The State of Health Care
Our current health care system, with its $3.3 trillion price tag, has left both patients and providers demanding better.T
he moment a patient interacts with a doctor can make or break the health care experience.
“Most people, when they come to see us, want a doctor who will hear them, see them, listen to them, and incorporate what they see and hear and take seriously the complaint or issue,” says Dr. Michael Wagner ’81, the chief physician executive at Wellforce health system in Massachusetts.
When this scenario occurs, patient satisfaction is high. But unfortunately, in the initial meeting, there are many other transactions for the doctor to think about, including electronic records, federal requirements and regulatory compliance.
“The doc’s mind is reeling with all sorts of other things they have to remember to do,” Wagner says.
Improving the patient-care experience—while at the same time reducing provider burnout—is Wagner’s primary mission at Wellforce, a system that includes nearly 3,000 physicians and four community hospitals, as well as Tufts Medical Center and Floating Hospital for Children, where Wagner served as president and CEO before joining Wellforce in May.
A few months into the job, Wagner’s enthusiastic about the task at hand. He has experience with nearly every aspect of the health care delivery system, and his nontraditional career path has kept him at the forefront of many of the biggest trends in an evolving industry. He’s confident he knows what needs to be fixed, and he has plenty of ideas about how to do it.
He also knows it won’t be easy.
HEALTHC CARE IS unbelievably complex. “It’s the most complicated industry in the U.S.,” Wagner says.
A $3.3 trillion industry, health care accounts for 17.9 percent of the U.S. GDP, according to the Centers for Medicare & Medicaid Services. Additionally, advances in science and technology, an aging population, and increasingly complex patient cases continue to drive up costs. In 2016 alone, health care spending grew 4.3 percent from the previous year.
For hospitals, the cost pressures are immense. Staffing and procurement needs are exacerbated by thin profit margins that—due to complicated pricing structures and insurance formulas—often require a fair amount of guesswork.
“We don’t know when people are discharged how much we are going to be paid,” Wagner says.
“Even after we are paid, we don’t know if it’s right. It’s 2018, and we’re still going over the Medicaid cost report for 2006. A substantial portion of a hospital’s profit margin is predicated on cost reports that go back more than a decade.”
The complexities, rising costs and need for shared intellectual capital have driven once-independent hospitals to merge, creating umbrella health systems like Wellforce. Wagner was at the helm of Tufts Medical Center when the decision was made to come together with Circle Health (which included Lowell General Hospital) to create Wellforce.
The prospect of health systems displacing independent hospitals concerns some industry experts. However, providers believe patients receive a fuller spectrum of care because these systems, especially in cities like Boston, can attract world-class talent and increased resources. The argument is that it’s not about buildings but treating people.
“We wanted to be part of something bigger—to focus on putting patients at the center of care and figure out solutions that support our providers. We thought, ‘Let’s do it locally, where we can, and lower costs and get higher-quality and better care for the patient.’”
WAGNER NEVER PLANNED to become a doctor.
The last of nine children, he doesn’t come from what he calls a “medical family.” His father was a chemical engineer at Pfizer; his mother, Toni Wagner, was an associate professor of physical education at Conn. He grew up in Ledyard, Connecticut, just across the river from campus. By the time he was in high school, his parents were nearing retirement.
“One Friday afternoon, my dad sat me down and said, ‘Son, you are the last of nine,’” Wagner remembers. “Obviously, I’ve figured that out by now, Dad. But what I remember is he said, ‘We don’t have any more money, so your choices are Conn or UConn.’”
Wagner went to medical school at Georgetown, where his background in math and analytics led him to study clinical decision-making and clinical decision analysis. He completed his residency in internal medicine at Dartmouth Medical School, where he was named chief medical resident and discovered his interest in the administrative side of medicine.
He eventually joined Cove Health Care, a venture-capital-backed startup that was building hospitalist programs across the eastern U.S. Wagner was then recruited to become the chief executive officer of the hospitalist division of Dallas-based EmCare Inpatient Services.
Eventually, the extensive travel schedule took its toll, and he returned to Tufts, working his way from chief of internal medicine in 2008 to president and CEO in 2013.
PATIENTS TODAY ARE far more complicated than they were even just 10 years ago. More patients are living with multiple major medical issues—diabetes, heart disease, cancer, severe bodily trauma—and they are on more medications than ever before.
“Gone are the old days of see, take care, discharge,”
It’s an expensive problem. A mere 5 percent of patients—the most complicated cases—account for nearly 50 percent of all medical spending in the U.S., according to a 2012 study by the U.S. Department of Health and Human Services.
To better care for these patients and improve health care delivery overall, providers need to focus on holistic treatment and long-term outcomes for complicated cases, Wagner says. Sounds simple, but the current fee-for-service model, which pays physicians based on individual treatments, isn’t designed for that.
“The cost structure demands providers see more and more patients in a finite amount of time. How is one doctor really thinking about 1,500 to 2,000 patients?”
This “treadmill of patients” is also a leading cause of provider burnout. Wagner believes a key part of the solution will be reimagining primary care.
“Primary care has been seen as this necessary evil, when it’s actually driving an important enterprise,” Wagner says. “Primary care is the first impression a patient gets and what keeps a patient connected with the health system. [This provider] can be the one thinking about multiple issues.”
Wagner envisions a more proactive, team-centered environment where physicians, physician assistants, nurse practitioners, care managers and medical assistants collaborate to think long term about the most complicated cases and to handle simple cases quickly and efficiently. But ultimately, Wagner believes the health care industry will have to move from a fee-for-service model to a global payment system to incentivize positive outcomes rather than individual services.
“Under the present system, if I reduce costs, the benefit goes to the insurance company. And that hasn’t resulted in lower premiums,” Wagner says.
“I believe strongly—and Wellforce believes strongly—that the world will move toward value, toward managing things globally to make smarter decisions for better outcomes.”
To illustrate, Wagner tells a story about a Wellforce patient, a child with Type 1 diabetes who wanted to go to summer camp. The child’s family couldn’t afford the camp, but care managers worked to make it possible for the child to attend in order to take advantage of the camp’s health benefits.
“We need to be able to think about this kind of thing from a total well-being perspective,” Wagner says. “A lot of times, it isn’t even a lot of money, but it can have a big impact on someone’s overall health.”
THE UNCERTAINTY SURROUNDING the future of the Affordable Care Act (“Obamacare”) is making many health systems around the country wary of changing models.
“Things are all back up in the air," Wagner says.
Massachusetts passed its own health care reform law in 2006, which has helped insulate the state from some of the uncertainty at the federal level. Providers here assume patients have insurance, and if they don’t, they are able to help patients acquire it.
In this environment, Wagner believes small, nimble systems like Wellforce can make significant changes. The health system has already increased the number of patients seeking care in community hospitals rather than in big-city hospitals with big-city prices. That can save thousands of dollars on a single procedure, and those savings add up quickly.
But other external factors threaten to hamper Wellforce’s maneuverability in the market. Wagner has been a vocal opponent of a proposed merger between Beth Israel Deaconess Medical Center, Lahey Health and several other hospitals, arguing that it would leave the state with two mega providers that could raise prices and siphon patients with private insurance away from lower-cost providers. That would leave small community hospitals that serve a higher portion of Medicaid patients—like those within the Wellforce system—without the subsidies they rely on from commercial payments.
Massachusetts is also considering a ballot initiative that would limit the number of patients one nurse can care for in any hospital in the state. Proponents argue that overburdened nurses lead to poorer health outcomes. Opponents, including the Massachusetts Health & Hospital Association, argue that the patient caps are too rigid and costly and could put some hospitals out of business. It’s a highly contentious issue that contributed to a July 2017 nursing strike by more than 1,000 Tufts Medical Center nurses.
Despite the challenges to innovation throughout the industry, Wagner believes change is inevitable.
“People go into health care today for the same reason they did 50 years ago—you go into it because you care, you want to make a difference. As a society, we’ve made health care so cumbersome and difficult, it’s zapping the life and energy out of people. We need to keep [providers] excited.”