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Interviews
John Valentine
Senate President
Utah State Senate
Interviewer
So Senator what can we do with this complex issue that seems to have so many sides and seems to have not any clear answers?
John Valentine
Healthcare is an impossible issue to some people, or a very complex issue to other people. In my mind it's not an impossible issue, it's one that has answers. The question is how do you find the answers?
Interviewer
How do you?
John Valentine
The answers that we explore from time to time are based upon financial considerations and based upon market forces. Those two go hand in hand because without market forces, people think they have a free ride, and a free ride will crash the system.
Interviewer
It's also more than market forces. These are people's lives. It's a much more emotional and a much more personal issue. And I'm not going out and buying a car. How do you deal with that complexity of the personal side... the complexity of the issue itself and dealing with the market forces?
John Valentine
We all have a heart. We all feel like we'd like to give the whole benefit to everybody of the full range of health care, and yet we in effect ration it. We ration healthcare by long lines in some systems. We ration healthcare by money in other systems. We ration healthcare by how much tolerance you have for the aggravation of going through a system. All of those are rationing mechanisms to ration scare resource--that scarce resource being healthcare.
Interviewer
Are we rationing now by providing it for some people and not for others?
John Valentine
With the advent of employer insurance, we saw a change in the market forces for healthcare delivery. That change was your employer will buy it, so I can just use it because my employer has paid for it. We see changes in that market with the ideas of health savings accounts, HSAs where if you don't use all of the benefits at the end of the year, you get to keep the money. My law firm, for example, does that very thing where we have a portion of it is the employee putting their own money out, and a portion of it is being paid for by myself as their employer.
Interviewer
I want to get into the role of the legislature. In terms of providing access to healthcare for all Utahans, what is the legislature's role?
John Valentine
The legislature has two roles. One is a policy-driven role, and the other is a financial-driven role. Often times a financial driven role is just closely linked to... The legislature has two roles; one is a policy driven role, and one is a financial driven role. Often those two are linked. The policy decisions are oftentimes driven by the financial decisions and vice versa.
Interviewer
How do you respond to somebody like that (handicapped woman in wheelchair lobbying) who can't get basic health care, is struggling doing everything she can, and yet is frustrated by the lack of funding?
John Valentine
One of the issues dealing with healthcare is the complexity of financing. There's only certain types of funds that we can use in the state for healthcare, and that's established by the Constitution. For example, we cannot use education money income tax for healthcare. We can't use gasoline tax for healthcare. Those are dedicated to education and transportation by the Constitution. We are basically restricted to the general fund which is a function of the sales tax. We see the interesting push/pull where the same community that's pushing for more healthcare is also pushing for reductions of sales tax, such as sales tax on food. The same dollars that pay for the healthcare are being reduced by the same advocates.
Interviewer
Do you feel trapped sometimes inside of that?
John Valentine
Sometimes we feel trapped when we have people not understanding how the whole system has to work by virtue of our Constitution. We feel trapped because we are saying that we'd like to be able to give more healthcare, but you're restricting the very funds that we can use to provide those healthcare. I look at Colorado as a model. They have the worst possible situation. They have something called TABOR, which is a tax-payers requirement to reduce the amount of funds. And they also have a requirement that requires them to increase education funding. Those two were in a collision course. And healthcare in Colorado for example, is starting to suffer.
Interviewer
And yet Colorado is able to do some things that we can't. For example in the... we're looking at a lot of clinics in this and a lot of community health clinics and right now a lot of them in Salt Lake are struggling, and if you look at our state funding to those clinics, it's maybe a third or half of what the national average is. And in Colorado they're getting a lot more money because they can use their tobacco tax for that. How do we fair? How do you explain how little money we give to those clinics?
John Valentine
One of the reasons that I use Colorado as an example, is they have made a policy decision to put more money into clinics and less money into home healthcare. Utah has done just the opposite. We have made a policy decision to give services to people in their homes rather than putting them into an institution or putting more funds into clinics. It's a policy decision of how you allocate the resources that you have.
Interviewer
Is that really where we should be going?
John Valentine
As I look at the Colorado model, I don't like that model because I believe that people would rather have services in their own homes rather than having to stand in a long line in a clinic. Some of the things that I see in the Colorado model I have some personal experience because my sister is one of the providers of Home Health Services, so I actually get to see the budget cuts that they take from a firsthand experience.
Interviewer
But in terms of the clinic care, a lot of the clinics are basic health, primary health clinics and it makes sense in terms of dollars to put the money into primary healthcare versus catastrophic healthcare. How do you balance that tension?
John Valentine
Utah has also made a second policy decision to try to put more money into basic healthcare rather than trying to give a Cadillac or trying to get... Utah has made a policy decision, a conscious policy decision to put more money into basic healthcare and less money into a broader range of healthcare services. Those healthcare decisions we have included things like funding CHIPS, the Children's Health Insurance Pool, or our own Health Risk Pool for high risk people. Those require premium payments, but those premium payments come back with big returns because of the fact that we have federal participation in those programs. We get more bang for our buck by having that participation with the federal government.
Interviewer
So inside of all of that just looking at that I'm just thinking to myself, well why don't we put more money into our community health clinics that do primary care? Is it because we're trying to put the money into the insurance?
John Valentine
One of difficulties we have when we're dealing with Health and Human Services is that there are so many needs in that area. For example, this last legislative session... We actually like to focus on participation with the Utah citizens. For example, we have funded in the last legislative session, we funded CHIPS with four million dollars. We also put additional funds into the High Risk Pool, the HIP program. Those are state programs that we really believe really drive good decisions because people participate in the economics of the healthcare that they receive.
Interviewer
Do you feel like sometimes there is an unfair burden placed upon you? We have 300,000 uninsured people and there are a lot of people looking to you and the legislature to solve that in a way or to provide some solution for it. Do you feel that in a way that's unfair?
John Valentine
You know my heart goes out and says I just would really like to give healthcare to everybody in Utah. The difficulty is my pocketbook says, John you can't do that without some type of restraint on how you allocate that resource. In other words, if you actually just put funds out there you don't have the ability to do anything else. You raid the school kids for example.
Interviewer
Actually I spoke to an economist. He said that the states really aren't the place to solve the financial healthcare issue. Because it does... it pits everybody against the school kids basically, especially the elderly. Do you feel that way that maybe the states aren't the best place to solve this issue?
John Valentine
The states can't go at it alone. They have to have the federal government's participation, but the federal government under the present administration has started to give more latitude to states to serve as laboratories; to come up with ways to making healthcare services deliverable at a cost effective basis in a rationing mechanism that is fair, and that's the key. That's the impossible dream that I don't think is impossible--and that is to come up with a laboratory by various different states experimenting with ways to deliver the services. You cannot just give a free lunch. There is no free lunch in this world, but there is a way to make an allocation model that works where you have federal participation, state participation, and the patient themselves participating in the decisions and in the economics.
Interviewer
I know Massachusetts has done a lot toward that end, California obviously. Do you see Utah moving in that direction at all or coming up with some sort of, you know, our own Utah solution to the uninsured and the basic healthcare crisis that we're facing?
John Valentine
I see us coming up with a Utah solution, not a solution that is in some other state, and that's the beauty of having the federal government allow states to serve as laboratories, to serve as experimenting places. That's one of the reason why I think the HIP program has worked successfully--is because it does require participation, and using that same kind of model, you can develop a Utah model that requires a person to have a small co-pay, to have a person participate in their economics of the healthcare decisions.
Interviewer
What do you think our future might look like in Utah in terms of healthcare reform?
John Valentine
One of the things that happened when Mike Leavitt was here; the Secretary of Health and Human Services, is he had a chance to sit down and meet with myself, with the Governor, and with the Speaker of the House and we talked about healthcare issues and about the challenges that states had, and it was very interesting to hear him talk about Utah's experiments as being models for other states. He likes the idea of having people participate in their economic decisions on healthcare and so he's looking at ways that Utah could be given waivers to allow more federal dollars to come in to match the state dollars that we do have.
Interviewer
So would we go so far as to something like mandates?
John Valentine
Mandates in Utah are not acceptable. They're not acceptable because we find ourselves making a mandate that then puts us at an economic disadvantage with competitive states around us that don't have those mandates. So when we see mandates, we actually find it to be counterproductive. One of those things we've seen as counterproductive in the insurance arena is the continued mandates that take place on insurance carriers. Every carrier must have all of these things added to their policies. It drives the price up and drives participation out of the market. In other words, fewer people have insurance, so if we could have a policy that didn't have so many mandates--it was a basic policy, and then you could add those additional things that you want coverage for based upon a pricing schedule, you could end up with an insurance product that's more competitive and can be broadly purchased or available to other people. That's something that we're working on from the Utah side; we're trying to make that so that we have a policy that doesn't have to have so many mandated coverages in it.
Interviewer
So just to simplify, it sounds like what we're going to be doing is having a broader more basic healthcare insurance package for people, and then are we also going to have some sort of financial incentive or financial assistance for people to purchase that?
John Valentine
See my view is that we would try to have a broader coverage that didn't have so many mandates in it, that would be more affordable for people to be able to obtain. That higher participation rate would be partially incentivized by the state and the federal government, but it would allow people to buy insurance who previously could not buy insurance.
Interviewer
So basically by making it more affordable?
John Valentine
By making it more affordable, you have a way to be able to get insurance. Let’s use an analogy of a car. Not everyone can afford an Expedition--a large SUV. But most people can afford a smaller car. If they can't afford a smaller car then perhaps they have to take public transit. Now some of us will go in and out of the various different systems. For example, I'll take my large SUV up to 106th South and get on tracks to go down to a Jazz game or go down to the Symphony or to go to Temple Square because it's more efficient to take that, it's faster oftentimes and I don't have to find a place to park. So you use various different aspects of the system based upon what is going to work for you on that particular day. Well healthcare can do the same thing. You can have a healthcare program that has a basic system and if you want to afford add-ons, you can buy the add-ons, but everyone should be able to afford a basic system--that's the view that Utah would like to put forward.
Interviewer
Would the basic system just be primary care, would it include hospitalization, catastrophic care? Has the discussion gone that far?
John Valentine
The discussion hasn't gone far enough yet to know what is going to be included in sort of a basic package that everyone can afford. Part of it is an issue of pricing. Part of it is an issue of is this going to be enough coverage because there is going to be cost shifts when you go into catastrophic coverages or catastrophic services--cost shifting meaning that if you don't have the coverage, society doesn't feel like they want to withhold medical services to someone just because you can't afford to pay for it, and so we see our charity hospitals offering a lot of charity care for those people in that category.
Interviewer
What I found interesting was I.H.C. actually contributes more to the clinic system--to the basic primary care clinics than the state. I found that odd, unusual. How can we justify that in our state?
John Valentine
One of the things that we look to in our charity hospital system is that charitable care includes not only care in the institution, but in satellite facilities such as clinics. The state has only recently started making funding to clinics. It has been more of a development that has occurred in the marketplace. We've allowed that to occur because it has been an efficient way to deliver the services. Now the state is being asked to put more money into clinic services, and you've seen a growing trend where the funding from the state is starting to increase, for example, we put money into the Maliheh Free Clinic in Salt Lake, which this last year--the first year I remember--where we actually put direct funding into a charity clinic in Salt Lake County.
It's a growing phenomenon because we can see it as a place to deliver healthcare services where we get a good bang for our buck. A lot of time the doctors are volunteering their services. A lot of times pharmacy companies are either donating or giving significant reduced prescription drugs. Often times they're going and using the prescription drug formularies that allows us to give the same type of drug in a generic--all those things are being used at the clinics, which is a way to effectively deliver service.
Interviewer
There is a lot of public pressure for bold solutions right now, you know you have the UMA, the Utah Hospital Association, Joe Jarvis... you have a lot of different advocates for different views. They're all clamoring for some sort of bold financially sustainable solution. Are they on the right track? Are those people on the right track, and what do you say to them?
John Valentine
Financial stability is the most important key as you develop healthcare systems. The reason I say that is that it is a disaster to fund something one year and then take it away the next. We saw that with Adult Services for Dentists.
Interviewer
But they're looking for major reform it sounds like. Do you think that's something that's going to happen--that we're going to have major reform in our healthcare system?
John Valentine
Major reform is only going to be successful if it can be sustainable. If you cannot sustain the effort, it is not worth the effort, and so you have to have something that has stability in it for it to be able to be used to go forward.
Interviewer
What do think of, inside of that because people are looking at a couple of different aspects of that? They're look at covering the uninsured. They're looking at getting a handle on rising healthcare costs. Do you think one of those comes first?
John Valentine
You know it's a chicken and egg proposition oftentimes when you're trying to look at how to finance versus how to deliver services. We saw that same issue the last legislative session when we were talking about a so called swing out provision which allowed people to swing out of the policy and go to someone who was not in their panel or not in an approved hospital. And then we also saw how that swing out, even though on its face looked really good, was actually causing cost to rise in other states that it actually had that particular type of a policy. We have to be careful with solutions we implement because the solutions we implement may make our system more unstable and less sustainable, so that's why we're proceeding cautiously rather than just take a bold step where no man has ever gone and then fall off of a cliff.
Interviewer
We don't want that to happen. Now Senator Scott McCoy introduced a resolution. I think mostly he did it to really get the healthcare discussion going, but he introduced the notion that healthcare should be a basic right, very much like we're entitled to basic education. Should all citizens of Utah be entitled to basic healthcare?
John Valentine
The idea of a constitutional amendment for healthcare was put forward as a discussion item. It does really focus on this whole debate as healthcare is a right versus healthcare as something that you have to participate in and purchase. If it is really guaranteed as a right, then the state will tax higher, and just pay for it for everybody and we'll end up with a Canadian system where we ration it not by who can afford it, but we ration it by how long can you wait?
Interviewer
So basically it sounds good, but the reality may not be what we really want.
John Valentine
That's what I'm concerned about.
Interviewer
Now there have been a few legislative task forces that have looked at this issue and certainly the Governor had his own initiative looking at it, and yet... I don't know... are you pleased with the results of the task force searching for answers? Are you getting the answer that you want?
John Valentine
I've been somewhat disappointed in the task force process. It has a tendency to end up with lines being drawn and two different battlefronts and we end up like World War I where we end up with a stall between the two warring sides. It is not going to be solved in a task force in my mind because it just has the dynamics that just don't allow it to be solved in that kind of a method.
Interviewer
What kind of a discussion would be more useful?
John Valentine
I think a useful discussion would be one with the executive branch of the federal government, the executive branch of the state government, healthcare providers, and legislators. That kind of a mix I think could actually come up with solutions. When we have just the legislators, or just the executive branch on the state side, or just the executive branch on the federal side, or just the healthcare providers, it's like ships passing in the night; we don't see each other.
Interviewer
Right now we have a situation in Utah where the premiums are basically rising at three times the rate of inflation. I don't know if these are the current figures, but these are from last year. Utah's uninsured rate has been growing, some people say as high as seven times over the previous few years. It's just not working at this point. Something is not adding up. What do you think about this situation in Utah and what needs to be done?
John Valentine
There's a direct correlation between rising insurance rates, and those who end up as the uninsured. There's also a second direct correlation with the rising insurance rates being tied to one key factor, and that is additional mandated coverage. Every time we have a mandated coverage we then see an increase in the insurance premiums--almost directly related to it. Why? Because a company has to price-out that additional coverage.
Interviewer
So pretty much at this point, if it were up to you... if John Valentine could have his magic wand, what solution do you see out there in terms of rising healthcare costs and the uninsured? What would you do? Where would start?
John Valentine
I would start with a basic policy that could be affordable for all Utahans. It would be a basic policy. It would not have a lot of the bells and whistles that we keep mandating to insurance carriers. On that basic policy, the premium on it would be means tested, in other words, depending upon your income would be dependent on what you'd have to pay for that policy. That policy would be available to everybody above the poverty line. People at the poverty line would be covered by Medicaid--that's a federal program that the state participates in. I wouldn't change that part of it. But it's for those uninsured Utahans above the poverty line, but not able to obtain insurance through their own employer. That basic coverage would be just that--it would be very basic. It would not have a lot of the things on it that people expect with insurance when they have expectation of full indemnity, in other words it covers everything. But that basic policy would provide a basic coverage for everyone to be able to afford.
Interviewer
Would you do something where you cover people 300% of poverty and above? I mean would you provide financial incentive?
John Valentine
I would probably give financial incentives above the poverty line up to about 300% of the poverty line. At 300% you can't afford it, and your employer should be providing your coverage.
Interviewer
A lot of small businesses, especially in Utah... you've got a lot of small business owners, and they're upset, they're clamoring, they're having a hard time. They really want to cover their employees, they just can't afford it. What do you say to them?
John Valentine
That's where we would have in the program that I would envision, would be available to small businesses to purchase as well. Because of the fact that it would be rated on a broad basis, you wouldn't have to have the individual business rating affecting the premiums. Also since it doesn't cover a lot of other types of events, it wouldn't have to be costed out based upon pre-existing conditions. I think that that one has the most hope and promise for a basic insurance policy for everyone.
Interviewer
Finally, is there something that you would like to say? There are a lot of people who come to you who are advocates for the uninsured. What would you like to ask them or say to them in terms of this issue?
John Valentine
You know the human side of me, when someone comes to me, and I've had a lot of them, and say President, I need insurance, I need healthcare coverage. How do I get it? My heart just goes out for them because I recognize there's a human being on the other side of the table and it just makes me want to come up with solutions that are sustainable that we can continue to have year in and year out, and that's why I keep talking about that sustainability is such an important issue.
Interviewer
And there's one other aspect inside of that. You're talking about getting basic healthcare coverage for people, but what about the rising costs of healthcare? Is there any way you can address that as a legislator?
John Valentine
One of the things we've looked at with healthcare costs is the markets in Utah versus the markets nationally. Utah markets seem to be driven very harshly by the national markets--by national trends. The cost of technology is driven into the Utah market. The cost of lawsuits in other states is driven into Utah's markets. The cost of being able to acquire top specialists into Utah is driven a lot of times by the markets, so all of those factors have a tendency to be driven by places external from Utah, which makes Utah's solutions a real challenge because we don't have a large enough population bait to drive the rest of the marketplace.
Interviewer
We're dependent upon others it sounds like.
John Valentine
Yes, and that's why the federal government has to participate in any kind of discussion we have for a national healthcare policy. If they don't participate in that, then the decisions that we make in the laboratory of a smaller state doesn't affect the marketplace as much as it would be as if you tried the experiment--it works in a smaller state--and then you expand it to in other states, then you can have an effect on the marketplace.
Interviewer
There are a lot of people, and they are really frustrated from all side of this… this issue--the uninsured are frustrated. There are people letting their diabetes go until they neuropathy in their feet and are permanently disabled, I mean we've been talking with people out there. There are health providers that are just frustrated with the whole system. There are people in government who are frustrated. Are you frustrated by this health system?
John Valentine
In many ways I am frustrated on this issue because frustration comes from not coming up with easy answers. When you come up with an easy answer and you see your way clear to go for that easy answer, then you say, o.k. I've got the answer, but there is no easy answer in this situation, and so that's what give rise to the frustration.
Interviewer
Can you see any hope?
John Valentine
As I said in the beginning, I really believe that this is not the impossible dream. I believe that there is hope, but I believe that it's going to have to be characterized in such a way that it's sustainable, and it's going to have people participate in their health care decisions. Without those two elements, it won't last.
Interviewer
And then inside of that, as a healthcare consumer, what is my responsibility in all of this?
John Valentine
The responsibility of a person who has their own insurance is to make certain that they use it wisely. Over-utilization is one of the root causes of increasing healthcare costs--going to the doctor with a sore throat when you really could take care of that at home unless you've got a history of strep throat, for example-- those are the kinds of over-utilizations that are part of the driving force of increased healthcare costs; it's not the only one, but it’s part of it.
Interviewer
How about the uninsured? How about the people who are out there and struggling... what can they do?
John Valentine
For someone who is uninsured, I think we can give the best hope by offering a basic policy. That basic policy would be affordable by someone who has limited means, but is above the poverty line.
Interviewer
And then finally, is there anything you'd like to add in terms of all of this? Am I asking the right questions?
John Valentine
Yeah, I think you are asking the right questions because you're asking the same questions that I've been asking my fellow senators and I've been asking advocates for healthcare, and I've been asking providers of healthcare. The questions that we're asking today are the ones that will provide answers for tomorrow.
