May 19, 2010 | Coming reform will affect every piece of the state’s health care system, creating opportunities for improvement as well as challenges, said Arkansas State Surgeon General Joseph Thompson, M.D.

Speaking today at UAMS as part of a special lecture hosted by the College of Medicine, Thompson broke down the new law that he said will improve access to health care in rural Arkansas, require health insurance for most Americans — including an estimated 500,000 uninsured Arkansans — and change the way health care is delivered and paid for.

But at the same time that more patients will be seeking care, there will not be enough providers to see them all and as of yet no increase in the number of federally funded medical residencies — despite medical schools like UAMS ramping up enrollment in recent years to address worsening physician shortages. In Arkansas, Thompson foresees a need to expand the abilities of physician extenders — nurse practitioners and physician assistants — to handle the influx of new patients.

“We don’t have all the answers or guidance yet,” said Thompson, who compared the phased-in implementation of health care reform to a trip to a family reunion. “It will be nice when we get there, but there are going to be bumps and flat tires and lost wallets on the way.”

Changes impacting health care consumers, insurance companies, employers and health care providers will be phased in by Jan. 1, 2014. Reforms taking effect this year include an extension of dependent coverage for medical insurance to age 26, the elimination of preexisting conditions as a barrier to insurance for children under 19 (eventually extending to everyone), a lifting of lifetime caps on insurance benefits and the ability to go online and compare health plans available in every state.

Thompson predicted an end to “fee for service” medicine and a shift to bundled payments for care. He cautioned that health systems will need to adjust how they bill for services and bring costs in line with the new funding mechanisms.

At the same time, health systems that have received federal funding for having a higher number of uninsured or underinsured patients will see that funding cut by 2014. Those dollars will instead shift to expand Medicare and Medicaid programs to help cover Americans alongside private insurers and employer-sponsored health plans.

The measure will impose tighter regulations on insurance companies; require most Americans to have health insurance coverage; add 16 million people nationwide to the Medicaid rolls; and subsidize private coverage for low- and middle-income people. The cost of these changes will be paid for in a variety of ways with about half —$500 billion—coming from the shifting of a 10 percent incentive or bonus paid to Medicare managed care programs. Other funding sources include a payroll tax increase on wealthier taxpayer, an excise tax on high-value employer health plans, fees in the insurance sector, and taxes on medical device makers and tanning salons. There will also be cost savings as the health care system becomes more efficient.

Thompson said those positioned to benefit from health reform included rural states like Arkansas with higher number of uninsured. With medical coverage, access to health care in rural areas could increase — “if we can find enough health care providers,” he said.

Arkansas also could benefit as the expected federal reimbursement for Medicaid increases from current levels. Health systems can benefit if they can adjust care delivery to fit payment changes and demonstrate quality care that is efficient and shows good outcomes.

Reform includes no provision for support of training and replacement of non-physician clinicians — the physician extenders Thompson believes will increasingly become the front line of basic care.

UAMS Chancellor Dan Rahn, M.D., added his concerns to another piece of the health care puzzle not addressed by reform — no increase in the number of funded medical residency slots. Medical schools have been expanding enrollments to address physician shortages and are graduating more students but there are no additional residencies available to allow the young physicians to continue their training, he said.

“It is big and complex and there are going to be issues to resolve,” Thompson said of health care reform. “This will be a dramatic change in form and function for health care in this state.”

Health reform information is available online at www.healthreform.gov.