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Ronald A. Williams |
VOTERS ARE MORE WORRIED about health care than about Iraq, according to recent polls, making it a key political issue—and leading many health insurance company CEOs to keep their heads down. Aetna's Ron Williams has been an exception, speaking up on many major issues, though declining to endorse any candidate's health-care proposal. Formerly Blue Cross of California's president, Williams came to Aetna as COO in 2001 when the company was on the brink of failure. He and CEO Jack Rowe engineered a turnaround that increased the company's value from $3 billion then to $21 billion today. Williams succeeded Rowe as CEO in 2006. Before an audience in the Time & Life Building in Manhattan, Williams sat down with Fortune's Geoff Colvin. Edited excerpts:
In most industries rising revenues are regarded as good. Why is it that in health care, rising revenues are regarded as a grave national problem?
I think the U.S. is conflicted. When it comes to our own health care, we all want the best—access to the latest and most important technology. At the same time, health care is typically purchased in an institutional setting. So we purchase it in the aggregate, but we consume it as individuals. Today the U.S. spends about $2.2 trillion a year on health care. As an industry we have to do a better job of describing how we help people get access to the health care they need and improve the quality of care they're given, and how that $2.2 trillion could easily have been $2.4 trillion.
Why does the U.S. spend so much more per capita than any other country?
We are a wealthy country. We also are the global engine of innovation in health care, whether it's the pharmaceutical industry or the creation of medical devices. Our health-care delivery system is different from many others in that we have a smaller group of primary-care or family-practice physicians and a much larger base of specialists. There's at least one economist who argues that the increase in health-care costs has actually been a positive in the context of productivity in health in the U.S. So in a lot of ways we're getting what we want, which is more health care, more access, and more technology.
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(4 pages)