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December 01, 2008

Divided We Fail: Leaders Urge Action on Health-Care Reform

by William D. Novelli

As leaders of organizations representing well over fifty million American consumers, workers, CEOs of the nation’s largest companies, and small business owners, we believe that bipartisan health-care reform is critical to a strong economy, personal financial security, and long-term fiscal stability. We—AARP, Business Roundtable, Service Employees Union International, and the National Federation of Independent Businesses—have joined together to form Divided We Fail, an effort to break the partisan gridlock to improve health care and long-term financial security for all Americans. We are writing to urge you to commit to taking steps in the first one hundred days of your administration to move health-care reform forward.

Over the past two years, we have worked together to engage Congress, other organizations and businesses, our members, the public, and the media on the urgent need for reform. We have secured pledges or letters from 366 mem bers of Congress who have committed to put aside gridlock and take action on health care and financial security; we have secured pledges from more than one million American voters who identify bipartisan action on these issues as top domestic priorities; we have hosted issue forums on health care and financial security in every state; we have invested tens of millions of dollars on national television, radio, and print advertising; we have hosted multiple national issue forums and briefings on Capitol Hill; and we’ve jointly endorsed legislative solutions on wellness and prevention, health information technology, and transparency of health data.

Our nation faces unprecedented economic uncertainty, and you, as our new president, will be working to get our economy back on track. Addressing skyrocketing health-care costs is a critical component of stabilizing household, national, and global economies. We cannot afford to delay action on identifying and implementing solutions to the health-care crisis. Such inaction undermines the economic security of our families; limits the productivity of our workforce; stagnates job creation and wage growth; and threatens to crowd out investments in energy, education, and infrastructure.

We stand ready to support you in a national effort to mak e access to quality, affordable health care a reality for all Americans. This foundation includes a focus on prevention and chronic care, gives patients more tools to manage both their health and their costs, and builds a more sustainable health-care system that consistently delivers value to all of us, which strengthens us as a nation.

The approach to health-care reform we propose is based on the fundamental principle that all Americans share a basic need: access to quality health care that is affordable enough for individuals, businesses, and society to sustain improvements in health and our financial security for future generations.

We believe that with leadership from the White House, Congress must develop a national approach to health-care reform that focuses on three priorities: (1) expanding access to coverage; (2) increasing affordability and value; and (3) improving quality, efficiency, and health outcomes.

Expanding Access to Coverage

While over 177 million Americans obtain health insurance coverage through their employers, roughly 47 million Americans under the age of 65 are uninsured and less likely to receive needed medical care. More than half of those people are working in a small business. Those without health insurance have higher mortality, lower health status, and lower rates of screening for many health conditions. As a result, they are more likely to suffer from preventable illnesses and to experience complications from these illnesses.

Lack of coverage has adverse effects on the nation’s economy. In 2006, estimates of the cost of uninsurance (due to poorer health, shorter life expectancy, lost productivity, but not costs to society) ranged from $102 billion to $204 billion per year. Sarah Axeen and Elizabeth Carpenter, Cost of Failure: The Economic Losses of the Uninsured, The New America Foundation (2008).

Expanding access to affordable coverage for all Americans would help in the development of better integrated approaches and coherent policies to improve health outcomes. Expanding access to affordable health insurance coverage is essential in building the foundation of a twenty-first century health-care system.

Increasing Affordability and Value

With mounting challenges from an epidemic of chronic disease and preventable health conditions, we spend without regard to results. The United States spends more money and a larger share of its annual output on health care than any other nation. Health care in the United States is inefficient, too often ineffective, and increasingly unaffordable. It lacks the necessary incentives for patients, doctors, and hospitals to make value-based decisions. In short, health-care costs have been rising at two to three times general inflation for the past several decades and are on an unsustainable course.

Health-care costs are out of control for employers and employees. One in four Americans has problems paying medical bills. Many of them go bankrupt every year because of medical costs. And employer health-care costs are sapping our nation’s competitive strength. More than half of the CEOs of America’s largest companies say that rising health- care insurance expenses are their most significant cost pressure, and insured small businesses cite health-care insurance as one of their fastest growing and most unpredictable costs.

We believe that it is possible to make health care more affordable while increasing access to coverage and improving health-care quality, value, and outcomes. But containing costs in health care will require retooling our approach to health-care delivery. It also will require changes in behavior and practices for all.

Improving Quality, Efficiency, and Health Outcomes

Improving the quality, efficiency, and health outcomes of the health-care system requires improving our approach to health-care delivery. A strategy to improve health care delivery should include changes in reimbursement incentives if we expect behaviors to change. Today, most payment approaches encourage the use of services. We need to change incentives that now encourage high volume to incentives that encourage better and efficient care. Care should be based on scientific evidence and should be coordinated, integrated, and centered on the patient, with clear and complete information, communication, and education.

At the same time, the delivery of health care should be better coordinated and integrated. Many factors contribute to the lack of effective care coordination, including low adoption of health information technologies such as electronic medical records; payment methods that fail to reward coordination; and an environment in which patients are often left to coordinate and manage their own care.

People who have multiple chronic conditions face particular hardships in the fragmented health-care system. They are the heaviest users of the health-care system, accounting for 83 percent of all health-care spending in 2001. Chronic Conditions: Making the Case for Ongoing Care, Robert Wood Johnson Foundation (2004). They may see several doctors and often receive conflicting guidance and are likely to experience medical errors, duplicative tests, or avoidable hospital admissions. Care management for individuals, especially those with chronic conditions or disabilities, could improve outcomes by helping coordinate chronic, acute, and long-term care services and by helping ensure that they have access to the full range of services and supports they need.

Principles for Health-Care Reform

We believe that with leadership from the White House, Congress must develop a national approach to health-care reform that upholds the pillars of quality, access, and affordability. For this to happen, Congress needs to act on the following priorities:

Expand Access to Coverage

  • Put consumers at the heart of any new approach.
  • Build upon the strengths of the employer-based system, while providing new mechanisms and markets for coverage.
  • Ensure fair tax treatment of health-care benefits.
  • Ensure that the neediest populations have an adequate safety net and subsidies to make coverage affordable.
  • Place children first by building on SCHIP (State Children’s Health Insurance Program) and its important safety
    net role.
  • Promote personal responsibility through the wide availability of affordable and meaningful plan choices.
  • Spread the benefits of risk-pooling to all consumers.

Increase Affordability and Value

  • Encourage preventive care and wellness programs to save lives, improve productivity, safeguard health, and lower costs.
  • Provide information to help consumers manage their health through healthy lifestyles and disease prevention.
  • Advance health information technology to create uniform interoperable standards that improve the quality of care and decrease overall health-care costs.
  • Reward care that is recommended by evidence, coordinated, and delivered in appropriate settings by clinicians who are engaged in efforts to improve outcomes.
  • Provide coverage to the uninsured and improve the value by reducing the shifting of uncompensated costs.

Improve Quality and Efficiency

  • Coordinate care to fulfill patients’ needs and desires and to improve the delivery of health-care services.
  • Inform consumers with accessible, understandable and readily available data on health-care quality, costs, and outcomes at the level of individual providers, systems of providers, and health plans.
  • Modernize reimbursement policies of both public and private payers.
  • Research the comparative effectiveness of all aspects of the health-care system and make the results publicly available.
  • Improve accuracy and fairness of payments in public programs and create incentives for all payers.
  • Develop specific payment strategies to improve the delivery of care for patients with multiple chronic conditions, including patients in the last six months of life.


If you will commit to taking action on this critical issue early in your administration, we will commit to engaging our members by hosting a health-care reform summit, working with you to develop a proposal as part of your agenda for the first one hundred days, and educating our members and the public about the challenges and tradeoffs reform entails.

Although we are proud of our efforts to focus attention on the need for health and financial security, we need your leadership to achieve these goals. Therefore, we respectfully request that you commit to making health-care reform a priority for the first one hundred days of your administration.