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MedAssets CEO John Bardis on the impact of the health-care law on the sector as well as patients’ costs and care.
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This week under requirement of president Obama's Health Care Reform law hospitals will now face fines if they readmit.
Too many Medicare patients.
This is just one of the many requirements hospitals are facing joining us now is John -- -- he is -- assets founder.
And CEO John that you just heard -- talking about how he can't plan for payrolls because he does know.
Exactly how Obama -- gonna work its way through the system what about hospitals power hospitals preparing for the changes in the health care.
Well -- challenging form David and reality right now we're gonna see -- -- around.
Twenty million people enter the system.
Starting in 2014 to 2021.
Campus space for them.
Well that's a serious challenge but perhaps the biggest challenges what at what price -- -- out of the system so these exchanges.
We believe are going to be more like Medicare Medicaid rates which today -- how -- actual cost of health care which is why the private sector's costs are so much higher.
So we see these influx of patients and putting pressure on hospitals financially on a unit pricing basis that will invariably cause serious cost.
Yeah that can imagine and we're not really describing what you really do yes you're CEO -- you work with four out of five hospitals.
Across the nation so you really have your your -- on on this two and a half trillion dollar sector.
Of the economy.
How how is health -- affecting patient.
Well I think that's the key question and that is we've got a fifteen trillion dollar economy with almost sixteen trillion dollars in debt.
2.4 trillion dollars in the fastest growing segment of it is health -- -- -- grew 8% last year which was -- GDP growth rate.
And yet no consumer knows how to buy health care -- price it.
So we're going to be successful which in any economy to they have yeah.
Percent of -- based upon consumers driving pricing and value and we're gonna have to educate consumers on how to buy it.
Today the wrong people pay for the wrong people by businesses pay for the government pays for and insurance companies by.
And we have no consumer engaged in the game punishing bad.
Well you know what Milton Friedman used to say that that the best way to find the price for something has to take out the middleman.
Have the service provider and the service receiver.
And those to make a deal now we have so many middlemen in between including a much bigger government role than we've ever had before.
That it's impossible to get the right price in there.
It's very typical in fact this was all started by Medicare and 65 who insensitive.
Which -- every hospital or provider in the country to establish their own costs for the very same procedure so how do we get better pricing into the system we have to make -- transparent.
So therefore for consumers to be engaged they have to know what they're buying and it.
What I gotta tell you by the way we're just one -- -- has hers I admire how wife was in a hospital for for quite a bit of time.
She had ten physical therapy sessions each one of which probably cost about a 150 bucks for the therapist.
She was charged 27000.
Dollars for those ten physical therapy solutions I called us -- says that's might my -- is gonna pay for but I guess I'm I'm incensed by this.
That's rather than fact that -- system which was established by the government hospitals really don't want to do this they're required to.
They have to establish a list price and or provide a rational discount.
-- insurance companies but this entire cost problem has been -- seven by the federal government since 65 we've been doing this same dance.
Since 65 by increasing costs.
The federal government came back in 83 -- -- those cost increases and that's and we saw the balloon squeeze out to the private sector to now today what is an unaffordable level.
In fact -- encouraged the 30000035.
Million people who needed insurance not to deal to buy it.
So this new program is going to bring in twenty million people by year when he when he won.
But we're also putting hospitals undergone by -- -- them for not delivering great outcomes or the outcomes that we think we want.
But the truth of the matter is the hospitals have no responsibility.
For care of patients after the discharge.
So really this is about not only value.
It's about transparent pricing and the normalization of a market so today we don't even know how to value the same procedures across states.
Because the prices are different starting with cost.
We don't know -- No not not in terms of pricing in in medicine and and the government doesn't seem to be making it easier John artists get your hands full sir thanks for come again thank you David thank.
