UMass CEO Eric Dickson backs Medicare for All, calls plan 'bold, courageous'

WORCESTER - Many hospitals hate the idea. Pharmaceutical companies, health insurance groups and hospital trade groups are lobbying against it. In fact, for many in the health care industry, the only thing universal about Medicare for All is disdain.

But for UMass Memorial Health Care CEO Dr. Eric W. Dickson, Medicare for All -- specifically, Sen. Elizabeth's Warren's plan for Medicare for All -- is not only worth considering, it's worth praising.

"It's a bold and courageous plan, and the best plan that any candidate has come out with to date," Dickson said Tuesday. "It's an option to consider ... very few health care CEOs would say that at this point."

Early last month, Warren released a plan to enact Medicare for All that she said would not raise taxes on the middle class. The plan, constructed with help from economists and health policy experts, estimates a $20.5 trillion cost over a decade and moves the country to universal health care over three years by first building on existing laws, including the Affordable Care Act. The plan is largely paid for by requiring employers to pay what they would normally pay in health insurance premiums to the government in the form of an Employer Medicare Contribution.

Dickson wrote to the Massachusetts Democrat to offer his support, earning a Nov. 2 Twitter shoutout from Warren, and Dickson tweeted in support of a "redesigned Medicare for All plan," the following week.

In an interview Tuesday, Dickson broke down two major challenges in health care that he said Warren's plan would address: people without insurance, and care that costs too much and is getting more expensive.

The first challenge would be solved by definition by Medicare for All, Dickson said.

The high cost of health care is a more difficult nut to crack.

But Dickson said Warren's plan has crucial elements that make it work.

A "linchpin" to the proposal for Dickson is administrative simplification -- particularly simplifying the preauthorization and denial processes through streamlined forms rather than a form unique to each state and/or each medical insurer.

Not only would this go a long way to reducing costs by freeing up physicians' and workers' time, it would also lessen physicians' frustrations with -- and burnout from -- constant paperwork, Dickson said.

The Warren plan also "levels the playing field" for health care providers by paying them all at 110% of Medicare rates, Dickson said.

Hospitals generally rely on three sources of payments: private insurance payments; Medicare, which is for seniors; and Medicaid, which covers low-income individuals. Private insurance generally pays the most, helping subsidize the cost of caring for Medicaid patients for whom hospitals are reimbursed the least and at rates often below the cost of care. UMass Memorial Health Care posted a nearly $20 million operating loss in 2018, which Dickson previously told the Telegram & Gazette was mostly due to reduced revenue from managed-care organizations handling patients with Medicaid.

But these three sources of payment can lead to price and profitability disparities among hospitals that treat a large proportion of patients with private insurance and "safety-net hospitals," like UMass Memorial, which treat a high percentage of Medicaid patients.

"(Wealthier) organizations generally oppose Medicare for All because they oppose the prospect of reducing commercial rates down to Medicare rates," Dickson wrote in his letter to Warren. "By contrast, safety net hospitals should consider Medicare for All as an opportunity to be more fairly reimbursed for treating those patients who are central to their missions - i.e., those who are either uninsured or covered by Medicaid, which has rates that are well below Medicare."

Having all hospitals paid at the same rate should standardize and reduce costs, the thinking goes, according to supporters of Medicare for All and Warren's plan.

And one of the major stumbling blocks of the Warren plan, its cost -- some experts have said the $20.5 trillion cost is too low, calculating costs as up to $34 trillion -- is something that Dickson said is essentially a wash for him and other large employers.

"We spend $140 million a year on our employees' health insurance," Dickson said. "If the government were to tax me $140 million a year and give all of our employees insurance, I'm neutral ... With no new costs, we could pay that to the government and then we could move to a single-payer system."

But Dickson has certain suggestions to improve the senator's plan.

He liked aspects of Gov. Charlie Baker's plan to shift spending from procedural care to behavioral health and primary care. Dickson also encouraged the senator to consider allowing Medicare Advantage plans.

"If you had a Medicare Advantage option, all of the people currently in Medicaid and commercial insurance could opt for a Medicare Advantage option and then I could still have my Blue Cross Blue Shield card, I could still have my Fallon Community Health Plan card as an option," Dickson said. "Then the millions of people who work for health insurance companies could continue to work ... and would not be put out of jobs just because we moved to Medicare for All."

That being said, the ultimate question is whether a President Warren could enact a plan given the health care infrastructure in place.

Dickson thinks so. But like Warren, he advocates a gradual approach rather than a "big bang."

He recommends (and will recommend to the senator in another letter) covering everybody 60 to 65 in the first year of the plan by enacting the Employer Medicare Contribution tax and then expanding the system over the next decade.

This would mean that the age group with the highest health care costs would be enrolled first, driving down costs, and also gives the health care industry time to adjust "in an incremental way," Dickson said.

"We could tolerate that," Dickson said. "There is an incremental way here that we could get this done, and it's going to just require some patience and some will."

Then there's the political considerations.

Dickson acknowledges enacting Warren's plan depends on a number of hypotheticals -- most notably, that Warren wins the nomination and then the presidency. And Dickson admits that the current Republican Senate would not enact the legislation, and that Medicare for All is not supported by Speaker of the House Nancy Pelosi.

Still, he's optimistic.

"I think it's possible to propose a concept which is that we're going to get here, this is what we're going to get to, and then work with -- assuming she got elected -- the House and the Senate on a glide path which is acceptable," Dickson said.

But with so many hypotheticals, why even speak out about it?

Well, opponents of Medicare for All, including the American Medical Association, are certainly making their thoughts known.

A national group called the Partnership for America's Health Care Future has been criticizing Medicare for All and public-option plans in television ads, on social media and in email messages. The group includes the American Hospital Association, America's Health Insurance Plans, Blue Cross Blue Shield Association, the Federation of American Hospitals, Pharmaceutical Researcher and Manufacturers of America, and dozens more.

Locally, St. Vincent Hospital declined to comment, deferring to the Federation of American Hospitals trade group. The FAH did not respond to requests for comment but has issued a report with the AHA examining a public option. That report says the proposal would inflict "the largest ever cut to hospitals -- nearly $800 billion -- and be particularly disruptive to the employer-sponsored health insurance market. State by state, the Medicare Public Option proposal would be equally as devastating, with cuts as high as $130.6 billion."

Reliant Medical Group also declined to comment.

Others are taking more of a wait-and-see approach.

"We are watching the legislative actions on this topic closely and working with our industry associations to understand the potential impacts to all of our stakeholders," said Christine Cassidy, chief communications officer at Fallon Health. "As always, Fallon advocates for health care solutions that offer affordability and access to high-quality medical care, and that are in the best interests of those we serve."

Dickson said he also believes that considering Medicare for All is in the best interests of those he serves.

"I feel that as CEO of a health care system ... I have an obligation despite the ramifications ... to continue to advocate for a system that covers everyone," Dickson said. "I have an obligation to speak out for what I think is right for the patients I serve."

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