'$27 billion really did focus the mind'

By Mike Miliard
01:51 PM
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The genesis and legacy of HITECH

In his book, The New New Deal: The Hidden Story of Change in the Obama Era (Simon & Schuster), Michael Grunwald, a correspondent for TIME magazine, makes a compelling case that President Obama's 2009 stimulus bill, the American Recovery and Reinvestment Act (ARRA), is probably more transformative in the long run than Roosevelt's New Deal. A big part of that mammoth $800 billion legislation, of course, is the $27 billion Health Information Technology for Economic and Clinical Health (HITECH) Act, which is devoted to digitizing the nation's medical records and rewiring healthcare for the 21st century. Grunwald spoke to Healthcare IT News about Obama's rationale for giving healthcare pride of place in the legislation, the negotiations and revisions that led to the creation of meaningful use, the ways it has set the stage for broader healthcare reform, the jobs it has created  -  and why health IT may just be the most lasting, bipartisan and transformative piece of the stimulus bill.

You call ARRA one of the "most ambitious and least understood" pieces of legislation in American history.

In Washington, it's just considered this $800 billion joke: levitating trains to Disneyland, and snowmaking machines in Duluth, and mob museums and all sorts of nonsense that isn't in the actual stimulus. And even nationally, a year after it passed, the percentage of Americans who believed it created any jobs was lower than the percentage of people who believed Elvis was alive. But this was by far the biggest energy bill in the history of the planet. And it was not just for energy, but it also laid the groundwork for healthcare reform, it was the most ambitious education reform in decades, the biggest infrastructure bill since Eisenhower, the biggest middle-class tax cut since Reagan, and the biggest investment in research, ever. And then, oh, by the way, just about every independent economist agrees that it helped prevent a depression and added 2 to 4 percent in GDP, which is the difference between contraction and growth. So it took this economy that was crashing at a 9 percent annual rate and losing 800,000 jobs a year, and within a few months you had the biggest improvement in employment in 30 years.

How did health IT become such a big part of the bill?

There was a lot of money in this bill for healthcare. The biggest chunk was aid to states to prevent huge Medicaid cuts. And there's some other stuff in there, but health IT  -  Rahm Emanuel had that famous line about how you never want to waste a crisis, and health IT had been something that had real bipartisan support: Hillary Clinton and Newt Gingrich. Because it really is a no-brainer, right? We've got online banking. We've got online dating. It's preposterous that you have to fill out the same 20 forms every time you go to the doctor's office. And that two doctors who aren't in the same room can't look at the same file. And that if you show up at a hospital on the weekend they have no way of seeing the test that you took on Wednesday and you have to retake it. And that your doctor could kill you with his chicken-scratch handwriting. It's just crazy. So I do think it sort of appealed to Obama, who really is this sort of rationalist, pragmatist, sort of policy guy. Here was this opportunity to spend all this money, well, why don't we just do it? People had been squabbling over the details for several years; the prospect of $27 billion really did focus the mind.

Did the administration see HITECH as a way to lay the groundwork for broader policy reform  -  what eventually became Obamacare?

Absolutely. In fact, [Health and Human Services Secretary Kathleen] Sebelius specifically said that to me. She said she considered the stimulus, and especially health IT, as the foundation for Obamacare. One thing I often point out is that one thing that did set Obama apart from the other Democrats during the primary when it came to healthcare was that he really was focused on cost. And health IT really has the potential to reduce costs. 

Talk about the challenges of doing something effective with that much money, getting the most bang for the buck.

Putting the bill together there were all kinds of disputes that had to be worked out. Privacy is one of them: How hard are you going to make it to share this information? If you make it too hard, then it's kind of useless. By putting this stuff online, not only are you making the act of providing healthcare easier and more efficient, but you're also providing data. There are really important potential uses for this stuff. There were all kinds of details that had to be worked out. One I remember is there was a fight when [Democratic California Rep.] Pete Stark basically wanted to force everybody to adopt the VistA system. But the thinking was, "Why be prescriptive? Maybe somebody will come up with something better than VistA. We want NIST to create these standards, so there will be these interoperability requirements, but let's not lock ourselves into VistA. This could be an industry of the future, let's see what the great American innovators come up with."

If the purpose of the stimulus is to be a jobs bill, obviously enlisting private industry will hopefully multiply the effect of this money.

Exactly. For most of the stuff in the recovery act, you could at least say that it provided some reasonably quick stimulus. Health IT was one of the items that at the time they weren't even sure they could say that with a straight face. But it turns out that the prospect of all this money out there did create a real boom in the industry. I'm not sure that they gamed that out in advance.

Talk a bit about meaningful use.

There was a fight inside the White House. My sense is that the strongest advocate for "stringent" was Zeke Emanuel, Rahm's brother, who was at the Office of Management and Budget, and really felt that this is the time: "Let's force people to do the right thing. They're going to get all this money, let's get them to do everything." But David Blumenthal, the analogy he always used was the escalator: "If we can get people onto the escalator, then they'll sort of naturally ramp up. But there has to be some use. We don't want them to just buy this stuff to have it sit in the corner gathering dust." I think the first draft, although they claim it was not just a negotiating position, it was, as you said, really draconian. Even Blumenthal's old boss at Partners was complaining about it in the New York Times. I think there was the sense that they had to go back to something a little less stringent  -  well, a lot less stringent. I think reasonable people can disagree about whether it's "meaningful" enough. But I think there's a real belief that if you're going to spend $27 billion on this stuff you'd better have this belief, that as doctors start to use it they're going to find it useful.

Almost four years in, what's the legacy of HITECH?

People are going to see their healthcare change. It's going to change their relationship with their doctor, it's going to improve their care, it's going to improve care in general as you begin to see that interplay with comparative effectiveness, for which there was $1.1 billion [in the stimulus], which was unprecedented. I think it's going to have a huge impact on cost. It's always hard to quantify what it would have been without it, but just in terms of fewer mistakes and less redundant tests and less unnecessary visits to the doctor when you can just knock some of this out online, I think that's going to make a real difference. It's real change. The question is: Is anyone going to remember that it was part of the stimulus? I don't know. Maybe after everybody buys my book.