In an appearance on CNBC's "Squawk Box" Friday morning, Cleveland Clinic CEO Delos "Toby" Cosgrove, MD, shared his take on how healthcare reform has played out after the passage of the Affordable Care Act.
Here are five key takeaways from Dr. Cosgrove on the state of healthcare.
1. Reporting requirements are piling up. "First of all, the number of quality metrics that we have to report to the government every year is just going up like crazy. We're now reporting well over 100 quality metrics on a regular basis," he said. Regulation paperwork numbers 16,000 pages and stacks 7 feet high, he added.
2. The pace of new knowledge in medicine continues to accelerate, paving the way for artificial intelligence technology like Watson. Dr. Cosgrove cited a statistic that the total amount of healthcare and medical knowledge will double every 73 days by 2020. "No one is going to be able to keep track of all this stuff," he said, and that's where IBM Watson comes in. "Watson has learned how to take the history, the physical and the lab studies and give us a problem list better than we can do as doctors," Dr. Cosgrove said.
3. Consolidation is inevitable. "You have to compete," Dr. Cosgrove said. The support required to deliver healthcare today — data centers, HR, supply chain, purchasing — requires a big back office, he said.
4. The exchanges have not been successful. Dr. Cosgrove pointed to the flood of insurers getting out of the exchanges as evidence of the breakdown. "All of the exchanges were underpriced to start with because they [the government] thought once they got people into the exchanges they weren't going to change and they could gradually ratchet up [prices] over time," he said. "Insurance companies lost a lot of money."
5. Two factors are driving up healthcare prices. "One is more people are being covered and two, there's more things we can do for people," he said.
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