Dr. John Kitzhaber’s Unorthodox Ideas On Reforming Health Care

When Dr. John Kitzhaber was president of the Oregon Senate, the state’s languishing economy was tightening the screws on Medicaid outlays. But Kitzhaber, a Democrat, and others wanted to find a way to avoid having to drop residents from the federal-state health program for the poor and disabled, and they came up with a radical idea.

The Oregon Health Plan prioritized medical services in order of value and each year, depending on how much money was appropriated by the legislature, health planners would determine how many of those services Medicaid could cover. The plan was lambasted by opponents, who said it rationed medical care, and President George H.W. Bush’s administration refused to grant Oregon permission to implement the plan, saying the proposal could have dire effects on the disabled.

The proposal was finally approved in 1993 by President Bill Clinton’s administration, and the concerns about rationing generally subsided as Oregon’s plan ended up providing fairly substantial benefits to Medicaid recipients. In addition, the state added thousands of new recipients, reducing the rate of uninsured residents from 18 percent in 1992 to 11 percent in 1996, according to a study in the journal Health Affairs. 

The success helped earn Kitzhaber, by then the governor, a national profile. Still, at home, he had a variety of tough dealings with a Republican legislature, and when he finished his second term, he famously said that Oregon was “ungovernable.”

A decision to expand the Oregon Health Plan shortly before Kitzhaber left office, led to serious funding problems and eventually a drastic reduction in the number of enrollees in the program, a study published by the Commonwealth Fund found.

Today, Kitzhaber, 62, who is again running for governor in 2010, is still promoting unorthodox strategies to address U.S. health care problems. A former emergency-room physician, he is president of the Estes Park Institute, which sponsors conferences to advise community hospitals, and founded the Archimedes Movement to encourage citizen participation in resolving intractable public issues, starting with health care.

“The problem with the debate going on in the nation’s capital today is that it has nothing to do with creating a system that provides for the health of Americans,” he said recently at a presentation at Elmhurst College in suburban Chicago. “It’s about paying for the system we already have.” Not only is that system a clunker, he believes, but also a cash-guzzler that will bankrupt the country.

The following conversation is condensed from a telephone interview with Kitzhaber.

Q. Why are you running for governor again?

A. Costs for health care are going to continue to escalate and states will be overwhelmed. Whatever comes out of Congress this year is not going to have much impact on overall costs.

As we approach the congressional midterm election and the next presidential election, I think Congress is going to look for a big state demonstration project, something that’s going to improve the delivery system and people’s health. Oregon is well positioned to be one of those states. I have an idea what a new system should look like. If I get elected to a third term, I’d like to put something into effect in Oregon and maybe Washington.

Q. You don’t think you could contribute your expertise at the federal level?

A. The crunch comes on the state level, not inside the Beltway. The crunch is going to be felt in the hospital emergency departments, in physicians’ offices, in public health clinics, when millions of baby boomers coming on to Medicare discover that nobody will see them. There will be enormous pressure to do something at the state level.

Q. Tell us about the Archimedes Movement.

A. It’s a new space for civic engagement outside of our traditional legislative and governance structures. It’s not just about health care. I believe our governance structures in America have not evolved since the Industrial Revolution. Our legislatures, particularly the United States Senate, have lost the capacity to respond to issues.

We’ve got a set of policies — for health care, transportation, economics — created in the middle of the last century. They haven’t changed much in the last 50 or 60 years, while the world around them has changed dramatically. They’re all protected by these powerful economic stakeholders who preserve the status quo. A new citizen movement is a prerequisite to creating the tension to push for legislative action.

Q. How do you feel about the reform effort in Congress?

A. I’m not optimistic. I think Washington, D.C., is really badly broken. The discussion today is not about health care, it’s about both parties trying to position themselves for future majorities. I don’t think you can pass a bill to fix the health care system, at the end of the day.

I think a lot of reforms the president has recommended made a lot of sense. I am a great fan of the president. This guy has an ability to communicate way beyond the norm. One of the mistakes he made was, he didn’t spend a couple of months explaining the system to people around the country, and why it should be corrected. That left a huge vacuum filled by people with other agendas. In that environment, it’s very difficult to act in the common interest.

Q. Then, in your view, what should be done?

A. To fix the health care system, people are going to have to be willing to put their personal interest behind the general public interest. This issue, if we don’t get our arms around it, is going to bankrupt the nation.

In 16 months, the leading edge of the baby boomer generation is going to come on Medicare. That is going to drive the national debt through the ceiling. We are in a trajectory, if nothing happens, to default on our national debt. The implications are staggering.

Q. On your Web site you talk about the problem of trapped equity in health care. What do you mean by that?

A. I believe you have to somehow change the debate from where we want to go, to how we get there. Everybody is building heart centers and cancer centers because the reimbursement is really good, it rewards treatment of acute conditions. But it doesn’t produce health.

We have to transition from one system to a new system that produces health. It’s like when we were building the nukes. The utilities had a lot of trapped equity in a certain kind of energy system, based on nuclear power plants. How do you help them move that equity into new forms of energy production, like solar, passive, green technology? It takes a significant transition period to get to a low-carbon economy. That’s what we have to figure out for health care.