Health-Care Issues Remain

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“Nobody knew that health care could be so complicated.” — President Donald Trump I was shocked by the quote above from our president, who made this statement in February 2017, soon after being inaugurated. As you all know, this statement was followed by six months of political debate over the repeal and replacement of Obamacare, also […]

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“Nobody knew that health care could be so complicated.” — President Donald Trump

I was shocked by the quote above from our president, who made this statement in February 2017, soon after being inaugurated. As you all know, this statement was followed by six months of political debate over the repeal and replacement of Obamacare, also known as the Affordable Care Act. Contrary to the president’s statement, virtually anyone that has any connection to the U.S. health-care system knows that it is extraordinarily complicated. Medical professionals, health-system employees, patients, suppliers, vendors, and the majority of the citizenry would clearly disagree with the president’s statement that “nobody knew.”

This past six months, I have debated with myself whether a column related to health-care reform would be of value. After considerable thought and reflection, I realized that the following column, originally published in the Rochester Business Journal in January 2005, was as relevant today as it was then. As you read the following, it will be clear that the health-care debate has been a subject in political football since the enactment of the Medicare and Medicaid programs in 1965. As you read, remember that I did not have to change one word of what I published in the column some 12 years ago.

•••

January 2005 column

Our health-care cost crisis is of our own making. Before launching into my health-care solutions agenda, please be advised that my opinions are predicated on a foundation of irrefutable assumptions.

• All people are created equal
• No human being is immortal
• We live in a capitalist, not socialist, economy
• Every individual has a right to access health-care services
• Socioeconomic factors create inequality in wealth distribution
• Health-care cost is of legitimate concern
• The vocal majority rules in health-care decision-making
• There is no such thing as unanimous support for health-care policy decisions

With these baseline assumptions, allow me to articulate a 10-point program for improving the cost-effectiveness of our community’s health-care system. Even though I must admit a fiscal bias due to my profession, the quality of health care is of equal importance in addressing these potential solutions. Also, I never intend to run for political office, and these opinions will ensure that I could never be elected.

With all due respect to myriad interest groups and health-care lobbies, here is Archibald’s Top 10 list, in David Letterman format, with no humor intended:

10. Controllable behaviors that negatively impact an individual’s health should be reflected as an increased cost in insurance premiums. If I smoke two packs a day, I should pay more. Abuse of controllable behaviors costs more in life and automobile insurance, why not health care? Tobacco and alcohol companies, beware.

9. Tort reform and caps on personal injury, pain and suffering awards are a legislative requirement. Maine took the first step in what I hope will be a trend in limiting awards in the litigation area. One of the platform issues of the new administration that I agree with is tort reform.

8. Successful reform of the health-care legal system should allow providers to immediately reduce costs associated with defensive medicine. The costs of unnecessary visits, tests, and procedures ordered by service providers to reduce the potential risk of litigation total billions of dollars each year. And malpractice-insurance-premium decreases will be an ancillary benefit.

7. Reintroduce the consumer’s wallet into health-care access and decision-making. If an individual wants to access health-care services, there should be a direct cost to the consumer, subject to income limitations. The recent adoption of health-savings accounts as an incentive for employers and employees to take control of escalating health-care costs is a paradigm shift in our government’s attitude towards health care. Health-care costs are virtually invisible to consumers, and a Wegmans vs. Tops price comparison would certainly affect costs. If you want proof, look at the declining cost trends for Lasik surgery procedures.

6. Reduce the level of administrative and regulatory compliance costs in health care. Depending upon the study, costs in these areas consume up to 26 percent of every health-care dollar. The potential savings are enormous.

5. Technology advancement is wonderful and our nation’s research industry is the finest in the world. However, technology advances frequently increase costs through obsolescence of existing equipment and the incremental cost to providers of adding the new technology. This area may be one of the most difficult to address since any control mechanism that limits new technology must be balanced with appropriate incentives for research initiatives.

4. Controls over the drug manufacturers and pharmaceutical suppliers must be established. The efficacy of drug therapies must be assessed. Blatant and excessive advertising by the pharmaceutical industry to a public that is largely not responsible for the drug cost must be reined in. The final three items on my list are the most controversial of all. If I haven’t lost your vote yet, I am confident that the “Big Three” will push you to pull another lever.

3. Health-care capacity must be addressed through a local community effort. The debate is not about either competition or cooperation but, as Deion Sanders once said, “I want both.” Health-care delivery in this country is largely controlled by local communities. Competition among service providers is an essential element of health-care cost and quality in every community. Leadership without bias is a necessity for success in this area.

2. Establishing standards for patients’ expectations of their right to access health care, both basic and advanced, is a necessity. The research discoveries on the near horizon from genetic mapping will create new opportunities and make obsolete existing equipment and facilities. Bioethical debate must address the essential question of, “Who is entitled to what and at what cost?”

1. End-of-life care must be addressed. We are making progress in this area with health-care proxies, palliative-care initiatives, and other planning processes. However, it’s staggering to know that the majority of your lifetime health-care costs will be spent in the last year of your life.

Health-care spending is approaching 15 percent of our gross domestic product. The baby boom generation, of which I am a proud member, is beginning to retire. The health-care issues we face as a community and a country are overwhelming.

As CEO of Excellus, the dominant insurer in our community, David Klein’s piece in the Dec. 19, 2004, edition of the daily newspaper was of interest. He stated: “A healthier community is fostered when its business leaders, physicians and other health service providers are included in the dialogue and when these professionals work in an environment that has its major health service and financing organizations working more cooperatively and with a focus on community benefit.” While this quote is a mouthful of words, action in support of this philosophy is what is needed.

Each of us must look in the mirror. A realistic assessment of our mortality and myriad issues that must be addressed is imperative. True innovation and industry reform can be a reality in health care.

Ignoring the debate and compromise necessary will only make matters worse.

•••

The only modification to the 2005 column is that health-care costs now represent 18 percent of our gross domestic product. It is truly fascinating to me how little has been accomplished in the past 12 years. We can only hope that the future will bring rational reforms that address each of the major issues discussed in my 2005 column.

Gerald J. Archibald, CPA, is a partner in charge of the management advisory services at The Bonadio Group. Contact him at (585) 381-1000, or email: garchibald@bonadio.com

Sales Pitches That Don’t Sell

Business Mentors, Nonprofits, Subscriber Only

Sales pitches are short-cuts that save time and don’t require thinking. They’re the stock-in-trade of salespeople, rolling off the tongue easily and unconsciously. They once worked well with customers, but not so much today. Here are some of them. “How can I help you?” This one gets top billing on the list, and deservedly so.

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“How can I help you?” This one gets top billing on the list, and deservedly so. It’s a leftover from the last century, when customers needed assistance and relied on salespeople and marketers, as well as the iconic Sears catalog, to point them in the right direction, followed by the ubiquitous shopping mall. While the catalog is long gone, the mall is fast going dark.

When you think about it, “How can I help you?” is insulting, a turn-off, and a crutch. It’s as if customers lack the ability to identify what they want and then to find it. A more adult approach would be to say, “Let’s talk about what you have in mind.” The role of salespeople and marketers is no longer that of a guide, directing customers to what they want to sell them. Those who make sales are coaches, who take the time to figure what’s in the customer’s best interest.

“We are the competition.” While it may work for Ferrari, this one is nothing more than a self-serving attempt to raise the “look no further” flag. A company that believes it’s out in front of the pack can back up the claim by comparing its product or service so customers can make that judgment for themselves.

There are no secrets today, so attempts at obfuscation or pulling the wool over the customer’s eyes is self-defeating.

“I have just what you’re looking for.” This might be described as the “presumptive opening” or, more accurately, as the “This is what I’m going to sell you, so save time by getting your wallet out now” strategy. Rather than attempting to engage customers, it’s more akin to browbeating than anything else. On top of that, it’s repulsive and demeaning to customers.

“We’ve been in business for 37 years.” There was a time when longevity made a compelling statement for customers, sending a message of stability and that somebody was doing something right. Not now. In fact, it may be just the opposite in the customer’s mind, as companies merge, fail, and, more likely, fall behind.

Old is out. Today, customers flock to startups, the new, and the innovative, particularly if the CEO is 23, not 63.

“You’re going to love this.” Whether it’s a house, an engagement ring, or a refrigerator, telling customers what to think can mean trouble. It’s demeaning, particularly when a stranger, such as a salesperson, does it. And it can come back to bite you. Even though customers make a purchase, they can come to resent being told how they should think about what they buy. What follows is a cancelled order or a quick return. And, no more sales.

“You’ll never do better than this price.” Sure, everyone in marketing and sales is justifiably concerned with price, more so every day. But that’s no excuse for arrogantly announcing to customers that they’re, in effect, stupid not to buy from you.

Such tactics may have worked in the past, but today’s customers don’t respond positively to such tactics. They want the evidence and they feel capable of their own research, even as they’re talking to a salesperson.

“Time is running out. Once they’re gone, they’re gone.” Yes, and you might want to throw in “Order now. Only 11 in stock.” Scarcity gets attention, as psychologists tell us. We balk at losing something we already have for the possibility of greater gain. This can help explain the appeal of mutual funds versus buying individual stocks.

Yet, we also don’t want to lose something we don’t have, particularly if it’s in scarce supply. It’s not surprising that such pitches as “Prices going up in 2 days” and “Only 3 left in stock” are irresistible, and, like magic, compel many customers to hit the “Buy now” button. While there are takers, the more thoughtful and better-informed buyers say, “Thanks, but no thanks.”

“I can see you know what you like.” Customers want to be treated with respect, but today’s customers avoid manipulation by fake praise that’s designed to create a “bond” with the salesperson. Instead of dwelling on ways to get the sale, it’s far better to focus on listening thoughtfully to what a customer says and the questions he/she asks.

“I don’t know how long that’s going to be available.” An upscale retailer had a one-day furniture sale and the place was jumping. Months later, the retailer held a two-day sale event for customers. Much of the same merchandise was shown at the original “special price.”

Playing games with customers destroys buyer confidence and can produce long-term negative consequences. No one wants to be played for a fool.

“Your friends will love it.” This one is used as the “persuader,” when selling everything from clothing to homes, cars, furniture, and jewelry, and the like. It’s aimed at the unsure, the indecisive, the confused, and those who don’t trust their own judgment. It’s as if the customer’s friends got together to give their permission to say yes. It’s a ridiculous idea.

“If you can get a better deal, take it.” This sounds as if a salesperson is daring the customer to find a better price. Not so. In reality, the purpose is to get the customer to back down, to give up, and capitulate, and buy now. Today’s savvy customers don’t take the bait. Instead they take the advice, track down a better deal — and take it.

So, what? Thoughtful salespeople and marketers are aware of the words they use with customers. Do they send the right message? Are they helpful in closing more sales? Or, are they repeated endlessly without thought or meaning?

John R. Graham of GrahamComm is a marketing and sales strategy consultant and business writer. He is the creator of “Magnet Marketing,” and publishes a free monthly eBulletin, “No Nonsense Marketing & Sales Ideas.” Contact him at jgraham@grahamcomm.com, or visit: johnrgraham.com

Today’s ACA forecast: More uncertainty from Washington

Opinion, Subscriber Only

With the failure to repeal/replace the Affordable Care Act (ACA) in Congress, state lawmakers should stop waiting on Washington to “do something” about health care. Congressional action, no matter what that action looks like, is unlikely to address the unmet Obamacare promises of delivering health-care access and affordability. Furthermore, an upcoming decision from President Trump on

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Furthermore, an upcoming decision from President Trump on what do about ACA’s cost-sharing reductions could make the future of the ACA even more chaotic.

More uncertainty is looming
Cost-sharing subsidies totaling about $7 billion were implemented to reduce out-of-pocket costs, such as co-payments and deductibles, for individuals and families below 250 percent of poverty. The cost-reduction payments have not only been controversial, but they are also at the center of a legal battle.

In 2014, House Republicans filed a lawsuit to end the payments since the funds were paid but never appropriated by Congress. The court sided with the House, but the Obama administration appealed. The Trump administration has yet to announce a decision on whether to continue these payments.

These payments will not only impact potential premiums for the 2018 plan year, but also may determine whether there will be a continued exodus of insurers from the ACA exchanges. If these subsidies do not continue, exchange insurers may decide to exit the exchange markets. Their contracts with the U.S. Department of Health and Human Services (HHS) stipulate that, should subsidies end, they can immediately leave the market.

Insurers that stay are expected to raise their premiums even higher to cover the lost cost-sharing subsidies. That would be in addition to the already high anticipated premium increases.

Fewer insurers and higher premiums

Insurers have already been fleeing the exchange markets over the past couple of years. Last year, Pinal County, Arizona was in danger of being the only bare county in the U.S. The state Department of Insurance scrambled to bring in an insurer before open enrollment began.

For most counties, premium increases will be steep. Average premium increases will be in the neighborhood of 20 percent. Premium prices are coming due, and with the prospect of uncertainty looming well past that deadline, there is a good reason to believe that many markets will see rates rise even higher.

What states can do

Regardless of what happens next in Washington, state-level policymakers should continue to strive for meaningful health-care reforms to impact the cost of care in their states. Reforms such as expanding state scope-of-practice laws, rescinding certificate-of-need laws, and protecting charity care efforts can impact health-care access and cost of services.

Scope of practice: Health-care practitioners should be allowed to practice at the top of their education and training. For example, pharmacists are not allowed to administer vaccinations in some states despite being well qualified to do this with minimal risks to the patient. Furthermore, rolling back scope-of-practice laws can help alleviate the shortage of health-care providers, especially in rural areas.

Certificate of need: Facilities and services should be available on the basis of able and willing providers, not on government-sanctioned boards deciding who should be allowed to serve patients. Rather than restraining costs, certificate-of-need laws consistently restrict health-care access and competition.

Charity care: States can also enact Good Samaritan laws that provide legal protection for those offering health-care services. These protections can be particularly helpful for allowing charity groups to provide large-scale charity operations and for medical personnel wishing to assist in response to natural disasters.

Direct primary care (DPC): This is an innovative health-care arrangement that allows patients or their employers to contract with a provider for primary care medical services directly. DPC allows patients to directly and more immediately access non-emergency care and, under many arrangements, allows them to do so as many times as needed at no additional cost. Unlike a typical health-care arrangement, DPC operates independently of traditional health insurance. But in some states, decades-old regulations originally designed to govern the health-insurance market are being imposed on these arrangements, stifling the potential growth of this new health-care option.

Telemedicine: In many states, it is legal for doctors to prescribe treatments through the Internet without ever meeting a patient in person. Unfortunately, there is an increasing push in some states to impose new regulatory burdens on practitioners that have no significant bearing on patient safety. For example, some states have adopted distinct clinical practice rules for these new services that are more onerous than those imposed on traditional providers.

Promote access and affordability

While there is no silver bullet to the problems facing the American health-care system, the answer to the nation’s health-care woes doesn’t lie in bigger bureaucracies and less accountability. That is why state lawmakers should not wait on Washington. They should begin work on meeting the unmet goals of ACA, promoting health-care access and affordability.

Naomi Lopez Bauman is Director of Healthcare Policy at the Goldwater Institute. The institute says its mission is to “defend and strengthen the freedom guaranteed to all Americans in the constitutions of the United States and all 50 states.”

JAMIE JACOBS

People on the Move, Subscriber Only

JAMIE JACOBS has joined the management team at Riger Marketing Communications, becoming a new partner at the agency. She will acquire equity in the company over the next five years. Jacobs’ career at Riger began as a student intern in 2005. Since then, she has held a variety of positions including account assistant, copywriter, and

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WILL LANDRY

People on the Move, Subscriber Only

ABC Creative Group recently added a new media buyer to its marketing team. WILL LANDRY is well-versed in all aspects of media, having worked behind the scenes in management roles at WCNY and Johnston & Murphy. He was also an anchor for WTOP News 10 in Oswego. Landry’s varied skillset and industry experience will be

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Barton & Loguidice

People on the Move, Subscriber Only

Barton & Loguidice has added four new employees to its Syracuse office. WILLIAM SPARKMAN will be working for the facilities and environmental groups at the firm’s Syracuse office as a project engineer. He received his bachelor’s degree in civil engineering from Cornell University. JESSICA MARTINEZ has joined the water/wastewater group as an engineer I. She

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Bankers Healthcare Group

People on the Move, Subscriber Only

Bankers Healthcare Group (BHG) has hired CHARLIE BEELER as a public relations coordinator. He is responsible for managing regional PR initiatives and assisting with content creation. Beeler is a recent graduate of SUNY Cortland, where he studied communications while interning with their communications office. RUSSELL HARLESTON, JR. has been hired as a wellness

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JACQUELINE (JACKIE) BANGE

People on the Move, Subscriber Only

Generations Agency has hired JACQUELINE (JACKIE) BANGE as commercial-lines assistant. She will work from the agency headquarters in Seneca Falls and assist existing and potential clients with policies, as well as processing, quoting, claims, and service. Bange brings more than five years of business and financial experience to the position and holds a bachelor’s degree

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Schneider Packaging Equipment

People on the Move, Subscriber Only

Schneider Packaging Equipment, which manufactures and installs end-of-line packaging equipment, has promoted BOB BROTZKI to president. He will be taking over the role formerly held by owner, RICK SCHNEIDER, who will continue to lead as CEO. Brotzki has continued to rise within the company since he began his career 1½ years ago as director of

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CNY Tweets – September 4

Business Mentors, Subscriber Only

Some recent tweets that came across the @cnybj Twitter feed, offering various business, career, personal, and digital/social-media tips: NFIB‏ @NFIB Has your #smallbiz recently gone through any of these eight changes? If so, it’s time to update your #businessplan: http://on.nfib.com/2xsym3M UVC‏ @UVConnect Learn company culture at Upstate Unleashed on Sep 19 from @dwdussault, Founder @P1Industries,

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