And explain to her the American Healthcare system. She wanted to know if we could meet for tea. I thought, thats a bit ridiculous. You cant happen and it in an hour, and i said to myselfwouldnt it by nice i there were a 250 page book i could give to someone and that would explain the system. When you look out there, theres no such book, and always figured the reason youre a tenured professor, its beneath you to write the book explaining the system, and if youre trying to get tenure, you figure you right this become, youll never get tenure. So i wanted to fill that void. And then once i got into writing the book i began to think, sets the platform for what is going to happen. Why dont i start making predictions about the future from what i know and all the people ive talked to, and i had been trained well enough, because one of my colleagues at penn is a professor at warden and has done a lot of research on forecasting forecasting and g predicts, and warns its a bad idea bus mostly experts dont do so well. Nonetheless we all have to make predicts, whether we are running hospitals or doctors investors so i did my best. Host a lot of people know you as one of the architects of the aca, Affordable Care act, otherwise known as obamacare. But before we talk about that, how did you even get to become an architect . What was your path . Start with medical school. Guest i was in medical school and not very happy about what i saw around medical school. That we were failing and one of the most frustrating aspects of it is when i would work in the emergency room and see we took care of the patient who had, say, heart failure, difficulty breathing, admitted to the hospital we worked hard to make sure the patient is what we called, dried out, excess fluid taken down, on the right medications, everything tuned up. Discharge the patient home and inevitably he or she came back, six, seven, ten days later, and we had to do it again and we were not following up. I remember one parent who was in the hospital for six weeks for back tealar endocarditis, and sent the page home and literally two weeks later was back in with the same. Then i win to do a ph. D in political theory at harvard, thinking that i would some of this was sort of the way the values of the healthcare, so i worked on end of life care, the physicianpatient relationship and then i came to the nih and worked on research ethics, and after seven years, i decided i should turn my attention to resource allocation and the Healthcare System, and i had the good 2014 of teaming up with a Prominent Health economist from stanford, rick fuchs, and when everywhere was depressed about reform, we developed avoucherbased system, and that got me into thinking about health policies, and then when president obama won and he appointed peter as the office of management and budget, i new peter from conferences and meetings and i said, peter, do you need a doctor to help on healthcare reform . He said lets talk, and we work out an arrangement where i would allergic another omb assisting. Host and as far as the problems with the aca, which you devote perhaps the first half over the book to that you set out to fix, you collectively, can you outline hose . Guest the American Healthcare system, in the subtitle, terribly complex. Host right. Lets read this. How the Affordable Care act ill. Prove our terribly complex, blatantly unjust, outrageously injustice, grossfully expensive system. Guest the healthcare him in in 2008, 2009, before the freeway, was although things, complex, trying to explain to people just how its paid for through insurance, through medicare, medicaid, the va, takes about 40 pages, and i dont even go into all the details. Then you explain how doctors are paid, how hops are paid, what the incentive structure is, what the regulation for drugs is, for devicesall of that is incredibly complex and we werent doing well. By any metric. 50 Million People up insured. Uneven quality. Some of our great academic centers, but pretty ounce even. We have millions of people who have high blood pressure, not hard to diagnosis, not hard to treat, who are either informant not diagnosed or inadequate treated and that increases risk of stroke, Heart Disease, shortens your life and thats full in the system. Before we pass the Affordable Care act, one in 20 people going into the hospital acquire an infection. Tens of thousands of people die. Then the was the coast. Taking ever more of the economy, making states trade off between medicaid and education, making individuals get Health Insurance but keeping wages low. Lots of reasons to change the system, and i explained all of this, and i think any one of them would be good enough justification, having all of them not a republican or a democrat in the world in 2008 or 2009, who really understood the system who would say, oh, no, its great. By 2008, 2009, almost everyone agreed we had a system at was broken and needed repair. The question just was, what kind of repair . Host you explain that very, very clearly. This is guest thank you. Host the Healthcare System is a daunting enterprise, and it is incredibly clear. What is also very interesting at the beginning, its a history. Now, i guess you could go bay walk but start with nixon and work up to clinton. Guest well, one of the surprises is i decided to let lets give people a feel for how long we have been trying to change the system. It goes back to 1912. One surprise to me is to uncover how engaged republicans were in healthcare reform in 1945. The governor of california at that time, earl warren, republican, pretty conservative, proposed comprehensive healthcare reform for california. And he came within one vote of getting it passed in california. And he had gotten sick and he said, you know, we really need to protect people from the costs of getting sick. When nixon got elected in 1946 to congress, one of his first legislative bills he introduced was a bill about. Com mensive healthcare reform, and if i describe it to youll think, did he write obamacare . He wanted to give people subsidies, based upon their income, so they could go and buy private insurance to cover themselves, and the government would provide those subsidies. Sounds a lot like obamacare to me. He proposed that in the late 1940s, and then when he was running for president in 1960 against john kennedy, there was a big debate. All the republicans and democrats were trying to figure out how to get the people left out of the employerbased insurance scheme, poor people, the elderly, how to get them insurance, and he again reintroduced the idea of subsidies for people to buy private insurance, and then when he gets president , in 1973 and 74, he is negotiating as president with ted kennedy in the senate and wilber mills in the house, how to come together on a comprehensive healthcare reform bill, and they were this close to a bill that they could agree to, and then in typical washington arrangement, scandals break out. Wilber mills has the fannie fox scandal where an exotic danner falls thety tidal bay sip and he is forced off the commit year, watergate overtakes nixon and it all goes poof. And we have to see liberals and unions did not want to have a deal that would have private insurance continued. They wanted single pair and they single payer and they withheld their support. So a combination of scandals which mainly put the kibosh on this bipartisan arrangement with the unions and liberals opposing it. And for 20 years after that, until bill clinton, we didnt have another reform, and then clinton comes in and wants to sort of marketbased reform, proposes his Health Security act, and unfortunately there are lots of other things overtook single focus on. Had to pass a tax increase. They had the nafta bill. By the time all the rest of the states was cleared for health care, opposition had gamed and had defeated the bill. Didnt get one bill passed another of committee. Healthcare reform is dead for 15 years until 2008, and the system just had become so onerous, we needed reform and i call it the worlds historical act. It did take 100 years and this will be the framework for the next 20, 30, 40, 50 years. Host well, i think that it might be fair to say the most interesting part of the book is the fact that you there at the revolution. This is what zeke saw at the resolution. When you do a good portion of the book to that and its very good foundation. The part i show this to people and they go, where is the zek can e part and its chapters you talk about your own observations and insights as someone who really was there, and you specifically talk about, im quoting here, the complex interplay between policy, politics, and Interest Groups. And if you would elaborate on that. Maybe focus on at least start with malpractice. Thats one of the more easy ones to understand, frankly. Guest it does illustrate its not nearly as simple as people lay it out to be. So, going into reform, i would have thought getting malpractice reform was it was a reasonable chance of it. First of all, we should also be modest in the expectations going in. Malpractice is something regulated at the state level. Its not regulated at the federal level. So putting malpractice reform in a federal piece of legislation is not going to solve the possible problem you. Cant force states as the federal government to do malpractice in this way. But we had a very good combination of arrange. S that made it look likely. The president himself was for malpractice reform. He had written an aural in the new england journal of medicine coauthored with hillary clinton, before declared for president , advocating for malpractice reform. He thought about and it thought it was a very important issue. There were two doctors in the white house, myself and bob coacher both thought malpractice reform was good to do. Other senior advisers who thought malpractice could encourage quality care and encourage doctors to focus more on quality. So we had a good arrangement. We studied a number of options, and we had laid out nine different options, pros and cons in a detailed memo, one day in the summer of 2009, as were putting various things together, i go into my brothers office, which i tended to do towards the end of the day if i went in at all, and rahm is wants some piece of information about some analysis of various Insurance Options and i was reporting back to him, and then as is usual way he says, what else are you doing . And i begin to explain the malpractice thing, and he basically said the fword, shut up. Were not doing that. And the explained why not. He said when he ama, whatever thaw saw in public, they come into my moves and were talking about what they need out of this bill and were really cutting the sausage of legislation. They never talk about malpractice. All they ever talk about is what the how medicare pays doctors. They want that fixed so doctors can get more money. They never mention malpractice. I am not doing malpractice because malpractice will require that we have to offend in of the Democratic Base, and if i dont need to offend the Democratic Base to keep the doctors on board, im not going to do it. And by the way no republicans are coming to negotiate with me if they came and said part of onegotiation for our support would be pal practice, we would have done it. That wasnt the case. So, here you had a situation where, on policy grounds the white house was for malpractice reform and he wad to buy some reasonable proposals. The Interest Groups, the ama, and the politicians, the republicans, werent interested. Now, people say, oh, no, no. But thats the way it lined up. If either the doctors had said, all right, we understand about payment but heres malpractice and we have to have something on malpractice. Or the republicans said, all right, well negotiate with you and heres the kinds of things we need in the bill. It would have happened, im sure. Thats not the way it lined up. And nonetheless, the president had two elements of malpractice he pushed. One in his september speech to the joint session of congress. He said we have a Pilot Program on Patient Safety and were going to make grants available to improve Patient Safety through malpractice reform. Made grants available. More than 100 million. And the Affordable Care act contained a provision, i think its 10. 607 if i can remember correctly, that says we will give grants to states to reform their malpractice laws and study them and see how it affects care and costs of malpractice insurance and costs of health care. So, president obama, more committed to malpractice reform than any president , actually did two pieces of Pilot Programs on malpractice reform. Did more than anything else. You cant say that he wasnt committed to it. Now, that we didnt get more comprehensive reform, ive disappointed, but the many Interest Groups or politics needed to support it wasnt there in the clutch. Host as a clip issue in san, malpractice interests me a lot. Just to pursue at it. Bit more, you had a very interesting fact here supported by several studies which i admit i didnt know, which is that most people who really are the victims of error, dont sue and that the vast majority of malpractice lawsuits are frivolous. So, your preferred approach, if i recall, was a safe harbor consistent of strategy. Talk about that. Its interesting. Guest again, one of the thing is point out in the book when i catalogue the problems with the Healthcare System no one should be happy with the malpractice system, whether youre other doctor, patient, hospital, lawyers, its broken. It doesnt do anything its supposed to do, which is to incentivize doctors not create errors. Compensate patients who are afflicted with an error. Make sure its done efficiently without a lot of overhead costs. Doesnt do any of that. Theres not a simple single metric you would measure the malpractice system on where it actually succeeds. It fails on every score. So patients as well as doctors s should want it reformed. Some people want, lets just cap how much we pay and put a short statute of limitations so people cant sue. I dont like those. In some ways they harm the victim of malpractice. Our view is, lets use malpractice as an incentive to improve the quality of care, make doctors adhere to guidelines that we all agree on. So we basically tried to think of a program that would do it and we call that safe hash pore. If doctors adopt Electronic Health recordsed a her to a guideline, if a guidelines exitses for treatment of a patient, theyre presumed, its a presumption which could be rebutted theyre presumed to be independent. So doctors say patient comes in with simple head trauma, you normally wouldnt do a ct scan. The guideline says dont do a ct stan but to protect my bottom i do a ct scan. The safe harbor thing it says, no, you followed the guideline, wow would be in a safe harbor and presumed to be innocent. That seemses to me to be the way to go. Invent vies using the electronic records and adhering to guidelines, and thats what we want doctors to do. So, we prefer that. There are other alternatives which could work well . Yes. I dont think we have enough research to say which is the optimal system. The university of michigan pioneered this, say your sore, which is easily identify a problem, admit it to the patient, propose to them a simple solution according to a very set schedule. With we cause a laceration, heres what well do. A medication error, heres what we pay you. And that has substantially reduced the number of lawsuits, its reduced their payments, its reduced the time to resolving the cases. So that looks promising. Again, we dont have enough research. Host okay. Thanks. Lets move on to the actual aca. So, january 1 rolled around, and things went into effect, and some stuff went right and some stuff went wrong. Tell me talk about what went right and then well talk about what went wrong and how we can how that can be fixed. Guest first of all, the Affordable Care act is more than just the exchanges. I think its very unfair to say, oh, it just came online of the fact is right after passage in march 2010, lots of things came online. So, many people should remember, although they might have already forgotten, the used that young adults up to age 26 can stay or their parents plan. That came online by september 2010 and Many Insurance Companies made it effective before it does thats within sucks months of passage. Similarly, provision to encourage hospitals to reduce their readmission rate. So, patients on medicare, who get discharged from the hospital, are theres a 20 chancer theyll return to the hospital within 30 days. We created a program in the Affordable Care act to innocent size hospitals to worry about what happens when patients leave the hospital to make sures theyre continuity of care. That went into effect in a few months. The patientcentered reresearch indent. So we didnt wait until october 1, 2013 for the Affordable Care act to be implemented. A lot of those provisions went into effect, and some of them were very successful, some of them im disappointed in, to be perfectly blunt, like i dont think the Patient Centered Outcome Research Institute has been sufficiently progressive in the kind of studies it undertakes. Its been quite timid and we have been trying to push them to actually undertake more comparative studies. Host is that at hhs . Guest no. Its an independent private not for profit funded by an assessment on all insured people. The board is nominated by the gao, the Government Accountability office so its independent and not part of the government, not host like the institute of medicine . Guest correct. The basic idea. Not subject to political whims. Has until 2019, and i think they unfortunately, to my disappointment, have not undertaken the right kind of comparative effective not research. They spent a lot of time worrying about dissemination but you need information to disseminate, and getting the basic information about which treatments work better, whether w