Freeman Magazine - Spring 2008

IN THE NEWS

Humana CEO highlights Tulane business forum

The nation’s healthcare system isn’t just broken, it’s not even a system to begin with, according to Mike McCallister, president and CEO of Humana Inc., the nation’s fourth-largest health benefits company.

“The attributes of a system—process improvement, connectivities, good metrics, Six Sigma, the things we talk about in the rest of our businesses every day that drive improvements—do not exist in health care,” said McCallister.

McCallister took on the topic of changing the nation’s healthcare system as keynote luncheon speaker at the 28th annual Tulane Business Forum.
The forum, a presentation of the Freeman School and the Tulane Association of Business Alumni, took place at the Hilton New Orleans Riverside on Friday, Oct. 19. More than 700 business people from the greater New Orleans region attended this year’s event, which focused on the theme of discovering opportunities.

McCallister noted that with one out of every five dollars in the U.S. economy going toward health care, creating a new model for delivery is critical to the nation’s future.
“At the end of the day, I think health care has to be brought into the rest of the economy,” McCallister said. “What are the attributes of the rest of this economy? Growth in productivity. Higher quality and lower prices. Ubiquitous real-time information. Transparency around products, services, quality and price. All those things. You’ll find none in health care.”

McCallister proposed a variety of changes at all levels of health care. He called on consumers to demand simplified information from their health care providers. He called on employers to work more closely with their benefits companies to provide appropriate coverage for employees and not to treat health plans like commodities to be sold to the lowest bidder.

He called on physicians to digitize prescriptions and records and make that information available to other physicians as patients move from doctor to doctor. He called on the federal government to eliminate barriers that prevent health insurance companies from operating between states and to make the federal Medicare database available to the private sector to generate better quality metrics.

And he challenged health care benefits companies to provide consumers with monthly statements similar to those provided by financial services companies, with a clear breakdown of costs and benefits.

“These are all opportunities,” McCallister noted. “Our best days are ahead of us.”
Tulane President Scott Cowen kicked off the forum with a presentation on the Scott S. Cowen Institute for Public Education Initiatives and its efforts to transform public education in New Orleans by bringing academic research and best practices into the city’s troubled school system.

Later, Donald E. Powell, federal coordinator for Gulf Coast Rebuilding, told forum attendees that abundant credit, tax incentives and insurance settlements have the entire region poised for a dramatic surge in activity. “It’s a perfect set of existing issues that will yield an incredible amount of economic vitality,” Powell said. “This is a unique opportunity that only comes along once in a generation.”

Also presenting at this year’s forum were Kevin H. Kelley, chairman and CEO of Lexington Insurance Co., who discussed how increased hurricane activity over the next decade could affect the insurance industry; James Monroe III, president of the Thermo Companies, who detailed his experiences as an entrepreneur and offered thoughts on how to transform post-Katrina opportunities into profitable businesses; and Peter DiMartino, senior managing director and asset-backed and mortgage credit strategist with Bear Stearns Inc., who addressed the mortgage credit market in both the U.S. and New Orleans.