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Carroll School of Management

Better Outcomes, Lower Price

Excerpt from remarks to Boston College’s Chief Executives’ Club of Boston

October 2, 2014

TAKEAWAY: Better Outcomes, Lower Price

I think you should be proud of the access work that you’ve done here. I guess the question remains to be seen whether the access [to health care in Massachusetts and now through the Affordable Care Act] is actually producing better health outcomes at a lower price. That’s the ultimate objective we should have as a society. We just can’t afford the path we’re on. And I think the Affordable Care Act as well as what’s happened here in Massachusetts are good steps. We ought to have 50 experiments going on, and we should be learning from those experiments as we go forward.

Like I said before, I think one of the things I’d like to do is get the rationing for healthcare shouldn’t be state politicians and it shouldn’t be federal politicians. I’m not sure it should be employers, and I’m not sure it should be payers. Ultimately, what it should be is the consumer of the healthcare themselves. They’ve got to make a decision to ration their own care when the economics fall outside the boundaries that they’re comfortable with.

And for those parts of our society that have the most need, we should be providing them with a safety net. But that safety net shouldn’t be all healthcare free. That safety net should provide some provisions so there’s economic skin in the game for even the lowest part of our society from an economic perspective to be interested in the economic choices that they make.

And the argument you’ll get sometimes, well, they’re eighth grade, average eighth grade education so they’re not smart enough to make those choices. Well I’ve seen what’s happened in other industries. And even those people who “aren’t smart enough” find a way to figure out the best solution. People stopped buying American cars when the quality became dismal and went to Toyota. It wasn’t just the college kids that went to Toyota. It was everybody went to Toyota. And what did that do? It forced Ford and others to get their act together from a quality perspective and get their share back. I think the same phenomenon would happen in healthcare.