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News Release

October 24, 2007

Contact:

Lisa Trei, News Service: (650) 725-0224, lisatrei@stanford.edu


Project aims to identify real fixes for healthcare system

Scholars at the Center for Advanced Study in the Behavioral Sciences are leading a nonpartisan, three-year effort to identify ways to fix the nation's broken healthcare system.

Stanford economist Victor R. Fuchs and bioethicist Ezekiel J. Emanuel of the National Institutes of Health are halfway through a multidisciplinary project, called FRESH-Thinking, which aims to develop analyses to inform comprehensive healthcare reform proposals. (FRESH is the acronym for Focused Research on Efficient, Secure Healthcare.) The project's long-term goal is to find solutions that create an effective and equitable healthcare financing system leading to universal coverage.

"Although not imminent, we're confident that comprehensive reform will occur in the U.S.," Fuchs said. "Our belief is that by studying those issues generic to all reform proposals—whether mandates, single payer or universal vouchers—we gain a much better understanding of what it will take to create a sustainable, comprehensive and workable healthcare policy."

According to Fuchs, current methods of financing healthcare in the United States have not changed significantly since 1965 and contain major flaws. "Employment-based insurance is inefficient and inequitable," he said. "Medicaid and other means-tested programs are costly, those eligible do not apply for various reasons, and benefits may vary widely from state to state. Medicare is facing financial disaster. In addition, 46 million uninsured are either unable to acquire insurance at an affordable price or are unwilling to do so."

The impetus behind FRESH-Thinking was a conversation between Emanuel and Fuchs in 2003 about universal healthcare. Both had worked for years on the problem: Emanuel from a medical, philosophical and bioethical perspective, and Fuchs from an economic, health services research and health policy perspective. Emanuel, an oncologist, is chair of clinical bioethics at the National Institutes of Health, and Fuchs is the Henry J. Kaiser Jr. Professor, Emeritus. In June 2006, the men teamed up to launch FRESH-Thinking, which is funded with $500,000 from the Robert Wood Johnson Foundation and $400,000 from the Blue Shield of California Foundation.

To get as much input and perspective as possible, the project directors have worked with health economists, physicians, health services researchers, consultants, government officials, Fortune 500 company representatives and healthcare professionals from other countries. "The current healthcare system in the United States is deeply and irreparably flawed," Emanuel said. "But, for a reform proposal to work, it's imperative that it has the buy-in of all stakeholders. Otherwise, it just won't work." In addition, Nobel laureate Kenneth Arrow, the Joan Kenney Professor of Economics, Emeritus, heads a 13-person advisory committee that participates in the workshops and guides the project's overall direction.

It is critical for people to understand the issues clearly, Emanuel said, because each one involves costs and tradeoffs. "No choice is perfect, but you have to think through all the options," he said. "You have to know what you're negotiating for. It's important to be clear eyed about what's important and what's peripheral."

The FRESH-Thinking project includes a core group of experts, including Alan M. Garber, the Henry J. Kaiser Jr. Professor and director of Stanford's Center for Health Policy and Center for Primary Care and Outcomes Research (CHP/PCOR); Sharon L. Levine, associate executive director of the Permanente Medical Group of Northern California; Harold S. Luft, director of the Institute for Health Policy Studies at the University of California-San Francisco; and Steve Shortell, dean of the School of Public Health at UC-Berkeley.

The group, which meets several times a year at the Center for Advanced Study in the Behavioral Sciences, helps the directors identity and address specific issues, such as legal and regulatory reform, and invites experts to write background papers and commentaries. For example, Emanuel said, a critical issue that has received little attention involves how to make the transition from the existing system to a new one.

"No one thinks you're just going to flip a switch," Emanuel said. "But no one has researched this." To help tackle this question, the group is researching how European Union member states switched from using national currencies to the euro. "There are things we can learn from that experience," he added.

Emanuel and Fuchs plan to synthesize the workshop findings to identify realistic policy options and to offer carefully evaluated recommendations on how to reform healthcare in this country. The project will culminate in early 2009 with a national conference in Washington, D.C., for policymakers, politicians, health economists and the media.

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Comment:

Victor R. Fuchs, Department of Economics: (650) 326-7639, fuchs@newage3.stanford.edu

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