Jonathan Cohn (4:10)

I've been in those Amtrak toilets. I don't know how you did that. Very loud, not the easiest way to have a conversation, but you did. And you then went to Trump Tower to have a kind of conversation.

Zeke Emanuel (4:20)

He said, well, we started talking and I said, well, there are a lot of things you could do on healthcare that would be quite positive. And I mentioned cutting drug costs because I knew he was interested in that. And, and that would probably be a priority of his. And he said, well, when we get sworn in and we start the new administration, we'll have you down. And I said, well, Mr. President, I'm just a little worried the Congressional Republicans will be sworn in about three weeks before you get sworn in, and they vow to repeal Obamacare and they might hamstring and hamcuff you before you even take the oath of office. We should probably meet earlier. And he said, okay, I'll have my office call you and we'll arrange something. And in fact, he did arrange. And I was down there in early to mid December. And the major purpose of that meeting, as far as I was concerned, were two. One was to get him to say there was going to be no repeal without a replacement plan and to forestall a sort of immediate repeal by the Republicans and Paul Ryan without there being a replacement plan. Because they don't have. They didn't have a replacement plan. They still don't have a replacement plan. And so I suggested that that alone would slow the train. And for anyone who studied politics, slowing the train allows the opposition to coalesce. Lyndon Johnson always said speed was the most important thing in getting legislation done. The second goal was to try to get him off this repeal and replace agenda and again emphasize that he should look at drug pricing. Because. And I put this to him in the meeting. I said, listen, President Obama couldn't get that. You would be better appealing to the ego. You would achieve something the Democrats and Obama couldn't achieve and that the American public desperately wants. And then the conversation veered into lots of other things. He brought Price, who was his designee for HHS on the line. We talked about vaccines and whether they cause autism and a few other.

Jonathan Cohn (6:30)

Wait, I didn't know that part. So was he on the vaccine autism thing? But that's interesting.

Zeke Emanuel (6:34)

Oh, way back when he. Before rf. Well, well, before he had any relationship with rfk, he was on the vaccine and autism side. I know that literature pretty well. I know all the. The details of the Lance famous Lancet article that caused the controversy. And I explained to him that that was not true. And I argued why the paper and the hypothesis is wrong. And he sort of ended that phase of the conversation with not quite dismissing, but say, well, you know, basically I'm not convinced. And I still think that there's a relationship here. So I didn't succeed in persuading him.

Jonathan Cohn (7:19)

I did not know that. I did not know that. Well, just to zip ahead, because I want to get to where we are today. You know, you had that conversation. You tried to derail him. He didn't derail. You went back to the White House later. Actually have a picture of that, which we'll put up for our viewers. That's a meeting at the White House after they started doing repeal. You're there. Mike Pence, the vice president is there. You, Paul Ryan, President Trump back there. You were not able to get him off repeal. He ends up trying. We all know what happened. They try. It fails. John McCain does his big thumbs down. Here we are eight years later, and they have passed a big healthcare Bill, this time they took the speed advice or they learned that lesson for sure and they moved lightning quick. Now, whenever we start talking about this, I try to point out to our listeners, to our readers, they did not repeal the Affordable Care Act. The architecture is still there. The basic formula of Medicaid is still there. But these are significant cuts. A trillion dollars almost out of Medicaid, more money out of the Affordable Care act, plus potentially we'll see what happens with these extra subsidies that are up for renewal. Those might very well go away. When you talk to the Republicans, when I talk to the Republicans who voted for this, who said they were going to do this, they said it's okay. We're just getting rid of waste. We're just getting rid of fraud and abuse. The only people are going to lose their coverage are people who shouldn't be eligible, documented immigrants, people who were there for some kind of enrollment error, or people who should be working and aren't able bodied adults. And everyone's going to be fine. You tell me you've been in the middle of this. You think everyone's going to be fine?

Zeke Emanuel (8:59)

Oh, there's no chance. And we know that there's no chance because you already have people who voted for this with buyer's remorse and talking about, well, we're going to prevent this from really going into effect because they realize it's going to devastate their states. So why is it a false narrative? First of all, there been lots of research by independent organizations that there's nowhere near $200 billion a year or $100 billion a year. What? Pick your number of fraud and abuse in the Medicaid system. Second of all, most of that, well north of 80 to 90% of that quote, fraud that there's actually in the system is performed by providers and insurers, not by the innocent enrollees. There may be some there, but most of that is a result of the complication of the system, complication of knowing whether you're eligible or not. I don't know if anyone listening or watching this has actually gone to a website for Medicaid and tried to fill or look at the forms and fill them out. The Texas one I just recently looked at, it is around 20 pages. It asks all sorts of totally crazy, ridiculous things like do you have a trust? What kind of trust do you, is it, you know, do you own land that has mineral rights on it? What kind of.

Jonathan Cohn (10:32)

And well, there's a lot of oil executives trying to get on Medicaid, right?

Zeke Emanuel (10:35)

I mean it's like, who are you trying to catch here? Exactly. And there's literally 20 pages of this where Texas knows full well what someone's income is and they can check with the IRS and they don't need any of this information from an individual. This is all about dissuading them from getting and applying and going through with the process, creating hurdles for it. So that's the first thing. Second thing is we know that if you're trying to fill this out, a lot of times what happens is you don't have the paperwork right. I don't know how many of your listeners have ever tried to fill out a complex form, send it in, and then someone says, oh no, I just had that situation with a bank and I got, you know, two advanced degrees from pretty prestigious places. It's a lot of complications to get all that paperwork. And by the way, the Medicaid at least in Texas requires six months of pay stubs. Just imagine assembling that.

Jonathan Cohn (11:32)

Six months of pay stubs.

Zeke Emanuel (11:33)

Yeah, six months of pay stubs. So one of the problems is a lot of the people they catch, it's not fraud, it's paperwork nonsense. And that needs to be distinguished from fraud. Second, the able bodied adults who aren't working who are on Medicaid without the usual exemptions, recent pregnancy, disabilities, taking care of children that turns out to be less than 5%. And you aren't getting 11, 12 million people who are going to lose coverage that is well more than 5% of Medicaid throughout the country. So you pour all of this together. This is not fraud and abuse. This is going to, people are going to be dismissed from coverage who are eligible and otherwise eligible. And you know, this is a case of, well, the federal government's not doing it. That is true. It will be. The states that will in the end have to decide, oh, do we pick up the, you know, reduced payments that the federal government's making us and make the whole, the system whole, or do we end up having to cut because, because we don't have enough matching grants, we don't have enough resources ourselves to cover tens of billions of dollars. And so yes, people will lose coverage. There is no doubt about it.

Jonathan Cohn (12:50)

So a couple weeks ago you wrote for us a really interesting article. I mean, this idea that, you know, the, I think Democrats, not just Democrats, a lot of people who aren't Democrats agree these Medicaid cuts are bad. They'd like to see them. They don't want to see them take place. What you wrote that I thought was so Interesting was you said it's not enough just to push back, not enough just to undo the cuts. We should be thinking constructively about how to make this system better. There's a political question about when is the right time to present that and how you present that. But let's put that aside. Just kind of sketch out briefly your kind of vision for what you'd like to do instead.

Zeke Emanuel (13:30)

Well, I think again this goes back in history to Medicaid's founding. It was never optimal program. I don't think any health policy expert, even when it was passed, thought it was well designed. It was modeled on something that Wilbur mills created in 1960 as a compromise and called elder care. It was where the federal government gave states.

Jonathan Cohn (13:53)

Is that the Mills Care act or is that what I can't remember. It's blanket.

Zeke Emanuel (13:56)

It's an elder care. So the best basic the at that time the Congress was considering a Democratic version of Medicare and a Republican version of covering the elderly with a voluntary purchase into insurance with subsidies from the government. Sound familiar? And they re rejected both the Democratic version of using Social Security and the Republican version of using the subsidies to buy insurance. And they wanted to do something or Wilbur Mills, who was chairman of the powerful Ways and Means Committee wanted to do something. So he created this program of grants to states to cover, to create their own voluntary systems to cover elderly in some way with very few requirements. About three years later it was evaluated, I think 1963 or early 1964 and it was deemed a total failure. Not very many elderly got covered. It was pretty much states didn't take it up and when they did it was pretty much of a waste. But it became the model, this sort of a state federal government partnership, money coming from the federal government matched by the states cover people who were unemployed or couldn't pregnant women. And it's a problem because it's run at the state. So in the US US you have 56 different programs. They don't talk to each other, they have different eligibility rules. Just to give you one example in that world, in Arkansas you aren't covered if you're an able bodied adult making only 17% of the federal poverty line. On the other hand in Minnesota you're covered if you're making 15 times more than that and just incoherent policies. And so my view is, you know, we should not build back, you know, oppose the Medicare cuts and the Medicaid cuts and let's get Medicaid back. No, as responsible government officials I think, or policymakers, I think we should think, well, what's the kind of system we really want? And let's begin to design that because four years of this Medicaid arrangement under Trump, it's going to destroy the system and we are going to have an opportunity to rethink the basic structure and we should use that opportunity. That doesn't mean we want the cuts to happen and people suffer and people literally die because of it. But I think that's going to happen inevitably. And what we can do is to reimagine. So here's my reimagining what Right now, even with the best arrangement, all we've gotten in the United States is to 8% uninsured. That means 30 million people roughly are uninsured in the United States. That is not universal coverage. Every other high income country in the world gets universal coverage. We have to create an arrangement for Medicaid that gets us to universal coverage. The second thing is we've got to end this sort of fragmentation. Too many different ways of getting coverage. So my proposal is let's put three groups together. People eligible for Medicaid, people working in the going into the exchange, and all the people who are uninsured. That creates actually a pool of about 120 million Americans. 150 million roughly Americans get insurance through their employer. And then you've got roughly 60 million Americans getting Medicare. That single pool, very big, it allows you to do automatic enrollment. Since almost all Medicaid in the country is through Medicaid managed care organizations, let's have an exchange. One exchange across the country, obviously that's provided individually and people get limited Choice. There are six plans you can choose from. Six plans. This large number of choices, 44 different plans, just makes it confusing and hard for people. And among those plans are some local plans that can all be these big nationals like United or Humana or Centener and then let people choose and they get subsidies in proportion to their income. And we reduce the administrative costs in two ways. One is we standardize things like benefits. We standardize co pays and deductibles. We standardize the billing process, we standardize the quality metrics, we standardize the eligibility. That creates a much more uniformity and the comparison is based upon network and quality. The last thing I would I say, and this is a really important point, a little complicated, but we now most of us who get coverage through, through our employer and people in Medicare and people even in Medicaid get coverage, have to pick annual re enrollment. Now I don't know what's sacred about annual, but it creates lots of problems. So my suggestion is we don't have annual re enrollment. You enroll in a plan and it stretches for five years. Now obviously if you have a change of circumstance, you get married, you move, or you have a new child, you can change your plan. But for most of us, they're into that plan for five years. There's a huge advantage to that because if you're an insurer now I'm responsible for that person for five years. Suddenly I take seriously things like prevention. It's much better if I, in five years there's a chance this person might have a disease that I could have treated better, like hypertension or like diabetes. And I can treat them and forestall additional costs that will in the end be better for me. The incentive to invest in prevention or management of chronic illnesses, well, is reduced if every year someone's moving out of the system. Right now 21% or 18 to 20% of people move in and out of Medicaid every year. Same thing in the exchanges. Actually more in the exchange. I think it's like 26%. Same thing in private employer sponsored insurance. So if you actually create five year contracts, you reduce what's called the churn, people going in and out into different programs and you change the financial incentives for insurers to actually take prevention seriously, to take managing chronic illnesses seriously. You have more of a healthcare system, less of a sick care system, which Americans want.

Jonathan Cohn (20:56)

So I think, you know, it's interesting. So just, I mean there's a lot there. So we could, I would love to, I would spend hours on this. Maybe someday we will, you know, but just the idea, I think two pieces there that are so important. The idea of standardization that like people, you know, there's this idea that more choice is always better. I think that is not true. And in fact the best versions of Obamacare I've seen are like in California where they've done a lot of that, right? I mean you don't, you know, the packages are all pretty similar. You can actually compare what you're getting with the insurance. There's not ten bazillion different options. And that cutting down the churn from a health care standpoint is so important, continuity, et cetera. So okay, let's stipulate that, let's take this from the standpoint of someone who agrees with you philosophically wants to get the universal coverage. So obviously there are people who don't agree with universal coverage. They don't, you know, whatever, let's totally respectable view but we're not going to talk about them for right now. Just the people who are on this side want to get to universal coverage, look at your plan and say, well, okay, that's an awful lot of surgery to do there. If we're going to do that much surgery, why not? Why are we stopping with, you know, having all these different plans? And why not just put all these people into one giant public plan? Why are you doing all these insurance? I mean, you're already, you're breaking some eggs here now, so why not break a few more and get us to something that's really, in their view, a better system?

Zeke Emanuel (22:11)

Well, I don't know that there's evidence that sort of Medicare for all version is a better system. And there's no. I'm going to make this controversial statement. I think it's 100% true. But I could be wrong and maybe some smart person listening may come up with things. There's no system that covers something as complicated as healthcare. That is one system for 330 million people, which makes it very complicated to do. That's the first thing. The second thing is if you have everyone in one Medicare system, just imagine how difficult it is going to be to do things like change payment to physicians where all their money depends upon one system. You will see fighting like you've never seen. Third point, we know from lots of data, as much as Americans hate the health insurance system, they actually like their particular insurance. Just remember the Harry and louise ads from 1993 created by Chip Kahn and.

Jonathan Cohn (23:21)

The Health Insurance association of America. Right, right, right.

Zeke Emanuel (23:25)

Americans, I mean, Americans hated their insurance company back then too, according to polls. And he made health insurance companies look lovable and made America fear the alternative.

Jonathan Cohn (23:37)

Didn't know that was possible. Right, right.

Zeke Emanuel (23:41)

I think we're not going to get. And by the way, if you really did take on the insurance companies, you have to remember people like United and others are very, very big, powerful and would spend a lot of money trying to defeat this. I think. And the last thing I would say is, I do think, you know, people read the Medicare Advantage data differently. I read the data as saying, look, managing when you have a capitated amount, you get a set amount for patients, you do manage ever so slightly better. And that makes a difference for importantly things like chronic illness because you have one group of point people. So I actually think there's. And I think there is an advantage to competition, limited competition, regulated, reducing the trickery, reducing the multiple prices, reducing the gaming. And by the way, this idea, as far Fetched as it might sound, you know, it's more or less modeled on the Dutch system, the German system and the system in Switzerland where they have all the money goes through a payer but they have multiple completing, they call them sickness, sickness funds for enrollment and those sickness funds have to manage to a budget.

Jonathan Cohn (25:03)

Want to have like a long discussion about sort of virtues of different public and private discussions, although probably pretty close to where you are on this. But let me take it from the other side and someone looking at this saying, well, that plan of yours sounds really interesting and you know, kind of, yeah, it would be more efficient to be simpler, but wow, you're still changing a lot. And if we've learned one lesson over the years is that making major structural changes in healthcare is really hard. The aca, the whole thing was designed to avoid those ads that killed the Clinton healthcare plan back in the 90s. And that's why you got you built on this crazy system without, you know, disrupting too much. You're talking, I mean, I know we're leaving employer insurance alone here, you're leaving Medicare alone, but you're, you're still disrupting a lot. And disruption is scary to people and it's easy to demagogue. And why should Democrats, you know, I mean, that's a lot of political vulnerability to take on when maybe, you know, it's just easier just to kind of undo the cuts. I mean, why make this so complicated?

Zeke Emanuel (26:06)

I would say two or three things. The first is for the first time ever, if you look at Gallup polling, you have a majority of Americans who say that the health care system has major problems or is in a state of crisis. I think the pressure is going to build over the next number of years for this kind of major reform. It's not going to lessen. And the reason I think that is you've got projected increase of costs. I mean people are already talking about double digit increases of costs in the exchanges. Employers are looking, if not high single digits, if not double digit increase in cost costs. So costs are going to increase, putting pressure on. There's multiple other things that are going to put additional pressure and make the public as well as the providers dissatisfied. There's providers, hospitals and doctors. There's going to have to be more free care and uncompensated care because people are going to be uninsured and can't afford it. Deductibles are likely to go up in response to the increase in costs as employers basically are going to put more on people. And I Think you also having a sort of fed upness with just the runaround and the amount of time and mental energy it takes any time you have to use the health care system. So I think actually the pressure for bigger change is going to increase, not decrease. And the further Congress kicks this down the road, I think my gut tells me the more upset people are going to be, not the less upset with how the system is operating now. I mean, the crazy thing is now 15 years after the Affordable Care act has been passed, you have people who have health insurance, even pretty decent health insurance, worrying about can they afford the CO pays, the deductibles, and going to the doctor and putting it off. That is a. You don't have insurance anymore. If that's what you've. The situation you've got. And to the extent that that increases or I can't afford my drugs because the CO pays are too high, you're going to just have more pressure to make more major reform. I think one of the things you're getting at, Jonathan, is an important point which is going through the usual legislative process is probably not the way something like this is going to happen. Have. Happen.

Jonathan Cohn (28:39)

Oh, interesting. Okay, so. So what is the way to do this?

Zeke Emanuel (28:42)

Well, I, I just don't see Congress getting the sort of feeling it isn't there for thinking, working together. And we're not going to likely have either party getting to 60 votes in the Senate. So I think we need to think about alternative approaches to getting this kind of level of reform. And by the way, I don't.

Jonathan Cohn (29:08)

So do you just. I want to, I want, I want to know. I want to get. So do you mean like go through reconciliation? Do you mean like get rid of the filibuster? Or you do mean by king.

Zeke Emanuel (29:15)

I think actually I, I think, you know, Simpson Bowles is the kind of thing I have in mind with some, some other things. Now, I don't know how many of your listeners even know who Simpson is.

Jonathan Cohn (29:29)

This is a commission, a bipartisan commission that had a kind of bind. Yeah, right.

Zeke Emanuel (29:33)

This was, this was on deficit and fiscal policy and it was to come up with a plan and then Congress would basically vote up or down the plan. And it was with Alan Simpson was a former senator from Wyoming who people on both sides of the aisle trusted. Bowles was a Democrat from North Carolina.

Jonathan Cohn (29:58)

It was bipartisan. Yeah, yeah.

Zeke Emanuel (30:01)

And they came up, you know, they were working out of the spotlight to come up with a program away from lobbying. And I think, I think there are, you know, a number of requirements. You would have to have you, you know, lock these people on a desert Air Force base, take their cell phones away and a few other things necessary to make it happen. You laugh, but just think about times when that kind of approach has actually been used in American history. And I would identify two times.

Jonathan Cohn (30:34)

Okay, I want to hear these two times. What are these two times?

Zeke Emanuel (30:37)

Jonathan? Your American history needs Constitutional Convention. They were on a high true sweltering summer from May to September in Philadelphia and they nailed the windows shut of Independence hall to hash out the Constitution. And there were no leaks to the press. The press kept. Now that's the equivalent of taking cell phones away. Right. Sorry guys. You're going to work and we're going to put you in the desert just so you get to feel what those founding fathers felt, right? That's not the only time in the creation of the Federal Reserve. Senator Aldrich from Rhode island, who was head of the Banking Committee, yeah. Took eight experts off to much more luxurious Jezebel Island. They cleared out the whole island. I think it's an island off Georgia if I'm not mistaken. Very highfalutin place to go hunting and other stuff. And he took them to work. And again, no, they were, they were supposed to go there undercover. The press did get wind of it, but they were isolated because they were on this island. No telephones, no nothing. And they were working without the pressure of various lobbyists and interest groups, et cetera. I think we need to think about something like that. And we've done similar things in other high stakes areas. And I think that's the kind of way we need to begin to think of big national projects where I think it's really just too much for Congress. And also the pressures of politics, interest groups, money, all that stuff doesn't do the national interest. And I think it might be something Congress would actually like to say. Yeah, we'll listen to this bipartisan commission of August25, people who really know about the system and can weigh what to do.

Jonathan Cohn (32:36)

Well, I think we've certainly seen evidence that Congress doesn't like to actually make decisions these days. So we got that going for us. I promised people we'd get to medical research. So I don't want to, I don't want to disappoint. You're steeped in the world of medical research. Give me a kind of lay of the land. How much damage? I mean, we've got these cuts to nih, to nsf. I mean, you go down the list. How much damage is being done and how much of it can be undone?

Zeke Emanuel (33:04)

Well, you have a interesting series of things happening where institutions are making a whole lot of cuts already. I know at Penn, we've reduced the number of graduate students in the basic biological sciences arrangement at the med school from 150 a year to 100. We are, you know, recognizing we're going to have austerity, looking for alternative sources of payment and financing for basic research. You know, let's be honest, the only thing that has that those kind of billions of dollars is really drug companies and drug companies with changes at the fda. It's a kind of problem for them because they rely on basic science to help them develop potential molecules and targets. Now to fund that basic science is, you know, there's all sorts of incentives against them doing it unless it's something very, very specific where they can own the intellectual property that comes out of it. You see Duke changing its arrangement with faculty. If you don't have external grants, we're cutting your salary kind of arrangements. Basically untenuring tenured faculty. Not so much taking the tenure away, but taking their salary and decreasing it. So you're seeing a lot of cutbacks and you've seen whole sections of the NIH go. So it's a serious problem. And the craziness. This is the thing. There's no strategy. Well, there is a strategy here, but there's no strategy that has the national interest at heart. This is. Biomedical research is the area the United States is clearly recognized as the world's leading leader in. Now, can NIH funding be improved and fixed and are there problems with it? Absolutely, I'm the first to say it. I worked at the NIH for 14 years. I think I love my time there. I worked outside the NIH at academic centers. I think there are many things we can do to improve the funding. One of which I would love to see is shifting more grants to younger people and giving them sustained seven year funding to prove themselves yay or nay, and, you know, get tenure or not tenure. I think that would be a really, really positive move, reducing the time of training so people don't have three, four, five postdocs so that they can have one postdoc and no more. So there are a number of positives. I do like the idea that they have actually said that the number of grants anyone can submit in a year is limited to 6. I might even go down from that. So there are some things here that are good, but in the end this is going to be quite negative, especially when you're reducing the total budget. And the Chinese have ramped up since COVID tremendously on their research. And we know this because we can see the number of biomedical, the number of drug companies that are going to Chinese companies and licensing their technology that they're really making great strides to hobble ourselves. The moment the Chinese are rising seems like a very bad geopolitical approach to the development of biomedical technologies.

Jonathan Cohn (36:39)

Yeah, that's one of the nuttiest parts of this to me is you look at medical research, basic science, same thing. Also in alternative energy, electric vehicles, all of that, we are just cutting the legs out, our own legs out from mangling an analogy here. But we are killing our own innovation. We are killing which is a source of jobs and one of our great strength as a country. And we're handing all of this to the Chinese and other countries, but especially Chinese who are doubling down on these investments. And the crazy part is it's all being done in the name of a crusade to make America great again and beat the Chinese. I mean it's like it's mind boggling. Just.

Zeke Emanuel (37:24)

I don't know. I agree with you. There's no strategy from the geopolitical sense. I think the only strategy certainly in the biomedical space appears to be. Is Tony Fauci somehow related to it? Cut. Is Francis Collins somehow related to it? Cut. Are these scientists, all these left wing wing scientists, Cut. I think that does feel like the rationales. And that of course is a terrible rationale from a national perspective. And it does not, does not work if you really want to regain American predominance or not regain because we have it, but retain American predominance in biomedical research. And I totally agree with you it EVs we lost that lead to the Chinese. I mean almost everyone agrees that BYD's a car is better than anything we produce in the United States. And we have yet to upgrade our grid in alternative energy, solar and wind. And the investments and incentives to do that are going away. This is a very, very bad long term strategy. Now this is another place if I were. We have to think hard. What's our ideal strategy here? We're going to have a lot of destruction and decimation in this space. How would we ideally like to have this happen? What are the kinds of things if we get to reimagine it in the next administration we would like to build? It can't be the old system for a lot of reasons. I mean we haven't had hardly any improvement in the grid, for example, because of lots of being hamstrung in lots and lots of ways. And that has to be certainly a top priority.

Jonathan Cohn (39:28)

Zeke Emanuel, thank you so much for coming on the Bulwark. We'll be talking again soon, I hope.

Zeke Emanuel (39:33)

Yes.