk for the whole rest of the day.

MR. ROFF: Peter Roff, with United Press International.

One of the things that I didn't hear addressed is the cost imposed on the health care delivery system by the tort bar, by the legal challenges, medical practice, both in terms of the administrative costs of the recordkeeping that doctors have to do to protect themselves in the event that they're sued for malpractice or for hospitals, but also in the role that those concerns make or those concerns play in determining the course of treatment for a patient.

MR. : Yes, a very good point.

Mark McClellan, who, before he became FDA Commissioner, used to be a very good economist. I think he probably still is. He did the landmark study on this, and he pointed out several facts.

First of all, because there is this threat of litigation, physicians do tend to repeat tests and tend to double check and so on. That's an important issue, but it also interacts with the way the physicians are compensated. The physicians are typically compensated or are often compensated on a fee-for-service basis. Most physicians are not salaried. So you have this powerful threat of litigation, coupled with this powerful economic incentive that I'm going to be paid more. If I do this thing, it isn't going to hurt my patient. It protects me. I make some money. Good deal, huh?

Good deal for the individual, bad deal for the system.

MR. ADLER: My name is Fred Adler, and I guess I'd like to direct my question to Carolyn. I'm with part of the supercomputing community.

I wanted to invite your comment on the report that the last administration did on--the President's Information Technology Advisers--on transforming health care through information technology. They made several recommendations and so forth.

Can you comment on that, as far as what's happening and what is likely to happen? And furthermore, now that PTAC has been reconfigured, do you have any suggestions or recommendations to colleagues as to how a group like that can really come to the table and take an aggressive follow-on stance to accelerating the process for information technology-based innovation in the health care space?

DR. CLANCY: I would need to follow up with you afterwards about looking at the specific report that was done in the last administration, and I'd be happy to do that.

A couple of our former grantees who have been way ahead of the curve in terms of health information technology are now members of PTAC. So we have been in touch with them quite a bit in terms o