Cutler Ready For The Challenges His Term As HIAA Chairman Will Bring
Hurricane Lili may have forced the Health Insurance Association of America to cancel its annual meeting last month in New Orleans. But one thing the powerful storm could not throw off course was the accession of Benjamin M. Cutler to the position of HIAA chairman for the coming year.
Cutler, who is chairman and CEO of Fortis Health, took over the post from J. Grover Thomas Jr., chairman president and CEO of Trustmark Mutual Holding Company.
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Cutler recently spoke with National Underwriter about his new position and the pressures the health insurance industry faces.
Asked how he feels at the beginning of his one-year term as HIAA chairman, Cutler said, “Challenged is a good word to describe it.”
Having been in the business for several years, he recognizes the challenges are magnified because the industry “gets lots of media attention.” But the challenges are real, nonetheless, and they apply not only to the health insurance business, but the entire health care sector.
The primary pressure, he said, is how to make health care more affordable “when all the factors are going in the wrong direction.” Among these factors are a workforce that is aging, direct-to-consumer drug advertising, and technology.
“We have to try to get ahead of all of this,” Cutler said, “and that is the challenge the industry faces.”
Asked if managed care had run its course in terms of cost savings, Cutler said “there are many elements of the managed care revolution that have worked very well. Some excesses have been squeezed out of the system.” One example of this, he said, is the negotiation of “more stringent arrangements with providers.”
Fundamental to the industrys problems, however, is the fact that “health care economics suffers from the consumer not being involved” in the real cost of care, Cutler said. “Employers are insulating consumers.”
Whats needed, he said, is “a number of years effort to retrain consumers.” He is under no illusion, however, about how difficult this will be for the industry. “Its a huge communications job and a lot of selling and education will be needed.”
The goal is “to empower consumers with more information so they can make informed decisions” regarding health care, Cutler said. This also means, he added, getting the health insurance business “to a more normal economic model that reflects how most of the rest of the economy works.”
One thing he has learned, he said, is that intra-industry fighting has proved lethal to what the industry needs to do. This is why he regularly speaks to the heads of the other major health insurance associations. “We are far better served to work together than to fight each other.”