On Demand: Sustaining the Military Health Benefit at a Reasonable Cost

Spiraling health costs threaten our nation's ability to compete in a global economy. But the U.S. military has unique resources that show the way to a sustained health benefit. To get there, we must abandon our current model-which mirrors the failing civilian system.

Civilians ask the health sector to control costs while providing total customer satisfaction with care on demand. Instead of following suit, the entire military-not just the health system-must reduce demand by addressing beneficiaries before they become patients. In this model ol proactive health, every sector aligns against powerful cultural and market forces to maintain a world-class health benefit.

The Crisis

Defense health spending is a warfighting crisis. This year's $36 billion dollar price tag, already more than twice the budget of the entire U.S. Marine Corps, is on track to double within 10 years.1 Meanwhile, we are not very healthy and our recruit pool is shrinking. A child horn today has a 50 percent chance at obesity, and a 33 percent chance at developing diabetes.2 We must turn the tide. The military currently approaches healthcare cost control like civilians. Trapped between an inability to say no and an inability to afford yes. leaders expect the health system to meet expanding beneficiary demands at a lower cost. Toward this conflicted mission, our military system relentlessly pursues low cost, high volume care. The model has three problems. First, we face morale and retention crises in providers accountable for volume, hut with little control over personal efficiency.

Second, we pursue economy (low cost and high volume) instead of value (low cost, high volume, and high quality), because quality has proven very hard to measure. Third and most important, perfectly efficient delivery of high value care cannot save us from insatiable demand.

It has been said for centuries that the desire to take medicine is perhaps the greatest feature that distinguishes humans from animals. However, desire means market in a capitalist system, and the multi-trillion-dollar American healthcare market is systematically expanding itself-and whipping Americans into a healthcare feeding frenzy. This goes far beyond drug ads. One cannot visit a U.S. supermarket without a magazine pointing to a doctor's ineptitude in withholding tests and referrals. One cannot drive down a road without a smiling lawyer offering to "help" us. And one cannot encounter any form of media without a report on some "new" treatment.

Americans gobble up this marketing in our culture with a mandate of individual self-determination, acceptance of individual self-destructive behaviors, ignorance about health care's actual cost or capability, and the expectation that perfect health is a right for which someone else should pay. It's the American way, it's doomed to failure, and it's going to be hell to overcome.

A Brief History of Failed Cost Control

The health sector of our civilian economy will never address demand, as this juggernaut want and needs demand for its success and survival in our tree-market economy. To illustrate, let us examine several industry responses to stakeholders' (i.e. business's) cries for cost control.

* Bureaucratic obstacles to beneficiary care or provider payment: forms, lack of available appointments, preauthorization requirements, actual or feigned incompetence, and so on. In response, employers create competing oversight and quality-control bureaucracies, and providers create competing billing bureaucracies. In other words, we pay dueling bureaucracies to reduce costs. And the very existence of these bureaucracies depends on healthcare demand. As a long-term solution, this is simply lunacy.

* Providers may agree to reduced reimbursement in exchange for volume. Preferred provider organizations are an example of this method. However, this short-term solution restricts supply and will, paradoxically, increase long-term costs in any economic model with increasing demand.

* Health maintenance organizations combine both of the above methods, and beneficiaries demand care but voluntarily accept access restrictions. Jusi as neither price negotiation nor bureaucratic obstacles limit demand, neither does the HMO.

* Consumer-directed methods shift costs to beneficiaries through copays, deductibles, and health savings accounts. Although they purportedly reduce demand, they more accurately reduce short-term costs. Proponents of these methods frequently cite a large study from the 1970s showing that beneficiaries with access to free care had double the demand of the uninsured, with only marginal health benefits.3 The study also showed that all care was reduced-both necessary and unnecessary. So these methods may prove useful tools to reduce costs from minor acute illness, but they may backfire in major chronic illness.

The military health benefit begins at age 20 (with enlistment) and lasts to at least age 65 (Medicare eligibility, and longer now with Tricare for Life). Therefore, the military's 45+ year ownership period may greatly magnify the marginal results of the eight-year study period, because tighter disease control avoids long-term complications.

Reducing Demand: Good News and Bad

We need a new model in which we all address demand at its roots. Specifically, we must change our philosophy-in the face of obvious opposing cultural and market pressures. We must reform our delivery system and focus on growing beneciaries who appropriately access their world-class health benefit when they become patients.

The U.S. military is uniquely suited to such a vision. We have a collaborative relationship with an integrated healthcare system that is largely free from conflict of interest. Also, we control many diverse aspects of our communities (exchanges, dining facilities, commissaries, restaurants, gyms, pools, and so on). Most important, we are the acknowledged world experts at creating healthy cultural change in young adults.

However, we must find the sustained political will to transform. We need to redistribute accountability for healthcare cost throughout an unaccustomed enterprise, which means asking some sectors (e.g., commissaries and exchanges) to abandon their fundamental civilian business model of maximum profits through total customer satisfaction.

Also, bearing in mind that no single drop of rain thinks it is responsible for the flood, a concerted attack on self-destructive and/or selfish behavior requires sustained vision and careful communication to face the inevitable beneficiairy and industry backlash. Finally, our warfighters need a non-intuitive new focus (and a politically incorrect one, in military culture) on young wives. Numbering almost Haifa million, they are the least visible and least understood sector of our beneficiary population-and the most demanding, costly, and influential one.

Fixing the Military Primary Care System

As we diverge from the civilian model, we must first expand our primary care capacity. This will meet promised access standards and recapture primary care that we now purchase from the civilian market. To do this, we must:

* Abandon our civilian-mirrored paradigm that leaves our primary and preventive care providers as our most undermanned and underpaid specialists. Restore necessary manning, whatever the cost.

* Continue strong support for graduate medical education in primary care specialties.

* Aggressively recruit and retain good nurse practitioners and physician's assistants.

For an immediate increase of our primary care system capacity, we should encourage beneficiaries to self-manage the minor illnesses thai hog down our primary care system to the point of paralysis. This would include eliminating over-the-counter medications from our military treatment facility (MTF) pharmacies. The benefit is unparalleled and unnecessary, and it encourages access at the slightest sniffle. It would also mean encouraging leadership-initiated sick days and/or light duty: many of our junior leaders encourage access at the slightest hint of illness.

Reducing Emergency Department Visits

We cannot continue to ignore the bad behavior of beneficiaries who demand immediate emergency room gratification for acknowledged non-emergencies. We should offer better choices-expanded primary care hours or a strong urgent care benefit. And we should penalize bad choices-perhaps with a token copay. And perhaps the copay should be more than token for civilian emergency departments in MTF catchment areas: we must halt the common practice of beneficiaries who spend thousands of federal dollars to avoid a twenty-minute drive.

Another problem is that bureaucratic access obstacles can render the emergency room as the only understandable and available access option. Most military beneficiaries know the triad of "we have no appointments; you'll have to call the clinic," followed by "the soonest appointment is six weeks away." and then "you should go to the emergency room if you think you need to be seen sooner." This common bureaucratic solution to supply-demand mismatch represents no less than a broken promise of timely access. Additionally, it represents a costly mission for emergency rooms to serve as an inefficient safety net for an overtasked system. To fix this, we must aggressively track what happens to beneficiaries at that first telephone call and adjust our capacity to support our access promises.

We can't reduce the U.S. cultural expectation of immediate gratification, and we can't eliminate bureaucracy. Hut we can shape military beneficiaries into responsible healthcare consumers. And we can keep our promise of world-class care without expecting our beneficiaries to be world-class bureaucrats.

Empowering Providers

Our providers are part of both the problem and solution. They need the training, authority, and accountability to become stewards of our precious dollars. First, we need to teach them well. Evidence-based medicine (EBM), a practice paradigm using applied statistics, is known for better care with fewer resources. For example, EBM shows the lowly baby aspirin as our most powerful weapon against coronary disease-dwarfing the marginal but real benefits of far more expensive therapies.

Our graduate medical education programs emphasize EBM, but training frequently stops on graduation. In addition to continuing our strong support for these programs, we should expand EBM training into ongoing education programs at all our medical facilities. We must also carry out the following steps.

* Eliminate industry sales pitches (that is, drug or equipment representative provided "education"). Our military should be free of commercial bias, and we don't need this kind of "help."

* Allow our providers to say no-thus eliminating a major unintended consequence of emphasizing volume and total customer satisfaction with care on demand. Frankly, most providers indulge inappropriate patient requests in order to avoid the dreaded, time-consuming patient complaint.

We need to develop productivity measurements that acknowledge the time and risk in refusing unnecessary resources. We should create procedure code for "refused patient request" in our productivity calculations. And there should be a tolerance for customer complaints that arise from providers' stewardship role in fighting the public's misguided perception that new, high tech, or invasive is better.

* Address productivity calculations that overvalue medical procedures and complexity. Current measurements tempt providers to suggest unnecessary tests or treatments. Through EBM. our providers should know the most cost-effective way to diagnose and treat. However, we must ensure that productivity pressure doesn't steer otherwise.

For example, most primary care providers can listen, touch, educate, and treat hack or knee pain quickly and well with physical therapy and over-the-counter medications. But they get credit for more complexity if they order an MRI, prescribe prescription medications, and refer to orthopedic surgery or neurosurgcry. Providers may deny they do this, hut it happens on a large scale.

* Hold our providers accountable for the resources they use. After empowering them to do the right thing, we must analyze their resource utilization patterns. This might even include peer review and taking adverse action on over-utilizing providers. Of note, this goes against a long tradition of impunity. But providers simply must take hack medicine-including their share of the responsibility for its costs.

The Big Step

In its entirety, the military should tap its unequaled expertise, scope, and aceess to target our young beneficiaries before they cement their lifestyles.

We already target active duty for healthy lifestyles, but we need a dramatic new emphasis on civilians-specifically, our young wives. Active duty men and women are pre-screened for disease and obesity. Civilians are not. and young wives represent the vast majority of our young adult civilians: 93 percent of our half-million civilian spouses.4 Additionally, women offer an important leverage point in American culture by making most of the lifestyle and healthcare choices, including for our children. If we don't reach till of our 18- to 25-year-olds- particularly women-as they complete their formative years, we pay for their unhealthy lifestyles for the next 45 years and lose their children as our future recruits.

To achieve this goal, we need to make several bold changes. These include the following.

* Beneficiaries should have a financial interest in their health. One way to accomplish this would he to create a tax-free basic allowance tor health care (BAHC) and charge lor health insurance. With tiered premiums based on lifestyle, this simple accounting change-perhaps at no net cost-would with every paycheck reward thin, athletic, nonsmokers and remind overweight, sedentary smokers that we will pay them to become healthier before they cost us all.

* Require an annual preventive health assessment (PHA) of all beneficiaries, including spouses and retirees, to qualify for any reduced premium tier. Our young, "immortal" beneficiaries ignore threats of future fatal illnesses, so let's try something immediate. Money is a great incentive!

* Retirees need to he included in the BAHC and tiered premium plan, including reasonable premiums for plans providing "free" care. As mentioned above, cost shares may result in higher overall costs because beneficiaries refuse both necessary and unnecessary care. I have personally seen that many retirees cannot (or will not) pay annual enrollment lees, cost shares, or deductibles. They go to the military treatment facility emergency department-the only place they can receive the "free" care they feel they were promised-in the midst of an expensive acute crisis of a poorly managed chronic disease. Shamefully, they have become our uninsured population.

* Tobacco must be eliminated-no matter how many beneficiaries demand our continued enablement of their self-destruction. It is unquestionably in our long-term warfighting interest to stop growing the next generation of lifetime users that will burden our future healthcare system.

Get tobacco out of our commissaries and exchanges, off our ships, and off our bases. Check urine for tobacco use at the annual PHA, and place users in a higher premium tier. This will remind smokers monthly that their habit costs all of us. It's time to face this killer.

* Attack obesity aggressively. Add an "overweight" category to active-duty weigh-ins, and take action before members become obese. Encourage à la carte pricing at dining facilities to discourage the all-you-can-eat gorging mentality. Abandon civilian practice and use pricing to steer choices (e.g., expensive French fries and low-cost salad). Offer low-cost healthy snacks instead of candy in vending machines.

Place overweight and obese members and spouses (weighed at their annual PHA) in higher premium tiers unless they prove they are consistently losing weight through an active duty weight-management program or medically supervised disease management plan. We should also target young civilian wives by unleashing our resources on their ingenuity. They can develop out-ot'-the-box initiatives in our communities: inexpensive fruits and vegetables at the commissary? Pricey potato chips? Cheap weight-loss programs (such as Weight Watchers(TM))? Eviction of unhealthy on-base restaurants? The possibilities are endless, but we must empower and encourage today's 220-pound 22-year-old to change tracks before becoming tomorrow's 400-pound 40-year-old train wreck.

* Target inactivity equally aggressively. Expand culture-of-fitness initiatives to include young civilian wives, just as we already target young active-duty members. Offer our resources to spouses' ingenuity for innovative solutions. These could include child care, women's gyms, and walking groups. For active duty personnel, we could reduce premium tiers for members who score an excellent or outstanding on their physical fitness assessments. Let's pay those who go above and beyond.

* Manage chronic diseases, including obesity. The priority of health over disease is obvious. Not so obvious is the principle of "adverse selection." in which a generous health benefit attracts an unhealthy population. And the military has a very generous benefit.

We should charge higher premium tiers for beneficiaries with certain chronic diseases unless they actively participate in a disease management plan. These programs have been shown to work in the civilian market, which in this case we need to imitate. We stand to gain far greater benefit, because our population has a greater burden of disease, and also because we "own" our beneficiaries far longer than do civilian insurers.

Our military and nation are in trouble, but the military has unique resources at our disposal if we can abandon assumptions and take a long-term perspective. By addressing demand through reforming our system and treating beneficiaries before they become patients, we will not only grow a healthier population but also sustain our world-class benefit at reduced cost. This will free up those dollars for warfighting-our real mission. We have the tools. Can we find the will?