Healthy, Wealthy, and Wise?

Healthy, Wealthy, and Wise? - Tomorrow night, President Bush will give his State of the Union address and he is expected to share his vision for healthcare reform. From everything I have seen, the playbook he will be reading from is Healthy, Wealthy, and Wise, a new book by a collection of economists associated with the American Enterprise Institute. The authors recommend a number of legislative changes to tax and insurance law that are intended to increase competition and the level of individual participation in healthcare purchasing decisions.

This is definitely a market approach to fixing healthcare; and while I would tend to favor such approaches personally, I still wonder if these changes will benefit a broader spectrum of our society. Over the next few weeks, I would like to explore the particulars of the President’s proposal. I hope you will join me in some critical assessment. Also be sure to watch Hospital Impact, as I am sure that Tony and I will cover the President’s speech later this week.

I will have to take a break from the series in a few weeks, as I will be attending the HIMSS Conference in San Diego. I am sure that my first HIMSS Conference will produce some interesting experiences I will share with Healthcare Tomorrow readers.

Mocha and an MRI

And now for something a little different...

Mocha and an MRI - You may not have thought about it before, but every time you order a Mocha at Starbucks, you are buying an MRI for your barista. In fact, according to Starbucks, on a per cup basis, your barista’s health insurance costs more than the coffee beans. I stumbled across this factoid recently, while reading a very well done article by Professor Michael Lipsky entitled, Starbucks and Healthcare. In the article, Professor Lipsky makes the point that in addition to raising awareness about the rising cost of healthcare, companies like Starbucks get a little self-promotion from advertising that healthcare coverage is a significant cost of production. I suppose it does make me feel better about paying $3.50 for a coffee drink, knowing that I am subsidizing someone’s health insurance.

A Dialogue

A Dialogue – As it says in the “About” section of this blog, I intend for Healthcare Tomorrow to be a discussion. Throughout the months I have received a number of encouraging and insightful comments from readers. I have come to realize that one of the drawbacks of Blogger (the service that hosts this blog), is that I cannot email people who leave comments unless they have an account with Blogger. Thus, I have not been able to dialogue “off-line” with many of them. Perhaps if Healthcare Tomorrow continues to grow, I will move to a more user-friendly service. Until then, allow me to dialogue “on-line” with Tim Gee, a gentleman that commented on my last post, A Theory.

Here is a portion of Tim Gee’s comment:

Andrew - great treatment of areas to address in our health care market. There is one, however, that never seems to get much attention - that was a critical issue back when I worked for an e-health connectivity startup.

Proponents of a single payer system say that the market driven approach to health care has failed, what with continued rising costs and less than 100% coverage of the population. The problem with this (and this is maybe the fourth element) is that our health care market is far from "market driven" - there are many distortions and indirect relationships between buyers and sellers, who pays and who benefits. I'm thinking about employers who pay for health care that is consumed by employees with little regard for cost or efficacy; or hospitals whose real customers are private practice physicians rather than patients; and payers who, through these distortions, wield power that is out of proportions to their theoretical role of managing risk.

These distortions in our health care marketplace, mainly the result of regulation and politics, have created the biggest barrier to reforms and technology adoption that would improve outcomes, patient safety and increase coverage through lower costs. Because of these distortions, each player in the health care market asks, "what's in it for me?" when considering change or investing in technology - and frequently, because of these distortions there is in fact little in it for them because the benefits are accrued by someone else in the health care delivery chain.

Tim – First of all, thanks for the comment, I really enjoy hearing from readers. I think you make a great point about the market place. It is a web of incentives and disincentives that don’t quite motivate the “right” behavior. As a philosophy student years ago, I learned that you can’t truly make anyone act outside of their own best interest. And that is why programs that align the interests of the different players to the end that we want to achieve is a key to fixing healthcare. We have seen some programs come about that are intended to do just this. At the beginning of the food chain, the purchasers of healthcare (I know it seems like it should be the patient, but we just aren’t there yet) have begun to change the incentives. Through Leapfrog and other business alliances, providers and insurance companies are being put on the hot-seat for improving quality and paying for quality. In order to engage the patient in cost-effectiveness decisions, insurance companies, no doubt at the behest of employers, are offering HSA-like products.

I think we would all agree that these are just the first steps in aligning the incentives and creating competition around what really matters – improved quality outcomes for everyone. But this brings me back to my theory. If we, the leaders of healthcare, are going to create a system that works for everyone, then we must be committed to continual improvement, we must use the tools of technology to get there, and we must be committed to looking beyond profit and create the incentives and the environment that works for everyone.

Again, thank you, Tim, for your comment. I hope to hear more readers in the future.

A Theory

A Theory - I have a theory on the essential elements to creating the healthcare delivery system that we should have. It struck me recently that there are three elements that are required to get us there. Now they aren’t necessarily simple things, in fact, they are quite broad categories, but they seem to encapsulate, for me, the forces needed to accomplish this task.

The first element is the never-ending struggle for improvement. Complacency is one of the silent killers in healthcare. When we accept the status quo, convince ourselves that “we provide good care”, or just don’t know what to do next, then we will never move beyond the level of care provided today. This is a hard element because it asks everyone involved in the care process to question their own performance. There is always an opportunity to improve outcomes, reduce variability, share more information, and communicate more effectively.

The second element is technology. As I enter the world of healthcare technology, I am becoming more convinced that we need the tools of technology in order to provide safe and coordinated care. Over the next decade, there will be billions of dollars spent on healthcare IT, and, yet, the biggest hurdle to realizing technology’s potential to improve care is the re-imagination (I am borrowing that from the Toyota Avalon commercial) of the very way care givers provide care.

The third element is a commitment to make the system work for everyone. This one is a great challenge. It is easy (relatively) to build a system that is profitable. The challenge is to remember that there is an additional end to strive towards. To remember that after the business model works, we have to make it work for those who lack access.

I know that theories aren’t much use to people. A theory isn’t a proven fact. It may not solve anyone else’s problems. But, for me, it is a hunch; recurring themes that seem to pop up every time I read an article about the industry, come across a new idea, or wrestle with the big issues of healthcare. In this new year, and with my new role, I imagine that I will be writing more about these elements. I have to see if my theory is correct.