Jan. 13--A holistic approach is the best way to improve the health of Americans, Aetna CEO Mark Bertolini told a roomful of investors and executives Tuesday, asserting that social services -- such as a ride to a social event for a lonely elderly person -- will ultimately be more effective at reducing health care costs than traditional approaches.
In a speech at the annual JP Morgan Healthcare Conference in San Francisco Tuesday, Bertolini noted that people often talk about how the United States spends more as a percentage of the gross domestic product on health care than any other country. But when social programs and health care are added together, he said, the United States actually ranks ninth. In Western Europe, about 60 percent of the combined spending is for health care, and 40 percent is for social programs. In the U.S., he said, the proportion is 80/20.
"Though counterintuitive to the political dialogue going on today, I think there's an opportunity for us to invest more in social services as an alternative to spending more on health care," Bertolini said.
He also talked about the direction he wants to take his company, with risk-sharing arrangements with large hospital systems, and even with pharmaceutical or medical device companies. In the future, Bertolini said, Aetna doesn't want to pay for a pill, it wants to pay for an effective pill, with that company ensuring that the patient takes the pill regularly as directed.
And, he said, the bureaucracy of the health care system -- both in getting care and in how it's paid for -- must be reformed.
"The rat maze, that's how people feel in the system. Been there myself. People are confused, they don't know where to go next," he said. In some instances, he said, they don't know how to get lab results to their doctors.
And the billing process is just as bad, he said. "Who are they paying? What are all these bills coming in? Why isn't my insurance company paying for them?"
Bertolini also asserted his belief that insurance companies must give Obamacare a chance, making what may have been a veiled swipe at UnitedHealthcare, which threatened to pull out of Obamacare in 2017 because of losses on the policies.
While Bertolini noted that Aetna withdrew from the Kansas market, "which was a big part of our [Obamacare] earnings miss in 2015," the company's main strategy in 2016 to narrow losses to roughly 5 percent on these plans is through pricing, adjusting the plans it offers, and implementing medical management for its clients.
Getting everyone in America covered by insurance is incredibly important for a functional health insurance market, he said.
"We believe we have an obligation to stick it out, and work with it until we know it won't work, and I believe it's too early to give up on that process," he said.
Obamacare plans are just 6 percent of the company's revenue, Bertolini said, and losses in that area are smaller than the investments the company has made in other areas, such as accountable care organization partnerships.
The CEO also touched on Aetna's planned acquisition of Humana, a $37 billion deal that still needs regulatory approval.
Bertolini talked about why the acquisition is so attractive, including the fact that more than 70 percent of Humana's revenues come from Medicare Advantage. These privatized Medicare plans are a major growth opportunity for the company, he said. He said he thinks that more seniors would choose Medicare Advantage -- 69 percent are still on traditional Medicare -- if they could use the same plan during winters in Florida or Arizona and the rest of the year at home. After buying Humana, the combined company would have Medicare Advantage plans across regions that include 91 percent of the population.
Bertolini did not say what the merger would mean for Aetna's Connecticut workforce, which numbers 6,200.
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