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Month: October 2005

TECH: Just a little more about the PHR

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You can skip this one if you’re bored but the Personal Health Record and associated stuff just won’t quite go away. I’ve not only got a tawdry past associated with the PHR/CHR, and have spent far too long thinking about it, but I’ve also fooled myself into creating a paper for a forthcoming academic presentation on the subject–which will be an archeology of the attempt by commercial vendors to get the PHR up and running.

Now USA Today has a piece on PHRs which goes onto talk about yet another new one (Mymedicalrecords.com) which is basically a "fax paper in vault" which looks exactly like half of the ones that came out in 1999, such as PersonalMD.com.  And BTW their technology was backwards even for then! So it look as to me as though USA Today has been a little bit snowed.

So let me give you my four categories of PHR

1) The PHR that is looking into a real EMR.  See the version that PAMF or Group Health of Puget Sound uses based on their Epic system.

2) The PHR that looks into the claims database of an insurer and changes the view of the CRM system the patient sees.  This is the one that I was selling back in the day, and that WebMD via its Wellmed purchase is now just offering to plans, and has had Empire launch (and Wellpoint announce it will be launching). The recent IBM announcement is in this vein, although I doubt any American trust their employer enough for that to be a success. (see yesterday’s 60 Minutes as to why)

3) A PHR that allows a patient to look into their doctor’s system if they have one, or not. RelayHealth has a version of this, and Medem’s iHealthrecord is able to look into Allscripts EMR (and theoretically a bunch of others too). This is the ultimate answer for most of America (or some version of it) but it’s dependent on using physicians as a distribution channel to patients and that’s a bit of nightmare.

4) A standalone device like Quicken, that may in some way be able to take in some portion or version of the EMR from providers. This is the route Capmed is going, and where RedMedic, MymedicalRecords, et al are heading.  I remain very, very skeptical about this — particularly their attempts to make consumers pay for it — but to be fair that’s what MedicAlert does and plenty of people are buying that bracelet.

Of course if you want to get everyone using one of these PHRs you’d be better off putting your whole state or national insurance system into it, as the Germans are doing.

Meanwhile, back in the UK, they are trying to get their related Choose and Book system up and running. This is a referral and appointment system between GPs and hospital specialists. (Note that in the UK there is very little patient self-referral). The answer seems to be that it is slowly beginning to work (in some places) and that it is increasing the role of the patient in choosing who they are referred to. (A choice which didn’t really exist before). Meanwhile, this article focuses on the early adopter the Whittington hospital, in North London, using Choose and Book. Of course The Whittington has always been ahead of the game introducing new and amazing things to the world. Yup, I was born there!

CODA: The USA Today piece horribly misquotes Mark Bard as saying that DrKoop.com had this PHR idea back in 2001 but never really got it going. DrKoop.com had this PHR idea before it was up and running in 1998, but couldn’t get it right and took the easier route of instead being a web health content portal. It never got the PHR thing into any level of production and having been an Internet star in 1999, it was on the famous March 2000 Barron’s list of companies that were losing too much money to survive (the article that helped start the dotcom crash). By 2001 it was basically going under. At least I hope Mark is being mis-quoted!

HOSPITALS: Friday Night Update by John Pluenneke

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When the going gets tough, the tough form a 501(c)(3) tax-exempt non-profit organization.

HealthSouth Corp. founder Richard Scrushy has formed a nonprofit group focusing on churches and religious charities. Richard and Leslie Scrushy Ministries was incorporated in Jefferson County last month.Records list the charity as being based at 2310 Marin Drive, the private company housed on the Scrushy estate in Vestavia Hills.

SAT MORN. CODA: In New Jersey, a poll this week shows Republican Doug Forrester trailing Democrat Jon Corzine by about 10 points in the race for the Governor’s job. That’s a bit of surprise for some people, as analysts had thought the Republicans had a real chance in the state thanks to local disgust over a series of scandals involving corrupt Democrats. Forrester is a PBM man and a part owner of a privately-held benefits company called BeneCard, which is apparently currently having some problems of its own.  Interestingly, in a state where the pharma industry plays a major economic and political role, Corzine has played the pharma card hard – running attack ads which criticize his opponent’s link to the drug industry. This is not a good sign for the GOP …

POLICY/POLITICS/TECH/HEALTH PLANS: Trown out in the trash

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Politically this has been quite a week. Don’t you think that John Kerry just wishes that we had five year Presidential terms and that he was going into the election this November, rather than a year ago? This week even the great flip-flopper himself came out with a plan as to how to get our troops out of Iraq. Pity he laid off all the attacks till the election was over (and same with Al Gore too!). Bush keeps ranting on about final victory in Iraq as if he had any idea what the hell he was talking about, and that he hadn’t declared Mission Accomplished two years ago. Now he finds that most of the cabal running the country’s foreign policy for the past 4 years are on their way to disgrace and/or jail, and that his incompetence in choosing a secret wingnut instead of a well-known one for the O’Connor seat on SCOTUS has lost him (at least temporarily) the support of the loony right.

What has any of this got to do with health care?

Well as they say on The West Wing, there are a couple of stories sitting in my backlog that I want to throw out in the trash. First BusinessWeek had a profile of David Brailer, stressing that he honestly believes that there’s a free-market solution to interoperability in our current health care system. Well he’s even lost Neal Patterson on that one (and yup last year Patterson spent a fortune failing to get his wife elected to the House as a Republican). Meanwhile, another leading health care IT exec who wants to get himself elected to Senate as a Republican (Rich Tarrant of IDX) is sounding somewhat like a commie in his support for Medicare and Medicaid. (Hat-tip Don McCane) Finally there was an extraordinary long interview in the New York Times with the founders of AFLAC (itself a pretty useless insurance product) in which they showed that you can make a duck famous while having absolutely no idea about how to fix the US health care system, even if you vaguely understand the problem.

All of this leads me to believe that the business class that runs the country is somehow getting around to this problem, and that they might not object to it being solved. If the Administration’s problems continue to pile on for all the crimes and cock-ups they’ve caused us in the last five years, then next October we might, just might, get a change in the Congress and put us on the road to a Democrat in the White House in 2009. If that happens (and I know this is all speculation) then health care will have to be the first issue on the domestic burner — which is a little sooner than I’d predicted. All pure speculation just now, but this week might be the turning point.

PHARMA/POLICY: The status quo versus the NHIN

Here’s my FierceHealthcare editorial this morning:

In a little over a week from now, there’s a special election in California with several propositions on the ballot–mostly to do with the political future of Arnold Schwarzenegger. But the two initiatives to do with drug pricing (Props 78 and 79) have seen an out pouring of money, almost all of it from drug companies. Their "Yes on 78, No on 79" commercials have plastered the airwaves, and the non-partisan Healthvote.org shows that by September 29 (i.e. not counting the last 10 days of campaigning) Big Pharma had donated nearly $80m for the joint campaigns, versus less than $2m spent by their opponents in favor of Prop 79.

The pluses or minuses of two propositions in one state are not the point of this editorial. The point is that a powerful piece of the status quo (Big Pharma) is prepared to spend so much to defend itself against what some might argue is a relatively minor attack on their pricing policy in only one state. The logical conclusion is that real reform of our health system, which will by definition require changes to the economics of physicians, hospitals and insurance companies, will meet even more vigorous resistance in defense of the status quo. Optimists who believe that the development of a National Health Information Network will cure healthcare’s problems might do well to note that the amount provided by Congress for that initiative to change the entire health IT system is only a fraction more than the amount Big Pharma’s rustled up for its single issue campaign in California.

HOSPITALS: The specialty hospital party looks like it’s over

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Specialty hospitals have made quite a few docs a very tidy penny, (for instance see this debate from the medical hotspot of South Dakota) and there’s been plenty of propaganda from both sides of this debate. But my sense is that the party really is about to end here. Wednesday saw two signal events that confirm my thoughts.

First, an apparently definitive (not that these things are ever definitive in the world of spin that we live in) study from Jean Mitchell in Health Affairs seems to show that the big community hospitals were right all along. Specialty hospitals have been skimming off the healthier wealthier patients, charging Medicare and insurers the most they could and leaving the community hospitals holding the bag. The AHA and its lackeys in Congress have been all over this, hence the moratorium on specialty hospital construction and the soon-to-come reframing of how specialty hospitals get paid (and it won’t be more!).

Now even more confirmation of problems at the biggest kahuna in the specialty hospital pack as MedCath, which had some problems in the past but had seen its stock double over the past year or so, carelessly loses its CEO within 3 weeks of him taking over. Oh and earnings are down and going further down. Now I’m sure this all the fault of the hurricane and they’re not alone–have you seen Tenet’s stock price lately? But clearly things are not going well.

Of course, Medcath has data (represented by its lackeys independent consultants from Lewin) in the same Health Affairs that claims that Mitchell’s methodology is inaccurate, in that she mistakes who is really "owning" these specialty hospitals, and underplays the role of HMOs in shutting out these specialty hospitals from their networks. But they basically say that as doctors are "entrepreneurial" and then say that "we note that physicians’ demands for more clinical autonomy and control over their incomes will not go away if specialty hospitals are ‘banned.’ " In other words, give ’em any fee schedule, rules, organization, whatever, they’re going to find their way around it.

Of course the only way to really fix this is to put the incentives of the payer/insurer and the providers in the same place rather than opposing each other. If Kaiser Permanente had a specialty hospital, then you’d assume they’d figured out that it made financial and medical sense for their entire system. (And I don’t think they do have one). Obviously improved efficiencies are a good thing, but outside out of the pre-paid integrated sector, most of the health care system is engaged in a series of payment games based on figuring out how to stay ahead of the obscure payment code.

So the solution as ever (and I think Medicare is getting there very slowly) is to change the payment rules.  But even that won’t be perfect. But for now, I suspect that the specialty hospital will find itself forgtten in the same health care attic as the physician-owned home infusion center, soon to be joined by the multi-millionaire oncologist.

PHARMA: Lowe on Pfizer

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Derek Lowe thinks that for Pfizer, The Tar Pit Beckons. That would be Tar Pit as in La Brea, where dinosaurs got stuck.

Interesting post and some interesting discussion in the comments about why Pfizer is or isn’t going to be like a utility stock down the road. Those of you who want to know more aobut valuations and strategy in the pharma world could do worse than read it!

POLICY: Wal-Mart caught with hand in cookie jar — affixs grin, and says “Look over there!”

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So just two days ago, Wal-Mart, which as I’ve pointed out in THCB before, has never really been serious about offering health benefits to its workers given that it makes higher profit margins when it doesn’t, apparently had a change of heart. The change of heart involved giving basically minimum wage the chance to pour their huge amount of extra savings into an HSA, and also to get health insurance (without a maximum benefits cap of a massive $25,000) after only one year of employment — ignoring the fact that Walmart deliberately has some of the highest turnover rates of any large corporation. But while Don McCane from the single payer crowd was not impressed, at least one usually non-free market loony blogger was somewhat convinced. (Note the somewhat jaded comment on Joe’s post from yours truly, in which I said that he was an optimist).

Why was he an optimist?  Because any large or small employer that depends on a low income workforce will do better financially by letting that workforce turn-over quickly and keeping their benefits as low as possible. The Costcos and Starbucks are exceptions and their margins suffer in comparison. Of course when you’re talking about health benefits, you’d also do well to try to get your employee population to be younger and healthier than average, or else America’s former largest employer may be your future model. (as Uwe says, GM is an insurance company that builds cars to defray its health care  expenses). So what did you really expect from the Beast of Bentonville.

Well of course it doesn’t take long to realize that Wal-Mart can’t help but trip over its feet in the PR department, event though it’s barely out of the glow of the minuscule positive spin it was getting. The NY Times gets its hands on the memo that tells the reality: Wal-Mart Memo Suggests Ways to Cut Employee Benefit Costs. What’s the rationale?  Get the unhealthy employees out of there, and also eighty-six the ones that stick around and might collect those benefits. And of course hire McKinsey to tell you about that strategy, because you really need $700 an hour consultants to tell you how to reduce your health care costs using those techniques!

In some ways I have a smidgen of sympathy for Wal-Mart. After all they weren’t even around when the ridiculous employer-based system was created. But it’s only a smidgen. Given that employment based insurance is  what we’ve got, and given that Wal-Mart is one of the planet’s most profitable companies, it could easily take the high road. Alternatively, it  could easily use its political muscle to push for genuine universal health insurance in which everyone (including big corporations) pays a fair share. Instead it just wants to get out of any notion of responsibility, and dump everything on some one else–usually its employees and the taxpayer.

And apparently it’s a family trait.

BLOGS: Dilbert’s creator on blogging

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Scott Adams wrote this in his newsletter:

People who are trying to decide whether to create a blog or not go through a thought process much like this:

  1. The world sure needs more of ME.
  2. Maybe I’ll shout more often so that people nearby can experience the joy of knowing my thoughts.
  3. No, wait, shouting looks too crazy.
  4. I know – I’ll write down my daily thoughts and badger people to read them.
  5. If only there was a description for this process that doesn’t involve the words egomaniac or unnecessary.
  6. What? It’s called a blog? I’m there!

The blogger’s philosophy goes something like this:

Everything that I think about is more fascinating than the crap in your head.

The beauty of blogging, as compared to writing a book, is that no editor will be interfering with my random spelling and grammar, my complete disregard for the facts, and my wandering sentences that seem to go on and on and never end so that you feel like you need to take a breath and clear your head before you can even consider making it to the end of the sentence that probably didn’t need to be written anyhoo.

The Dilbert blog is here

POLICY: NY Times opinion on Medicaid

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Shorter NY Times opinion on Florida Medicaid: It’s so screwed up that screwing it over more can’t make it any worse, and really Florida Republicans are deserving of our trust, as they’ve proved their fairness to their poorer and darker-skinned citizens so often in their history (as in the 2000 election).

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