The leadership for reform may emerge from various congressional committees, private-sector interests, a new working group established by the President, or various other organizational arrangements. Lessons from the failed 1993 reform effort—including the need for greater transparency—would undoubtedly underpin the design of a new reform process. Regardless of the entity that takes the lead, the secretary and the department inevitably will be required to give sustained attention to the development and assessment of reform options.

Any health reform strategy ultimately put forward will affect every aspect of department activities:

  • Reform will affect departmental priorities and whether and how well it can meet its mission and goals.

  • Reform will influence the structure, alignment, and interrelationships of departmental agencies and units.

  • Reform will affect many aspects of HHS agencies’ daily operations and the expertise their staff will need.

  • Reform will change the outcomes for which the department is accountable.

In fact, reform will have an impact on all of the seven elements of organizational success: strategy, structure, systems, staff, skills, style, and shared values.

If only because health reform would have such a major impact on the department, the secretary cannot afford to be merely a passive observer of the process. The department has both motivation and opportunity to play a significant role in creating a high-value health system because of the enormous costs—and powerful leverage—of Medicare and Medicaid and its role in setting quality standards across government health programs (IOM, 2003).

The department also has important expertise and information to contribute, too. Because it is the principal advocate within the federal government for public health and advancing the health of the population, it may be up to the secretary to make the critical case that “health reform” is more than just reforming the insurance coverage and payment systems. HHS has paramount operational knowledge about the complex workings of the health sector, and the secretary will want to use the extensive data available from Medicare, Medicaid, CDC, FDA, the Health Resources and Services Administration, the Agency for Healthcare Research and Quality, and other federal, state, and private-sector agencies to help

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