Bringing the Prius into American Medicine

6a00d8341c909d53ef0115702ff0f9970b-pi President Obama has repeatedly promised
that providing every American affordable access to quality health care
won't cost more money than we'll save through reform, but he's recently
raised the stakes even further. Health care reform, he has said, would
"foster economic growth" and "unleash America's economic potential."

Is that realistic?

I
understand why critics are skeptical. After all, if you'd asked U.S.
automakers several years ago what the chances were that someone could
produce a snazzy family sedan averaging 50 miles per gallon, they would
have been dismissive, too. Yet while the establishment scoffed, Toyota
rolled out the Prius.

The poster child for the Prius
equivalent in health care-high quality, reasonable cost, satisfactory
personal experience–is the Mayo Clinic. But we can't rely on
franchising Mayo to remake American medicine. If you spend time with
those working in the trenches of genuine health care transformation,
you'll see hopeful signs you might miss just looking out the window in
Washington.

Researchers believe there is 30 percent "quality
waste" in U.S. health care; that is, unnecessary costs due to care that
is inappropriate, inefficient or unsafe. As it happens, the first
hospital executive I ever heard use that figure to describe savings
he'd personally seen at his own institution works on a much more modest
scale than Mayo.

Lowell Kruse is about to retire after 25
years as CEO of St. Joseph, Missouri-based Heartland Health. Seven
years after I listened to him describe what his team had done to
improve care and cut costs, he's still sticking by his earlier estimate
of the waste that's there for taking. "It's not easy to get at, not
easy at all," he cautioned in a phone call. "There's a whole bevy of
things lined up against it, but it's there." 

Kruse might
have added that you don't have to run a large, rich, academic health
system in order to be successful at trimming costs while improving
quality. You just have to build the kind of culture that believes
preventing heart disease is just as important as providing superior
care to those who end up needing cardiac surgery. You have to build a
culture that relentlessly attacks broken business processes; for
example, standardizing a confusing welter of surgical supplies. And, of
course, your physicians and employees have to regard these activities
and countless others as a benefit to patients rather than a threat to
profits.

Heartland may not be a household name, but its
medical center ranks as one of the top 20 in the country (out of about
5,000 hospitals) on a series of Medicare quality and safety measures.
Heartland has also accumulated a slew of awards, and it recently hosted
a group of British visitors wanting to import some of its Show-Me State
wisdom.

Nor is Heartland an isolated example. In Appleton,
Wisconsin, Dr. John Toussaint insists that "quality waste" adds up to a
stunning 40 to 50 percent of costs. Until recently Toussaint ran
ThedaCare, whose systematic efforts to improve care and lower costs
were profiled in a case study by Harvard Business School superstar
expert Michael Porter.

Porter and heavy hitters like
former Treasury Secretary Paul O'Neill serve on the board of
Toussaint's new ThedaCare Center for Healthcare Value, which is
organizing a national coalition of other providers with a similar
approach. Think of it as a cooperative to take the basic "Prius
Medicine" platform and refine the details.

More broadly,
these types of initiatives are critical to demonstrating that the
rhetoric of health system transformation makes sense in reality. For
example, experience shows that widespread use of information
technology, a focus of the Obama effort, has the greatest impact when
applied by clinicians and managers in support of specific cost and
quality improvements.

Accountability and transparency, two
other pillars of reform, produce the best results when incorporated
into routine clinical and business decisions. And it's not coincidental
that everyone from physicians to the cleaning crew at places like
Heartland and ThedaCare make constant references to "lean production"
and other kaizen (continuous improvement) terms adapted from none other than Toyota.

As
everyone agrees, the stakes involved in health care reform are critical
to U.S. economic health. If we can slash the $2.4 trillion spent on
health care by anywhere close to 30 percent, the $720 billion saved
each year would have a profound effect on our ability to rebuild roads,
invest in schools and restore our global competitiveness. Together,
these are critical components of realizing America's economic potential.

Although
the Congressional Budget Office is not allowed to "score" these
potential savings when evaluating legislation, achieving even a
fraction of what is possible would pay for the $1 trillion to $2
trillion estimated 10-year cost of universal coverage.

Leaders
like Kruse, Toussaint and others have shown they can give their
communities care that's safer, more affordable and more reliable. The
question is whether Congress will address the misaligned incentives and
other obstacles standing in the way of making a Prius-equivalent the
new standard of American medicine.

Michael Millenson is a frequent contributor to THCB and also a contributor Kasier Health News,  where this post first appeared.

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7 replies »

  1. None of what Obama or others propose as methods for financing health care even begin to deal with the fundamental issue constraining public sector finance.
    Namely, America does not control its currency. We pay interest on money that the Government could create just as easily as it is being created by private banks controlled by the Federal Reserve.
    Were it not for this FACT, America could have all the funding it needs for public sector programs.
    Now, however, any such opportunity is rapidly fading from the realm of possibility because Obama has traded America’s sovereignty for Global One World Banking.
    An analysis by Ellen H. Brown reveals the extent of Obama’s foreiture of our sovereignty, in, “BIG BROTHER IN BASEL: ARE WE TRADING OUR NATIONAL SOVEREIGNTY FOR FINANCIAL STABILITY?” http://www.webofdebt.com/articles/big_brother_basel.php
    This excerpt should spur you to further reading and action on this critical issue of how we finance America not just health care.
    “Political colonialism is now a thing of the past, but under the new (G-20) FSB guidelines, nations can still be held in feudalistic subservience to foreign masters. Consider this scenario: XYZ country, which has been getting along very well financially, discloses that its national currency is being printed by the government directly.
    The Financial Stability Board (FSB) determines that this practice represents an impermissible “merging of the public and private sectors” and is an unsound banking practice forbidden under the “12 Key International Standards and Codes,” (Obama agreed to these in April of this year.
    Banker-created national currency is declared to be the standard “good practice” all governments must follow. XYZ is compelled to abandon the “anachronistic” notion that creating its own national currency is a proper “function of government.” It must now borrow from the international bankers, trapping it in the bankers’ compound-interest debt web.”
    “Consider another scenario: Like in the American colonies, the new FSB rules precipitate a global depression the likes of which have never before been seen. XYZ country wakes up to the fact that all of this is unnecessary – that it could be creating its own money, freeing itself from the debt trap, rather than borrowing from bankers who create money on computer screens and charge interest for the privilege of borrowing it.
    But this realization comes too late: the boot (The International Bank of Settlements) descends and XYZ is crushed into line. National sovereignty has been abdicated to a private committee, with no say by the voters.”
    Ellen H. Brown, “BIG BROTHER IN BASEL:
    BIS FINANCIAL STABILITY BOARD UNDERMINES NATIONAL SOVEREIGNTY”
    http://www.webofdebt.com/articles/big_brother_basel.php
    Within the next four years this will be America’s reality, simply because we the people have not the courage and fear to take action or care about the future for our children and grandchildren. The future for Americans is healthcare if you are rich, wrenching morbidities, premature death, and taxation without relief for the 99% of us who are and will be debt slaves.

  2. It is absolutely TRUE. I have been saying this – now I feel – forever. I wrote several times on my blogs also that healthcare crisis will pale the financial if not addressed. The challenge with it would be that it wont be that quickly possible to turn it around.
    It is tied to
    national security
    economic security
    global competitiveness
    and much more…
    rgds
    ravi
    blogs.biproinc.com/healthcare
    http://www.biproinc.com

  3. I don’t get the Prius comparison, either. In part because of its high cost, it has limited appeal. If you need a car analogy, what the U.S. health care system needs is the equivalent of the Ford Taurus of the 80s and 90s — low cost to manufacture, reliable, popular — nothing flashy but providing all the basics. But the system needs the flexibility that if people have the means to get Prius or Ferrari health care, they can choose to do so.

  4. Does any one have ideas for revising the incentives so that all those feeding at the trough now are not at the bottom of the food chain?

  5. I don’t see the Prius and Mayo comparison really but a good piece nevertheless. Millenson is one of my favorite frequent commentators on here.

  6. Dear Michael: Thanks for writing about this, and especially for mentioning the Thedacare folks. It’s about time that physicians of all specialties began to organize for voluntary improvement in health care quality and cost, in a manner that the market for these services can identify and respond to.
    Kind regards, DCK

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