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Our PBS Documentaries> Critical ConditionTHE IDEALISTIC HMO: CAN GOOD CARE SURVIVE THE MARKET? TranscriptOPEN: ANNOUNCER: This program is part of the PBS Democracy Project. b-roll: ambulance lights/EMT’s tending patient in home: EMT 1: I understand that you’re having some chest pains? EMT 2: OK. We’re gonna take your blood pressure here. LUCA FRESIELLO: I thought it was just a bad dream. I really couldn’t believe anything could, could happen like that. Really. EMT 1: And the strap’s gonna to go under your arms. VALERIE KENNEDY: I’d never been in the hospital. Gee, I was the healthiest, you know, woman walking around. . . b-roll: stretcher into ambulance EMT 3: Let’s go. VO/OC JAY LUBBERS: It’s something like falling off a cliff and you don’t know when you’re going to hit bottom. Cue music b-roll: pov - ER hallway ER Nurse 1: Are you still having chest pains? ER Doctor: Can you just describe the chest pain for me? Was it a sharp pain? Was it a dull pain? NARR: ALL OF US. WE’RE ALL AFRAID OF WHAT WILL HAPPEN WHEN OUR HEALTH FAILS. b-roll: pov – ER exam room ER Doctor: Alright. What’s his vital signs right now? NARR: WITH SO MUCH AT STAKE, JUST HOW GOOD IS YOUR HEALTH CARE? ARTHUR LEVIN: Medical errors kill between forty-four thousand and ninety-eight thousand people a year in the United States. MIKE McCONNELL: If the insurance company denied anything he could die. MARK CHIPPS: It’s money. It’s cost over care. Cost over care. MARK CHASSIN: As a consumer, you’re highly likely to be the victim of a quality problem, and not know it. title logo NARR: CRITICAL CONDITION WITH HEDRICK SMITH ANNOUNCER: Principal funding for Critical Condition was provided by The Robert Wood Johnson Foundation. Making grants to improve the health and health care of all Americans. Major funding provided by The California Healthcare Foundation. Additional funding provided by The Rockefeller Brothers Fund And the Charles E. Culpeper Foundation. Title/bumper Dip to black Dissolve to standup STANDUP: MOST MANAGED CARE COMPANIES, LIKE HUMANA, SELL INSURANCE. THEY DON’T ACTUALLY PROVIDE HEALTH CARE. THAT’S A FAR CRY FROM THE ORIGINAL NON-PROFIT HMO’s LIKE KAISER PERMANENTE. LAUNCHED MORE THAN 50 YEARS AGO BY INDUSTRALIST HENRY KAISER TO OFFER INEXPENSIVE, PREPAID HEALTH CARE FOR HIS WORKERS, KAISER STILL TAKES A PIONEERING APPROACH TO HEALTH CARE ...COMBINING DOCTORS, HOSPITALS AND INSURANCE IN ONE PLAN. IT WAS BORN AS A RADICAL EXPERIMENT … A GROUP PRACTICE WITH THE SOCIAL MISSION OF LIFETIME CARE. . . DOCTORS ON SALARY MAKING THE BIG DECISIONS. A MAJOR PRESENCE IN THE COMMUNITIES THAT IT SERVES, KAISER IS AN EASY TARGET FOR CRITICS. home video of World AIDS Day protests: Protester: I got an HMO. How about you? Mine is Kaiser. I am screwed. Sound Off. Kaiser kills . . . NARR: WORLD AIDS DAY. 1995. SAN FRANCISCO ACTIVISTS PROTEST AGAINST KAISER PERMANENTE, WHICH DOMINATES HEALTH CARE IN THE CITY. Vanna Black: And welcome everybody to the Wheel of Misfortune. Crowd: Ohhh. Protester: You lose. Vanna Black: . . . everyone’s a loser at Kaiser. Crowd: Shame, shame, shame JAY LUBBERS: Kaiser was very behind the times in the way they dealt with HIV. HIV patients routinely use drugs that are not yet approved. So one of the problems early on with Kaiser was Kaiser would not allow any use of drugs other than the standard, approved drugs. DAVE MAHON (o/c): The patients always said, “We don't need what we already know. We need what what's tomorrow. Because we're gonna die.” nat sound: Protester: You took an oath to take care of sick people. Well, do it! NARR: MOVING TOO SLOWLY . . . PLACING BARRIERS TO CARE . . . THESE CRITICS SAW AS COMMON PROBLEMS… NOT ONLY AT KAISER PERMANENTE, BUT WITH ALL MANAGED CARE. YET THE ACTIVISTS TARGETED ONLY KAISER. MAHON: We only picketed Kaiser--not because it was the worst but because you knew where Kaiser was. It's like the big kid on the block. If you can bring that kid to his knees, the others are going to get in line also. SOKOLOSKI (o/c): Do I think those protests were effective? Absolutely. I think it slapped Kaiser in the face and I think Kaiser, uh, stood up to it and said, "Okay. What can we do here?" b-roll meeting: Michael Allerton: As Kaiser members you all have concerns about the system and how things work, whether. . . NARR: KAISER REVAMPED ITS HIV ADVISORY BOARD FOLLOWING THE PROTESTS…. AND AFTER CITY OFFICIALS THREATENED TO CUT CONTRACTS WITH THE HMO, KAISER INVITED ITS HARSHEST CRITICS TO JOIN THE BOARD AND GAVE MEMBERS FAR MORE POWER: Bob Ward: And the fact is we still have to acknowledge that Kaiser is the only HMO that I know of that’s ever allowed the members to come in and be part of the process but I also understand like everything else we have to keep the heat on because they have lots of different agendas and priorities. SOKOLOSKI (o/c): I thought, "My God. You know, here's a chance for me instead--instead of just complaining, you can come in and, you know, you can make change, Mahon: It was covered but only in selected situations . . . MAHON: To build up that trust really has taken a long time. The people who are on the board now we work so well with because we trust them. They trust us. We do not see a dividing line--us versus them at all. And when we first joined the board it was definitely--it was the committee, it was us versus them. DR. DAVID LAWRENCE (o/c): We began to change from being a rather isolated organization who said basically, I think like most health care, my way or the highway. You know, this is how we do it. We're the professionals. Take our voice, et cetera. The AIDS community wouldn't stand for that. Uh, and they demanded the level of participation and involvement that was in many ways unprecedented in health care. b-roll of Follansbee entering Kaiser, walking halls NARR: IN 1998, KAISER PERMANENTE STEPPED UP ITS COMMITMENT TO HIV MEMBERS STILL FURTHER BY HIRING TOP SAN FRANCISCO HIV SPECIALIST, DR. STEPHEN FOLLANSBEE. FOLLANSBEE HAD SPENT HIS FIRST 16 YEARS AS A DOCTOR IN PRIVATE PRACTICE. DR. STEVE FOLLANSBEE: In private practice it became more war-like. I mean there were camps. A medical group here fighting a medical group there. nat sound: Dr. Follansbee: Good morning. DR. FOLLANSBEE: Physicians within medical groups fighting over how much money they were going to get paid and the mission of delivery of care began to get lost. DR. FOLLANSBEE (o/c): And Kaiser in 1999 is the closest thing to what private practice was when I started. And wasn't, uh, when I left. LUBBERS: If Steve Follansbee were not at Kaiser, I wouldn’t be at Kaiser. NARR: FOLLANSBEE WAS SO RESPECTED THAT WHEN HE CAME TO KAISER, SOME OF HIS PATIENTS FOLLOWED HIM . . . ONE WAS JAY LUBBERS. nat sound/b-roll Lubbers: Lubbers: Thanks LUBBERS: I was diagnosed in 1987. It’s something like falling of a cliff and you don’t know when you’re going to hit bottom.” And, how far am I going to fall? When am I going to hit? You know, that’s always there. So I’m still in my free fall. Um, and I’m-I’m glad to be there, but you know, at some point, uh, I’ll hit the bottom. nat sound: Man: 67 Please. NARR: ONCE A SKEPTIC ABOUT THE QUALITY OF KAISER’S CARE, LUBBERS HAS BECOME A BELIEVER. nat sound: Kaiser worker: Put this away so you don’t lose this. Can’t lose those blue cards. LUBBERS: I get the drugs I need. I get the care I need. I’d say that Kaiser is, in my experience, outstanding when it comes to dealing with any given crisis. b-roll: Lubbers with Follansbee, getting care, discussing medications NARR: TO SURVIVE, LUBBERS MUST MANAGE A MOUNTAIN OF EVER-CHANGING MEDICATIONS. DR. FOLLANSBEE: One of the things that Abbott wants is the list of all the drugs that you’ve been on. LUBBERS: You want to see the medications? Okay. Okay. Let’s just start here, there’s this. . . DR. FOLLANSBEE: For the protease inhibitors, the crixovan, virosept, LUBBERS: And this. . . DR. FOLLANSBEE: Retonovir, Afordovase. . . LUBBERS: And this. . . DR. FOLLANSBEE: The D-4T, AZT, Abocovir LUBBERS: All of this. DR. FOLLANSBEE: DDI, and Imprenovir. LUBBERS: I don’t even have room for all this stuff. So I have to stash it over here, so there’s this and this. It just takes up an enormous amount of space, both emotionally and physically. SMITH: What kind of cost is there involved in that - for a year? DR. FOLLANSBEE: Uh, you know, I don’t know. SMITH: Rick: But Jay’s list could be running 50,000 bucks a year, plus. DR. FOLLANSBEE (o/c): Oh, clearly HIV medications now have um, jumped to the top of the list at this medical center as the class of drugs most costly to this medical center. b-roll Lubbers brushing his dog Lubbers: Let me get your face, let me get your face. LUBBERS: It can be extremely um, costly. Is it worth it? Yes. You know, every day, every hour that I’ve gained … has meaning to me. b-roll: With dog-again Lubbers: What a good doggie LUBBERS: We have chosen in this country, to make health care available. And it’s not just HIV. Uh, coronary bypass operations, breast cancer, um, all different kinds of cancer - they’re all very expensive diseases to have. Uh, we don’t question that you should proceed and take of that patient, and it’s the same with HIV. nat sound: Dr. Follansbee: Slow breaths. NARR: BUT INSIDE THE INSURANCE INDUSTRY, THE GAME IS TO AVOID TAKING CARE OF SICK PATIENTS. nat sound: Dr. Follansbee: Let me have you lie on your back, looking up at the ceiling. DR. LAWRENCE: Now the way, uh, uh, the insurance industry--and again, I separate Kaiser Permanente from that industry--but the way the industry is moving, uh, is, uh, to try and find the healthier and healthier populations to take care of, to cover. Um, it's a different view... SMITH: You make money because they don't use your services. DR. LAWRENCE: Exactly. Well, now what we do we take care of a lot people. Some very, very healthy, some very, very sick. And you balance that across your entire membership. NARR: EVEN THOUGH HIV PATIENTS COST KAISER FAR MORE THAN THEY PAY IN PREMIUMS, KAISER TOUTED ITS EXPANDED HIV CARE IN A 1998 AD CAMPAIGN IN SAN FRANCISCO BUS AND SUBWAY STATIONS AND IN GAY NEWSPAPERS. THE ADS FEATURED MEMBERS OF KAISER’S HIV ADVISORY BOARD, INCLUDING JOHN SOKOLOSKI:
SOKOLOSKI: It was a big decision for me. It was really hard. I thought, “Oh, my God. Do I want my picture all over bus shelters?” But I’m putting something back into the community and I think it helps me and that’s why I agreed to kind of step out of my, my shell that I had been in and, and expose myself. DR. TOM BODENHEIMER: Most health plans would never do an advertisement, show- saying, "We take good care of HIV," because they would then get HIV patients who are expensive and they'd lose money on them. SMITH: In other settings, in private practice, with other health plans, do they walk away from or try to minimize their exposure to expensive HIV patients? DR. FOLLENSBEE: And the answer is yes. There was the general sense, and there was discussion in closed doors that there was indeed redlining. We'll lose money because we'll get too many HIV patients. SOKOLOSKI: We had some angels within Kaiser, somehow, somewhere, that blessed us with being able to do something like that ad campaign --'cause that is unprecedented. b-roll/nat sound of meeting: Sokoloski: We’re still working on getting the teen clinic flyer revised so that . . . SOKOLOSKI: It boils down to why would anyone care? Someone did care. NARR: IN SHORT . . . KAISER WASN’T SHYING AWAY FROM THESE COSTLY PATIENTS, IT WAS LIVING UP TO ITS SOCIAL MISSION. AT ITS SAN FRANCISCO FACILITY IT TREATS 1700 HIV AND AIDS PATIENTS, MORE THAN ANY OTHER PRIVATE INSURER IN THE CITY. AND FOR KAISER, THE AD CAMPAIGN WAS AIMED AT MORE THAN JUST THOSE PATIENTS: MAHON (o/c): We weren't promoting it to try and get new HIV patients but part of it was also "Look what quality care Kaiser gives to its HIV patients" with the extension being "if we do that to people who are really sick, you know, we are a good organization because we're going to take care of the rest of you." LUBBERS (o/c): You know, I’ve been dealing with this for a lot of years. I was diagnosed in 1987, um, and I’ve had many, many friends who passed away from AIDS, so I’m-I’m grateful for every day. NARR: FOR JAY LUBBERS THE END FINALLY CAME IN FEBRUARY . . . HE DIED PEACEFULLY . . . AT HOME . . . SURROUNDED BY THOSE WHO LOVED HIM. b-roll: Hannawalt on beach VIVIAN HANNAWALT: It's wonderful to walk out here! It's a wonderful way to start your day. NARR: 68-YEAR-OLD VIVIAN HANNAWALT HAS BEEN A KAISER MEMBER SINCE THE MID-80S. LAST YEAR, FOR THE FIRST TIME SHE WENT FOR A COLO-RECTAL SCREENING EXAM. HANNAWALT: I had no, no symptoms. I had no indication of any problem. NARR: THE EXAM DISCOVERED A PRE-CANCEROUS GROWTH CALLED A POLYP. A SECOND, CLOSER LOOK REVEALED THE WORST: VIVIAN HAD COLORECTAL CANCER. HANNAWALT: It’s not something that happens to you. It’s something that happens to all kinds of other people. It’s not something that you want to hear. Dr. Lewis: Take a deep breath. Let it out. NARR: VIVIAN’S CANCER WAS FOUND THROUGH A COLORECTAL CANCER SCREENING PROGRAM PIONEERED BY KAISER PERMANENTE IN NORTHERN CALIFORNIA A DECADE AGO. . . DR JOE SELBY (o/c): The truth is, that back in 1990 very little screening of any kind was going on in most places. It was not even recommended yet by organizations like the US Preventative Services Task Force. The reason was there was no proof, there was no scientific proof, that it saved lives. NARR: DR. JOE SELBY SPEARHEADED AN EXHAUSTIVE REVIEW OF KAISER PATIENT RECORDS TO SEE IF SCREENING WOULD SAVE LIVES. DR. SELBY: This was one of the few, places by virtue of its size, by virtue of the data systems that it maintains, and by virtue of its, uh, unified medical record, it’s one of the few places in the world where a study like this could have been done. NARR: KAISER’S BREAKTHROUGH STUDY SHOWED THAT SCREENING PATIENTS WITH AN INSTRUMENT CALLED A SIGMOIDOSCOPE CUTS THE DEATH RATE…. GASTRO-ENTEROLOGIST ALBERT PALITZ WAS AN EARLY SUPPORTER OF THAT PROCEDURE. SMITH: So this is a little video camera . . . DR. PALITZ: That’s correct. And the image shows up on the video screen over there. One of the breakthroughs in colon cancer screening was the availability of this video technology. We pass the instrument about 20, 25 inches up inside the colon. SMITH: And you can spot anything unusual. . . DR. PALITZ: This is an extremely accurate way to screen the colon. We are also able to pass instruments through this little channel, to obtain biopsies, remove polyps. It’s about 10 minutes of discomfort for 10 years of protection. nat sound: Nurse: OK. You all right? NARR: AFTER THE KAISER STUDY, DR. PALITZ HEADED UP A SMALL TEAM OF FRONTLINE PHYSICIANS AND ANALYSTS WHOSE IDEA WAS THAT KAISER SHOULD SCREEN ALL LOW-RISK MEMBERS OVER THE AGE OF 50 EVERY TEN YEARS. . . nat sound: Nurse: Take a couple of nice easy breaths. We’re almost done. NARR: BUT THERE WAS A HITCH. THE FINANCIAL BENEFITS OF PREVENTING CANCER WOULD NOT CATCH UP WITH THE COSTS OF THE PROGRAM FOR MANY YEARS: CATHERINE KEHR: It has a 15-year pay off. Not one year. Not two years. NARR: CATHERINE KEHR DID THE FINANCIAL ANALYSIS FOR KAISER: KEHR (o/c): I’ve never had someone say, we can support a 15-year strategy. And that program is absolutely dead in the red for the first seven years. DR. SELBY: The initial investment was about seven million dollars for space, and scopes, and training. And then there’s a, an annual investment in personnel of about an additional five million dollars. nat sound: Dr. Selby: Even from a cost-effectiveness perspective, colonoscopy is the way to go. NARR: THE CHALLENGE FOR DOCTOR SELBY AND THE PALITZ TEAM WAS TO CONVINCE THEIR PHYSICIAN PEERS ON THE BOARD OF THE PERMANENTE MEDICAL GROUP TO SPEND THE MONEY. DR. SELBY: We did a, ah, ah, a sort of a dog and pony show. We each - I showed them the data . . . KEHR: There were a couple of actually very thoughtful questions. And otherwise there was, it was very quiet. And a lot of, ah--quiet with a lot of nodding heads. And I was thinking, yes! nat sound: Dr. Crosson: We’re getting ready to build a system that’s going to make Kaiser Permanente different. NARR: DOCTOR JAY CROSSON WAS ASSOCIATE EXECUTIVE DIRECTOR OF THE PERMANENTE MEDICAL GROUP AT THE TIME. DR. CROSSON: There was no question within the partnership of the health plan, the hospitals, and the medical group that we would do this. SMITH: The medical evidence says, “This is going to work,” so the finances be damned? DR. CROSSON (o/c): Well, you know, we wouldn’t - we wouldn’t be able to stay in business if we damned the finances on everything. Uh, but this was so compelling an issue. nat sound: Dr. Eulie: Let me, let me just go check and make sure its not a big problem . . . NARR: AND SO KAISER SWALLOWED THE PROGRAM’S HEAVY FRONT-END COSTS IN ORDER TO PROVIDE ITS MEMBERS WITH HIGH QUALITY PREVENTIVE CARE FOR THE LONG-TERM - A RARE DECISION AMONG HMOs. KEHR: I think it comes back to lifetime commitment to the member. Kaiser really believes that its members are its members for life. Other health plans tend to take a shorter view of their patients. Either they have a one year pay back to share holders or they’re operating on a two year commitment to their membership because that’s the average member, the average tenure of membership. HAL LUFT (o/c): I've been out of Kaiser for 19 years now. Uh, I've been in eight different health plans in California, only two different doctors, but the health plans keep changing. So what incentive does a health plan have to invest a lot of money in my care when I may not be in them anymore, 2 or 3 years from now? Nat Sound: Hannawalt: It has healthy habits on top . . . NARR: KAISER HAS POSTERS REMINDING PATIENTS OF ROUTINE PREVENTIVE CARE THEY SHOULD BE GETTING, INCLUDING SIGMOIDOSCOPY: B-roll in corridor Hannawalt: then there are the screening tests. . . NARR: BUT THAT REMINDER WASN’T ENOUGH FOR VIVIAN HANNAWALT: HANNAWALT: It’s not something that you kind of court... If nothing is said about it, you just as soon forget about it, right? Right. DR. CROSSON: We knew it was not something that our members - patients - were going to be demanding. We weren’t going to have protests in the street or people calling up, continually, asking of sigmoidoscopies. If people were going to be convinced to get sigmoidoscopies, we were going to have to do it because we were the ones - the doctors - we were the ones who knew what the evidence was and what had to be done. NARR: THE PROBLEM FOR HANNAWALT WAS THAT SHE DID NOT HAVE A REGULAR KAISER DOCTOR – CALLED A PRIMARY CARE PHYSICIAN… DR. SELBY: In a system like this, if you don’t have a primary care physician you’ll not be able to take advantage of most of the preventive measures that a health maintenance organization offers. nat sound/b-roll: Hannawalt arriving for doctor’s appointment: Hannawalt: I have a chemo appointment at 4 o’clock NARR: VIVIAN FINALLY SIGNED UP FOR A PERSONAL DOCTOR WHO MADE SURE SHE GOT HER SIGMOIDOSCOPY. WITH CANCER, THE TRICK IS FINDING THE DISEASE EARLY. b-roll in exam room Dr. Lewis: Hi, how are you doing? Thanks for waiting. Hannawalt: What else can I do? NARR: BUT VIVIAN MISSED THAT CHANCE, AND BY THE TIME THE CANCER HAD BEEN DISCOVERED IT HAD SPREAD TO HER LYMPH NODES. nat sound: Dr. Lewis: How did you do with the first course of therapy? NARR: BRIAN LEWIS IS VIVIAN’S CANCER DOCTOR. DR. LEWIS (o/c): If you find something when it’s at earliest stage, which would be stage A, where it hasn’t really invaded beyond the lining, the inner lining of the colon or rectum, the cure rate is in excess of 90%. Once it becomes invasive, once it starts to go into the substance of the wall of the colon or go into lymph nodes, then the cure rate falls off significantly . . . DR. LYLE SHLAGER (o/c): In her case--she's not the perfect example, in the sense that when we did the sigmoidoscopy we found a flat polyp. NARR: DR. LYLE SHLAGER IS THE GASTRO-ENTEROLOGIST WHO FOUND VIVIAN’S CANCER: DR. SHLAGER: We did remove it, but it required surgery because it was invasive cancer with some lymph nodes. nat sound/b-roll Hannawalt in exam: Nurse: Go ahead and sit down, please. DR. SHLAGER: But a year from then it could have spread a lot more. She could have required a colostomy with a whole removal of the rectum rather than the surgery that she had--a much bigger surgery. NARR: IN VIVIAN’S CASE, DELAYS IN HER TREATMENT MAY HAVE ALLOWED THE CANCER TO SPREAD. HANNAWALT (o/c): You know, I was told that I should have a sigmoidoscopy in October. The appointment didn’t happen until April. And I was told in April that I should have this polyp removed, and that did not happen until July, which is a, you know, it’s a fair amount of time. SMITH: Was that a dangerous time for her--too long a lapse of time? DR. SHLAGER: Yeah. That's a question that's come up within the organization to look at it. That's one of the things that happens with m--with mass screening. Any--when, when people have symptoms they all get done right away. When we have screening there's always going to be some lag interval. I think the intervals probably are a little bit longer than we'd like to have them now, to be quite honest, because we're trying to catch up our resources with the success of a program. nat sound/b-roll Hannawalt receiving treatment: Nurse: Which side do you want to do today? NARR: APART FROM THE DELAYS, VIVIAN REMAINS HAPPY WITH HER CARE AT KAISER AND WITH THE FOUR SPECIALISTS TO WHOM SHE HAS BEEN ASSIGNED FOR TREATMENT. Nurse: OK, is your mouth nice and cold? HANNAWALT: As a lay person, what are you going to do? You’re just going to go in the Yellow Pages if you have a problem, right? You know, I think that Kaiser is more able to find good people and hire them than I am. DR. SHLAGER: Well, I think it's one of the few settings where you actually still can take care of your patients and it's really-- it still is truly physician run. Nat Sound/B-roll: Dr. Shlager in exam: Dr. Shlager: Alright, so this is just a screening exam . . . DR. SHLAGER: If a patient comes to me and they need something--you can do what you want to do. There's no--there's no approval process for anything. NARR: SINCE 1994, KAISER PERMANENTE HAS SCREENED NEARLY 400,000 MEMBERS IN NORTHERN CALIFORNIA . . . AN EXCEPTIONALLY LARGE LONG-TERM INVESTMENT IN PREVENTIVE CARE: Nat Sound: Dr. Shlager: This all looks great. DR. SELBY (o/c): So we’re nearly double the rate of screening of the rest of the California population. DR. CROSSON: We’ve probably saved thousands of people who would have died otherwise. NARR: ONLY TIME WILL TELL WHETHER VIVIAN HANNAWALT WILL BE ONE OF THOSE WHO WERE SAVED. nat sound/b-roll children’s party Woman: OK, ready, go. Crowd: Wooooow. NARR: THESE MAY LOOK LIKE ORDINARY AMERICAN KIDS, BUT THEY’RE NOT. MOST HAVE DIABETES…A CHRONIC ILLNESS THAT CONSUMES TEN PERCENT OF ALL U.S. HEALTH CARE DOLLARS AND PLAGUES SIXTEEN MILLION AMERICANS. Woman: All right, swing. NARR: …ONE OF THEM IS 12-YEAR-OLD DILLON MOORE . . . DIAGNOSED FOUR YEARS AGO . . . DEBBY LYTTLE (o/c): The doctor, I remember, said, oh boy! That was the first words out of his mouth. Oh boy! And I knew something was wrong then. . . DANIEL LYTTLE (o/c): We didn't know what to do, we didn't know what the next step was for him. Um, it was, it was terrible. SMITH: And Dillon, what was it like for you? DILLON: Scary. BRENDA EBY (o/c): Their life has now been just turned topsy turvy. Everything that they knew how to do before in raising their child has now gone out the door. And now they're like babies. They need to be taught how do you parent a child with diabetes. DEBBY LYTTLE: We didn't know what his life ex, expectancy was. DAN LYTTLE: Right. DEBBY LYTTLE: Um, what would happen to him, how to deal with it. We didn't, we really didn't know what it meant to be diabetic. nat sound/b-roll in exam room: Dr. Egli: No bumps on your arms or legs anymore? NARR: DILLON HAS TYPE ONE DIABETES WHICH MEANS THAT HE MUST CONSTANTLY MONITOR HIS BLOOD SUGAR LEVEL . . . AND TAKE INSULIN TO MAINTAIN THE PROPER BALANCE. THERE IS NO CURE FOR DIABETES, SO DILLON HAS HAD TO LEARN HOW TO MANAGE HIS DISEASE, DAY IN AND DAY OUT. Dr. Egli: Should we hop down? NARR: AT KAISER, DILLON IS CARED FOR BY A TEAM OF MEDICAL PROFESSIONALS. EVERY THREE MONTHS AT A MINIMUM, DILLON GETS A THOROUGH REVIEW FROM NURSE BRENDA EBY… DIETICIAN SCOTT BROWN…AND DOCTOR CATHERINE EGLI, A SPECIALIST IN PEDIATRIC DIABETES. DR. EGLI: This represents our team. And our philosophy, or approach, is that we're all a team. We work together and Dillon is the center. NARR. DILLON’S FAMILY JOINED KAISER IN 1998, WHEN THEY MOVED TO CALIFORNIA FROM CLEVELAND. IN OHIO HE WENT TO THE PRESTIGIOUS CLEVELAND CLINIC. DEBBY LYTTLE: We didn't have this kind of care in Cleveland. There we would go we’d see a different resident every time we went in. And he did have a, a primary care endocrinologist, but he came in just for a couple of minutes and then he'd leave. So there wasn't the continuity of care that there is here. NARR: WITH A COMPLEX DISEASE LIKE DIABETES, KAISER PERMANENTE BELIEVES ITS INTEGRATED CARE SYSTEM GIVES IT A BIG EDGE IN TODAY’S HEALTH MARKET. LAWRENCE (o/c): We have a myth that we carry around in our head about Dr. Welby and the individual doctor operating out of his own office. It's all that sort of thing. That's a chassis, a delivery chassis that is essentially obsolete. NARR: TAKE AN INDIVIDUAL FAMILY DOCTOR LIKE SAN FRANCISCO’S TOM BODENHEIMER. FOR HIM, MANAGED CARE MEANS JUGGLING THE REGULATIONS OF SEVERAL DIFFERENT HEALTH PLANS, BASICALLY ON HIS OWN. DR. TOM BODENHEIMER: I get a lot of stuff in the mail that tells me how to take care of diabetes, how to take care of cholesterol, how to take care of heart failure, and the stuff is really nice. You know here is one from Blue Cross. Here is another one from Aetna. Here is one from Cigna. But the problem is I know all this stuff. I need some help to implement it. What I could use is someone who is a diabetic expert. It could be a nurse. It could be a nutritionist. SMITH: So why don't you hire somebody like that to come help your staff? DR. BODENHEIMER (o/c): It's difficult to afford such a person in a very small office like ours because of the financial pressures of increasing costs, of personnel and equipment, and reducing reimbursements. nat sound/b-roll Dillon’s exam: Nurse: 41 kilograms, OK. NARR: FOR KAISER, TREATING DIABETES IS VERY COSTLY. Nurse: 15-0-2. Put your shoes on. NARR: EACH YEAR THE HMO SPENDS THREE-QUARTERS OF A BILLION DOLLARS IN NORTHERN CALIFORNIA ALONE TO TREAT 125,000 DIABETIC MEMBERS. SMITH: Right, now where’s the
insulin? SMITH: Yeah? NARR: FOR DILLON, THE SINGLE MOST COSTLY ITEM HAS BEEN AN INSULIN PUMP THAT FEEDS A STEADY FLOW OF INSULIN THROUGH A TUBE INTO HIS BODY. SMITH: Is it easier than shooting the needle in your arm? DILLON: Yeah. DEBBY LYTTLE: OK, Now we’re going to prime it just a little bit so the insulin for sure is getting in there and he’s ready to go for a couple of days. DEBBY LYTTLE: I'll tell everybody, get on the pump because you can, you can have a life again. Without the pump, when he was on shots he had to test at a certain time, he had to eat at a certain time. He had to eat a certain amount. All those things were set. And it had to happen. SMITH: Like the Army? DEBBY LYTTLE: Yeah. Sort of! (laughter) SMITH: Let me ask you. How much does this piece of equipment cost? DR. EGLI: The pump itself costs $5,000. SMITH: Okay. So that's a considerable investment. DR EGLI: I would call it an absolutely great investment. SMITH: Because? DR. EGLI: Well, the real costs, I think, of diabetes are the complications long-term: Renal disease, kidney disease or kidney failure, dialysis or kidney transplant, uh, heart disease and stroke, blindness. So the costs of that can be astronomic over years the cost of this is very, very cost-effective. DEBBY LYTTLE: Kaiser is, has been terrific. We've had no, no hassles over what he's needed to have, um, covered. You know, they've paid for everything that they're supposed to pay for. We couldn't ask for a better situation. DANIEL LYTTLE: No, it's fantastic. NARR: DIABETIC KAISER MEMBER ROBERTA KUHLMAN DOESN’T USE THE PUMP. INSTEAD SHE MUST GIVE HERSELF SEVERAL DAILY INJECTIONS OF INSULIN. nat sound/b-roll at pre-school Kuhlman: Should we start setting
up over there? Kuhlman: OK. NARR: WHEN SHE DECIDED TO HAVE A BABY, ROBERTA WORKED WITH A SPECIAL KAISER MATERNITY TEAM FOR DIABETIC WOMEN . . . A HIGH-RISK GROUP FOR PREGNANCY. NARR: AFTER SEVEN YEARS OF STRUGGLE, ROBERTA FINALLY GAVE BIRTH TO HER DAUGHTER DARYN THREE YEARS AGO. nat sound: Crowd: Happy birthday, dear Daryn, happy birthday to you. Kuhlman: Happy birthday. NARR: AFTERWARD, ROBERTA LEFT HER JOB AND LOST HER EMPLOYER-PAID HEALTH INSURANCE. Child: Thank you, Daryn. NARR: RATHER THAN JOIN HER HUSBAND’S COMPANY PLAN, ROBERTA OPTED TO PAY FOR KAISER OUT OF HER OWN POCKET. Kuhlman: There you go Jenna. KUHLMAN (v/o - o/c): There’s no way that I wanted to try a new physician or starting to go through some of these ridiculous things you have to go through for to get approval for drugs and get approval for this test and that test - which, I don’t ever have to do when I’m part of Kaiser. NARR: BUT ROBERTA PAID A STEEP PRICE TO STAY WITH KAISER. SINCE SHE WAS NO LONGER IN A GROUP PLAN, KAISER DID NOT COVER HER DRUGS, MEDICAL SUPPLIES OR EQUIPMENT. nat sound: Kaiser receptionist: This is your receipt. . . KUHLMAN: We’re talking $250 a month, just for the test strips. Um, we then add on $38 for a bottle of insulin and this is only one kind of the three different kinds of insulin I take I now don’t even have coverage for my syringes and there’s the $15 co-pay on the office visit and then there’s the Kaiser fees. A year adds up to about four or five thousand dollars and that’s not including the other medical expenses we have for my daughter and my husband. NARR: BUT ROBERTA WANTED TO GET PREGNANT AGAIN AND SHE TRUSTED KAISER. KUHLMAN: Kaiser is worth that much - at this point in my life, given the chronic disease that I have and given that I’m trying to get pregnant one more time. nat sound/b-roll in doctor’s office Kuhlman: I started feeling low, like yesterday for instance. . . DR. ANNE REGENSTEIN: We thought that she would be an excellent pump candidate. NARR: WHEN ROBERTA’S DOCTOR, ANNE REGENSTEIN, RECOMMENDED THAT SHE START USING AN INSULIN PUMP, ROBERTA’S LIMITED COVERAGE HIT HOME. KAISER WOULD NOT PAY FOR HER PUMP AND THE $5,000 PRICE TAG PUT IT OUT OF HER REACH. KUHLMAN: I must say that the financial put the brakes on very quickly for me. SMITH: Your medical recommendation to her is, “Get the pump,” and her response is, “I can’t afford it.” So a dollar issue is standing in the way of a good medical decision? DR. REGENSTEIN: I think the um, in the difference here, is we discussed this with her as an option and a possibility and that it might work better for her….If this were something where she would really suffer in a major way if she didn’t have it, it could get done. ANN ALBRIGHT: I think some people think that pumps are just convenience items. NARR: KAISER MEMBER ANN ALBRIGHT DIRECTS THE STATE OF CALIFORNIA’S DIABETES CONTROL PROGRAM. ALBRIGHT (o/c): When you have to live every day with this disease - no breaks, no vacation - and you have to pay attention to these things all the time, convenience takes on a whole different meaning. . . DR. REGENSTEIN: In an ideal world, would this be covered? Yes. Would a year off um, from work for women? Yes. Uh, there are many, many things that I wish we could offer our patients. SMITH: So here you have a patient whose doctor is recommending she get a pump to manage her disease, but Kaiser, her health plan, is saying, “We don’t pay for it under individual coverage.” ALBRIGHT: Right. I-I think the logic in that is questionable. Um, I’m sure that Kaiser’s response would be that they have a reason for making that distinction. I think it would be interesting to hear what that response is. DR. LAWRENCE (o/c): What you've identified in that story is the fundamental problem right now in American health insurance coverage. nat sound: Nurse: It’s a little high today, 140 over 68. DR. LAWRENCE: The marketplace is such now that the opportunities to provide a social insurance capability where the healthy are subsidizing the sick that's getting harder and harder to do. GOLENSKI (o/c): In the past, Kaiser and many other insurance plans simply subsidized Robertas from the surplus of the large plans. The large employers refuse to pay that anymore. DR. LAWRENCE: This is why it's harder and harder in the social, to carry out our social mission in today's insurance climate. nat sound: Kuhlman: So long Daryn, we’re glad you’re here today. KUHLMAN (v/o): I hope that one day, somehow, I might be able to get the pump because I do - I do feel it is a better option for me than what I’m going through now. STANDUP: AT THE DAWN OF THE 1990, WITH MANAGED CARE SWEEPING THE COUNTRY, KAISER PERMANENTE HAD SEEMED POISED TO DOMINATE AMERICAN HEALTH CARE. IT WAS NO LONGER AN OUTCAST, ITS GROUP MODEL AND DOCTORS ON SALARY DERIDED AS SOCIALIZED MEDICINE. INSTEAD, IT FACED INTENSE NEW PRESSURES FROM A CUT-THROAT MARKETPLACE: EMPLOYERS DEMANDING LOWER COSTS AND AGGRESSIVE NEW FOR-PROFIT MANAGED CARE COMPETITORS OFFERING CHEAPER PREMIUMS. TO ADAPT, KAISER FELT COMPELLED TO ALTER ITS TIME-TESTED FORMULA. . . AND IT STUMBLED - BADLY - ACROSS THE COUNTRY AND BACK HOME WHERE IT BEGAN, ACROSS SAN FRANCISCO BAY IN RICHMOND, CALIFORNIA. nat sound/b-roll ER: Paramedic: Ok, one more time. Patient: Ouch. NARR: AT THE CENTER OF THE STORM . . .KAISER’S RICHMOND EMERGENCY ROOM . . . NARR: IN 1995, KAISER CHRISTENED A NEW 50 MILLION DOLLAR MEDICAL CENTER IN RICHMOND, BUT CHOSE ONLY TO RUN A VERY LIMITED, STAND-BY ER DR. BALDINI (o/c): Let me tell you, it was brutal. It was very difficult. And our staffing was cut back. And, ah, during the day shifts we only had one doctor. And, and almost a skeleton nursing crew. It was, you know, a problem waiting to happen. nat sound: Nurse: You’re at Kaiser Richmond Hospital. You’re going to be here to see a doctor in the ER. OK? NARR: OPERATING ROOMS AND A MODERN INTENSIVE CARE UNIT WERE BUILT BUT NEVER OPENED: DR. BALDINI: This was empty. It just sat empty. Brand new ICU. Used to always walk by with a tear in our eye. It was, you know, it just stayed closed. And so anybody who needed that kind of intensive care, we would stabilize them in the emergency room and then try to find transport to get them to the closest facility. NARR: THAT PRACTICE – TRANSFERRING CRITICALLY ILL PATIENTS TO OTHER HOSPITALS - MAY HAVE PROVEN FATAL FOR 39-YEAR-OLD WILLA HIVES. BRELAND: This was Willa. . . NARR: IN 1997, HIVES DROVE HERSELF TO THE RICHMOND E-R WITH CHEST PAINS AND WAS TRANSFERRED TO SUMMIT HOSPITAL, 12 MILES AWAY IN OAKLAND. SHE DID NOT SURVIVE THE JOURNEY. BRELAND: We got there and they just told us she had just died. NARR: MARGARET BRELAND IS HIVES’S MOTHER. BRELAND (o/c): I was very upset. I was very discouraged and upset at Kaiser. BRELAND: Why would you put all that money into a new hospital and have it sitting there and then say it’s a standby hospital? nat sound/b-roll in ER: Whippy: Hi, Mrs. Jones. DR. WHIPPY: I think the decisions that were made were made with the patients best interests in mind. NARR: DR. ALON WHIPPY IS ASSISTANT PHYSICIAN IN CHIEF AT KAISER RICHMOND. DR. WHIPPY (o/c): There was a thought that you could operate a, an emergency department for moderate patients, that would really meet the community’s needs. And that didn’t work well. NARR: KAISER’S 1989 DECISION TO REBUILD IN RICHMOND RAN COUNTER TO ITS STRATEGY OF CONCENTRATING SERVICES IN LARGE MEDICAL CENTERS TO IMPROVE QUALITY. WHAT’S MORE, THE RICHMOND OPERATION HAD LONG BEEN A MONEY LOSER THAT SERVED A LARGELY POOR, BLACK COMMUNITY. DR. LAWRENCE: It doesn't make any economic sense whatsoever. SMITH: Why did you build it in the first place? DR. LAWRENCE (o/c): Well, I made that decision. There was a very strong emotional and historic tie to the community of Richmond. It's also an African-American community. And we'd been, uh, champions of diversity and champions of our social responsibility. NARR: BUT TAKING THE HIGH ROAD WAS FAR MORE DIFFICULT FOR KAISER IN THE LOW-BALL MANAGED CARE MARKETPLACE OF THE 1990S. . . UNDER PRESSURE, DAVID LAWRENCE BROUGHT IN BUSINESS CONSULTANTS TO REMAKE HIS HMO INTO A TOUGH MARKET COMPETITOR. DR. LAWRENCE: That was one of the things that I quite consciously did, beginning in the '90s, early '90s, was to bring in people from the outside, consultants, uh, experts to help break down the insularity of Kaiser Permanente that had been built up over 40 or 50 years. Remember, this was a sleeping giant beginning in the late '80s, early '90s. NARR: UNDER THE SWAY OF ITS NEW BUSINESS ADVISORS, KAISER BEGAN TO MIMIC ITS FOR-PROFIT COMPETITORS. GOING AFTER MARKET SHARE, IT HELD DOWN EMPLOYER PREMIUMS… AND GREW EXPLOSIVELY: TANYA BEDNARSKI (o/c): I think Kaiser and their competitors during the mid-1990s had a mantra that bigger is better and if we have volume, we have efficiencies, um, if we have size, uh, we have staying power. NARR: DESPITE MOUNTING ENROLLMENTS, KAISER LEFT SOME OF ITS NEWLY BUILT FACILITIES UNOPENED, CHOOSING INSTEAD TO BUY BED SPACE FROM COMPETING HOSPITALS: BEDNARSKI: There were at least two, maybe three, that they never opened and they went out and bought beds at local hospitals and paid retail for them. So they were paying another facility while they had their own facility sitting there moth-balled. SMITH: What would impel David Lawrence and the others around him to depart that much from their own successful formula? GOLENSKI: The entire culture was changing radically. There were all these brand new for-profit companies that were making a killing. So the general atmosphere was one of a business-market orientation and much less of the old Hippocratic professional commitment to patients. b-roll of meeting: Dr. Lawrence: This decade, the decade of the 90s, is one of the worst that healthcare has had to deal with. . . NARR: IN THE END, KAISER’S NEW MARKET STRATEGIES WERE A BUST. Dr. Lawrence: In the first quarter we lost 101 million dollars… NARR: IN JUST TWO YEARS, 1997 AND 1998, KAISER LOST MORE THAN HALF A BILLION DOLLARS - ITS FIRST LOSSES IN 50 YEARS. BEDNARSKI: They went into markets during the mid-1990s, they were not successful in those markets, they built facilities, they didn’t open the facilities, um, employers are wondering what’s Kaiser doing? How are they making these decisions and then in the end, should we pay for them if they’re not fruitful. DR. CROSSON (o/c): I can’t damn all business consultants. But I do believe that the advice - much of the advice - that we received during that period time... SMITH: From business consultants? DR. CROSSON: From business consultants - that was focused in on um, uh, helping us change our strategy, turned out to be bad advice. GOLENSKI (o/c): The loss of confidence in Kaiser's own way of doing business was in my view the most dangerous and the most damaging decision that was made. NARR: BLEEDING RED INK, KAISER FLED MONEY-LOSING REGIONS FOR THE FIRST TIME EVER. . .RETREATING TO ITS HISTORIC ROOTS IN THE WEST AND BACK TO ITS CORE CONCEPTS – TEAM-CARE, DOCTORS IN CHARGE, LONG-TERM COMMITMENT TO PATIENTS: DR. SHLAGER (o/c): I think that they realized that the true value of the organization was what they were, which was really not getting away from the original model. BEDNARSKI (o/c): They’ve been clearly embarrassed by their mistakes because they’ve been well-publicized. And they’re now starting to focus back on what is it that we do very well. And what are the distinguishing features of our model of healthcare delivery that we can use to our advantage. DR. LAWRENCE: At the core of it, that idea, that idea of organized care and integrated care with this patient at the center, is the principle to which we aspire. NARR: COMING HOME TO ITS ROOTS MEANT DEALING WITH OTHER CRISES. nat sound/b-roll: ER Dr. Baldini: Mrs. Jones, I’ll be right back… NARR: IN NORTHERN CALIFORNIA, THE FEDERAL GOVERNMENT THREATENED TO CANCEL KAISER’S MEDICARE CONTRACT FOLLOWING THE DEATHS OF WILLA HIVES AND THREE OTHER PATIENTS TRANSFERRED OUT OF THE RICHMOND ER. DR. LAWRENCE: When we had the error in Richmond I said we blew it. I felt like, you know, this is a wonderful community. And this is a person who trusted her life with us. And, and we didn’t respond the right way. NARR: TO PREVENT FUTURE PROBLEMS, KAISER CONSIDERED CLOSING THE RICHMOND EMERGENCY ROOM ALTOGETHER. DR. BALDINI (o/c): This was going to close. I mean, let me tell you. It was very, very close to closing. Ah, this is the wave of the future, closing down ER’s. You know, they’re not the most cost-effective place to mete out care. But you know, for most people that’s all they got, is the emergency room. b-roll of Richmond City Council Meeting Crowd: We hired you, give us our due. We hired you, give us our due. Woman: I refuse to go to Oakland Kaiser and I refuse to go to Kaiser in Walnut Creek. I pay for Kaiser, and I pay for Kaiser in Richmond. NARR: KAISER’S IDEA OF CLOSING THE ER MET FIERCE COMMUNITY OPPOSITION…MANY OF KAISER PERMANENTE’S OWN DOCTORS AND NURSES JOINED THE PROTEST. b-roll: meeting Doctor: We have an obligation to take care of those people and their chronic illnesses, not just taking care of the bottom line. DR. LAWRENCE: It's the dilemma that we always get into, how do you meet the needs of a community, um, on the one hand, and maintain standards of quality and superior care that require consolidation? b-roll of ribbon cutting at hospital: Crowd: One, two three. NARR: DESPITE THOSE CONCERNS, KAISER GAVE IN TO COMMUNITY DEMANDS. . . EXPANDING EMERGENCY SERVICES BY OPENING THE INTENSIVE CARE UNIT AND THE OPERATING ROOM. nat sound/b-roll: hospital tour Kaiser tour guide: I’ll have everybody come all the way back. It’s not very often you get to see the internal workings of an operating room. Visitor: Right. Take advantage of it. Kaiser tour guide: * we process – put together the instrumentation, make sure it’s sterile. And this is a fancy-schmancy dishwaster. The nurses in the morning open it up and we’re ready to roll. All right. Mayor: Impressive. Thank you. DR. WHIPPY: We have intensive care beds available on site. We have intensivists, cardiologists, a wide array of support, ah, personnel that we didn’t have in 1997. DR. BALDINI: This is a great boon to all of us. I mean, it’s almost a miracle that they decided to shower all this money on us and give us all the back up that we, you know, sorely needed. NARR: TO GET OUT OF THE RED, KAISER HAS IMPOSED BIG RATE INCREASES FOR THE LAST TWO YEARS . . . SO NOW, KAISER IS NO LONGER THE LOW-COST HMO. LOOKING TO THE FUTURE, KAISER IS PINNING ITS HOPES ON WINNING WITH QUALITY, WHERE IT CONSISTENTLY OUTSHINES ITS RIVALS.
DR. LAWRENCE: You can go down the pathway of trying to improve quality as the way you compete economically, or you can do the cut and slash kind of model. You have a choice. There's a fork in the road. And health care delivery systems have to decide which way they're gonna go. We've chosen to go down the quality path. nat sound: Receptionist: Good morning, Pacific Business Group on Health. How may I direct your call? NARR: BUT KAISER’S HIGH QUALITY DOESN’T GUARANTEE BUSINESS SUCCESS. THE PACIFIC BUSINESS GROUP ON HEALTH . . . A POWERFUL EMPLOYER COALITION IN CALIFORNIA . . . STUDIES AND RATES HEALTH PLANS. BANKER PAUL FEARER CHAIRS THE GROUP: SMITH: What health plan in California has a consistently good record or the best record on the quality of care? FEARER: I think, if you look at the delivery of health care in terms of diagnosis of cancer, treatment of heart disease, diabetic care and so forth, the stand out plan is Kaiser. NARR: KAISER OUT-PERFORMED ITS RIVALS, INCLUDING BLUE CROSS OF CALIFORNIA. YET THIS YEAR’S BLUE RIBBON AWARD WENT TO BLUE CROSS: FEARER (o/c): Kaiser has moved from one of the lowest cost plans to one of the higher cost plans. So we don’t just direct people necessarily to the highest quality plan, we direct them to the highest value plan. SMITH: What does it say to people when the Pacific Business Group on Health has a bunch of health indicators in which Kaiser of Northern California outranks Blue Cross of California, and yet the blue ribbon award from that business group goes to Blue Cross? DR. LAWRENCE: When that happens, it undermines their own statements about the focus on quality and I was disappointed when they did that. I was disappointed that they, they, they put such a heavy emphasis on cost, or price to them, uh, over what apparently are the objective ratings about quality. GOLENSKI (o/c): That's why Kaiser is in dire danger, but much more importantly, that's why the American people are in dire danger around health care. SMITH: Can a system with Kaiser's values and priorities survive in this competitive marketplace? GOLENSKI: I don't know. Kaiser is the last chance for a comprehensive non‑profit health system in the country. I don't know if it will succeed. Dip to black In Memoriam Credits ANNOUNCER: To learn more about this program, and ways for patients to get better care, visit PBS Online, at the internet address on your screen. To purchase a copy of all or part of Critical Condition, please call 1-800-553-7752, or write to the address on your screen. ANNOUNCER: A presentation of South Carolina ETV. ANNOUNCER: Principal funding for Critical Condition was provided by The Robert Wood Johnson Foundation. Making grants to improve the health and healthcare of all Americans. Major funding provided by The California Healthcare Foundation. Additional funding provided by The Rockefeller Brothers Fund And the Charles E. Culpeper Foundation. ANNOUNCER: This program is part of the PBS Democracy Project. ANNOUNCER: This is PBS. 
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