An Interview with Stuart H. Altman

Stuart Altman

Stuart Altman

Bio:Stuart H. Altman is the Sol C. Chaikin Professor of National Health Policy at Brandeis University. From 2000-2002 he was Co-Chair for the Legislative Health Care Task Force for the Commonwealth of Massachusetts. He is Chair of The Council on Health Care Economics and Policy, a private non-partisan group whose mission is to analyze important economic aspects of the U.S. health care system and to evaluate proposed changes in the system. He is also Chair of The Health Industry Forum which brings together diverse group leaders from across the health care field to develop solutions for critical problems facing the healthcare system. He has worked with President-elect Obama’s healthcare policy team.

KC: What do you feel are the most significant healthcare events of the past century that have led us to where we are now?


  • Truman ran in 1946 on a platform to provide national health insurance that went nowhere.
  • Johnson faced the crisis of a growing number of elderly Americans who were unable to afford premiums as the method of setting rates changed from community rating, in which everyone paid the same rate, to experience rating, in which people paid according to their past history and current healthcare needs.
    Similarities to our current situation include a Democratic majority in Congress, a committed President, and the willingness of the President to work with Congress, as LBJ did with Wilbur Mills, Chairman of the House Ways and Means Committee.
  • The Clinton plan failed because it was a complex program with tight governmental controls that took over one year to come to Congress. Furthermore, it alienated powerful insurers and enjoyed only lukewarm support of the physician and hospital communities.

So, we find ourselves with an approximately 100% increase in healthcare spending since 2000, an economic crisis that will lead to severe job losses, and states that are unable to afford any increases in Medicaid costs. We have a historic opportunity to achieve significant reform if we:

  • Act quickly
  • Work closely with Congress
  • Reform without singling out powerful stakeholders who need to be a part of any compromise

KC: Is what you are proposing an extension of the Massachusetts model?

SA: Exactly. I know that this is controversial, but we need to extend coverage first and achieve cost containment once the system is in place. The individual mandate is working. Massachusetts has the lowest rate of uninsured patients of any state in the US. The MA Connector built upon the private insurance model, with subsidies for low-income residents, rather than disrupting the private insurance system.

KC: Before the MA model was signed into law, didn’t MA have a relatively low rate of medically uninsured residents? How would you deal with a state like Texas that has a rate of medically uninsured residents several times higher than MA?

SA: That’s what people in Washington are grappling with now. There will have to be subsidies to either states or individuals to purchase coverage.

KC: Is the status quo an option?

SA: It is always an option. It is just not a very good option. Nearly every advocacy group has a health reform plan. Altman’s Law states that advocacy groups seek to preserve the status quo rather than adopt another plan that might disadvantage their interests.

Nevertheless, we have the best opportunity that we have had for a long time to achieve significant healthcare reform. Extending healthcare coverage should be viewed as an integral part of the nation’s economic stimulus package. The uninsured are increasing, and the states need help.

KC: What is your advice to physicians and hospitals?

SA: Access to primary care has reached a crisis level. If it is not solved soon, patients will seek out alternatives that may not be in their best interests and that will drive up the cost of care even further, especially if charlatans fill the void. In addition, physicians need to deal with the overuse of technology and procedures. Granted, some of that is driven by malpractice concerns, but those of us in the policy community feel that there is lots of room for improvement.

Hospitals are more complex. They have enjoyed financial growth in many parts of the US, increasing political power, and leverage as the largest community employer in many locales. If we reign in spending, hospitals will have to be in on the agenda.

KC: What does the appointment of former Senate majority leader Daschle portend for the Department of Health and Human Services (HHS)?

SA: That was a great call. He is not an ideologue, but an experienced politician who can work with both parties in Congress and who will surround himself with competent people.

KC: Is there anything that we have not covered that you would like to add?

SA: We need to change the structure of our healthcare delivery system to emphasize more integrated delivery systems. But to make this happen we need to eliminate our traditional fee-for-service model of paying for care and put in place more bundled payments that pay for achievable outcomes, not just for providing a service. We also need to have the government invest in research that allows physicians and patients to know which medical interventions work and which are cost-effective.

For more information. on the Massachusetts model to which Dr. Altman referred, please consult Doonan MT, Altman SH. “Healthcare Insurance: The Massachusetts Plan,” in Cohn KH and Hough DE, eds. The Business of Healthcare, v.3. Westport: Praeger Publishers. 2008, 35-60. Reproduced with permission of Greenwood Publishing Group, Westport, CT,

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5 Responses to An Interview with Stuart H. Altman

  1. elaine arkin January 6, 2009 at 5:39 pm #

    From a Brandeis email. sounds like David Helms might know him

  2. G.L. Keel January 7, 2009 at 10:11 am #

    I would like to hear from Dr. Altman about whether he considers pharmaceutical interests “stakeholders who need to be a part of any compromise.” How do we limit capture by such interests, especially when past policy choices favor them and increase costs (prescription drug coverage as a new entitlement)?
    Also, how might we create incentives for individuals to alter their lifestyle choices that contribute to widespread diseases and expensive treatments (diabetes, heart d, stroke, cancer)? Sugar and fat taxes seem to challenge Americans’ cherished belief in personal liberty.

  3. Stuart Altman January 8, 2009 at 3:36 pm #

    Here is Dr. Altman’s reply:
    You questioned whether we should include pharmaceutical companies in the discussion of healthcare reform. In my view absolutely. This does not mean that they will be able to dominate or necessarily get their way but their issues need to be discussed. After all many of us depend on the products they produce to continue functioning.

  4. lieben March 3, 2009 at 4:33 am #

    Interessante Informationen.


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