September 2007

GAO-07-1155SP

Health Care 20 Years 

From Now

Taking Steps Today to Meet Tomorrow’s 

Challenges
September 2007 

HEALTH CARE 20 YEARS FROM NOW

Taking Steps Today to Meet Tomorrow’s 

Highlights of GAO-07-1155SP, a GAO Challenges 

forum. 

The discussion sessions focused on three interrelated topics: cost and 

personal responsibility; coverage of the uninsured; and quality, standards, 

and outcomes. The keynote speech focused on related policy challenges. 

The following are highlights from these discussions and the participant poll. 

The proceedings are not intended to reflect the views of GAO. 

Health care spending. Participants did not reach agreement on whether the 

federal government should have an aggregate spending limit, such as a 

percentage of the federal budget, but supported other measures, such as 

federal value-based purchasing, reformed tax treatment of health care, and 

limits on direct-to-consumer advertising of prescription drugs. 

Health insurance coverage. There was near unanimity that ensuring the 

provision of health care coverage for all Americans should be a federal 

responsibility. The group also strongly agreed that the federal government 

should assure the existence of a well-functioning health insurance market, 

whereas they did not agree on whether the nation should continue to rely on 

employer-provided insurance as the dominant method through which most 

Americans obtain their health insurance coverage. 

Performance measures. Participants strongly supported the federal 

government’s taking the lead in developing new indicators of health system 

outcomes and performance. The group also strongly favored having a broadbased independent body develop national, evidence-based practice 

standards. 

Policy challenges. The keynote speaker opined that a limited window of 

time—about 8 to 10 years—remains for the health care community to engage 

in effective reform. After that, he noted, budget and national security 

concerns will dominate. Because neither purely regulatory nor purely 

market-based approaches are politically viable, pragmatism rather than 

ideology should drive health policy. He concluded that we need a blended 

strategy, stating, “We have to shape our future now or be its victim.” 

The figure below shows results for a sample of the 18 propositions that 

participants were polled on at the end of the forum. 

Selected Results of the Health Care Forum Participant Poll 

Propositions 

Strongly 

agree Agree 

Neither 

agree nor 

disagree Disagree

Strongly 

disagree

The federal government should take the lead in

developing indicators...to measure the U.S. health 

care system’s outcomes and performance. 71% 10% 16% 3% 0%

Steps should be taken to encourage individuals to 

assume more personal responsibility for their own 

health and wellness. 55% 23% 7% 16% 0%

The United States should balance its health care 

research investments between new discovery and 

assessing comparative and cost effectiveness for 

new and existing medical interventions. 65% 23% 3% 7% 3%

Source: GAO analysis of health care forum participant poll.

“Unless we fix our health care

system—in both the public and 

private sectors—rising health care 

costs will have severe, adverse

consequences for the federal 

budget as well as the U.S. economy 

in the future.” This is one of the key 

messages that Comptroller General

David M. Walker has been 

delivering across the country in 

town-hall style meetings, in 

speeches, and on radio and

television programs. 

Using another format to explore 

issues with health care experts, 

Mr. Walker convened a forum at

GAO on May 17, 2007. Attendees 

included health policy experts,

business leaders, and public

officials selected for their subject

matter knowledge and 

representation of various 

perspectives.

Participants examined health care

cost, access, and quality challenges

in discussion sessions led by 

distinguished economists Robert 

Reischauer and Mark Pauly and

other leading health care

authorities Carolyn Clancy and

Suzanne Delbanco. Nationally

known health insurance expert

Leonard Schaeffer served as the 

keynote lunchtime speaker. At the

conclusion of the forum,

participants were polled for their 

views on points raised during the 

discussions. The poll was 

conducted using electronic voting

technology that produced real-time,

but confidential, results. 

www.gao.gov/cgi-bin/getrpt?GAO-07-1155SP. 

To view the full product, click on the link 

above. For more information, contact 

A. Bruce Steinwald at (202) 512-7114 or 

steinwalda@gao.gov. 

United States Government Accountability Office
Contents 

Letter 1

Preface to the Proceedings 1 

Comptroller General’s Introductory Presentation – David M. 

Walker 4

Session 1: Cost and Personal Responsibility – Robert Reischauer 9 

Session 2: Covering the Uninsured – Mark Pauly 14 

Lunch Session: Breaking the Policy Impasse to Secure America’s 

Future – Leonard Schaeffer 18 

Session 3: Quality, Standards, and Outcomes – Carolyn Clancy and 

Suzanne Delbanco 20 

Wrap-Up – David M. Walker 25 

Appendix I Forum Agenda 30 

Appendix II Forum Presenters and Participants 32 

Table 

Table 1: Results of the Health Care Forum Participant Poll 28 

Figures 

Figure 1: Revenues and Composition of Spending as a Share of 

GDP, Fiscal Years 2006-2040 5 

Figure 2: Social Security, Medicare, and Medicaid Spending as a 

Percent of GDP, 2000-2080 6 

This is a work of the U.S. government and is not subject to copyright protection in the 

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reproduce this material separately. 

Page i GAO-07-1155SP Health Care Forum
As Comptroller General of the United States, I am afforded a mixed 

blessing. On the one hand, I am burdened with T.M.I. (“too much 

‘’information”) regarding the future of this country’s federal fiscal 

condition and outlook. I live each day with the knowledge and certainty 

that unless we fix our health care system—in both the public and private 

sectors—rising health care costs will have severe, adverse consequences 

for the federal budget as well as the U.S. economy in the not too distant 

future. On the other hand, my position and long tenure at GAO allow me to 

bring the message to the public early and often. So far this year, I’ve 

appeared on a number of major radio and television programs, including 

NPR’s Diane Rehm Show, CBS’s 60 Minutes, and Comedy Central’s 

Colbert Report. Also, since 2005, I have traveled the country with the 

nonpartisan Fiscal Wake-up Tour—a broad coalition of individuals and 

organizations led by the Concord Coalition and involving the Brookings 

Institution, the Heritage Foundation, and other organizations—to discuss 

the nation’s fiscal challenges in a series of town hall-style forums. 

Increasingly, and disturbingly, my fiscal message has become a health care 

spending message. In fact, health care costs represent the number one 

fiscal challenge for federal and state governments and a major challenge to

the competitiveness of U.S. businesses. 

Preface to the 

Proceedings 

I’ve used another format for shining a light on the challenge posed by 

rising health care costs on the nation as a whole—two forums on health 

care held at GAO, the most recent of which occurred on May 17, 2007. Our 

discussions this year confirmed that little in the health care system has 

changed since January 2004, when GAO held its first health care forum. 

Our longer-range federal fiscal outlook, owing significantly to federal 

health care entitlement spending, remains grim; Medicare and Medicaid 

spending threaten to consume an untenable share of the national economy 

in the coming decades. Health care spending systemwide continues to 

grow at an unsustainable pace, eroding the ability of employers to provide 

coverage to their workers and undercutting our competitive advantage. 

Finally, despite spending far more of our economy on health care than 

other nations, the United States has above average infant mortality, below 

average life expectancy, and the largest percentage of uninsured 

individuals. In short, our health care system is badly broken. 

Page 1 GAO-07-1155SP Health Care Forum
Nevertheless, I was encouraged to hear participants focus in a 

constructive manner on a range of possible initiatives for health care 

reform. Participants examined health care cost, access, and quality 

challenges in detail. (See app. I for an agenda of forum sessions.) The 

format was designed to maximize the opportunity for open, interactive 

dialogue without individual attribution. Forum attendees included health

policy experts, business leaders, and public officials selected for their 

subject matter expertise and representation of various perspectives. (See 

app. II for a list of participants.) Distinguished economists and other 

leading health care authorities served as leaders of the forum’s three 

discussion sessions and one served as the keynote lunchtime speaker. At 

the end of the day, participants were polled for their views on several key 

points raised during the forum regarding health care system challenges 

and reforms.

These proceedings summarize the ideas and themes that emerged at the 

forum, the collective discussion of participants, and comments received 

from participants based on a draft copy. As such, these proceedings are 

not intended to reflect the views of GAO. Their purpose is to serve as a 

small step toward elevating public understanding of the challenge and

acceptance of the need for change. Ultimately, it will take the combined 

efforts of many groups and individuals over an extended period to 

successfully address the issue. Still, time is relatively short before 

budgetary pressures end the chance for health experts to decide 

deliberatively and thoughtfully on the future of the nation’s health care 

system. 

I wish to thank all the forum participants for taking the time to share their

knowledge, insights, and perspectives. These will be of value to the 

American people and to their representatives in Congress as they 

communicate with their constituents about the inability of our health care 

system to maintain the status quo. We at GAO will also benefit from these 

insights as we carry out our mission to help Congress examine federal

health care spending and its implications for all health care payers. I am 

Page 2 GAO-07-1155SP Health Care Forum
hopeful that the American people will become fully engaged in national 

debate on this topic as a means to facilitate serious, timely, and sustained 

action that can help save our fiscal future for the benefit of our country, 

children, and grandchildren. 

David M. Walker 

Comptroller General 

 of the United States 

Page 3 GAO-07-1155SP Health Care Forum
Health Care Forum Introductory Presentation, led by David M. 

Walker, Comptroller General of the United States. Mr. Walker 

opened the forum with a presentation entitled “Health Care System 

Transformation Challenges: The Need for Leadership, Transparency, 

and Accountability.” The following are highlights of Mr. Walker’s 

presentation. 

Comptroller General’s 

Introductory 

Presentation 

The federal government is on a “burning platform” and the status quo way 

of doing business is unacceptable. Today is not the problem, tomorrow is. 

Mr. Walker noted that the present value of the federal government’s major 

reported long-term “fiscal exposures”—the difference between what we 

have promised and what we have in dedicated revenues—totaled over $50 

trillion in 2006. This represents close to four times gross domestic product 

(GDP) in fiscal year 2006 and is up from about $20 trillion, or two times 

GDP in 2000. If we wanted to put aside today enough money to cover these 

promises, it would take about $440,000 per American household, up from 

$190,000 in 2000. Clearly, we have been moving in the wrong direction in 

connection with our long-range imbalance in recent years. Equally 

troubling are the long-range fiscal simulations by GAO and others showing 

that, over the long term, the nation faces large and growing structural 

deficits in future years due primarily to rising health care costs and known 

demographic trends. (See fig. 1.) 

Page 4 GAO-07-1155SP Health Care Forum
Figure 1: Revenues and Composition of Spending as a Share of GDP, Fiscal Years 

2006-2040 

Percent of GDP

Fiscal year

All other spending

Medicare & Medicaid

Social Security

Net interest

Source: GAO’s January 2007 analysis.

0

10

20

30

40

50

2006 2017 2030 2040

Revenue

Note: This simulation assumes that discretionary spending grows with GDP after 2007 and all 

expiring tax provisions are extended through 2017. Thereafter revenue returns to historical average of

18.3 percent of GDP plus deferred revenue. 

Absent significant changes on the spending or revenue sides of the budget 

or both, these long-term deficits will encumber a growing share of federal

resources and test the capacity of current and future generations to afford 

both today’s and tomorrow’s commitments. In particular, public 

entitlement program obligations will be unsustainable for future 

generations of Americans. As the baby-boom generation retires, federal 

spending on current retirement and health care programs—Social 

Security, Medicare, and Medicaid—will grow dramatically. A range of 

other federal fiscal commitments, some explicit and some representing 

implicit public expectations, also bind the nation’s fiscal future. (See 

fig. 2.) 

Page 5 GAO-07-1155SP Health Care Forum
Figure 2: Social Security, Medicare, and Medicaid Spending as a Percent of GDP, 

2000-2080 

0

5

10

15

20

25

30

2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065 2070 2075 2080

Percentage of GDP

Fiscal year

Medicare

Medicaid

Social Security

Source: GAO analysis based on data from the Office of the Chief Actuary, Social Security Administration, Office of the Actuary, Centers

for Medicare & Medicaid Services, and the Congressional Budget Office (CBO).

Note: Social Security and Medicare projections based on the intermediate assumptions of the 2007 

Trustees’ Reports. Medicaid projections based on CBO’s January 2007 short-term Medicaid 

estimates and CBO’s December 2005 long-term Medicaid projections under midrange assumptions. 

Absent policy changes, a growing imbalance between expected federal 

spending and tax revenues will mean escalating and ultimately 

unsustainable federal deficits and debt levels. 

Mr. Walker observed that many of the federal government’s current 

policies, programs, functions, and activities are based on conditions that 

existed decades ago, are not results-based, and are not well aligned with 

21st century realities. Policymakers need to engage in a fundamental 

review, reprioritization, and reengineering of the base of government.1

 1

See GAO, 21st Century Challenges: Reexamining the Base of the Federal Government, 

GAO-05-325SP (Washington, D.C.: Feb. 16, 2005). 

Page 6 GAO-07-1155SP Health Care Forum
With regard to our health care system, specifically, the public needs to be

educated about the differences between wants, needs, affordability, and 

sustainability at both the individual and aggregate level. 

Mr. Walker concluded that comprehensive health care reform will 

probably need to occur in installments over a number of years. Our goals 

should be fourfold: 

• Provide universal access to basic and essential health care. 

• Impose limits on federal spending for health care.

• Implement national, evidence-based medical practice standards to 

improve quality, control costs, and reduce litigation risks. 

• Take steps to ensure that all Americans assume more personal 

responsibility and accountability for their own health and wellness. 

After the presentation, forum participants asked questions related to 

Mr. Walker’s illustrations of the long-term fiscal picture. Then the 

discussion broadened to participants’ observations on the appropriate 

focus of health care reform efforts. 

Some participants raised the following questions about the various 

assumptions underlying GAO’s simulation in figure 1: How would allowing 

the tax cuts to expire affect the long-term fiscal picture? Would preventing

an expansion of entitlements have a greater or lesser effect than 

eliminating the tax cuts? 

Mr. Walker responded that the recent tax cuts comprise only about 

1 percent of GDP; in a GAO simulation under which the tax provisions 

expire, the long-term fiscal imbalance remains largely unchanged. Not 

surprisingly, the entitlement programs are the bigger fiscal problem. In 

addition, not only must the federal government reform Social Security, 

Medicare, and Medicaid and institute tough budget controls, it must also 

engage in comprehensive tax reform that will not undercut our economic 

growth and must reprioritize and constrain other federal spending. 

Maintaining federal revenues at their historical average of 18.3 percent of 

GDP will not be enough to cover the growth in the entitlement programs. 

We must do all of these things, and the sooner the better because time is 

working against us and our debt clock is ticking.

Discussion by Forum 

Participants 

More on Long-Term Fiscal 

Picture 

Page 7 GAO-07-1155SP Health Care Forum
Another participant asked whether GAO has created a scenario that 

assumes the growth rate for Medicare spending is kept to the growth rate 

of GDP or GDP plus 1 percent. Mr. Walker noted that GAO’s simulations 

are based on data from the Medicare Trustees’ “best estimate” 

(intermediate) projections, which assume that Medicare spending grows at 

a rate of GDP plus 1 percent. He added that that this growth rate pushes 

the fiscal imbalance problem further into the future but does not solve it.

Yet another participant wondered how this message, which has been 

heard for several decades, might be different today. Mr. Walker explained 

the difference as follows: the traditional measures of fiscal health— 

economic growth, inflation, interest rates, unemployment, and capital

markets’ performance—may not point to a current fiscal crisis. 

Nevertheless, the long-range structural deficit is worse today than it was in 

the 1980s and closer to becoming a reality. Furthermore, the political and 

social circumstances today are quite different from the 1990s. At that time, 

the United States was mostly borrowing from itself. Today our debt is 

increasingly held by foreign creditors who may put political pressure on 

the United States to change its policies in their favor. Another difference 

relates to the baby boom generation’s impending retirements, which will 

result in an unprecedented strain on U.S. entitlement programs and 

therefore the federal budget. Finally, the geopolitical climate has changed 

such that there are new emerging superpowers, including China, India, and 

the European Union, competing with the United States in world markets. 

Several participants agreed that addressing problems in the health care 

system cannot be limited to the federal government’s role. According to 

one participant, framing the issue is the most important factor in finding a 

solution. He contended that patients’ experiences with the health care 

system should be the highest priority. Another participant countered that

the federal role was most important, as Medicare, Medicaid, and the 

federal employees’ health insurance program make government the largest 

payer in the health care system and federal payment models have had a 

strong influence on private payers. For example, in the 1980s the 

movement in Medicare to pay hospitals prospectively based on groups of 

related services—that is, DRGs—rather than reimbursing them their 

charges was adopted eventually by payers systemwide. 

Observations on Appropriate 

Focus of Health Care Reform 

Efforts 

Page 8 GAO-07-1155SP Health Care Forum
Several participants commented on elements they believed should be the

focus of health care system reform, offering a diversity of views: 

• We are not getting good value for our dollars spent; health care quality 

needs improvement, as demonstrated by studies finding evidence of both 

overuse and underuse of services. 

• The problem with discussions about “reforming the system” is that we do 

not have a system to reform. Ours is a disaggregated model in which 

providers operate as individual self-interested entities seeking to maximize 

their revenue. 

• We should focus on the rate of health care spending growth and its driver, 

medical technology, rather than on system reforms. 

• Looking at individuals’ out-of-pocket costs—that is, copayments, 

coinsurance, and deductibles—is highly misleading as a focus for reform. 

Under our third-party payer system, the true cost of health care remains 

hidden from view. In the private sector, prices are neither transparent nor 

uniform, as negotiations between payers and purchasers occur under 

cover. Therefore, the extent to which public and private payers are 

subsidizing one another remains unknown. We need to examine health

care costs in their totality. 

Following Mr. Walker’s remarks and group discussion, participants 

engaged in discussions on three major topics: health care costs and the 

role of personal responsibility; access to and coverage for health care 

services; and health care quality, standards, and outcomes. Session leaders 

began with a presentation of key points, after which discussion was 

opened to all participants. 

Cost and Personal Responsibility, led by Robert Reischauer, 

Urban Institute. To what extent or in what ways can federal health 

care spending be controlled? Should there be absolute spending limits, 

spending triggers, or spending targets? Should tax preferences be 

reformed and insurance incentives structured to foster personal 

responsibility? Dr. Reischauer developed several of these topics for 

discussion, as paraphrased here:

Health care is the monster in the federal budget. Under certain, not 

unreasonable, assumptions about the rate at which health care costs are 

projected to grow, spending on Medicare and Medicaid will soar to 

Session 1 

Page 9 GAO-07-1155SP Health Care Forum
unsustainable heights. However, “trends which are unsustainable will not

continue.” What can or should be done? Will policymakers address the 

health care spending trend in a timely and incremental fashion or will 

more drastic change be forced on us by crisis? 

Some argue for controlling federal health care entitlement spending—that 

is, spending on Medicare and Medicaid. The question is, can federal 

spending be controlled in isolation of spending in general? The American 

public will not tolerate separate health care systems for services provided 

though entitlement programs and those provided through the private 

sector. 

Proposals to control spending with absolute limits come with an array of 

policy questions. For example: 

• What would be the measure used to set a spending limit: a percent of 

GDP? a percentage growth rate? a percentage of the federal budget? a per

capita dollar value? 

• How do you decide on the threshold number? What factors should affect 

the threshold—for example, population size? the population’s health 

status? the general inflation rate? 

• How could you have a national limit when levels of spending, growth rates 

of spending, and quality of care vary across geographic areas? If Medicare 

spending in Minnesota is half of what Miami spends, why should the same 

steps be taken to control spending in both areas? 

• How do you enforce exceeded limits: reduce provider payment updates? 

increase beneficiary premiums? tighten program eligibility rules? 

Another way to control spending relies on incentives to slow growth—

ranging from revising tax exclusions for insurance premiums and out-ofpocket costs to achieving greater price transparency. A third way involves 

discouraging unhealthy behaviors, by penalizing smokers and drinkers, for 

example, with higher insurance premiums. 

At the end of the day, however, can incentives to slow growth and 

penalties for unhealthy actions result in anything more than rearranging 

the Titanic’s deck chairs? In particular, can federal health care spending 

really be controlled without fundamentally restructuring the nation’s 

delivery and financing systems? 

Page 10 GAO-07-1155SP Health Care Forum
In response to Dr. Reischauer’s presentation on taming health care 

spending growth, participants discussed the nature of the U.S. health care 

delivery system and efforts to address certain of its flaws. They also made 

observations about, among other things, the price of medical care in the 

United States relative to other countries and the role of medical 

technology in driving spending growth. 

The group generally agreed that our disconnected health care delivery 

system is not designed to treat, with efficiency, individuals with chronic 

conditions (e.g., diabetes, hypertension, asthma)—the population that 

accounts for most of health care spending. As one participant noted, “the 

entire system works fine in terms of short-term care, such as colds or 

broken arms, but works terribly in treating chronic conditions.” Another 

noted that Medicare in particular was built around paying for a disease or 

injured body part. Payment under this approach has not fostered 

efficiency nor is it conducive to disease management or prevention. For

example, physicians are financially rewarded for the number of services 

they provide while financially discouraged from time spent on care 

management and prevention. Related to that idea, some participants noted

the importance of integration, meaning that doctors, hospitals, and other 

health care providers should be organized to provide care and receive 

reimbursement as integrated units. Without such integration, another 

participant pointed out, current pay-for-performance initiatives aimed at a 

single provider type will not achieve desired savings and will remain 

superficial; incentives to be efficient need to be aligned across all 

providers to foster cooperation. Pay-for-performance efforts aimed solely 

at hospitals, he continued, will not work while physicians are ordering 

80 percent of health care services. 

Some in the group cited integrated care delivery, longitudinal care (as 

opposed to episodic, illness-oriented, complaint-based care), and built-in 

accountability for care as key factors needed to reform the current health 

care delivery system. Participants pointed to recent models that embody 

these factors, including:

Discussion by Forum 

Participants 

Fragmented Delivery System, 

Acute-Care Focus 

• the British and German health care models, where all specialists are 

employees of the hospitals, while primary care practitioners are out in the 

community. 

• provider-sponsored organizations (PSOs), which work much like a 

managed care HMO, except that they are formed by a group of hospitals 

and doctors who assume the financial risk of providing care to patients. 

Page 11 GAO-07-1155SP Health Care Forum
• the medical home model, in which patients have direct access to one 

physician (“my personal physician”) who accepts responsibility for 

managing their care, makes arrangements with teams of additional health

professionals to provide services outside the practice’s expertise, and is 

paid under a reimbursement system that rewards physicians and patients 

financially for choosing medical practices that foster quality and 

efficiency. 

• bundled payment systems, in which flat fees are paid for major 

procedures, such as coronary artery bypass surgery; these fees include 

some months of follow-up treatment and cover additional treatment if the 

patient suffers complications or is readmitted to the hospital. 

• Medicare’s physician group practice demonstration, which tests a hybrid 

payment methodology that combines Medicare fee-for-service payments 

with a bonus that participating physicians can earn by demonstrating 

savings through better management of patient care and services and 

meeting quality performance targets.

At various points in this discussion, several participants asserted that 

efforts to contain health care spending by federal payers—particularly 

Medicare—could not be effective if conducted in isolation from health 

care spending by private payers. 

Some participants indicated that constraining capacity is a strategy that 

should be added to the list of reforms Dr. Reischauer presented. One 

explained that there has been a push to increase the number of physicians 

educated in our country, which, in leading to an increased number of 

physicians, could result in increased costs ranging from an estimated $5 

billion to $50 billion a year. 

Taking a different tack, another participant noted that the United States 

does not differ markedly from other countries in health care utilization, 

capacity, or technology. For example, she observed that the United States 

does not have more physicians per capita nor more hospital beds per 

capita than other countries and that Germany and Switzerland are also on

the cutting edge of medical technology. The difference between our nation

and others, she contended, is in price: in the United States, the payment 

level for services and for providers is higher than in other countries. 

Additional Observations on 

Health Care Spending Growth 

Page 12 GAO-07-1155SP Health Care Forum
With regard to health information technology (IT), one participant saw it 

as an important part of the solution to health care cost control. She gave

an example of small businesses that have not had their health insurance 

premiums go up for 5 years because of their ability to use health IT to 

control costs. Several other participants noted the potential for health IT

to improve the quality of care but believed that on a wide scale it would 

have little effect on cost, given the nature of major health care cost 

drivers. 

Several participants noted the major contribution of medical technology 

advances to rapid health care cost growth. The dilemma for society, 

contended one, was to balance the seemingly limitless potential to 

improve technology against the cost of doing so. The participant observed 

that technology could be vastly improved for automobiles, but people 

would not be willing to pay for it. He concluded that work needs to be 

done in the area of comparative effectiveness—that is, comparing the 

relative benefits and costs of drugs, medical devices, and medical 

procedures designed to achieve the same outcome. 

One participant suggested that a more fundamental problem existed than 

could be addressed by imposing spending limits, changing the health care 

tax exclusions, or encouraging better health habits nationwide. Citing 

noted economist Professor Uwe Reinhardt of Princeton University, he 

observed that our health care delivery system is like an elephant walking 

over trees and policy makers are tiny people hitting the elephant with 

sticks. In other words, the real problem—provider oligopolies (such as 

specialty hospitals that can self-refer) and unsavory relationships between 

physicians and drug companies and physicians and the research 

community—is massive and reforms to bring down health care spending 

do not address these complex and destructive relationships. 

The electronic poll conducted at the end of the forum asked for 

participants’ views on points raised in session leaders’ presentations or in 

the discussions following. Participants could strongly agree, agree, neither 

agree nor disagree, disagree, or strongly disagree with 18 propositions 

presented. Below are the poll results for the propositions related to points

made in session 1. Using a two-part test for statistical significance, we 

sought to determine the extent to which participants agreed with each of 

18 propositions. For a comprehensive look at the poll results, see 

pages 27-29.

Relevant Propositions and 

Electronic Poll Results 

Page 13 GAO-07-1155SP Health Care Forum
A spending limit—such as a percentage of the federal

budget—should be used as a policy tool to control federal 

health care spending. 

No agreement 

Certain federal tax preferences for health care should be 

revised to encourage more efficient use of health care 

products and services. 

Strong agreement 

The federal government should impose constraints on the 

development and diffusion of medical technology. 

Agreement 

Steps should be taken to encourage individuals to assume 

more personal responsibility for their own health and 

wellness. 

Strong agreement 

Covering the Uninsured, led by Mark Pauly, Wharton Business

School, University of Pennsylvania. Should every American have at 

least some health insurance? If yes, why and how much? What, if any, 

federal role is there in ensuring some basic level of coverage to all 

Americans? Should the minimum coverage for different people be 

uniform for everyone or different for people at different income or health

status levels? Dr. Pauly developed several of these topics for discussion, 

as paraphrased here:

What do we know for sure about the uninsured population? Dr. Pauly 

identified some facts and conditions that health care experts generally

agree on. 

Session 2 

• The uninsured population is a very heterogeneous group. Compared with

the insured population, the uninsured population has a higher share of 

those who are nonworking, poor or near poor, or at high risk for health 

problems. However, many of the uninsured are working, not poor, and not 

at risk for serious health problems. 

• People are uninsured for different reasons: some because the cost of 

insurance is high relative to their total income and other basic needs, and

others because the cost is high relative to the benefits they expect to 

receive, even though they may be able to “afford” it. This latter category 

includes young adults who do not expect to be in ill health. 

• From a policy standpoint, one of the most controversial uninsured 

subpopulations is the “Tweeners”—those individuals with incomes above 

the poverty level (up to 150 percent of poverty) but below the median 

income (about 325 to 350 percent of poverty). Three-fourths of the nation’s

Tweener population is insured, mostly through private insurance. 

Nevertheless, Tweeners make up about half of the uninsured population.

Page 14 GAO-07-1155SP Health Care Forum
With this blend of insured and uninsured in the Tweener population, 

policymakers are concerned with “crowd out”—which occurs when a 

public program attracts individuals who might otherwise obtain health 

insurance through the existing private market, thereby shifting health care 

costs to the public sector. 

• The current tax exclusion for employer-sponsored health benefits is 

inequitable and inefficient. Under this exclusion, an employee’s health 

insurance benefits are not considered income and therefore not subject to

income tax. Generally, people who can get health insurance through their 

employer thus get favorable tax treatment not available to others. 

• Being uninsured harms the health of those who are poor and near poor. 

Despite this general agreement regarding the uninsured population, 

Dr. Pauly continued, certain facts are in dispute. For one thing, research 

cannot quantify the existence or magnitude of harm to Tweeners of not 

being insured. There are correlations between insurance and health status, 

but correlation does not translate neatly into causation. Moreover, it is not 

clear that extensive coverage results in better health. While catastrophic 

coverage for the uninsured appears to be a good idea, research has not 

shown whether more generous coverage would have a significant positive 

effect on health. 

Similarly, the “distributional effect” of eliminating the tax exclusion of 

employment-based insurance is unknown. Specifically, to what extent 

would dropping the health insurance tax exclusion affect different 

population subgroups—the currently insured and uninsured—in terms of 

health coverage and health status? In a related point, Dr. Pauly noted that 

some proponents of coverage expansion advocate for uniform coverage 

for all Americans. However, uniform benefits for all is inefficient for 

producing equal access to care. Policies based on tax subsidy incentives, 

for example, should be targeted to low-income individuals if equity is to be

achieved. 

Dr. Pauly concluded his presentation by noting that insurance coverage 

reform decisions will likely reflect societal and individual values, some of 

which are moral; others, more self-interested. Regardless of these 

differences, it appears that much of society is willing to incur costs to 

increase Americans’ access to medical services, improve their health 

status, and reduce their chances of financial distress. 

Page 15 GAO-07-1155SP Health Care Forum
Following Dr. Pauly’s presentation, participants examined issues 

associated with expanding health insurance coverage. 

One participant called attention to the findings of a survey of the Citizen’s 

Health Care Working Group—a 14-member body created by Congress and 

appointed by the Comptroller General. According to the survey, most 

citizens believe that all Americans should have access to health care 

coverage. The survey also found that most people are willing to share 

financial responsibility for extending coverage to the uninsured and 

providing financial security to protect individuals from medical 

bankruptcy.

In reaction to the idea of universal coverage, participants made several 

points: 

• Caring for the uninsured now is costly; one participant put the cost at 

$126 billion annually, contending that an additional several billion dollars 

is spent in lost productivity because of uninsured workers’ delay in 

treating health problems. 

• It is important to consider whether dollars spent now on the uninsured 

population’s costs could be reinvested so that everyone had access to a 

core set of services and coverage for catastrophic health events. 

• The lack of political will to achieve universal coverage exists because of 

the absence of consensus on how to expand coverage and the peril 

politicians face when specifying the cost and details of a coverage 

expansion plan. 

A number of participants agreed that in considering policies to broaden 

health insurance coverage, it is not feasible to identify a “basic” or 

“minimum” benefit package. For example, one participant noted that “the

search for a basic benefit package is akin to the search for the Holy Grail.” 

Others pointed out that a consensus exists for considering only a small 

number of services, such as certain cosmetic surgery, as “luxury” medical 

care. Importantly, what is basic for someone with asthma or other chronic 

health condition may not be basic for a healthy individual. Further, one 

participant noted, regardless of what services are included, budget 

constraints are the most important factor in shaping any benefit package.

Several participants noted that there are ways to proceed without trying to

tackle the definition of a basic benefits package. One example is to expand

catastrophic health insurance. Another participant noted existing 

Discussion by Forum 

Participants 

Observations on Universal 

Coverage 

Defining Basic Benefits 

Potential Models for Expanding 

Coverage 

Page 16 GAO-07-1155SP Health Care Forum
programs that can serve as models for expanding health insurance, 

although with some qualifications: 

• Medicare is the most popular insurance program in the United States and

should be considered as a potential model. At the same time, the benefit 

package is considered to be limited, lacking in stop-loss provisions, and 

most beneficiaries have additional insurance to supplement Medicare. 

• State Medicaid benefit packages often include a broad range of services 

and might be described as “generous,” but because provider 

reimbursement levels are often very low, access to care often can be 

limited. 

• The Federal Employees Health Benefit Program (FEHBP) offers an array 

of options and choice to a sizable population across the United States. 

However, the population covered under FEHBP is employed and has 

reasonably good purchasing power. The cost-sharing requirements that are 

manageable for this population may not be equitable or affordable for the 

poor or near-poor populations. 

• The state of Oregon experimented with defining a core set of services as 

part of proposals to expand coverage statewide; but under public 

pressure, the core set broadened over time, which added to the proposals’ 

cost. 

Several participants noted that because the uninsured population is 

heterogeneous, there should be different solutions to increasing coverage 

for the different subpopulations. For example, one participant felt that 

public sector programs could be used to expand coverage for the poor and 

near poor while private sector plans could play more of a role in attracting 

those uninsured who have higher incomes. Another participant pointed 

out that requiring uniform health insurance coverage is inefficient because

people have different preferences for the amount of coverage they are 

willing to pay for. 

Even under a pluralistic approach to expanding coverage, several 

participants noted that a dominant health care payer, such as Medicare, 

needs to be a larger player in the market. Otherwise, achievements in 

access to care, control of system costs, and widespread use of information 

technology and quality will likely be limited. 

Coverage Solutions for a 

Heterogeneous Population 

Page 17 GAO-07-1155SP Health Care Forum
The electronic poll conducted at the end of the forum asked for 

participants’ views on points raised in session leaders’ presentations or in 

the discussions following. Participants could strongly agree, agree, neither 

agree nor disagree, disagree, or strongly disagree with 18 propositions 

presented. Below are the poll results for the propositions related to points

made in session 2. Using a two-part test for statistical significance, we 

sought to determine the extent to which participants agreed with each of 

18 propositions. For a comprehensive look at the poll results, see 

pages 27-29.

The federal government should ensure that all Americans 

are covered for basic and essential health care services. 

Strong agreement 

States, rather than the federal government, should take the 

lead in expanding access to health insurance to all 

residents. 

No agreement 

The United States should continue to rely on employersponsored health care coverage as the backbone of the 

U.S. system of coverage. 

No agreement 

The federal government should assure that a health 

insurance market exists that adequately pools risk and 

offers alternative levels of coverage. 

Agreement 

“Breaking the Policy Impasse to Secure America’s Future,” led by

Leonard Schaeffer, founding chairman and CEO of WellPoint and 

former administrator of the Health Care Financing 

Administration. Mr. Schaeffer currently serves as Senior Advisor to 

TPG Capital. 

Mr. Schaeffer recapped several themes that emerged in two earlier 

sessions: the unsustainability of federal health entitlement spending, the 

demographic shift to an aging society that will consume more health care 

than ever, the lack of standard medical practices and evidence-based care, 

and the increasing burden on employers to finance health care. He 

followed with a discussion of barriers to implementing good policy, 

noting, among other things, that 

Relevant Propositions and 

Electronic Poll Results 

Lunch Session 

• physicians are not trained to manage the health care system; they function

as individual contributors whose defense of their professional autonomy 

contributes significantly to a system lacking leadership and accountability; 

• consumers, spurred by advertising and the Internet, demand access to new 

medical technology, without knowledge of its value, safety, or efficacy; 

Page 18 GAO-07-1155SP Health Care Forum
• information on price and quality, needed for the marketplace to work 

more effectively, is lacking on the major drivers of health care spending; 

and 

• advocating rational health policy is a “third rail” for politicians, as 

constituencies in health care are multiple and each has objectives that 

conflict with one another. 

Mr. Schaeffer contended that pragmatism rather than ideology should 

drive health policy. For example, proponents of a market-based strategy 

want to reform the insurance market and tax policies, rely on competition 

and consumer choice, and solve problems through increased use of 

information technology and greater price transparency. Alternatively, 

proponents of a regulatory strategy want to rely on government control of 

costs and spending, leverage federal programs, and establish best 

practices. Mr. Schaeffer argued for a blended strategy—one that 

coherently combines the best elements of the marketplace and 

regulation—to increase access, contain costs, and improve quality. 

Mr. Schaeffer concluded that a limited window of time—about 8 to 

10 years—remains for the health care community to engage in effective 

reform. After that, if nothing is done, federal health care spending will be 

at the mercy of budget hawks eager to lower the deficit. If the budgeteers 

are not successful, the national security experts will intervene, seeking to 

significantly reduce our debt to foreign nations whose interests and values 

may be contrary to ours. “We have to shape our future now or,” he 

forecasted, “be its victim.”

Mr. Schaeffer sprinkled his presentation with candid commentary, some of 

which is highlighted below: 

Regarding reliance on consumerism to lower costs: 

• “American consumers don’t have enough information in the health care 

market as opposed to other markets. To ask them to behave as good 

consumers is not reasonable.” 

• “In the few cases where consumers have price information, they don’t

seem to comparison shop. If consumers don’t price shop when it’s entirely

their health care dollar, why would they do it with other payers’ money?” 

Page 19 GAO-07-1155SP Health Care Forum
• “Do YOU have restless leg syndrome?” Who ever heard of it before the ad 

for the new drug? Consumers see ads, self-diagnose, and then go see their 

doctor.” 

Regarding unmoderated growth in medical technology: 

• “Health care is one sector of the economy where the introduction of new 

technology does not replace the old, but adds to it.” 

• “Health care technology diffuses on the 5 o’clock news. Every news station 

has a doctor now. Patients hear about new medicines before their doctors 

get a chance to read about them.” 

Regarding health care reform solutions: 

• “This is an area of the American economy that is a significant risk to our 

economic future. Everyone who pays a bill is desperate for savings.” 

• “Health information technology won’t solve the problem. Health IT is 

required to collect data—then we have to turn data into information for 

decisionmaking and then make sane decisions.” 

• “The best hope is to leverage federal Medicare and Medicaid by fiat, 

because the government can do things that other payers are afraid to do. It

is not an easy position but the private sector will follow.” 

• “It is not the market vs. government. We need a hybrid solution.” 

Quality, Standards, and Outcomes, co-led by Carolyn Clancy, 

M.D., Agency for Healthcare Research and Quality, and Suzanne 

Delbanco, The Leapfrog Group. How can national practice standards 

be developed to measure provider performance and what should be the 

federal role? How can IT facilitate quality measurement and improved 

outcomes? What do international comparisons of health outcomes and 

other such measures tell us about quality? The two session leaders 

discussed these and other issues in their respective presentations, which

are merged here for purposes of exposition. 

The presenters raised several interrelated points on developing quality 

measures and addressing structural challenges. They noted that the need 

for improvement in health care quality is widely recognized. Studies 

confirm that a substantial gap exists between the best possible care and 

Session 3 

Page 20 GAO-07-1155SP Health Care Forum
actual care. To illustrate that gap, experts estimate that providers do not 

“do the right thing” between 40 and 50 percent of the time. Not 

surprisingly, health care purchasers are increasingly monitoring the 

performance of their network providers. However, these monitoring 

initiatives are disparate and uncoordinated, lacking in an alignment of 

goals and consistency of measures nationwide. Part of the problem is 

structural, in that health plans, providers, consumers, and purchasers are 

all responsible, but no one is accountable. For example, about two-thirds 

of outpatient visits are to small group practices of fewer than five 

physicians. Because of their small size, there is not likely any one 

individual who is responsible for monitoring quality, while the 

infrastructure in small group practices—that is, the administrative 

resources to measure and monitor quality—is likely weak. 

What can be done in a system in which different stakeholders have diverse 

goals—that is, one seeks to reduce costs, another aims at ensuring errorfree care, and others want to minimize administrative burden? The 

presenters offered these ideas and challenges: 

• The science of measurement is still evolving. Today’s measures are tightly 

linked to site of care—for example, the physician’s office, the hospital, or

the rehabilitation center. This means that providers are blind to what 

happens when a patient leaves their enterprise. To date, measures that 

encompass episodes of care are not available, although researchers are 

working toward developing these measures. 

• With regard to the relevance of international comparisons, the 

Organization for Economic Cooperation and Development (OECD), which 

reports on health care quality indicators, concludes that no country does 

the best or worst on all measures, but some countries do better than 

others, and every country has areas of improvement. Similarly, within the 

United States, health care spending and outcomes can vary dramatically 

by geographic area. Although benchmarks should be set nationally, it is 

important to observe differences at the local level, since change is driven 

locally. 

• Finding a cohesive set of quality measures is a challenge. Some purchasers 

seek measures that can lead to improved quality care and reduced costs. 

The measures do not have to be perfect, as long as they improve on the 

current low level of information. To date, public agencies and private 

companies have organized under the National Quality Forum (NQF), a 

body created to promote a common approach to measuring health care 

quality. 

Page 21 GAO-07-1155SP Health Care Forum
• In 2002, NQF sought to standardize adverse reporting by compiling a list of 

“never events”—safety errors that should never happen in a clinical setting 

but should be reported when they do. Since then, the list has been 

adopted or modified by other governmental entities and organizations. 

For example, the Leapfrog Group, an organization whose members include 

large public and private sector health care purchasers, asks hospitals to 

adopt the Group’s own never events policy. This policy entails telling 

patients of errors, not billing the patient for care associated with the error, 

reporting the error as appropriate, and conducting a root cause analysis.

Leapfrog is interested in the never events policy because it addresses cost 

and quality simultaneously. 

• In their search for standards, some purchasers are seeking health plans 

that, in their measurement initiatives, address the Institute of Medicine’s 

six key traits of high-quality care—safe, timely, effective, equitable, 

efficient, and patient-centered. 

• How measurement information should be used—to reward performance 

or improvement—is another factor needing deliberation. One answer is to 

have incentives that not only reward “leading edge” providers but also 

bring along providers that are not at the top in performance. 

• Reporting to the public on physician and hospital performance matters. In 

fact, public reporting has been shown to lead to improvement in care. 

Whether the reporting should be voluntary or mandatory remains 

problematic, as drawbacks exist with both. Voluntary reporting may 

attract only those with nothing to hide, but mandatory reporting may 

suffer from trying to meet the needs of the lowest common denominator, 

which may not be sufficient to illuminate differences in quality among 

providers. 

• Public reporting is a “messy business.” Purchasers are not consistent in 

the metrics they use to assess providers’ performance, resulting in 

challenges in aggregating data across providers. The lack of uniformity 

adds to the difficulty of achieving transparency—making public the basis 

for reporting and the algorithms used. 

• Health IT is not a magic bullet to improve health care quality on its own. 

Rather, it can make the right thing to do the easy thing to do. The evidence

that health IT saves money or results in improved quality is thin, as a 

substantial number of studies on health IT effectiveness are concentrated 

in four large institutions that had a strong champion inside the 

organization, ran home-grown health IT systems, and had lengthy 

Page 22 GAO-07-1155SP Health Care Forum
experience with health IT. Less is known about the success of currently 

available commercial products. 

Following the presentations by Dr. Clancy and Ms. Delbanco, participants

elaborated on points the presenters raised, including national goal-setting, 

cost impact, public reporting, and health IT. 

Participants reiterated the points raised by the presenters, noting in 

particular the importance of having national goals and benchmarks to 

define the performance expected from the health system. For example, 

some participants thought the collection and analysis of data should be 

done nationally; in deciding how to change practices, however, the scope 

of data analysis should be local to account for area differences: what 

works in one place may not in another. Others noted that no means exists 

for coordinating a national focus on quality. One participant thought the 

NQF could serve that coordinating function, but to do so would require 

more financial support, including federal resources. Another participant 

concurred that the efforts of NQF were good but questioned whether its 

consensus-driven model was bold enough for the level of reform needed. 

Several participants were skeptical that quality improvements, desirable in

and of themselves, would also save money. They argued that there was at

best a weak relationship between quality and cost and that other actions 

would need to be taken to achieve cost savings. To illustrate, one 

participant noted that hospitals were unlikely to agree to forgo payments

for certain never events, such as surgery on the wrong body part or a 

mismatched blood transfusion. As a result, while reducing avoidable never 

events could improve quality, different incentives would be needed to

contain costs. 

Some participants identified the need to present quality information 

differently for consumers and professionals. For example, one noted, if we 

report that Hospital A has a 1 percent error rate and Hospital B has a 

0.1 percent error rate, consumers shrug. But if we report that Hospital A’s 

error rate is 10 times that of Hospital B, consumers react. We don’t want to

scare consumers, but we need to dramatize the issue for them. Another 

participant agreed that public reporting is not yet “consumer friendly.” 

However, she also noted that consumers want information on quality and 

want the information when they actually get the care, according to survey 

findings released by The Commonwealth Fund. She reported that 

consumers have not had much impact on health care quality to date and 

need to get more involved. At the same time, health care systems must get 

better at making information more “actionable” for consumers. 

Discussion by Forum 

Participants 

Setting National Goals 

Impact of Quality 

Improvements on Cost 

Public Reporting 

Page 23 GAO-07-1155SP Health Care Forum
One participant cautioned that although we have some reasonable quality 

measures now (such as care for diabetes) and are developing more, some 

aspects of care may never be conducive to measurement or public 

reporting; instead, the attention should be placed on structural, payment, 

and organizational issues, including the need to create appropriate 

financial incentives and encourage stronger health IT to manage risk. 

Other participants countered that, although the current measures are not 

sufficient to drive change, improvements can happen as more measures 

are developed and reporting becomes more routine. 

In the end, one participant concluded, quality measures need to be driven 

by the “real world” of physicians practicing in their offices and doing what 

needs to be done medically, not just because the government is measuring 

it. Another participant suggested that Congress create a model system in 

each state that the local physicians could observe in operation to see how 

it could work for them. A third observed that most physicians view quality 

initiatives as “background noise,” pointing to a key cultural challenge that 

needs to be met. 

Participants noted that if health IT is to be successful in affecting cost, 

quality, or both, a strong cultural change is needed systemwide, as well as 

alignment between the entity making the health IT investment and the 

savings achieved. Part of the cultural change includes assuring that the 

smallest unit in the health system has health IT capability. For example, 

Medicare’s quality improvement organizations are working with small 

physician groups to implement health IT. Additionally, health IT 

investment may be more likely when cost savings accrue to the entity 

making the investment. For example, VA applied health IT to support the 

use of its cost-saving formulary. This positive impact was supported by an 

underlying structure of accountability within a closed system. 

The electronic poll conducted at the end of the forum asked for 

participants’ views on points raised in session leaders’ presentations or in 

the discussions following. Participants could strongly agree, agree, 

neither agree nor disagree, disagree, or strongly disagree with 18 

propositions presented. Below are the poll results for the propositions 

related to points made in session 3. Using a two-part test for statistical 

significance, we sought to determine the extent to which participants 

agreed with each of 18 propositions. For a comprehensive look at the poll 

results, see pages 27-29.

Limits of Health IT 

Relevant Propositions and 

Electronic Poll Results 

Page 24 GAO-07-1155SP Health Care Forum
A public-private entity should be created to assess and disseminate 

its findings on comparative and cost effectiveness of health care 

products and services. 

Strong agreement 

OECD health care measures (population-based, resource, and 

spending) are a valid gauge of U.S. health care system 

performance. 

Agreement 

The federal government should take the lead in developing 

indicators (such as comparisons across regions, trends over time) 

to measure the U.S. health care system’s outcomes and 

performance. 

Strong agreement 

The federal government should create financial incentives to 

expedite the use of information technology in health care, ensuring 

it interoperability and wide adoption. 

Strong agreement 

In the forum’s final session, Mr. Walker polled participants on their views 

regarding the health care system challenges and reform options that 

surfaced in the preceding sessions. Through the use of interactive voting

technology, participants registered, on a 5-point scale, the extent of their 

agreement or disagreement with 18 propositions. (See table 1 at the end of 

this section listing each proposition and the polling results.) The 

technology allowed for the voting to be real-time but confidential. 

The poll was not intended to be scientific: our participant sample was 

neither random nor large enough to be statistically representative. 

However, forum managers, through careful development of the participant 

list, sought to ensure that the forum presentations, discussions, and poll 

results would not be biased in favor of any particular view of health 

system maladies or directions for reform. 

Taken as a whole, the poll results suggest several themes from 

participants’ collective views on likely avenues for effective reform. The 

discussion below seeks to capture these themes, referring to the numbers 

of relevant propositions shown in table 1. 

The session discussions made it clear that nearly all participants felt some 

urgency about gaining control of health care spending in the United States. 

The group did not reach agreement about whether an aggregate spending 

limit, such as a percentage of the federal budget, should be used as a tool 

to control spending (#1) but strongly supported other measures, such as 

instituting value-based purchasing in federal health care programs (#5), 

changing the tax treatment of health care to encourage greater efficiency

(#3), and limiting direct-to-consumer advertising of prescription drugs 

Wrap-Up

Health Care Spending 

Page 25 GAO-07-1155SP Health Care Forum
(#6). The group strongly supported encouraging individuals to assume 

greater responsibility for their health (#7) and generally agreed with 

permitting further importation of prescription drugs (#8) and aiming 

efficiency incentives at the individual patient (#2). 

Several of the themes emerging from the forum discussions and 

participant poll related to the role of the federal government in addressing 

health care challenges. In particular, despite the efforts of several states to

reduce the ranks of the uninsured (#10), there was near unanimity among 

participants that ensuring the provision of health care coverage for all 

Americans should be a federal responsibility (#9). Further, the group 

agreed that the federal government should assure the existence of a wellfunctioning health insurance market (#12), whereas they reached no 

agreement on whether the nation should continue to rely on employerprovided insurance as the dominant method through which most 

Americans obtain their health insurance coverage (#11). 

In forum discussions and the participants’ poll, participants generally

favored constraining the development and diffusion of medical technology 

(#4). They strongly supported balancing the nation’s research investments 

between new discovery and assessing the value of new and existing 

technologies (#18) and strongly favored the creation of a public-private 

entity to assess the comparative and cost effectiveness of health care 

products and services (#13). While discussions indicated that the diffusion 

of health IT was no panacea, there was strong support for government 

subsidy in this area (#16). 

Forum discussions generally supported the notion that reforms should be

accompanied by the development of performance measures to gauge

success or failure at meeting reform objectives. In the participants’ poll, 

two-thirds of participants supported the view that OECD measures, which 

compare health system performance measures across countries, are a 

valid gauge of U.S. health system performance (#14), and four-fifths 

supported the federal government’s taking the lead in developing new 

indicators of health system outcomes and performance (#15). Consistent 

with this view, the group also strongly favored the development of 

national practice standards by an independent body that includes key 

stakeholders (#17). 

Health Insurance Coverage 

Technology 

Performance Measures 

Page 26 GAO-07-1155SP Health Care Forum
In conducting the participant poll, we sought to determine the extent to

which participants agreed with each of 18 propositions, using a two-part 

test. First, we tested for the existence of a statistical difference 

(significance) between the responses of two groups—participants who 

said they agreed or strongly agreed and participants who said they 

disagreed or strongly disagreed. If the test did not find the difference to be

statistically significant, we characterized the result as “no agreement.” If 

the test found the difference to be significant, we conducted a further test 

to determine whether a statistically significant difference existed between 

the proportion of participants who agreed and the proportion of those who 

strongly agreed. If the test found a statistical difference, we characterized

the result as “strong agreement.” Otherwise, we characterized the result 

as “agreement.” (See table 1.) 

Poll Results 

Page 27 GAO-07-1155SP Health Care Forum
Table 1: Results of the Health Care Forum Participant Poll 

Percentages 

Propositions

Strongly

agree Agree

Neither agree 

nor disagree Disagree

Strongly

disagree Summary resulta 

1. A spending limit—such as a 

percentage of the federal budget—

should be used as a policy tool to 

control federal health care spending. 

26 19 13 23 19 No agreement 

2. Fostering efficiency incentives at the 

individual patient level is an

appropriate and effective way to 

moderate health care spending

increases. 

23 29 13 19 16 Agreement 

3. Certain federal tax preferences for 

health care should be revised to 

encourage more efficient use of 

health care products and services. 

58 39 3 0 0 Strong agreement 

4. The federal government should 

impose constraints on the 

development and diffusion of 

medical technology. 

36 39 7 7 13 Agreement 

5. The federal government should 

revise its payment systems and 

leverage its purchasing authority to 

foster value-based purchasing for 

health care products and services. 

77 13 3 3 3 Strong agreement 

6. Direct-to-consumer advertising of 

prescription drugs should be limited. 

52 26 13 10 0 Strong agreement 

7. Steps should be taken to encourage 

individuals to assume more personal 

responsibility for their own health 

and wellness. 

55 23 7 16 0 Strong agreement 

8. Further importation of prescription 

drugs (beyond current levels) should 

be allowed. 

39 32 23 3 3 Agreement 

9. The federal government should 

ensure that all Americans are 

covered for basic and essential 

health care services. 

73 23 3 0 0 Strong agreement 

10. States, rather than the federal

government, should take the lead in

expanding access to health 

insurance to all residents. 

3 17 17 33 30 No agreement 

11. The United States should continue 

to rely on employer-sponsored 

health care coverage as the 

backbone of the U.S. system of 

coverage. 

16 26 19 26 13 No agreement 

Page 28 GAO-07-1155SP Health Care Forum
Percentages 

Propositions

Strongly

agree Agree

Neither agree 

nor disagree Disagree

Strongly

disagree Summary resulta 

12. The federal government should 

assure that a health insurance

market exists that adequately pools 

risk and offers alternative levels of 

coverage. 

48 36 10 7 0 Agreement 

13. A public-private entity should be 

created to assess and disseminate 

its findings on comparative and cost 

effectiveness of health care products 

and services. 

87 10 3 0 0 Strong agreement 

14. OECD health care measures 

(population-based, resource, and 

spending) are a valid gauge of U.S. 

health care system performance. 

13 53 10 7 17 Agreement 

15. The federal government should take 

the lead in developing indicators 

(such as comparisons across 

regions, trends over time) to 

measure the U.S. health care 

system’s outcomes and 

performance. 

71 10 16 3 0 Strong agreement 

16. The federal government should 

create financial incentives to 

expedite the use of information

technology in health care, ensuring 

its interoperability and wide 

adoption. 

48 32 10 7 3 Strong agreement 

17. National practice standards should 

be established by an independent 

body that includes key stakeholders. 

58 26 10 7 0 Strong agreement 

18. The United States should balance its 

health care research investments 

between new discovery and 

assessing comparative and cost 

effectiveness for new and existing 

medical interventions. 

65 23 3 7 3 Strong agreement 

Source: GAO analysis of health care forum participant poll.

Notes: Percentages may not add to 100 due to rounding. 

a

Significance is at the .05 level (using a one-tailed test). 

.

Page 29 GAO-07-1155SP Health Care Forum
Appendix I: Forum Agenda Appendix I: Forum Agenda 

8:45 Welcome and Introduction: Bruce Steinwald—Director, Health Care 

Team, GAO 

8:50 Introductory Presentation and Group Discussion: David M. Walker—

Comptroller General of the United States

9:45 Session 1: Cost and Personal Responsibility: Robert Reischauer—

President, Urban Institute 

To what extent or in what ways can federal health care spending be 

controlled? Should there be absolute spending limits, spending triggers, or 

spending targets? Should tax preferences be reformed and insurance 

incentives structured to foster personal responsibility? 

10:45 Break 

11:00 Session 2: Access and Coverage: Mark Pauly—Professor of Health Care

Systems, Business and Public Policy, Wharton Business School

Should every American have at least some health insurance? If yes, why 

and how much? What, if any, federal role is there in ensuring some basic 

level of coverage to all Americans? Should the minimum coverage for 

different people be uniform for everyone or different for people at 

different income or health status levels? 

12:00 Break 

12:15 Luncheon: Leonard Schaeffer—Senior Advisor, TPG Capital; Founding 

Chairman and CEO, WellPoint; Former Administrator, Health Care 

Financing Administration

1:00 Session 3: Quality, Standards, and Outcomes: Carolyn Clancy—Director, 

Agency for Healthcare Research and Quality—and Suzanne Delbanco—

CEO, The Leapfrog Group 

How can national practice standards be developed to measure provider 

performance and what should be the federal role? How can IT facilitate 

quality measurement and improved outcomes? What do international 

comparisons of health outcomes and other such measures tell us about 

quality? 

Page 30 GAO-07-1155SP Health Care Forum
Appendix I: Forum Agenda 

2:00 Session 4: Real-Time Poll of Forum Participants. 

Use of interactive voting technology to assess the group’s views on longterm goals and promising first steps. 

2:45 Wrap-up and Concluding Comments: David M. Walker—Comptroller 

General of the United States

3:00 Adjourn 

Page 31 GAO-07-1155SP Health Care Forum
Appendix

Par

 II: Forum Presenters and 

ticipants 

Page 32 GAO-07-1155SP 

Appendix II: Forum Presenters and 

Participants 

Carolyn Clancy Director, Agency for Healthcare Research and Quality 

Suzanne Delbanco CEO, The Leapfrog Group 

Mark Pauly Bendheim Professor of Health Care Systems, Wharton Business School, 

University of Pennsylvania 

Robert Reischauer President, The Urban Institute 

Leonard Schaeffer Senior Advisor, TPG Capital; founding chairman and CEO of WellPoint; 

former administrator of the Health Care Financing Administration 

David M. Walker Comptroller General of the United States 

Forum Presenters 

Forum Participants 

Henry Aaron Senior Fellow, Economic Studies, The Brookings Institution 

Robert Berenson Senior Fellow, The Urban Institute 

Nancy Chockley President, National Institute for Health Care Management Foundation 

Nancy-Ann DeParle Managing Director, Healthcare, CCMP Capital 

Elizabeth Docteur Deputy Head, Health Division, Organisation for Economic Cooperation 

and Development 

Elliott Fisher Professor of Medicine and Community and Family Medicine, Dartmouth 

Medical School, Dartmouth College 

Richard Frank Margaret T. Morris Professor of Health Economics, Harvard Medical 

School, Harvard University 

Anne Gauthier Senior Policy Director, Commission on a High Performance Health 

System, The Commonwealth Fund 

Gail Graham Director of Health Data and Informatics, Veterans Health Administration, 

Department of Veterans Affairs 

Health Care Forum
Appendix II: Forum Presenters and 

Participants 

Robert Greenstein Executive Director, Center on Budget and Policy Priorities 

Mary Kay Henry International Executive Vice President, Service Employees International 

Union 

John Iglehart Founding Editor, Health Affairs 

Karen Ignagni President and CEO, America’s Health Insurance Plans 

The Honorable Nancy Johnson Fellow, Institute of Politics, John F. Kennedy School of Government, 

Harvard University 

Randy Johnson Director of Human Resources Strategic Initiatives, Motorola, Inc. 

Charles “Chip” Kahn President, Federation of American Hospitals 

Marjorie Kanof Managing Director, Health Care Team, GAO 

Herb Kuhn Acting Deputy Administrator, Centers for Medicare & Medicaid Services 

Patricia Maryland Chair, Citizens’ Health Care Working Group 

Mark Miller Executive Director, Medicare Payment Advisory Commission

Ron Pollack Executive Director, Families USA 

John Rother Group Executive Officer of Policy and Strategy, AARP 

Dallas Salisbury President and CEO, Employee Benefit Research Institute 

Henry Simmons President, National Coalition on Health Care 

Bruce Steinwald Director, Health Care Team, GAO 

Richard Umbdenstock President and CEO, American Hospital Association 

Bruce Vavrichek Assistant Director for Health and Human Resources, Congressional 

Budget Office

Alan Weil Executive Director, National Academy for State Health Policy 

David Wennberg President and Chief Operating Officer, Health Dialog Analytic Solutions 

Page 33 GAO-07-1155SP Health Care Forum
Appendix II: Forum Presenters and 

Participants 

Jessica Farb 

Hannah Fein

Mary Giffin 

Bruce Steinwald 

Page 34 GAO-07-1155SP Health Care Forum

GAO Forum Managers 

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