The Wrong CEO for Medicare
Obama's nominee to head Medicare, Dr. Donald Berwick, is a respected academic physician. But can he turn around an agency with a $500 billion budget?
This week, forty-two Senate Republicans signed a letter to President Obama asking him to withdraw the nomination of Dr. Donald Berwick to head Medicare. The Senators argued that Berwick lacked the experience needed to head such a complex agency. They’re right.
The Medicare program is one of the largest entities in the U.S. government. It’s a government health insurance plan that sets prices, determines coverage rules and pays claims, just like any insurance plan.
There’s one big difference between Medicare and other insurance companies thought: Medicare is going to bankrupt us. It’s also shown a complete inability to prevent fraud. A recent GAO study suggests that 10% of its $500 billion dollar budget is spent on fraudulent claims.
Who would be the right kind of person to run such an organization? It’s pretty clear that one would want a tough administrator who has managed billion dollar budgets. Someone who understands the insurance business, who has created health plans and is knowledgeable about insurance fraud prevention. Of course, since Medicare is a health insurance plan, it ought to be someone familiar with the intersection between healthcare and the business world.
Dr. Berwick is a highly respected academic physician who’s been at the forefront of the quality improvement movement and patient safety movement in healthcare. His well-known appreciation of the British National Health Service has been the source of major Republican objections to his appointment. Whether or not that is a legitimate basis for rejecting his nomination is up to the Senate to determine. What should be the true object of scrutiny is whether his skills and experience match the job description. It’s hard to argue that they do.
More likely it appears that Berwick’s appointment was a sop to the various medical society lobbies that value his academic credentials. His selection also plays into the trope Obamacare is an extensive reformation of health care delivery in America. This is simply not the case.
Yes, there is a plan to create demonstration projects where physicians and hospitals will have to develop systems to collaborate on care. This will hasten the massive consolidation of providers going on around the nation but probably do little more than that. Embedding this plan while also preserving the fee for service components of Medicare will create an untenable and unmanageable situation.
The only individuals who have the experience to run Medicare live in the private sector: health insurance company CEO's. Unfortunately, the Obama administration won’t turn to the very health insurers they’ve been vilifying to help fix Medicare.
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