Guest speaker, someone i have known for many years and consider a mentor and friend. Is the president the Blue Cross Blue Shield association, a National Federation that supports Blue Cross Blue Shield companies, including Blue Cross Shield michigan. The system, through its federation of insurers covers one out of every three americans. I think that it is a very important statistic. It is something nobody else does. It serves every zip code in the united states, meaning in every zip code in america, someone has a blue cross card. It is one of the most trusted brands in Health Care Conversations on health care and his involved inconversations on health care and health care reform, so everyone has access to quality, Affordable Health care. Scott has devoted his career to improving the health of all americans. Through parts of that identify Health Issues and challenges and provide insights to improve the quad of care across america. Scott was named president and ceo of bcbsa after serving four years as Senior ExecutiveVice President , including two years as chief operating officer. Prior to that, as an exec at a Vice President for system development, he was in charge with new Business Strategy and Technology Evaluation center, which is renowned for evaluating the safety and effectiveness of emerging medical treatments. During scotts tenure, the Blue Card Program was introduced through this National Program which allows blue plan members to receive Health Benefits while traveling or living in another part of the blue service area. Our nationwide membership in the from 65s increased million in the beginning to 106 million members today. The helm of many important policy debates including the implantation of the Affordable Care act. It was his vision to use available data to develop insights about what is happening in Health Across america, in driving solutions on health care trends, like Millennial Health. Before joining bcbsa, scott served as president and ceo of chicagobased prudential Russia Health plan. He also led health inc. A missouri based pho. Hes a leader with a strong commitment to corporate responsibility. His also driven to be cynically active professionally and personally. In addition to serving on numerous blue cross boards, is a Founding Member of the National Business group, the Health Institute of Health Care Costs and solutions, board member of Brain Research foundation, an Advisory Board member of paragon biosciences. He also serves on the Leadership Council of the Health Care Management association the , deans Leadership Council of science at purdue university. The Washington University school of medicine counsel. He has also advised the white house policy and programs and services affecting our older citizens and was a charter member of the American HealthInformation Community commission , to advance Health Information technology. The ceoserves on Advisory Board for building a healthier chicago. Scott earned a bachelors degree from purdue university, where he is a proud boilermaker, and holds a masters in Health Administration planning from the Washington University school of medicine. He also holds an honorary doctorate from purdue. Would also like to introduce andmoderator today, awardwinning Health Reporter at ww to bj at newsreader 950. Previously she was a medical reporter for major stations in miami, chicago and boston. She has received multiple awards. A and a Michigan Association of broadcasters and to american art Heart Association awards. Deanna holds a bachelor science degree from michigan and earned a doctor of put i trick a doctor but i tree from the Williams School of medicine in chicago. She completed residency at the Phoenix Community hospital. Pleasure to introduce them. Lets give them a warm welcome. We look for to their conversation. [applause] dr. Lites good afternoon. Im thrilled to be here with the detroit economic club. Thank you for having me and scott. We are going to be talking about the vision for the future of health care. A lot of people i talked to over the past few weeks found out that i was going to be meeting with you today. They all had questions that i should ask you. Up question kept showing over and over and over. So lets start with this. Im sure it is something you have never heard. They want to know why is health care so expensive for consumers and business as in our country . Mr. Serota thats an easy question. I will get to the question. But i did not get a lot of applause when you said im a proud boilermaker. [laughter] so i have to go on record. My daughter did not see the light and she is a proud spartan. [applause] you have to do something to get the audience on your side. Ok, why is health care so expensive . Unique in that the consumer of services is typically not the person paying for the service. Dynamic in a strange that environment. You have organizations, whether it is the government or insurers like the blues, who are paying for the service, but the manufacturing plant who are the physicians and hospitals delivering the service. So you have lots of disconnects. And lots of missing checks and balances. So that would be. 1. The second point is, we built the Health Care System on a piecework basis. That is the more you do, the , more you get paid, so we have created incentives for delivering excessive care, so long as that care is not going to do harm. So we have a scenario where providers are in scented to deliver more care. Patients have no buffer not to accept that care because theyre typically not paying for it. And payers are afterthefact trying to manage the care in a remote basis. So that drives the price up. What is more important than . Nothing. Lth society, it as a believe appropriate lake, lots of dollars in innovation, in anding new breakthroughs ways to drive better value in the system. And those innovations and breakthroughs have a price attached. We have also increased life expectancy, improved health outcomes, we have eradicated diseases. So we have done a lot of good things with those dollars. The logical question is what can we do to make it more affordable . The evolution there is to move our Health Care System to one that is less focused on inputs and more focused on values and begin to construct relationships between payers and providers that are focused on the outcomes of the care received rather than , the inputs. In fact, Blue Cross Blue Shield of michigan is one of the leaders of that movement, about 5000 physicians operate here on a patient centered medical home, an environment where the primary care physician begins to manage or take ownership of the full spectrum of care of the people who are part of his or her practice. We try to do that across the country. In fact, in our system alone, 70 million americans get their care through some form of a valuebased care arrangement the goal there is to focus our reimbursement on approving the outcomes that our patients receive. And it is showing results. We have had diminished remissions to the hospital, diminished emergency room utilization increased compliance , with chronic disease treatments and protocols. We have a whole host of activities beginning to show positive results. Long answer to a short question. Dr. Lites will a lot of Companies Offer incentives so if you quit smoking or lose weight. Are they worth businesses investing in . Mr. Serota i believe any investment you make in your employee or Workforce Health is a benefit. I think the lifestyle things, losing weight, reducing smoking, all have positive outcomes. Out if the still investment in those programs is still paying out in a real dollar benefit. But i think if you factor in the noneconomic or nonhard economic factors like reduced sick days and parter to be measures, i think it is an investment we should all be making. Dr. Lites about a year from now, we will be having a big election and health care is always a big issue. If you were running or advising a candidate mr. Serota the former will never happen. [laughter] lets say you were advising somebody. What are some things that would make a Good Health Plan and what are some things as voters we should be looking for . Mr. Serota im a big believer in building on what works and not just tearing things up for the sake of tearing things up. Or i advising candidates, i nation,y we spent, as a a long time working on, debating and implementing the Affordable Care act. I would build on its successes and look at the fact that as of this moment in excess of 90 of americans have Health Insurance today. So i would look at ways to close that gap and get the last 10 . I think the number i saw this morning was 7. 5 , but how do we close that gap without disrupting the care that the rest are receiving . There are a number of Public Policy initiatives we could do that would improve lower costs and improve our ability to access care. I would encourage candidates to look at the issue of pharmaceutical costs and promote the idea not just in pharmacy, but in the entire Health Care System of transparency, allowing , patients, employers, insurers to have a real line of sight and understanding of what the components of health care really cost. And therefore identify where the opportunities are for improvement, so how are pharma drugs priced . Lets get some transparency. What are the real developmental costs. Real costs. So we can have a better discussion on how much we can afford to spend in that regard. As a society. We have to develop Public Policy initiatives on high cost drugs. Exceedsirst drug that 2 million for treatment. We have to, as a country, figure out how to deal with those particular issues. We have to improve access and lots of communities. We have to and we have to ensure our rural hospitals survive. There is no shortage of agenda. The answer to your question in this regard. As a priority, i was a focus on building on what is working disruptingpposed to what is working today just for the sake of disruption. Dr. Lites ok. There have been some major Health Issues in the news lately and i kind of wanted to get your take on them because we are talking about the future of health care. And also how does the blues combat these things . Here we have, five people that died, only over 450 people have been hospitalized with respiratory illness. What do we do with something that is newer, or something you dont have a lot of data on . Mr. Serota the issue of how to deal with vaping, i put in the broader category of how do you deal with lifestyle issues. Or we as a society, the blues. As dan said earlier, we are in every community. Unique, the unique qualifications of our programs are People Living in the communities in which they operate. So when we make decisions or policies to decide priority issues, it is impacting our neighbors and our friends, our families and communities. So we are very committed to a community activities. I put all of these things smoking, vaping, all of these things, nutritional issues, into the degree of social determinants of health. We as a blues system fail very committed to take the resources, the insights and information we have and try to work with local communities to solve those problems. We want to be certain that peoples genetic code is more important than their zip code as we look at how to address health care issues. We take the data and information we have two work with policymakers in washington and in state capitals so they can , understand the depth of the problem. So they can understand the communities that are impacted with the problem. And then we try to work with those communities to actually take our resources and staff to invest in those communities and solve those problems. , opioidsing today yesterday and opiates for a long time. Dr. Lites the measles outbreak, vaccination rates. The best way to deal with it is with information. We are blessed with a Data Resource because of 107 million members in every zip code and every demographic. We are blessed with the data that provides us great insight, so the trick is to take that for the people who can really make a difference. Dr. Lites when we think of health care, people often think of the elderly as the ones who are the sickest, but i saw a report that say the millennials are not the healthiest. Can you talk about that . Mr. Serota sure. We have done 27 different kinds of reports on various Health Conditions, given that we are in this beautiful stadium, i would say one of those that hit the headlines earlier was a concussion report. The latest one that we did was on Millennial Health and we were very surprised that we found the millennial generation, which will be 50 of the workforce in 2020 is at this stage the sickest generation of any other cohort group. It relates seven of the top 10 conditions are Mental Health or Emotional Health related conditions. Generally stemming from detachment issues. Contact but not enough human contact. We are seeing chronic conditions arise, things like high cholesterol and high Blood Pressure that we would expect to see in people 25 years older. It is an issue of vital importance. We have taken that on his omission to address this issue. Have had listening sessions. Because the data only tells you so much. Went out to 11 communities in the u. S. And spoke to the millennials and ask them what they were looking for. Interestingly, people of my generation, seniors, are very concerned about privacy and data. Not an issue for millennials. What they want is a compassionate medical professional who is willing to treat them as a whole person, and look at their conditions in the context of their life as opposed to treating each disease condition independently. Which is kind of like the patient centered medical homes that you are doing here in michigan. They are very free to share information. They will seek sources anywhere to Seek Solutions to their problems. Theyre really creating human contact and they are creating the ability to interact and communicate with people. So 11 cities in november were having a national culmination event in philadelphia where we are bringing leading experts in Millennial Health together where we can begin to embark on a campaign to try to address these issues. Im counting on millennials to support the Health Care System in the future to take care of me. So we need to be sure that that generation is as healthy as they can be and should be given their physical age. Them even do most of have a primary care physician . Mr. Serota no, i would say that the number of millennials with a primary care physician is markedly lower than the seniors, but they crave that and they are looking for that connection. I think that might be one of the soi think that might be one of one of the shortterm solutions to make that connection. They are much more comfortable butthey are much more comfortable with virtual care programs than other generations, so we have to find that sweet spot where we can get connected to the Health Care System. Dr. Lites what about Artificial Intelligence and the future of health care . Mr. Serota Artificial Intelligence and Machine Learning have a wonderful opportunity to do a number of things. First, in underserved countries around the world, Artificial Intelligence can serve as an extension and do screening that may not get done because of the lack of access to medical professionals. Conference recently, where executives from Googles Google were talking about working with Artificial Intelligence to do retinal scanning in india, which is underserved from an ophthalmologist standpoint. And found that the scanning and screening they did compared to human screening was actually better in the plumbing rescreening. If you multiply those kinds of activities in various areas, you canenvision a time when we get trained radiologists, pathologists out of the basement and to the bedside, and have a lot of the screening work done by machines. And have that medical, Trained Medical professionals over read and actually get more involved with the more complex matters leaving routine matters to machines. So i think theres a wonderful opportunity for us to be more efficient and effective and to free up our medical professionals to deal with more complex problems. So i think it has an incredibly bright future. Dr. Lites how about as we are moving, we have more electronic records. Patient portals. We are using wearable devices for medical testing. What about our security with our Health Information. Mr. Serota a couple of comments on that. First, one of the greatest challenges in my professional life has been, or frustrations has been the lack of interoperability for health care data. The inability to share data between physicians and hospitals, between our devices and our physicians. We have had very little success despite enormous investments. You heard and mention i was part of the very first Health Information community. It is not one of the stellar successes of my life. We were charged by the Bush Administration to try to create national interoperable standard. Still working on it. People point to banking and say we have created those kinds of standards. In health care, and we need to be. Interoperability is a challenge for the next administration. And unfortunately probably will be for that generation after that and after that. We have to create these data superhighways that we can move information seamlessly amongst and between people, so we can have a better understanding of conditions people have building often individual record. From a privacy and security standpoint, there is a lot of concern and fear about concentrating that health data in any location. People of our generation are very protective of that data. An Identity Theft is clearly easier if you have access to all of this kind of information. Unfortunately, the bad guys are usually a step ahead of the good guys in that fight, but we invest in the blue system enormous amounts of money trying to ensure protection. Of health data. We have established National Standards. We have adopted National Standards adopted established by others. To protect that kind of Health Information. I know that others do the same. It is just a never ending battle that we have, the fight to ensure that that data is protected as much as it can be. Dr. Lites what about Precision Medicine and the future of health care . Mr. Serota Precision Medicine affords us, for those of you not familiar with the term, it is really developing interventions that are focused on your own personal genetic code. So it is understanding your genome, understanding your genetic makeup and then targeting treatments to use specifically. Obviously, extremely expensive. I think we but it has the potential to be curative. I think we are just beginning to see the potential of that which means nows the time to establish National Policies about how to deal with that and protect precious data that is necessary to develop those targets and how to pay for it because it is going to be astronomically expensive, but again, if it is curative, and if it is substitutional for other treatments, it may not have to be additive to the total cost of health care. But we have to have the National Debate now. I wish i had a solution. I dont, but it is something that we as a society need to wrestle with now before it becomes so ubiquitous that it is treating all kinds of conditions. We have all of this information. How to get patients to take some responsibility for their health care . Because we have obesity epidemics, even Childhood Obesity is on the rise. Mr. Serota if i had the answer to that question. Personal accountability is a cornerstone of any Successful Health policy. Some would argue you need to have skin in the game. You need to be paying some of the premium. You need to understand the m with economic indications of the decisions you make. Thers would argue implications do not always need to be economic, the Health Applications themselves should be a sufficient deterrent. Generation watched after ration to continue to smoke and to eat unhealthy. So obviously the Health Implications are insufficient motivators, so i think we have to create a Health Care System which has accountability and consequences. The difficulty is how do you really create those consequences and how do you make the relevant if the Health Conditions themselves are not consequential enough. They what can you do to create that consequence . I think it starts with education at the preschool level. You begin to educate the children, the families, the communities about the importance of health, but you do it in a fashion that not only educates them about what they need to be doing, but facilitates them doing it. That is back to the social determinants of health, in ensuring that all communities have access to the things they need. In our world in the blue cross , blue shield world, we take this very seriously. We have created an institute whose focus is on social determinants of health. The first area that we started with was transportation because we found that a number of people were not compliant with medications or appointments because they just cannot get there. Lyft andtnered with uber so when physicians make appointment, they can also ask if they have a ride. If not, we can arrange for transportation to and from and we can arrange for cars to take them to the pharmacy to get the medications. Recognize many communities dont we alsorecognize many communities dont have access to healthy food, so we have created a program which will deliver healthy meals at very low cost to communities that have deficiencies in access to fresh fruits and vegetables. Because we have patients in every zip code, we are trying to design programs that are portable and repeatable and we can do on that scale. Desertso look at food to design programs thatinsufficient and begin to invest whether it is building playgrounds or doing other things. It is one thing to tell people they need to do it. It is another thing to show them a pathway. We want to do both. Dr. Lites what is your vision for the future of health care . Is it positive . Mr. Serota im extremely bullish on the future of health care and on our industry. First, as i said earlier what , could be more important than health. I know we wring our hands on what percentage of the gdp is going to health, but it is part for me to think of something that is more important than that. Investing in health is appropriate, so long as youre getting outcomes. So long as youre getting value for that investment. Bullish on that. As a huge employer in the marketplace. Most Health Care Providers are very committed to their communities. Im also bullish that there are opportunities to make dramatic savings in the cost of health care today, just the financing of health care by building on , the successes of the Affordable Care act and by investing at the National Level perhaps in catastrophic insurance where our sickest people would be covered by a catastrophic policy that the government would be responsible for and the rest of us would operate underneath that. We could produce premiums by a third. In a program like that. And improve outcomes. So there are wonderful opportunities for us to make theter permits both in delivery and financing of health care. It is a great time to be health care professional. Dr. Lites thank you so much, scott. Deanna. A thank you, [applause] thanks to deanna and scott. Well start off by asking the aca, how would you rate it . Mr. Serota when it started off i thinkive it a c. It had kind of a rocky road. I think over time we have all committed to health to improving it. I think it is approaching a b, b and that has an upward trajectory. I think if Congress Acts in a responsible fashion, and build on the successes, some of the things i talked about with regard to shoring up the idea of a reinsurance program, and investing in making sure that the subsidies are properly administered, for a read of stably modest investment we can have a dramatically positive impact. Remember, the statistic i sent earlier. And 10 e between 7. 5 are uninsured. That means that 90 to 93 are currently covered. If autocare act has played a role in making sure that can happen. Dan a student question and how do you think Blue Cross Blue Shield and the Healthcare Industry as a whole will advance and change in the next five to 10 years. Mr. Serota first, i will be retired. [laughter] so it will be some elses vision you will be discussing. I think from the blues perspective, you will see us investing more in technology. Plus more in our ability to use , andto predict outcomes assist providers in intervening earlier in treatment and care. Youll see Greater Movement toward valuebased contracting. We have 70 million of our members connected through a valuesbased contract today. I assume it will be all of our members within the next five or so years, virtually every relationship we develop what providers will be focused on outcomes and successes, as opposed to inputs. As a vital way to go. Industryhe health care will be much more rapid to adapt technology. We will eventually, within that timeframe, solve the interoperability problem. So we can share and communicate information. Information will be much more transparent. We will have a much deeper understanding of pricing structures and outcomes. So patients will be able to shop for Health Care Like that shop for television and cars and other things. Or you will be able to comparison shopping. We will be directing people for the bestperforming institutions which will raise all boats. So i think it will be an exciting time for the industry. Piggyback on that, as technology continues to accelerate. A question we are replacing the old with the new. But the problem is unlocking innovation is hard. What are your thoughts about that innovation and of all of this, and how we can make breakthroughs easier than we have. The issue in health care today is not necessarily the breakthroughs, it is the adoption of the breakthroughs in rapid fashion and its scalability. One of the benefits of being as large a piece of the economy as we are today, health care, is it attracts a lot of money and a lot of entrepreneurs. So there is a lot of very smart people trying to solve some really complex problems. Seen some incredible breakthroughs prayed we have seen some promises unfulfilled. As well, as a result of that. That Health Innovation will be sparked by patient demand and buy a Movement Toward a much more patient focused, patient centered delivery system. And as we look at our Health Care System from the patient out instead of historically we have looked at from the professionals in, as we start to look at it from the patient out, we are going to find that there are incredible opportunities for us to improve communication, improve education, improve the information flow, and unlock the power of entrepreneurship into the Health Care System. Once we do that, i think we will find widespread adoption. In the current medicare for all act and similar bills in congress, and if they were to pass, what impact would that have on the blue cross organization, and what role could or would Medicare Advantage play in all of this . Mr. Serota medicare for all takes many shapes and means many things to many people. Imagine, i think the disruption that would be caused by a medicare for all unfeasible toit a implement. And not in the best interest of our nation. I think the American People are used to choice. I think it is important that the Health Care System of the future is a publicprivate partnership. Each play a very Important Role in sparking innovation, sparking creativity. Managing costs. I think a Tighter Partnership between the government and the private sector is necessary. Better commit occasion and sharing of information and data, building on the success of your formal care act. I think all our critical pieces. Some defined medicare for all as literally medicare for all. Every american is automatically enrolled in the medicare program. And somenvironment, have said and lemon a private insurers. If you take that extreme measure. Obviously Medicare Advantage goes away. And you become a fee for service reimburse her for everybody. In the more traditional, if there is such a thing. In the less progressive implementation. Would be a medicarelike program. Acing au pair type program, in which case there would be robust competition amongst the Fastest Growing program today in medicare, Medicare Advantage. Is a programntage by which the government reimburses private insurers and we compete for patients by andting, by establishing creating Innovative New mechanisms, new benefits, and we are evaluated on our performance on a star system. And we get reimbursed based on our successes and how well we treat patients and how will they evaluate us. A brief unpaid commercial, the michigan plant is one of the nations leaders in Medicare Advantage. Plan. Michigan they do a spectacular job and doing that and bracing that particular program. It will be a vital piece of a medicare for all. It would allow the private sector to continue to compete for patients in that environment. The advantage programs would be reimbursed by the government. The government would pay the Medicare Advantage programs who in turn would contract and pay and incentivize the providers. So it could be a cornerstone link just as it is today in the existing medicare programs. Get to the we lightning round, how about pharmaceutical costs. It isre an answer and almost on a daily basis that you and the politics of washington around pharma. Where is this going and is there a solution. Mr. Serota there must be a solution because we cannot afford the current trajectory of the pharmacy benefit. I think the answer lies in a couple things. Transparency. Understanding the pricing formulas. And at lies in injecting some new competitors into the marketplace. And i think all of those are coming and i say stay tuned for exciting announcements in that space with regard to injecting new competitors into the marketplace. Dan we are going to move to the lightning round which is a quick question, quick answer to get to know you. Mr. Serota i dont do quick answers very well, but i will will try. Dan what is something on your bucket list . Mr. Serota a hole in one. Dan favored team growing up Favorite Team growing up . Mr. Serota chicago bears. Dan last book you read . Mr. Serota the last book i read was one of these spy novels. I think it is called red zone. This one of the cia type spy novels. I have been carrying it in my briefcase. Old new yorker articles about successes and failures in the Business Community that ive been meaning to read. I read one story every now and buffett had itnd in their lust. If you get brownie points high on their list. If you get brownie points for carrying it, ive been caring for about six months. Dan Favorite Movie . Mr. Serota the godfather. Dan favorite vacation spot . Mr. Serota jackson hole, wyoming. Dan what advice would you give yourself . Mr. Serota lighten up. [laughter] isaac life wait to seriously when i was growing up. Dan best sport when you were growing up . Mr. Serota football. Dan what person, other than offending member am a would you like to have lunch with other than a family member, would you like to have lunch with . Mr. Serota that is a good question. He is not here anymore, but i would say ronald reagan. Dan final question. You have been here many times. Describe detroit in a word or two . Mr. Serota you know im not pandering here, but amazing and the downtown, ive told the story before. 10 years ago, 12 years ago or more than that now since you have been there 14 years. It is probably 18 theres ago when i came here. I stayed at that dac 18 years ago and i wanted to get food and they said we will bring it to you, do not leave. Today, you go to the dnc, you you can walk around, go to restaurants. In some remarkable, resurgent. It is truly an american success story. You should be proud of your community. It is amazing. [applause] dan again, thank you. I will turn it back to steve. One quick announcement before we say thank you. If you liked todays program, you can download the audio podcast tomorrow about this time. In fact, we were just recently named as one of the top podcasts in metro detroit. How about another round of applause for scott, deanna, and dan. [applause] you all did an amazing job. Thanks for being with us. Scott, particularly you. Thank you for traveling and forgiving as your thought leadership. Ladies and, thank you for coming on time every time. This meeting is now adjourned. Thank you. [applause] the house will be in order. Cspaner for 40 years, has been providing america unfiltered coverage of congress, the white house, the Supreme Court and Public Policy events from washington, d. C. And around the country. So you can make up your own mind. Crated by cable in 1979, cspan is brought to you by your local cable or satellite provider. Cspan, your unfiltered view of government. Republican senator sen. Joni ernst ria held a town hall meeting in templeton, iowa. She answered questions from constituents on chinese tariffs, gun violence and health care. During the event, a constituent also pressed sen. Ernst on president trumps criticism of the ukraine whistle blower and corruption in government. This is one hour