If the Affordable Care Act survives and rolls out between now and 2014, one of its biggest mysteries will be resolved: How much will it really cost?
In budget-strapped California, that is a question still under fierce legislative debate. Arnold Schwarzenegger, who was California’s governor when the act was passed by Congress in 2010, estimated that the state’s share, as it moved low-income enrollees into the Affordable Care program, would be as much as $2.65 billion annually.
The current Brown administration has challenged that figure but has no new estimate – yet. Despite this fact, the state has already begun covering 280,000 people – most of them in Southern California – as one of the Affordable Care Act’s largest pilot programs.
The Obama administration’s last projection estimated that the Affordable Care Act would lower costs nationally for the federal Medicare program by a whopping $200 billion through 2016. The president’s critics are loudly skeptical of that number, but I believe they are overlooking one enormous cost-saving contributor – the industrywide acceptance of secure digital records and information exchange.
This digital record and exchange technology is being rapidly implemented by providers and insurers nationwide under an earlier, less controversial federal reform – the introduction of the Nationwide Health Information Network for moving sensitive medical documents.
That earlier reform is part of the Health Information Technology for Economic and Clinical Health Act, or Hitech Act, which was signed into law by the president in 2009. This upgrade to our national infrastructure has already begun to measurably improve health care quality, safety and efficiency.
As the Affordable Care Act rolls out, it will use that new digital network and an electronic health record environment that was championed and implemented earlier right here in Southern California by health care digital heroes like Dr. Benjamin Chu, regional head of Kaiser Permanente Southern California in Pasadena.
Kaiser’s $6 billion KP HealthConnect system, now deployed across all eight Kaiser regions, is today the largest civilian electronic medical record system, serving more than 8 million members. The returns, however, have been immediate. Just one example: KP reported saving $275,000 in a single year at a single clinic just through the use of its electronic patient reminder system – one small application of its broad and ambitious new digital universe.
Federal participation
Already on board the new Nationwide Health Information Network are some of the federal government’s largest health care delivery providers: The Social Security Administration, the Department of Veterans Affairs, the Department of Defense, the Centers for Disease Control and Prevention, the Indian Health Service and the Center for Medicare and Medicaid Services.
Private health care leaders, like Anna Tran, chief executive of Alhambra-based Care1st (a client of mine), are now using the new network for Health Insurance Portability and Accountability Act-compliant electronic record exchanges, armed with even more affordable tools to work toward better coordinated care between health care stakeholders and to achieve the federal guidelines for meaningful use.
We have known for some time that government-provided health insurance is uniformly lower in cost worldwide. The use of electronic records under ACA will only improve that savings – eliminating inefficient shuffling and misfiling of paper reports and catching redundancy and outright errors in care.
Within the health care community, doctors still need convincing. A study conducted last year (but only announced in June) reported that a majority of physicians in California – 61 percent – do have access to an electronic health record system, but only 30 percent of the 7,931 physicians surveyed use a system that actually meets the tough federal networking and privacy standards.
Most of the California physicians, in fact, were using only simple visit-notification systems and lacked the kind of robust capabilities necessary to exchange and review true quality-of-care records – treatment, diagnosis, preventive care, peer review and insurance reimbursement functions were missing.
With the Supreme Court’s green light to the Affordable Care Act recently, we are now fully engaged in a grand effort to improve our health care system.
Critics within our own state are now challenging whether we can afford such an ambitious revolution in the delivery of care to California’s neediest citizens in the Medi-Cal program.
But let’s not miss our chance for a statewide health care system without borders – a world of care and preventive medicine in which doctors communicate seamlessly with all parts of the health care delivery system.
The question for Californians is really this: How can we afford not to accept and welcome this revolution?
Richard Stephenson is the founder and chief executive of
RISARC, a Burbank consulting firm to the health care industry.
