Healthcare Reforms For The Future

>> Lanhee Chen: Hi, everyone. We're going to get started. I know that the heat probably has kept some people away, but that's okay. We have a hardy group here, and it's good to see some old friends here as well. So thank you all for being here for the launch of healthcare choices for all, which is a new health care reform plan that two of my colleagues who you will meet shortly, Danny Heil and Tom Church from the Hoover institution, and I have spent some period of time putting together.

And so what we'll do is we're gonna walk through elements of the plan first, talk a little bit about the genesis of all of this. And then we'll be joined at the bottom of the hour by Congressman Dan Crenshaw and I'll have a conversation with him about the stuff that he's working on in Congress and areas of interest for him.

So just to start, I think the concept that we are trying to advance here is that there's a basic contrast in healthcare as we see it between a lot of the ideas that we're seeing on the progressive left and the many ideas that we're seeing for those of us who believe in a more market based system.

And this contrast has become really apparent to us over the last couple of years as the progressive left has talked increasingly about Medicare for all, public option, things that we believe will be quite disruptive for our healthcare system. And so the vision that we're presenting is one that is very different in the sense that we been promoting more choice and optionality for more Americans.

And as we'll see, this builds on a lot of work that's been done within the market based community over the last couple of years. But to begin by sort of dispelling this notion that those who believe in markets, in healthcare, don't have any ideas, clearly, I think part of the challenge is we almost have too many ideas in some ways.

And so this effort that we're engaging in is really what we believe is additive to that. Many of you know, it's been an eventful last 15 years in health care policy. Obviously, the Affordable Care act, having passed, was seen by many as a significant accomplishment. I think the challenge that we've had is that even with the Affordable Care act, there remain a number of significant issues with the us healthcare system.

We still have a relatively opaque health care system, we still have a system where accessibility and affordability remain significant challenges. I'll just pause on the issue of opacity for a minute. It's a big challenge in part because we have this system of third party payment where no one actually ends up really paying the healthcare bill.

And so as a result, there isn't a significant incentive on the consumer side, nor are there a lot of informatics that consumers can rely on to make smart healthcare decisions. So if we're going to have a healthcare system that performs more like other markets, and you see how well markets work in a variety of different contexts, it's going to be very difficult to do unless we develop, again, more ability for the consumer to see and understand more about the cost of health care.

There are a lot of great things about our system. We have a highly innovative system. I don't hear of many people wanting to go to Canada to get care, maybe prescription drugs, but not care. And frankly, preserving this innovation is one of the things that we believe very strongly that there are elements of the system that are working well and that we shouldn't inhibit those things from continuing to work.

The last thing I'll just say kind of where the system is, and this is something that many of you in this room know well. We have a major fiscal challenge, particularly with Medicare. Now our plan deals with the under 65 population, we've decided to leave the more tricky political issues to others.

But our focus really is on how do we make the system fiscally sustainable for the broad majority of Americans who get their coverage through employer sponsored insurance. Medicare is facing imminent fiscal challenge. That is something we have to take very seriously, and it's something that we believe policymakers should take seriously given some of the challenges that are ahead and what the law prescribes if we don't deal with the fiscal health, particularly of the health insurance Trust fund.

So it's interesting because the answer to this, again from the progressive left, tends to be Medicare for all. Which is the reality that even with all the conversation about improving access to health insurance, nearly 30 million Americans still remain without health insurance in the United States Post Affordable Care act.

And it's something that dipped a little bit during the pandemic because of a massive amount of federal spending. But as some of that spending gets rolled back and different things are happening, what you're seeing still are a significant percentage of people who remain without health insurance. And that's a function of a lot of different things.

It's a function of people in some cases, who are undocumented, and there's a whole debate about access to benefits for that group of people. But, you know, there are a lot of people who, many of whom are like my students at Stanford, who say, you know, I go snowboarding all the time.

I don't think I need health insurance. And they make a personal decision not to get health insurance, and with the rollback of the individual mandate penalty in the Tax cuts and Jobs act several years ago, there isn't a financial inducement really anymore to get coverage. And so as a result, these numbers increase over time for a variety of different factors.

But the notion that we've solved the access problem, even given all of the spending and all of the disruption to insurance markets that the Affordable Care Act caused is simply not true. The other issue we deal with is cost. Again, people in this room know well that if you look at healthcare spending per capita, that number is only set to increase.

Whether you look at individual families spending or you look at federal spending, on both of those measures were seeing significant increases over the next seven years, $1,000 more per capita on the private side and on the public side, almost $1,400 a person more. And this is inflation adjusted.

So even though we've experienced significant inflation over the last year, year and a half, these numbers are independent of that. So what we're seeing still are the access problem exists, the cost problem still exists. And the reality is that, as I noted earlier, there are a number of different reform concepts that market advocates have put out there over the last couple of years.

I think the predominant media narrative has been that there's no ideas for those who believe in market reforms for health care, and nothing could be further from the truth. And so what we're trying to do with this is not to supplant ideas, but to be additive to them.

We believe that a conversation should be had, for example, about the efficacy of health savings accounts, which have been probably the single greatest innovation, at least for believers in markets and for believers in empowering consumers, it's been a massive innovation. But we've hit a little bit of a plateau when it comes to take up of health savings accounts.

So our plan begins to look at and explore why that is. And so we've seen a series of different plans and proposals over the last couple years. Some of the authors of those are in this room, and we build on their work in what we try to do here.

So I'm gonna talk about the principles that underly our plan, and then I'm gonna ask Danny to come up to talk about the tax piece specifically. And then my other Tom church will talk a little bit about how we promote innovation and increase what we call the supply side of healthcare.

But briefly, these were our guide when we thought about this plan? How do we give more power to patients and individuals to make smarter healthcare decisions? How do we encourage personal saving? As my co author, Tom Church, likes to say, the only thing that you can predict are death, taxes, and health care expenses.

And so we wanna be able to have a system where people can save in their own healthcare and save smartly. We also recognize that there are a significant number of Americans who will need government assistance. And so we reject the notion that Medicaid is forever coverage. It shouldn't be, we should provide people a pathway to self-sufficiency.

And in doing what we've done, we think about the various elements of our plan. We have really built into our plan ways that we can introduce some market mechanisms into programs like Medicaid, where really very little of that exists now. By the same token, one of the biggest issues I take with the Affordable Care Act is that it really created less competitive marketplaces, particularly for health insurance, and that's a function of the regulatory regime it put in place.

But if we can figure out a way to create more competitive markets that offer tailored healthcare plans for what people need, rather than making people buy coverage they don't want and coverage they'll never use. That is really where we need to go in our healthcare system to be more effective.

Finally, obviously, the biggest holy grail of all of this is to control cost, and that is something that we believe will happen when the right incentives are introduced and consumers participate more in their own healthcare. A brief overview we call our plan choices for all. It's meant to be a deliberate contrast to care for all.

There are three basic components of it, which I'm gonna let my co-authors about. And we're thinking about how to minimize bad incentives in the tax code, predominantly the federal level, how we enhance choices for patients. And we do that through state innovation. And then finally, we'll talk about the supply side of healthcare, which is a lot of different proposals that have been out there recently, and some that we'll talk about with our guest, Congressman Crenshaw, when he gets here.

He's been a big supporter, for example, of enhancing access to direct primary care, which we also are very supportive of. So with that introduction, I will ask Danny to come up and talk about the tax piece.

>> Daniel Heil: So thank you very much. We think of what HSAs have done over the last 20 years unambiguously, in best market reform that we've had in healthcare in more than a generation.

Over 30 million account holders now benefiting millions of Americans, driving up savings for healthcare. For a number of these account holders, I think the average balance right now is about $3,000 in each account. And so when you think of what HSAs have done, they've been wonderful. But as Lanhee mentioned earlier, we've seen uptakes sort of plateau.

And for a huge swath of Americans, HSAs don't seem like the right vehicle for them, or at least they're choosing not to opt for that, even when it's available to them. And we started asking why that's the case. And there's a whole host of reasons, but we kinda narrowed it down to two big ones.

Now, the first one is that you have to get a high deductible plan in order to use your HSA. And we like high deductible plans. We think high deductible plans make a lot of sense in the sense that we wanna give people control over their healthcare. And when you get a low, high premium, low cost sharing plan from your employer, all the incentives go out the window to think about your healthcare costs.

You go into the doctors and you're not paying any sort of thing out of pocket. It reduces the incentive for you to really think deeply about the healthcare you're consuming. And ultimately, that drives up healthcare for everyone. And so we're big believers in high deductible plans, but for millions of Americans, they look at high deductible plans and they're risk averse or they have high health care costs, and they say these plans probably aren't right for us.

And so instead, what we are asking is, is there another way to get those folks to save for their healthcare in a way that doesn't cost too much money from the federal budgets? The other part of health savings accounts that discourage uptake is the 20% penalty if you withdraw money for unqualified uses.

And that's there for a good reason. We don't want people squandering away their health care savings for other purposes. And beyond that, healthcare is when you contribute to your HSA, you get a deduction from your income taxes, your payroll taxes, including the payroll tax. And so when you actually take out that money, if you're taking it out for unqualified uses, you get this massive tax benefit if you don't have that 20% penalty, cuz you're never gonna be paying that payroll tax.

So we wanna eliminate this. So the concern was if you don't have 20% penalty, HSAs are just gonna be this massive tax savings vehicle that people are gonna use without regard to whatever their healthcare issues are. So what we wanna do is the IHA, and the IHA, the individual health account, is all about eliminating some of these restrictions on HSAs for new groups of people.

Now, we think for most people who have hsas, they should keep them. The tax advantages will be more, and it makes sense for them. But for a smaller group, for the people who have decided that HSAs aren't right for them, the IHA offers them more flexibility. Flexibility in two senses.

One, you don't have to get a high deductible plan. Instead, your plan, you can get whatever type of healthcare plan you like, as long as you have some catastrophic coverage. You can give money into an IHA tax from income taxes. And the idea behind that is we want people who decide high deductible plans are right for them to get into this, but we wanna make sure they have an incentive to choose a low premium plan.

And the option that we think will work well is, rather than saying you have to pick a particular type of plan, we want to link your contribution amount to the amount of your premiums. So if you have a low premium plan, you should be able to contribute more to your IHA.

If you have a high plan, you might not be able to contribute at all. But ultimately, it's up to you to decide what kind of plan you want. And if you wanna have a lot of tax savings, you go with the IHA, you go with a low premium plan.

Otherwise, you might not benefits with that. We think the tax structure on this can be a little bit different. And so we don't think you deduct it from payroll taxes, but with it, then you don't have a penalty. So you don't have that 20% penalty when you're actually withdrawing money for unqualified uses.

And so we think those two things alone make this a very attractive tax vehicle to people who have found HSAs just don't work for them. Now, we also think that hsas are great for other groups of people, but unfortunately, the current system doesn't really allow people in the ACA, the Affordable Care act, or people in Medicaid to benefit at all from hsas.

They have no way to save for their future healthcare expenses in a tax preferred way. So we wanna fix that. And with the IHA, we can fix that in the sense of we can make this available to ACA recipients. And one reform that we talk about a little bit in our plan, and there's a lot of reforms in our plan.

We encourage you to take a look at all of them. But one reform we have is expanding state options to actually offer lower, cheaper plans on the Affordable Care act and then taking the subsidy that's coming from the federal government and shifting it over to the IHA. And we think that's an opportunity to actually encourage people who are low income, who probably can't afford to contribute money directly themselves to the IHA, to give them an opportunity to actually save for their future healthcare expenses.

And we think the same thing goes for Medicaid, too. We think there's an opportunity in Medicaid to actually give Medicaid recipients a subsidized IHA account. And with that, we're giving them control over their health care future, that they get to pick how they spend that money rather than state Medicaid policymakers.

And there's a whole large other issue here that we talk about in the paper, and that's how we generally deduct out of pocket medical expenses. Now, right now, if you want a big deduction for healthcare, you gotta do it through your employer. You got to get that high premium plan.

And we think that's ridiculous. We think that there's a better opportunity to expand deductibility to all healthcare expenses. And this isn't a new idea. This is an idea that our colleagues at the Hoover institution proposed 15 years ago. John Cogan, Dan Kessler, in their book, Healthy, Wealthy, and Wise.

And in that book, they narrow down the idea that by encouraging people, by telling them that the taxes are level between out of pocket and premiums, more people are gonna shift to higher out of pocket expense type plans and lower premium plans. And with that, we get better incentives.

And when they scored it, they said it probably actually doesn't cost anything. When you look at our report, you'll see that we think this probably doesn't. Isn't budget neutral over the first ten years, at least, you still have some short term costs, but the costs are so much smaller than, say, what the, the recent ACA expansions were.

We estimate if you have OOP deductibility, expanded OOP deductibility and IHAs we're under $100 billion over the next ten years. Now, do we think these reforms are going to be put in place the next year? Probably not, but there is tax reform in just about a year and a half from now that's gonna be needed as the Tax Cuts and Jobs Acts expire in 2026.

So we think there's an opportunity to take. Ihas take oop deductibility and bring it into the conversation in the next couple of years. And with that, I'll bring it over to Tom to talk about some of the supply side reforms.

>> Tom Church: Thank you, Daniel. Thank you all for being here.

Let's move on to some supply side issues. You've heard from Lanhee and Danny about our approach to health care reform. We'd like to add new choices. We don't want to take away anyone else's choices. And you've heard about the demand side, right? I mean, we're a market friendly healthcare people.

We believe that ways to lower prices are to work on the demand side, improve the incentives there and then on the supply side, increase the available supply. And we think about that in sort of two buckets. One, the number of providers that are available for people who need healthcare, the number of doctors that are available, hospitals and other areas.

And then the insurance side where people can purchase insurance to pay for large, unexpected or even routine costs. And so we'd like to go through just a few here. I mean, I'm gonna be very brief because we'd like to get over to the congressman, but there are a handful that we endorse that you're gonna have heard about before.

These ideas have been long championed by conservative economists and healthcare people, starting with direct primary care, which is a terrific innovation in healthcare. You can think of it as cheap concierge care. It's care for people, maybe about $80 a month or so that they get their direct primary care from a doctor.

Now I've interviewed a couple dozen of these doctors across the country. They're the happiest doctors you've ever talked to in your life because they've left the hospital system where they used to have 3000 patients on a panel and spent as much time or more coding insurance than actually speaking to their patients.

And now they have panels of 300 to 500 people and they get to spend an hour per patient and the results are terrific. And the congressman is going to speak a lot more about this because he has been a champion of this reform for a while. Right now you are not allowed to pay for DPC costs out of pocket, sorry, with a tax deductibility, and the IRS won't allow you to have one and also have NHSA.

That's a restriction we think we should probably be lifting. Telehealth expanded vastly during COVID Covid was terrible, but it also showed a lot of Americans what happens when you have access to doctors without the restrictions that exist right now. In the same sense, we can jump over to the insurance side.

We're fans of association health plans. Congress, the House has recently passed the Choice Arrangement Act which would remove the geographic restrictions or commonality tests. So that small businesses or small employers, or even self-employed people could get together and buy insurance within the same industry without having to be a large employer and work under ERISA rules.

We'd love to see that expand. We also, while we look at the ACA and we look at the available insurance options that are there, we'd like to bring back catastrophic copper plans. We'd like to pair these with our IHAs. You can find many more details of that in our plan.

And I don't wanna run through everything here, but there are a lot of state and federal reforms that are available. I think what you'll recognize here is that regulation undermines choice. You can go through any of these. Scope of practice prevents nurses, PAs who have training from operating up to that level of training.

Not every state makes those prohibitions anymore. We relaxed a lot of them during COVID, out the back. Let's get rid of those again. We can go through a few more of these here. The ACA stopped the creation of new physician owned hospitals. This has been now a decade and a half.

We've got good literature on what happens and the health outcomes are not any better and it's not any costlier. We should probably get rid of those as well. Now I'd like to actually bring lan he back up to get ready to introduce the congressman. There are a handful of other, in fact, a lot more supply side options.

You can go to our plan, you can click the QR code there or go to hoover.org choices for all and go through a much larger plan. And we appreciate your time. I know Lanhee will take some questions with the congressman after they have some remarks. But after that, we would like to see you for a reception and much more conversation to answer many more questions in detail.

Thank you.

>> Lanhee Chen: It's my pleasure to introduce our representative of the second district of Texas who is a decorated military veteran, being a former Navy SEAL officer and someone who's been actually a leader on healthcare issues. So we're delighted that he's joined us today. We'll get to some of the specifics around issues that I know you've been a leader on, like direct primary care.

But before we start, let me ask you this question about the kind of general perspectives on health care, right? As I see it, you've got the progressive left is usually talking about, how we can have more government involved? And as a general matter, I think on those of us who believe markets as I was saying earlier, really talked more about how we expand choices.

How do you see the health care debate right now? I mean, you're living it in Congress every day. You're having to deal with your colleagues on both sides. How do you see the health care debate?

>> Congressman Dan Crenshaw: Well, there's not much debate. It doesn't feel like we're really coming to the table as republicans.

And so I think that's why we're having this conversation right now and trying to come up with plans that we can talk about in three words. So that's that's the real problem, I will say on the health subcommittee on E and C, there's actually a lot of bipartisanship.

I mean, we passed out the transparency, I think, the transparency legislation, pretty sure, unanimous. So that'll fly right through. And that's, you know, with hospitals being upset about it and all that. So there's solutions around the edges. But I think the real problem is there is no debate because nobody really knows what to do.

You don't even hear Democrats screaming Medicare for all as much as they used to because they realized that was kind of a losing issue. And we just need to have a vision. And so the way I've always seen it and talked about it kind of from the outside, like I'm not part of the doc's caucus in Congress because I'm not a doctor.

And that always gets very specific. And I don't have that specificity. What I do have, I think, is the ability to take it all in and say, look, we have a general idea of where we want to go. And it's complicated, so we need to describe that vision to people.

And so we have to be talking about the debate, I guess, in terms of visions. And on the extreme end of the Democrats, it's Medicare for all. It's a completely socialized healthcare system. And it's very easy to show why that doesn't work as you can point to Canada or the UK because these are peer countries.

And you can show how when you basically, when you're putting in price controls, you constrict supply just like any product. It doesn't matter what product you're talking about. And in healthcare, supply matters because that means doctors, like numbers of doctors, it means facilities, so that means wait times, but it also means lack of innovation.

So there's real consequences to that. So that's a little easier, it's a little easier to explain that to people and get them off Medicare for all. But the rest of the Democrats are are still basically status quo, right, Obamacare. And so. And nobody thinks status quo is working.

But also, if you talk about breaking any kind of status quo with healthcare, people get really freaked out, right? Remember the repeal and replace stuff, right? I wasn't in Congress at that time, but I've heard it was a nightmare. So I think we have to speak about it in terms of a vision and lay it out.

What we talked about on my podcast was, what I would love to see from Hoover would be a two minute video that describes my daughter Suzy in the year 2040. And this is what healthcare is, right? She pulls up her app, and she picks out her direct primary care provider, right?

She just types in her zip code, and she has a list of choices of docs. She could probably afford it cuz we're only talking like $75 a month. It's like her gym membership, really. And that's total access to a direct primary care doctor, but she can't afford it.

Maybe you have a health savings account or what you guys are proposing, the individual health account, same thing. And maybe money gets put in that. And there's a debit card, and everybody in America has the same healthcare debit card, and that's what they use, and maybe that's how she pays for it.

And then that doctor helps her find her insurance. Where does she find her insurance? There should be a common interface we already have one with the ACA, you know, whatever website, so you might as well just use that. But we got to improve upon it and then that daughter helps her find the insurance that makes sense for her and there should be a hell of a lot more choices for that.

And they should be clear and they should be and there should be ratings associated with them. There shouldn't be all this hidden stuff, right, we can force that. You know, we are doing that with the transparency legislation, right, but it's happening slowly, you know, and then, and then how do you keep prices down in the long term?

And you gotta figure out how to deal with that percentage of the patient population that's driving up all the premium costs and you do that through a reinsurance model of some sorts, you know, and, and so, and so you. But we can, we can tell a story about little Susie going through that and finding her insurance provider and it just being kind of easy because, you know, she, she knows what things cost.

She has one card that's meant to pay for it and she knows who her doctor is. There's a relationship there that's all people are really looking for in a healthcare system and we just have to name that vision. Whatever makes choices for all. Well, we gotta, we gotta just solidify around it I've, I've tried other names too.

I don't know if you guys have pulled that name. We gotta figure that out. But that maybe that's it. Let's just do that. And I think, you and because we, we always get bogged down in real specific details when it comes to the debate, we gotta speak in terms of vision.

 

>> Lanhee Chen: Yeah, so if you think about the, the current debate over healthcare, it does feel to me a little bit retro sometimes, in the sense that we should be having this conversation about what the future healthcare system looks like. But I think one of the challenges is that both sides, I do think, sometimes get a little bogged down in, well, what do we do about this element of Obamacare or that thing or this provision?

So if you had to give your, aside from sort of, we need this unifying vision, which I agree with, if you were sorta to give your colleagues in the congress some advice about how do we, how do we get there? How do we get this conversation about the future?

 

>> Congressman Dan Crenshaw: Yeah see, I mean, you agree on utopia, so utopia is what I just described, right? Susie in the year 2040 like, that's utopia. So you agree on that? I'm not even sure alot of democrats would have a problem with that vision that was just laid out because, I mean, like, the tricky part with health care policy is you can't treat it completely like a free market because if you, because people need it.

And so you do have to acknowledge that democrats are right about not that you have a rights to health care, because as conservatives, we have very specific, we use words very specifically. And so, but it is something we agree people need. Okay, it's sort of, in our laws, if you go to an You get treated So we obviously already agree with that in principle.

The question is how to deliver it and so, you know, the best way to deliver these are not perfect way, but the best way to deliver something that we agree people need but can't be totally a free market is through some kind of voucher system. And that's basically what we're talking about when we talk about subsidizing a health savings account if they're, if they're below the poverty level, just the way you would do with a housing voucher or food voucher, because we agree that people need food.

But you sure as hell wouldn't deliver food to people by letting them take whatever they wanted out of a supermarket. And kind of them, letting them charge some third party afterward, telling them they have to buy the cucumbers before they buy the tomatoes just because, like, that's what the plan said to do.

And then they might get charged later for more, you know, and there's, it would be crazy there wouldn't be prices on anything. There'd be such a strange way to deliver food. No, we let a free market thrive, and then we say the people who can't engage in that free market will help you there, will help you get into it.

Because otherwise you're sacrificing that competition that creates the innovation that we so desperately need in healthcare.

>> Lanhee Chen: So.

>> Congressman Dan Crenshaw: So where do we start? I think is your other.

>> Lanhee Chen: Yeah, yeah I mean, you know, because, for example, HSAS very successful in innovation. We mentioned earlier there are now 30 million HSA accounts out there that got a balance, on average, about $3,000 that's been successful.

But it feels like whenever we talk about expanding HSAS, there's resistance.

>> Congressman Dan Crenshaw: Yeah, it's weird but.

>> Lanhee Chen: Why is that?

>> Congressman Dan Crenshaw: I don't know, I don't know. Because I've never heard, like, a real argument against it, I think, I'm guessing the far left would probably think that such an obvious path away from Medicare for all.

So that could be the reason. But, like, we've been successful in getting some Democrat support on the, you know, on bills that would make direct primary care eligible for an HSA, for instance so there's, there's, there's a no no and so we're trying to push that through their ways and means.

There's another problem with the health care debate in general is some me and rich McCormick were talking about earlier. I think he was, he's coming here I think he said he was so it's like, you know, there needs to be sort of a one one committee that has jurisdiction over all healthcare things, and there's like three, I mean, it's ways in and in workforce, energy and commerce.

You could argue the DOD and VA, too. And so you've got to develop that vision and you got to give everybody in lockstep. It's very difficult to make those changes, just politically speaking, especially when your average American, if you're asking them what's important to them right now, they've got, like ten other things right now before healthcare.

It doesn't mean they don't think the system is crappy for them, but if they have an employer insurance plan that they like, then they really don't think the system's that crappy. And so it depends on who you talk to and inflation the way it is just with all the things going on at any given moment, you talk to voters, they're just angry about what they saw in the news that day.

And so it's hard to get them educated on the complexities of the healthcare policy debate. And that's to the advantage of a lot of the stakeholders that you just kind of keep making money from it and it makes it hard for us as policymakers who do rely on public opinion to move things forward to really get anywhere.

But anyway, I want to ask your first question I would start with primary care. That's my passion because that's where you enter the healthcare system so maybe that's where we should enter the legislative debate. Let's get primary care figured out let's get that doctor patient relationship figured out.

That's why I like to start there, cuz I think it's plausible. I think there's some bipartisanship there. Like there's a direct dry, like direct primary care as a model there's a model that we can see is working in a lot of places around the country. It's reducing costs I mean, we see it.

We see it reducing premiums as well, because, you know, in the Houston area, you've got a direct primary care physician's office that sort of, like, contracts with a bigger company. That company then renegotiates its insurance and, you know, everybody wins and employee at that company feels like they know who their doctor is.

It's not, if you don't go to very often, it's not obvious, you know, who your doctor is and how to even find one. You know, that would, that would so that's like a, that's a first tangible step that I think is important to take and I think a lot of it flows from there.

And you gotta, once you understand the vision, then you start getting specific with those little bites at the apple.

>> Lanhee Chen: Yeah, the direct primary care thing to me is particularly interesting because one of the challenges we do have in our system is there seems to be a relative lack of access to primary care.

And as a result, you have people seeking care either too late when things are really expensive or personal situations have gotten bad. Healthcare has deteriorated, and we really ought to be figuring out how to get more people in to see doctors at that level earlier on. The other issue we seem to have is a lack of supply of doctors in some places that's something you guys have encountered in the congress as part of our reforms.

We talk about expanding this medical care

>> Congressman Dan Crenshaw: Comes up I don't know how to manufacture you. That's a complicated problem, right, it's actually a problem with, literally across the country, we're talking about. Supply of human capital. Yeah, I don't know, look, there's Dr Burnout. You're a doctor, you tell me, how do we.

You fit some guy or daughter, yeah, just help us with that. But it certainly comes up like, it comes up all the time. So, for a lot of reasons, right, there's burnout, the incentives aren't aligned. There's huge incentives to go into these hyper specialty areas, but primary care, not so much gonna have a passion for.

It's got to work financially, there's a lot of factors to that. God, how do we prevent, I mean, electronic health records drive these guys crazy, that's very obvious. I had an interesting conversation with Dr Brian Miller from Johns Hopkins about using AI to make these processes better and more innovative.

Why isn't an AI machine taking notes? It's not that hard, I mean, well, you do talk to text and it's, and then you say something terrible, so that obviously it's not working that well, but it shouldn't be that hard to make that better. And things like that could just make the lifestyle choice better, I think.

Now, do we have obvious solutions for that? No, that's why we rely on the Hoover Institute, so please send them over.

>> Lanhee Chen: One of the things we didn't talk about in this plan, but I'm curious that your take on as a VA, which I know you've had experience with and probably some thinking about.

But where do you think things stand right now with-

>> Congressman Dan Crenshaw: Well, I mean, a heck of a lot better than they used to. If you've been to one VA, you've been to one VA, I'm not a doctor, but I've stayed at multiple Holiday Inns and it's basically the same thing.

But I've been a lot, so I've got what that interaction is like, and I've been to a lot of, I've been to three different VAs. So the Boston VA, the Washington DC VA, very briefly, and then the Houston VA, I've got the most experience with. Boston was an absolute disaster, it was, I literally got car one day and walked over someone on the.

He was getting help and like, leave him there, just to be clear. He was just like, like, holy shit, like, what the hell is happening at this place? Smelled terrible, it felt like a homeless shelter, they screwed up all my tests. It was a nightmare, it was an absolute nightmare.

I have no complaints about Washington DC VA, but it was, I didn't really do much there either. And then Houston VA is exceptional, so I don't know. And then also in Houston, there's these outpatient clinics, like, kind of around the areas. It's just, there's a dynamic in Houston, too, where the doctors at the VA have their own private practices.

They're with bail, or there's just like a, there's an ecosystem there that makes Houston pretty unique. So they saved me from going blind, like, I'm not going to complain about the Houston VA. I'm also, let's be honest, too, a little, I don't know what my experience would be like if I wasn't me.

Does that make sense? I've only dealt the Houston VA basically as a congressman, so. But I don't know, I don't hear complaints either. And I do ask, I'll ask veterans how it's going, and they do really well. So if you've seen one VA, you've seen one VA. The problems have often been just your typical bureaucrat problems, these are bureaucracies.

And bureaucracies like to work from nine to five, they don't have an incentive to do much more than that. They don't care that you're mad at them, they just don't care. And so there was a, this happened years ago, but with the ability to just fire federal employees, get the VA just easier than it normally is to fire a federal employee.

We really need to expand that across the federal government. That makes a big difference, right? Just being able to manage the way you need to manage to make it work. So there have been a lot of improvements in the VA. I'm not one of these, it goes up and bashes it.

But it is important to know, just for the sake of kind of political argumentation, that, so Bernie Sanders, if he was sitting here, he was invited to a Hoover Institute event to be wildly.

>> Lanhee Chen: We did it.

>> Congressman Dan Crenshaw: That would have been great, that would have been fantastic.

But if he was here, he would say, well, that's exactly why we should have it for everyone. And I'm like, okay, here's the thing. The VA cannot exist without the overall market, it just can't. Or where the doctor's gonna get trained. So you want the UK's vision, that's basically what he'd be arguing.

And it doesn't work, it's just not working. We're seeing that, we're seeing the problems they have. They certainly don't innovate, they don't do anything. So every, every new innovation, or every drug that's developed, everything that the VA uses is from the American innovation machine. We're kind of the last ones doing this.

So that would be the counterargument when that counterpoint would come up, I think.

>> Lanhee Chen: So, Innovation in healthcare, glad you brought that up because I know that's a topic that you've been very interested in. How do we keep America the most innovative system, and what do you see being the challenges to doing?

 

>> Congressman Dan Crenshaw: Well, seems like FDA, and of course like CMS approval after that. So there's just, I was amazed that anybody still tries to push their products through the FDA. And I just keep seeing these horror stories wherever, and I don't have this perfect idea on how to fix that.

It's very difficult and it's often different with every case about why this particular device, and I could show a bunch of doctors whatever device I'm talking about, and you'd be like, that's fine. That's totally why we'd want, doesn't even need to be approved, it's the easiest thing in the world.

It's so obvious, it's innovative, it's good, but it's no that dangerous. That's not to call that dangerous. And yet they'll be very forthcoming and productive and efficient with approving a very risky, I don't know, new Alzheimer's drugs or something. They're just wildly inconsistent. And that's not good for investors, investors don't like just throwing their money away and use the case study.

My friend in Houston who has the device that I'm talking about, it's so obviously fine. So it's an easier way to give an epidural, like in spinal tap injection, that's all it is. And it's been like years, and it's amazing that these investors will keep doing it. It's amazing she'll keep pushing this product because at a certain point, she's just gonna have to pay her investors back and just not make you any money off of this radically innovative product.

That'll help a lot of people. So fixing that has got to be a priority. And we've just been very risk averse in Congress when it comes to reforming, doing reform for the VA. We really just wait for the kind of the user fee agreement negotiations to happen every few years.

And we don't have to, we're lawmakers, we can just make laws. That's the whole point. But there's not an obvious silver bullet on how to fix that. So that has got to improve. I've had some interesting conversations with people like Scott Gottlieb on how to do that, how to improve at least the communication between the VA.

Or between the FDA and the innovators, because a lot of times it feels like a black hole, they can't get calls back. They don't know what they're doing wrong, and that's a real problem with her timelines and all sorts of things. Reforms to demand action, I think we can get there.

And then there's the CMS, the next obstacle that they face, which is just getting their device approved or device. Or drug or whatever treatment approved for Medicare and Medicaid, because if it doesn't, the insurance companies generally don't follow suit. So that's a whole other hurdle, so the problem is just.

Overly burdensome regulation and it's trying to strike that balance between safety, risk, innovation, all of that. We might be imbalanced, I think, based on how I see it.

>> Lanhee Chen: So, you mentioned earlier that there's a relatively limited bipartisan appetite to do anything on healthcare. You mentioned transparency that might be one area, you think you'll see bipartisanship on direct primary care?

Are there any?

>> Congressman Dan Crenshaw: There is, yeah.

>> Lanhee Chen: Hope that you could point to as you think about?

>> Congressman Dan Crenshaw: Yeah, so I mean on the direct primary care strategy that we're implementing, there's already bipartisanship there. There has been representative Schreier on the Democrat side on the committee, we got through this very baby step kind of bill.

It just really just clarifies and gives guidance on how state Medicaid programs can use direct primary care, cuz it's kind of an open question on whether they even could do that. So we just clarified that just, yes you can, go ahead and do it. But we broke up my original bill into the relevant committees and then you need to make it eligible for health savings accounts, right?

It's just pushing it that way, incentivizing it that way, because at the state level, once it's allowed to be used, it can nothing get creative. Now you can start to, you really shouldn't say Medicare for all, it should be primary care for all. That's a more reasonable approach to healthcare, that doctor paid, it's a more plausible, reasonable, viable, obtainable goal.

But it should be solved at the state level maybe through those programs and so, there's definitely progress. There's not philosophical opposition in a serious way to direct primary care, I don't think, except maybe from Bernie, but it's just against everything. I don't know, he didn't come.

>> Lanhee Chen: So, direct primary care is great, it seems like HSA, there's a little bit, maybe a disagreement there, transparency is a way forward.

And anything else that you're working on at healthcare that you think people ought to know about or hear about in terms of just issues or areas that you would like?

>> Congressman Dan Crenshaw: As lawmakers we have to focus, too much of the time, we sort of just cast these wide nets and then you do nothing.

And that's how I've noticed the health care conversation is constantly in policy circles and in Congress. It just kinda goes everywhere, it turns into a complaint session, about how screwed up everything is. And I'm like okay, I don't care anymore cuz I'm not a doctor, I've never worked in the healthcare industry, so I don't get caught up in all the details.

So take a step back, focus on one thing, that is achievable and do that, don't add it anymore to my plate, all right? I want help, from you guys from these kinds of think tanks, what are some ways, some low hanging fruit we can, or high hanging fruit I don't care, to make the FDA more user friendly, right?

The entire point of it is to eventually save patients, right? Make sure something is safe enough to put the market. I'm not a big fan of their whole efficacy mandate because I think that should be up to the doctor, but it does depend, right? It's case dependent, but maybe they're not being manned and staffed with the right people, I don't know what the problem is.

That's something I've always been interested in focusing on. But, because every patient enters the healthcare system through a primary care doctor, I think that's the first legislative goal we should have. There's a million other things we could talk about, I guess with healthcare, but if you're gonna fill my brain with.

I also have to, think about the Mexican drug cartels and Ukraine and our energy grid. So just, please don't put too much more in my head at any given moment.

>> Lanhee Chen: I think if we could move the ball forward on access to direct primary care, that'd be a pretty big accomplishment, particularly in the way.

 

>> Congressman Dan Crenshaw: It'd be a normalization, we're looking for a culture shift where it's like, that's just how primary care is done, I think that would be my goal. That in itself is a big lift, it's already taking off, but how do you make that culture shift? I think and, so that's a big enough goal at the moment.

 

>> Lanhee Chen: Yeah, well, we appreciate your work on that. We appreciate you taking some time at your schedule to come down and join us to talk about healthcare today and hope you all join me in thanking Congressman Crenshaw.

>> Congressman Dan Crenshaw: Thank you.