NEW @ THCB PRESS: Surviving Workplace Wellness. Spring 2014. Al Lewis and Vik Khanna. e-book edition. # LIGHTHOUSE Healthcare. Illuminated.

flying cadeuciiJe n’ai fait celle-ci plus longue que parce que je n’ai pas eu le loisir de la faire plus courte. —Blaise Pascal

Translation: I have made this longer than usual because I have not had time to make it shorter.

As Appley as it gets.

A while ago I was challenged to write about what an Apple-like approach to healthcare might look like.

That challenge has been weighing on me.

For starters, we’re all over Appled aren’t we? Maligned anecdotes about Steve Jobs and the iPhone make their way into almost every presentation remotely related to innovation or technology. Triteness aside, I’ve been stalled because Apple is really a philosophy, not a series of steps or lessons learned. (Although, they are nonetheless methodical.)

Instead, what I’ve been kicking around in the ole noggin are three notional predictions, which I’ll assert are inevitabilities which will fundamentally disrupt healthcare delivery as we know it today.

What follows is about as Appley as I’m likely to get. Despite big-bang product launches, Apple actually plays the long game. They introduce small features into products to affect user behavior years before a flagship product takes advantage of those reprogramed behaviors.

That’s how they disrupt.

I believe there are three meaningful, unstoppable trends, in our current world which will significantly alter healthcare. The steps taken towards these inevitabilities, along the way, are the what will define the innovators and leaders. They are the ones who see this future and know how to drive towards it.

The three trends are:

  • Tools and culture which favor individual empowerment
  • The commoditization and automation of diagnosis
  • Accelerated globalization of treatment options

But wait, there’s Moore.

Don’t worry, I’m not going to leave you hanging. I’ll attempt to rationalize each of these points and explain why, particularly when considered as a bundle, they are a powerful force for disruption. And to prime that pump, we have to talk about Gordon Moore.

Continue reading “Moore’s Law in Healthcare – Three Predictions”

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flying cadeuciiThere have been lots of news reports, including some from me, about insurers raising premiums 10 percent or more on the Obamacare exchanges next year.

But for most people who bought health coverage in the Obamacare exchanges, that’s not really a concern.

That’s because the vast majority of Obamacare buyers so far have received tax credits to reduce the cost of that coverage.

Those subsidies, rather than being flat dollar amounts, fluctuate so customers never pay more than a certain percentage of their incomes on insurance.

In other words, if premiums rise next year like WellPoint Inc. has predicted, subsidies also will rise to keep the net cost to consumers at the same percentage of their income.

So rising premiums aren’t a problem for consumers, unless their income rises so much that it reduces the size of their subsidy.

“If all insurers increase their rates by 10 percent, that might not have a dramatic shift in the market,” said Paul Houchens, a consulting actuary at the Indianapolis health practice of Milliman Inc. “Most of that premium increase is going to be absorbed by the federal government.”

(Rising federal spending could also be a problem for Obamacare–not to mention taxpayers–but that’s not my focus today. Also, Houchens noted, Obamacare’s premiums are not scheduled to rise in line with premiums forever, but will be indexed to income growth and inflation.)

But for 2015, what could cause the biggest problem for Obamacare consumers, Houchens pointed out to me last week, is if an insurer reduces its premiums. Or if a new compeitor enters the market in 2015 with lower premiums than insurers were offering in 2014.

If that idea makes your head spin, welcome to Obamacare, where up is down and down is up—at least compared to how health insurance used to work. It’s what I’ve taken to calling the weightlessness of Obamacare.

Continue reading “Make Sense? Competition, Not Higher Premiums, May Turn Out to Be the Biggest Threat to Obamacare Buyers”

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Yesterday the Pew Research Center’s Internet & American Life Project released the findings of their survey on the future of science. 1,001 participants were read a list of scientific innovations that may or may not happen in the next 50 years.

The respondents reported how likely these innovations were to occur, whether they believed such a change was a positive development, and whether they would personally use these new technologies.

Here are some highlights from the survey:

Custom Ordering Organs
Americans are confident that people in need of an organ transplant will have new ones custom made for them in a lab. 22 percent of Americans say that scientists will definitely be able to custom make organs for those in need, 60 percent think it will probably happen.  Only 15 percent of Americans think it will probably or definitely not happen.

Controlling DNA
Americans are not fans of genetic engineering.  66 percent of respondents say that we will be worse off if prospective parents can alter the DNA of their children to produce smarter, healthier, or more athletic offspring. About one-in-four Americans think scientists striving to create perfection by developing the ability to control the DNA of offspring would be a positive change.

Growing Meat
A large percentage of those surveyed are turned off by the thought of test tube meat.  78 percent of Americans would not eat meat that was grown in a lab.  22 percent of Americans reported they were comfortable eating lab grown meat.

Continue reading “Would You Get a Brain Implant if It Could Make You Smarter?”

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PAMWe all know “that patient” – the one we may dismissively label “noncompliant.”

The person with diabetes whose HA1C is consistently above normal limits – the one who swears, when confronted with the numbers (yet again) he’ll start eating right and using his insulin as prescribed.

And yet, month after month, the lab work tells a different story. We watch in helpless frustration as patients like these spiral downward, developing complication after complication.

I thought about “that patient” as I read a recent Wall Street Journal article describing Dr. Judith Hibbard’s Patient Activation Measure (PAM), which she and her colleagues at the University of Oregon developed some years ago.

First, let me say I greatly admire the research and work of Dr. Hibbard and her team; I believe that the PAM is a wonderful tool and a step forward in better understanding patients.

While the article, and Dr. Hibbard, argue that the use of the tool can better target the needs of patients – and I agree – I can’t help but worry that the entire premise that patients need to be “activated” misses a point.

Patients are people before they are patients.

We know that when people are sick, they are still part of their broader world of family, friends and finances. We also know that their social, spiritual and psychological selves are every bit as important, and as important to their “cure” as their activation as a patient.

I suspect that Dr. Hibbard would agree with me and even argue that the PAM reflects all of these factors.

PAM is accurately diagnosing the end state – how all these factors impact the patient and the patient’s ability to be involved in his or her own care.

I worry, however, that the PAM may be oversold by healthcare administrators who put it in place as a way of trying to address all the factors that affect patient activation.

Continue reading “Diagnosis Is Not Therapy”

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flying cadeuciiIt’s a strange business we are in.

Doctors are spending less time seeing patients, and the nation declares a doctor shortage, best remedied by having more non-physicians delivering patient care while doctors do more and more non-doctor work.

Usually, in cases of limited resources, we start talking about conservation: Make cars more fuel efficient, reduce waste in manufacturing, etc.

Funny, then, that in health care there seems to be so little discussion about how a limited supply of doctors can best serve the needs of their patients.

One hair-brained novel idea making its way through the blogs and journals right now is to have pharmacists treat high blood pressure. That would have to mean sending them back to school to learn physical exam skills and enough physiology and pathology about heart disease and kidney disease, which are often interrelated with hypertension.

Not only would this cause fragmentation of care, but it would probably soon take up enough of our pharmacists’ time that we would end up with a serious shortage of pharmacists.

Within medical offices there are many more staff members who interact with patients about their health issues: case managers, health coaches, accountable care organization nurses, medical assistants and many others are assuming more responsibilities.

We call this “working to the top of their license.”

Doctors, on the other hand, are spending more time on data entry than thirty years ago, as servants of the Big Data funnels that the Government and insurance companies put in our offices to better control where “their” money (which we all paid them) ultimately goes.

In primary care we are also spending more time on public health issues, even though this has shown little success and is quite costly. We are treating patients one at a time for lifestyle-related conditions affecting large subgroups of the population: obesity, prediabetes, prehypertension and smoking, to name a few that would be more suitable for non-physician management than hard-core hypertension.

It is high time we have a serious national debate, not yet about how many doctors we need, but what we need our doctors to do. Only then can we talk numbers.

Continue reading “Let Doctors Be Doctors”

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There’s a war being waged on one of America’s most revered institutions, the Emergency Room. The ER, or Emergency Department (ED for the sake of this post) has been the subject of at least a dozen primetime TV shows.

What’s not to love about a place where both Doogie Houser and George Clooney worked?

Every new parent in the world knows three different ways to get to the closest ED. It’s the place we all know we can go, no matter what, when we are feeling our worst. And yet, we’re not supposed to go there. Unless we are. But you know, don’t really go.

Somehow, we’ve turned the ED into this sacrosanct place where arriving by ambulance is ok, and all others are deemed worthy based on their insurance rather than acuity. If you think I’m wrong, ask any ED director if they want to lose 25% of their Blue Cross Blue Shield volume.

But its true. I hear ED physicians openly express disappointment in people who came into the ED and shouldn’t have.

It’s just a stomach bug, you shouldn’t be here for this… Or, it’s not my job to fill your prescriptions…

Some history

The Emergency Department is a fairly modern invention. The first EDs were born of two separate, though similar, aims. At Johns Hopkins, the ED began as the accident room, place where physicians could assess and treat —wait for it —minor accidents.

Elsewhere, in Pontiac Michigan and Northern Virginia early EDs were modeled after army M.A.S.H. field hospitals. They were serving more acute needs.

Today, billing for emergency department visits is done on the E&M Levels where level 1 is the least acute (think removing a splinter) and level 6 is traumatic life saving measures requiring hospitalization (think very bad car wreck). Most EDs, and CMS auditors, look for a bell curve distribution, which means there are more level 3 and 4 incidents than most others. While coding is unfortunately subjective, solid examples of level 3 visits include stomach bugs requiring IV fluids, a cut requiring stitches, and treatment of a migraine headache.

Continue reading “Stop the War on the Emergency Room!!! (Fix the System Failure)”

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Karen DeSalvoDuring National Minority Health Month, we acknowledge the potential for health information technology (health IT) – from electronic and personal health records to online communities to mobile applications – to transform health care and improve the health of racial and ethnic minorities.

Lack of access to quality, preventive health care, cultural and linguistic barriers, and limited patient-provider communication are factors that aggravate health disparities.

By increasing our investment in health IT policies and standards, we can help improve the quality of health care delivery and make it easier for patients and providers to communicate with each other – a huge step toward addressing the persistence of health disparities.

The Pew Research Center’s Internet & American Life Project External Links Disclaimer found in 2012  that African Americans and Latinos are more likely to own a mobile phone than whites and outpace whites in mobile app use, using their phones for a wider range of activities.

The study showed that African Americans and Latinos use their mobile phones more often to look for health information online. This has very important implications for personal management of health and interaction with the health care system.

However, barriers to widespread adoption of health IT remain.

For example, a 2014 consumer engagement report found that minorities were less likely to adopt online patient portals to access their health information than were non-Hispanic whites.

Continue reading “Advancing Health Equity in the Digital Age”

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flying cadeuciiThe American Recovery and Reinvestment Act of 2009 (ARRA), sometimes called the Stimulus Actwas an $831 billion economic stimulus package enacted by the 111th Congress in February 2009 and signed into law on February 17, 2009 by the President.

It included $22 billion as incentives to encourage adoption of certified electronic medical records in hospitals and medical practices. The rationale behind the policy directive was clear: system-wide implementation of electronic medical records enables improvement in diagnostics and treatment coordination, fewer errors, and better coordination of patient care by teams of providers.

Almost immediately, the medical community cried foul.

Their primary beef: the cost to implement these new systems would not be recovered by the incentives.

Similarly, physicians pushed back on the conversion of the U.S. coding system from ICD-9 to ICD-10. They did not question the need for the upgrade: the increase from 19,000 to 68,000 codes is necessary to more accurately capture all relevant clinical aspects of a patient’s condition and align our data gathering with 20 other developed systems of the world where ICD-10 is already used.

That health insurers, medical groups, hospitals and others must use the same coding system that reflects advances in how we diagnose and treat seems a no brainer. But some physicians pushed back due to costs and disruption in their practices.

Last week, physicians won a battle: the Centers for Medicaid and Medicare Services (CMS) announced it was delaying the deadline for implementation of ICD-10 for a year, to October 1, 2015.

Continue reading “Health Information Technology: Sorry, There’s No Turning Back!”

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flying cadeuciiAn article containing some ideas from The No Asshole Rule appeared in The McKinsey Quarterly some time ago and was summarized in The Economist.

This post is motivated by the question with which The Economist ends its little story: “If jerks cost firms so dearly, why are so many them employed?”

I think that it is a good question, and one that I have puzzled over a lot. To their point:

A study of American workers released in March found that 44 percent of Americans reported they have worked for an abusive boss. This study was conducted by the Reed Group for the Employment Law Alliance.

They surveyed a representative sample of 1,000 American adults within the past two weeks, which resulted in interviews with 534 workers.

Things are even worse in some occupations, notably medicine. A longitudinal study of nearly 3,000 medical students from 16 medical schools was just published in The British Medical Journal. Erica Frank and her colleagues at the Emory Medical School found that 42 percent of seniors reported being harassed by fellow students, professors, physicians, or patients; 84 percent reported they had been belittled and 40 percent reported being both harassed and belittled.

The full report is here. Similarly, a 2003 study of 461 nurses published in the journal of Orthopaedic Nursing found that 91 percent had experienced verbal abuse in the past month. Physicians were the most frequent source of such nastiness, but it also came from patients and their families, fellow nurses, and supervisors.

The No Asshole Rule suggests a few reasons why there are so many.

1. In our society, we value winners so much that, even if they are jerks, we tolerate, or even glorify, them because — so long as they keep making money or winning games — we think they are worth the trouble. Exhibit one is Coach Bob Knight and his long tenure at Indiana University. The administration didn’t have the courage to get rid of him because he won so many games, despite a history of atrocious behavior.

See this story and the associated 1997 video clip: It sure looks to me like he is choking the player. Knight brags that he “did it my way,” but I don’t want people doing things that way in my organization, no matter how great they “perform.”

Continue reading “Why Are There so Many ___________s in Medicine??”

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Craig GarthwaiteTwo weeks ago, the Kellogg School of Management was privileged to host Joe Doyle, an outstanding economist from MIT.

In a broad research portfolio, Joe has focused on the effects from differing intensity of medical treatments.

This research is shattering some long held beliefs about the relationship between health spending and outcomes.

We think that Joe’s work is not known widely enough outside of the academic community, so we are using our blog to let you know what you have been missing and, in the process, perhaps change the way you think about healthcare spending.

It is well known that the U.S. far outspends other nations on healthcare, yet the outcomes for Americans (in terms of coarse aggregate measures such as life expectancy, infant mortality, and other dimensions) are quite average.

Of course, these outcomes are not the only things that we value in health care.

A lot of our spending is on drugs and medical services that improve our quality of life and won’t show up in these aggregate outcomes. For example, more effective pain management can decrease pain and improve quality of life – often with important economic benefits.

Despite this fact, most health policy analysts have concluded that we can cut back on health spending, without harming quality on any dimension.

This is not a new idea, of course. In a famous 1978 New England Journal article, Alain Enthoven coined the term “flat of the curve medicine” to describe how the U.S. had reached the point of diminishing returns in health spending. And for nearly 30 years the Dartmouth Atlas has documented how health spending dramatically varies across communities without any apparent correlation with outcomes.

The question has always been, what health spending to cut? Garthwaite’s previous work has shown that broad regulations requiring longer hospital stays for new mothers and their babies have provided only limited benefits and that more targeted rules could save money without sacrificing quality.

Beyond some wasteful regulations, we can always point to gross examples of overspending such as the rapid proliferation of proton beam treatments. But beyond those clear examples how can one identify what is waste and what is medically necessary?

In two important papers, Joe Doyle and co-authors ask a more fundamental question – is the often cited broad variation in health spending actually wasteful at all? They find that even in healthcare, there really is no such thing as a free lunch.

His work should be mandatory reading for everyone who believes that broad spending cuts will have no adverse consequences.

For those who lack the time to read these papers, we provide the “Cliff’s Notes” versions.

Continue reading “Is Higher Spending Truly Wasteful?”

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