The Future of Health Care Policy in a Divided Congress with Newt Gingrich
In this episode, Chip meets with former Speaker of the House, Newt Gingrich, to discuss:
- What are the prospects of McCarthy Speakership? Functionality of Washington with divided government?
- Comparing similarities/differences between the House in the late 1990s and now.
- Discuss Speaker Gingrich’s experience leading a Republican House and how he dealt with health care while balancing the budget and attempting to reform entitlements.
- Speaker Gingrich’s outlines his vision for the future of American health care.
- How hospitals can prioritize preventative care and aging.
- The role hospitals play for the future of health.
- What policymakers can do to support and elevate health care innovation.
There are very few people who know more about the House, navigating divided government or developing major budget legislation than former Speaker Newt Gingrich. Chip has known Gingrich for more than 50 years and in this episode the Speaker shares his perspective and provides deep insight into the current House majority and looming policy debates – especially when it comes to health care.
Speaker 1 (00:05):
Welcome to Hospitals in Focus from the Federation of American Hospitals. Here’s your host, Chip Kahn.
Chip Kahn (00:14):
The start of the hundred 18th Congress is unprecedented in modern American political times. The protracted process for choosing the new house speaker reflects the thin Republican margin and is a possible precursor of more difficulties ahead. So from the standpoint of hospitals and healthcare delivery and financing, what are the implications of these thin margins in the Senate as well as the house and divided government generally? How will healthcare be affected as the coming deliberations over the federal debt ceiling may extend to federal deficit reduction, placing entitlement programs like Medicare and Medicaid in the cross airs. There are very few people who know more about the house, navigating divided government or developing major budget legislation than our guest today the former Speaker of the House, Newt Gingrich.
I have known Newt for over 50 years and have never ceased to be struck by his strategic insights and unique vision about what stands before us. His perspective will help us understand the current developments in the house and what those efforts may imply for coming budget policy. He also has vast expertise in health and healthcare policy, and he will provide some foresight for American healthcare and the health of Americans. Thanks for joining us today, Newt.
Newt Gingrich (01:41):
Listen, it’s been over a half century since you and I first started working together, so for me it’s a thrill to have a chance to talk with you and the things you’ve been doing that are so important to healthcare in America and to the American hospital system.
Chip Kahn (01:55):
Yeah, thanks Newt. So just to get started, how do you assess the prospects for the McCarthy speakership and the direction of the House and Congress generally as we get started into this 2023 new session?
Newt Gingrich (02:10):
Well, it may surprise you, I actually think Speaker McCarthy’s stronger for having survived 15 rounds partially because he convinced his own team that he is tough enough that he could sit there and smile for 15 rounds and if he’d won on the first round, people would’ve been waiting for the blowup and they would’ve wondered when it was going to come. And as it is, I think they’ve mostly digested it. Second, as we just saw in the last few days, McCarthy has staked out a position on the debt ceiling of negotiating and talking in contradiction to what Biden had done as vice president in 2011. Biden has staked out a position of not talking, and Joe Manchin has now reached out called McCarthy and asked to come see him because Manchin thinks McCarthy’s right and Biden’s wrong. Well, that’s a pretty significant break in the old order.
The other point I’d make is that when they created the select committee on China and when they voted to cut China off from having able to have access to the American Strategic Petroleum Reserve on both of those votes, they got huge democratic bipartisan votes. In fact, I think they got a majority of the Democrats and one of the two votes. That’s a very good sign that the presumptions of the Pelosi system may not be working and that if he picks his fights carefully, some of them have to be partisan, but a lot of them will not be directly 100% partisan and he will get a significant number of Democratic votes.
Chip Kahn (03:41):
That’s a good way to start, but let’s look to the past as Shakespeare wrote, “What’s past is prologue,” what do you have to share from your experiences in the 1990s that you think would be useful to this new house, and what are the similarities between the new house and what you had to cope with when you took over in 1995?
Newt Gingrich (04:05):
It’s really interesting. As you remember, we had not been in a majority in 40 years. In fact, the only Republican who had ever served in a Republican majority was Bill Emerson in Missouri who’d been a page in 1954. I mean, literally that was our institutional base. So we had to do an enormous number of things in order to become both the first majority in 40 years, but more importantly, the first reelected majority since 1928, that’s 68 years. When we did that, we sort of broke the pattern in Washington and we then kept control until 2006. Denny Hastert became the longest serving Republican speaker in history. When they lost in 2006, what was really important was they knew they could be a majority. When I arrived in ’78, there were an enormous number of Republican leaders who knew they would be a minority and who were defeatist.
But the team that had lost in ’06 came roaring back in ’10, actually won a bigger majority than we did in 1994. And then when we lost four years ago, Kevin McCarthy, who had been through all this and had been part of the Bayner team in creating a majority in ’10, came back, gained seats in ’20 and then gain seats again this year. And so there, there’s a different psychology here. You have committee chairman who have been committee chairman, you’ve got committee subcommittee chairman who’ve been subcommittee chairman. We had none of this institutional capability and frankly, it slows me down a little bit because there are a lot of really smart people now in the house who know a lot more than I do about the things they’re working on. I don’t have the net advantage and knowledge that I had in ’94 when nobody knew anything.
Chip Kahn (05:52):
Let’s drill down a bit though to your earlier experiences. I mean, one of the things that you achieved in a sense in your speakership is bookended by the Balanced Budget Act of 1995 that was vetoed, but then the success of the passage of the BBA of 1997. From your work then, what are the lessons regarding budget policy? You brought up that Speaker McCarthy is already getting involved with making budget policy his top priority, actually the debt ceiling is only an extension of that in some ways. So what from your experience would you have to say to this house regarding what you learned in your experience in the nineties?
Newt Gingrich (06:36):
Well, I think first of all, they ought to set a goal and the more consortium members have said balance budget in 10 years, we set out to balance the budget in seven, we actually achieved it in four, which was a great shock to everybody. And in fact, Alan Greenspan as chairman of the Federal Reserve, had a working group looking at how they would manage the money supply if we actually paid off the federal debt in 2007, which of course all fell apart after I left. But it was really interesting how dramatically you could change things. So part of what I think has to happen here is McCarthy has to produce a politically sellable lie path to a balanced budget in order to have his rights stay with him. I think that Trump’s comment the other day is right, don’t touch Social Security and don’t touch Medicare.
I think Medicaid is a little bit different. You can improve Medicare. As you may remember, we had a substantial Medicare reform bill in 1996, which I always thought was our most daring adventure because you couldn’t get to a balanced budget unless you touched Medicare. We were touching it in a presidential election year, but we were doing it so carefully and with such training that spent so much time on it that AARP actually cited with us against the Clinton White House to their great shock. And so we were able to politically survive really the development of Medicare Advantage, which was a very big breakthrough at that time. So I would say you can improve Medicare, but you can’t cut it. You shouldn’t try to do anything with Social security just as Margaret Thatcher in the middle of changing almost everything never touched the National Health Service.
Social security’s just too complicated and too dangerous for a minority party, which we still are if you look at the house centered presidency. I think we can regain being a true majority, but you don’t do that by picking a fight you can’t win. And I’ll give you a modest example, there are two things that I think you’ll like. One is if your goal is 2033, so you’d like to get some spending cuts this year that have an effect on 2033, well, it turns out every dollar or a hundred dollars or a million dollars you save, you can multiply by 16% and if you do the savings this year, that’s the amount you save plus 16% in 2033 because you’re not having to borrow the money so you’re not paying interest on that additional debt. Well, for example, there are $150 billion of on obligated COVID emergency money that is sitting there, they’re paper money.
They have no obligation at the present time, there’s another 500 billion that is obligated but unspent, but just stick with 150 billion that that is obligated at the present time. When you then apply the 16% rule, that’s another 24 billion in interest savings. You can reduce the projected 2033 deficit by $174 billion by just not spending money that’s currently not being spent. Now, it’ll be interesting to watch the left explain how even though nobody’s currently spending it and it’s currently unobligated, we have to keep it in, spend it anyway. And I think the country at large was just a new, Rasmussen poll that came out yesterday, and the country at large has by a pretty substantial margin now believes that you should not pass a debt ceiling without having some spending reduction. And I think that will grind down Democrats in the House and the Senate and ultimately Biden who had negotiated a debt ceiling deal in 2011, only Biden’s going to have to negotiate, otherwise you won’t get it.
Chip Kahn (10:18):
You separated when you talked about the entitlements Medicaid from the other major program, Social Security in Medicare, do you have any specific thoughts about at least the direction of dealing with Medicaid?
Newt Gingrich (10:31):
Well, I have two thoughts that are very different. I mean, one in terms of Medicaid is my sense is that we’ve never gotten very good health outcomes from the way it’s been managed in a lot of states. And in fact, there are arguments in some places that the uninsured end up doing better than people who are on Medicaid. And I think it is worth looking again, and I believe in a systems approach. I don’t believe in a green eye shades accountants approach to budgets. Budgets are political management documents, and you ought to start with could you produce the equivalent of Medicaid advantage? And I’m just using that as a term for the moment. I’m not going to get into detail, but to rethink the delivery system, to rethink the way we deal with people poor. The second point I’d make though, I have a project we’ve started called From Disabilities to Capabilities because I think that we have the technological and scientific knowledge that we can dramatically improve the lives of almost everybody who is facing some kind of physical or mental challenge.
It’s what happened to us with welfare reform. Our most successful social conservative reform in the 1990s was the Welfare Reform Act of ’96, which when Clinton agreed to sign it, we got literally one half of the Democrats in the house to vote for it. It was a very successful bill. It moved us from Welfare to work. It has the largest single improvement in children leaving poverty as their parents got jobs and did better. It was great for the states because it reduced the number of people they were paying for and increased the number of taxpayers who were putting money in the system. So if you take that model and you combine that one with everybody who’s currently getting government aid, and two, you look at the notion of, for example, in workman’s comp, if you’re a 33 year old truck driver with a bad back, why am I going to pay you workman’s comp for the rest of your life when in fact there are a hundred things you could learn to do.
Now that that means you got to decide you’re going to learn to do it, but I don’t think the rest of us have an obligation. And I got into this in 1981, it’s part of the most radical things I ever went through. When in the middle of a recession, group of young steelworkers came to see me from Pittsburgh, I had just bought in Savannah, I’d gone to the home of the founder of the Girl Scouts and bought the 1912 Girl Scout Manual, which is entitled What Every Girl Can Do for Her Country, which is obviously in the modern era, a right wing fascistic concept and actually showed them a little uniforms carrying an American flag of an unbelievably anti woke document. Well, there’s a page in there where it says every girl should learn a second trade, so if the first trade dies, she can earn a living at the second trade.
And so I suggested this to this young steelworker guy in his late twenties, six foot three, solid guy, my family came from Steelton, Pennsylvania, so I knew the general pattern. He said to me, “No, I’m not going to learn a new trade. It is your job to make sure I have the job I want, period. And until then I’m going to be on unemployment.” Well, I thought that was probably not a very good cultural position. So I would say we ought to look at substantially thinking through people who are able-bodied, but who are currently drawing money from the government while doing nothing. We should really look at the whole process of dealing with people who have disabilities and try to turn them into capabilities. And we ought to look at theft. I think the current estimate is that $600 billion was stolen from COVID relief.
I know in California the estimate is that $20 billion was stolen from unemployment compensation mostly by prisoners in the California state system using the California state computers. Now, that’s just stupid. I mean to tell me we have to tolerate a stupid government that’s incapable of managing its money while we give it more money strikes me as a pretty good grounds for reform.
Chip Kahn (14:29):
We have to pass a debt ceiling. I think it’s a critical mandate, but clearly here it is a vehicle probably for some deficit reduction. I mean, at the end of the day, do you see what we’re going to go through as a dress rehearsal for the future for 2025, or do you think they can achieve much progress in 2023 towards reducing the deficit?
Newt Gingrich (14:53):
One of the things, when Joe Gaylor and I went back and beginning to work this book on March to the Majority, one of the things that hit me that made us I think different is we really arrived in 1995 with a contract with America, and we really had a generation of idealists who really wanted to actually pass it into law, they didn’t just want posture. And it’s pretty clear-cut under our Constitution that for a bill to become law, the president has to sign it, but for the president to sign it has to pass the Congress. So the founding fathers designed this brilliant mechanism to force you to work together if you’re going to get anything done. So Biden is going to have to come to grip with something which he knows because he actually was involved in the 2011 debt ceiling negotiation, which is he’s going to have to negotiate period.
They can posture all they want. They can do this kabuki dance. The fact is they’re going to have to negotiate. And they’re going to have to negotiate a deal for which McCarthy can get his conference to vote or they’re not going to bring it up. So now the way we used to do it is we created a box and one side of the box was what I had to have, and the other side of the box was what Clinton had to have, one part of the box was what I couldn’t have and the other part of the box was what Clinton couldn’t have. And when you put those things down, you said, oh, so here’s the zone we can live in. So I’ll give you the example I just mentioned. If you got $150 billion sitting out there, that is literally unobligated, why couldn’t Biden give that up? And that’s, as I said a while ago, that’s 174 billion in savings over 10 years. Now, you can then go to the conservatives and say, gosh, does 174 billion sound like a start?
And at least you’ve begun a conversation. But if Biden going to stamp his foot and say, no, no matter how stupid the program is we have to spend it, then he’s got a big problem. I believe the house will pass a dead ceiling. What I don’t know is whether or not the president will sign it.
Chip Kahn (16:50):
Time will tell.
Newt Gingrich (16:50):
Chip Kahn (16:51):
So let’s turn to healthcare and now let’s talk about your vision for the future of American healthcare. I mean, we have a cost problem, workforce problem, difficulties with access, but we also have seen in this age incredible innovation. As we do this further dive what is in your crystal ball? What would you like to see happen that may not seem part of the current trajectory of healthcare delivery and financing, but is a trajectory that we ought to be on?
Newt Gingrich (17:25):
Well, an area where you and your organization can have a huge impact is to try to figure out is it possible to find 15 or 20 senior administrators who are interested in being centers of innovation? I mean, the truth is the hospitals are the largest aggregation of practical knowledge in the health system and that’s become truer over the last 10 or 15 years as you know, because you’ve been part of it. They’re bigger, they’re wealthier, they have greater reach, and they have the sheer technological capability to do things. I mean, analogy I would draw is to have a Delta Airlines or American Airlines or United Airlines, you have to have a big system. And as southwestern learned recently, you have to have very modern computers so you’ve got to make the investment. It is almost impossible to have a tiny airline that survives because they don’t have enough aggregate wealth, they don’t have enough technology, they can’t reach enough market.
And so what I’m saying, I would’ve opposed this 20 years ago because it worries me about the rise of oligopolies when you look at some of these cities, University of Pittsburgh Medical Center is a great example where they’re so big and they’re so noncompetitive. I once got in this conversation, we had, as you may remember, we used to have the Center for Health Transformation and one of our members was the largest nonprofit, which I think is a very strange term because they all make profits, but one of the largest nonprofit hospital systems in California. And they were buying very advanced technology from the same company as Kaiser Permanente and they covered the same area. And I said, because I was such a big fan of intercommunication with health systems, why don’t you two get together and make sure that your two systems are going to be compatible?
And the executive who knew me well enough that he was pretty casual and relaxed, said, I can’t do that. That makes it too easy for doctors to switch. Now, and I’m sitting there thinking, wait a second so we’re going to have two parallel systems built by the same technology company, deliberately not able to talk to each other so you can keep your doctors. So you have to try to figure out could you find members who are willing to think far beyond that? And the reason I say that is this, my vision of the future is enormous information centered in the patient or their family or their immediate informal caregiver, maximum use of technology and science. I mean, for example, I would do everything I could, and this is also a big expense potential, but I would do everything I could to get people out of dialysis centers either by having a really sophisticated home dialysis or by having very inexpensive kidney transplant systems, probably using xenotransplantation with animals or a variety of things.
But I would look at every major cost center in the health system and try to figure out, because it’s pretty simple, patients or customers, you want convenience, you want certainty, you want the lowest cost compatible with Exxon service. I mean, one of the things conservatives don’t understand about health is, and then you may remember, I wrote a book one time called Saving Lives and Saving Money and put it in that order because they wanted to make the case health is a moral issue. If you or your family or your son or your daughter is sick, you don’t want to be told you’re now in a free market and by the way, it may not work very well, but look how cheap it is. What you want to be told is we’re going to get you the best we can get you if it’s a life-threatening problem period.
But then you got to say, so how do you make that affordable without going to global budgeting and government controls and all that stuff, which in the long run is a nightmare. I mean, one of the things people should be doing now is look at the disaster of the National Health Services becoming Great Britain, where even the Labor Party is now talking about dramatic reforms because it’s just melting down, it’s bureaucratized to a point where it’s incompetent. So I think you want to find a way to recenter a lot of decisions back in the individual to give them a lot more information as you know I think I’m very much for transparency of cost. I was literally last night with a guy whose wife died recently and she spent nine days in an essentially hospice environment at $20,000 a day. Well, that’s pretty hard to explain.
I mean, I’d like to figure out how did they get to $20,000 a day except they could and he has good insurance and I’ll probably pay it off. But that’s part of the whole problem right now is that as the system is so unbelievably complicated, I always tell people I do national security and I do healthcare. They’re both life and death. They’re both huge and complex. Healthcare is at least 10 times more complicated than national security. And when I first really got time to dive into it after the speakership, I was staggered by how complicated the health system is and probably has to be because it’s the largest single consumer of knowledge that we have. When you think about Alzheimer’s or you think about cancer or you think about genetic conditions or sickle cell anemia, each of these is an enormous zone of knowledge. And then you bring them all together and you try to figure out how you’re going to manage a system that’s delivering this stuff. There’s nothing else as complex as the health system.
Chip Kahn (22:50):
So along those lines, and from your work, how can we make aging more user friendly? In a sense, it’s always been a problem, and for some of us, we’re now into that trajectory, and what’s your vision there from making life as people age better for them and better for all of us, actually?
Newt Gingrich (23:13):
Well, first of all, comment, I’m 79, Henry Kissinger’s, 99. I recently did a podcast. I do a program called Newt’s World, which I hope you’ll come on sometime. And Henry recently did a podcast with Henry who’s an old friend. And I had called him a couple weeks ago and I said, “Henry, you’re 20 years ahead of me and I’m now at a point where I’m really curious about advice on aging.” And he said, “You’re way too young, call me in a decade.” Now, he had just published a book at ’99 and he did our podcast and he’s now writing another book. And so part of my advice is that we have to get rid of the agricultural industrial sense of aging, which was based on the fact that if you plowed behind a mule or you worked in a steel mill, you were physically broken.
I mean, you didn’t have the kind of aging you’re going to have, the kind of aging most people are going to have. We’re doing some work with several doctors who are looking at people who live to be over 100. I was just recently with a person, in fact, I did an interview with Ben Justice whose grandmother lived to be 105. She outlived her sisters who lived to be 102. Part of that is genetic, in fact, more of it’s genetic frankly, and attitude. It turns out with the doctors, we did a podcast a couple weeks ago on the process of getting older with a doctor who has one specific real proposal. And that is to get NIH to understand that the process of aging itself should be looked at as sort of the tree from which all of the branches come, whether you call about diabetes or Alzheimer’s or heart disease.
And that if you can improve the tree, everything else gets better. And this is a guy who now deals with mice that lived to be 30 and 40 years older than mice. No, they actually reverse aging. They’ll take an older mouse and it gets to be the equivalent. So 60 year old mouse in human terms gets to be 20 and they’re working on all these things. And he said, look, he said, if you avoid aging, and this is what happens with people who live to be over 100, if you avoid aging, none of these things happen to you. And so he said, the holy grail should be how do we get the tree to grow longer not fight, we spend almost all of our money on the branches, so we’re worried about your heart disease, we’re worried about your kidneys, we’re worried about…
He said, you get the tree to live to be 105. And he thinks the nominal age will actually be about 150 and he’s beginning to see people who are living to be 115, and they’re actually I think over 100,000 people who live to be 100 right now. Chip, I’m offering you hope here.
Chip Kahn (25:59):
And my father lived to be 97, so I can be encouraged by that. Let’s go off on a tangent though, that you spent a lot of time and been a real leader in, and that’s the area of coping with Alzheimer’s. And even if we are at the most optimistic and can help as many of us as possible, think about the terms of aging in terms of that tree, there’s still those who hit the decline that’s caused by Alzheimer’s. What can we do for those that get Alzheimer’s and other kinds of deterioration that occur because of other things happening in their body?
Newt Gingrich (26:40):
Well, as you may remember, I co-chaired with Bob Carey, a three-year study on Alzheimer’s and I actually had a pretty big impact both on the National Institutes of Health and on the Senate. It was one of the most interesting Senate briefings I’ve ever done because you had all of these senators who had relatives with Alzheimer’s, and they all came to the briefing and they all stayed for the whole briefing because it was personal. This was not public policy. I just did a podcast a couple weeks ago with somebody I had first met back in 2008 who has been part of the first drugs to be approved, begin to postpone the effect of Alzheimer’s. And he said, part of what’s going to happen, and this is going to be whole new level of complexity, the earlier we determine that you have onset, the more we can do to minimize its impact.
So I said the newest drugs, the very first drugs ever approved that have a clear impact on Alzheimer’s work only if we get to you very, very early, and most doctors aren’t trained to test for Alzheimer’s or to test for cognitive problems, and it only works for Alzheimer’s, it doesn’t work if you have hardening of the arteries or a number of other things that affect how your brain functions, but it’s the beginning of a breakthrough. Chip, I would say I’ve drawn into three things. One is the development of drugs that in the classic traditional way, for example, that we’ve dealt with cancer, where if you go back to 1971, when Nixon proposed a war on cancer, we had relatively primitive drugs. They didn’t work all that well. And it’s been wave after wave, wave of innovation. So that for a lot of cancers now are just manageable problems if you get them early enough and then they’re not death sentences.
That’s an enormous change in about a 50-year period. So that’s one box is how do we get to better drugs? Second, can we in fact find the kind of genetic breakthroughs that allow us to figure out how to block it from even happening? And there there’s a real fight over what actually causes Alzheimer’s because there are two very different schools and my view of life is study both of them. Don’t get involved in a scientific fight, just do both of them. Alzheimer’s a big enough issue. But the third thing is, this goes back to my point about from disability to capability, we have to change how we measure things. And I have a number of cases of Alzheimer’s and among my relatives and I’ve watched them deal with it, and I used to teach the oldest men’s class at First Baptist Church in Carrollton, Georgia.
Everybody had members who acquired Alzheimer’s because they’re already in their eighties or nineties when I was there hanging out with them. Person who was an Alzheimer’s caregiver is twice as likely to have a health problem as a person who’s not and that’s because of the stress and the strain. And for example, if you’re the wife and your husband’s fairly large, just getting them into the bed may in fact hurt you, may cause an injury. So there ought to be a way to have a program that looks at all these, this goes back to capabilities rather than disabilities, what are all the different things we could do? The Japanese, for example, have moved very heavily under robotics. And it may well be that there ought to be a model Alzheimer caretaker home that when you find somebody in your family has a problem, you can rent this kind of equipment for the length of time they’re going to need it or if it’s going to be a very long period, you probably would buy it.
But the goal would be to have the optimized ability to take care of somebody without hurting the caregiver. And at the same time, to maximize the comfort and the length of life and the experience of life for the person who has Alzheimer’s. So I think those are three different boxes and we should be pursuing all three because it’s a huge issue and as people live longer, it’s going to be a bigger issue and it’s a big financial issue.
Chip Kahn (30:37):
Newt, thank you so much for your insights, both in terms of the developing political scene as well as your vision into the future on these critical healthcare issues. I just appreciate you and you’re taking time with us this afternoon.
Newt Gingrich (30:54):
Glad to do it. It’s what you’re doing is very, very important.
Speaker 1 (31:02):
Thanks for listening to Hospitals in Focus from the Federation of American Hospitals. Learn more at fah.org. Follow the Federation on Social media at FAH Hospitals and follow Chip @chipkhan. Please rate, review and subscribe to Hospitals in Focus. Join us next time for more in-depth conversations with healthcare leaders.
Newt Gingrich is a former Speaker of the U.S. House of Representatives and 2012 presidential candidate. He is Chairman of Gingrich 360, a multimedia production and consulting company based in Arlington, Virginia. He is also a Fox News contributor and author of 42 books, including Beyond Biden and many New York Times Best Sellers. He lives in McLean, Virginia, with his wife Callista L. Gingrich, former U.S. Ambassador to the Holy See and CEO of Gingrich 360.