To understand and effectively navigate the current healthcare debate, every U.S. CEO must now be a healthcare leader.
From the health, well being and productivity of employees and their families to the impact on a company’s bottom line, healthcare is a major business concern for everyone. Five consecutive years of double-digit health insurance premium increases have hit the business community hard.
If we don’t identify new efficiencies in the way we administer employee-based healthcare programs, the negative impact of these costs on businesses will only grow. Healthcare spending currently accounts for 18 percent of U.S. economic output. It could reach 34 percent by 2040, according to a June 2, 2009 report by the White House Council of Economic Advisers, if the current rate of cost growth continues.
To assume a leadership position, CEOs in all industries should help identify, champion and implement best practices in preventative healthcare. I agree wholeheartedly with the recommendation voiced by the leaders of the Center for American Progress, Service Employees International Union, and Wal-Mart in their June 30, 2009 letter to President Obama: “Not every business can make the same contribution, but everyone must make some contribution.”
One of the best and most efficient ways to help people to live healthier lives is to prevent diseases before they begin, or catch them in the early stages when they are easiest and least expensive to treat, saving billions of dollars in the process.
As an example, colorectal cancer (CRC), the nation’s second leading cancer killer of both women and men, costs more than $8.4 billion each year to treat and took the lives of almost 50,000 Americans last year.
Ninety percent of CRC cases are curable if detected early and treated appropriately, but only 39 percent of colorectal cancer cases are detected in the early stages. Although everyone over 50 is automatically at risk for CRC, only 57 percent of adults aged 50 years or older have ever had a colonoscopy or sigmoidoscopy, which are among the most effective tests for colorectal cancer, according to the CDC.
Some estimates indicate that if CRC screening rates were increased to 80 percent of the at-risk population – the current rate now seen with mammograms – CRC deaths could be cut in half. In order to help reduce our long-term healthcare costs, we must raise awareness levels for all screenings, whether for cancer, hypertension, diabetes, or high cholesterol, and help people gain access to the screenings they need. New ideas are crucial; for example, some dentists now offer patients opportunities to have their blood pressure screened.
And the payoffs from prevention efforts are real. At Olympus, where the company pays the total cost of wellness programs and the majority of healthcare plan costs, our average medical and pharmacy claims have increased over the past four years by an annual trend rate of only 1.4% – quite striking when compared to our benefits provider’s annual trend rate of 12%. We attribute this experience directly to our strong emphasis on preventative healthcare, combined with greater employee awareness about wellness overall and a desire to be better healthcare consumers.
Our nation’s healthcare problems are complex, but they can be solved with strong leadership and innovative ideas from businesses, governments and individuals. Every CEO has a responsibility to help educate the public about the importance of preventative healthcare and to help find best practices that will improve the quality and efficiency of the nation’s health.
Mark Gumz is the President and CEO of Olympus Corporation of the Americas.
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Dr. Weinstein, I do understand the economies of large numbers and I am not insane enough (or liberal enough :-)) to suggest spending billions per year of life saved, unless of course it’s the life of one of my kids.
I do agree with you, and Dr. Motew if that’s what he meant, that screening and subsequent treatment of disease is not going to provide us with cost reductions. I think Deron is absolutely right in that prevention has a much better chance of bending the cost curve, albeit very slowly.
I just don’t think that we should look for cost reductions in areas such as screening (certain screenings, at least). Most established ones, such as mammograms and colonoscopies, are, in my opinion, money well spent. It may turn out that cost to society would be smaller if we did not screen anybody, but “effectiveness” would be zero, rendering cost/effectiveness infinite.
Whatever the OPs motives for this article, I think we have more obvious places to look at for cost reductions, other than colonoscopies. There is plenty of fat to remove before we are forced to apply the “R” word and cut into the muscle.
You wrote, “”Prevention of death does not necessarily translate to cost effectiveness.”
I don’t quite understand the meaning of this statement.””
The basic issue is how much should society be willing to pay to save a life. If we could prolong the life of someone at a cost of 100 billion dollars per day, most sane individuals would quickly recignize that it is not “cost effective”, ie we have better uses for our health care dollar. Why save one life with that money if we could save 10,000? We live in a world of finite resources and (seemingly) infinite demand for those resources. Cost effectiveness is another way of saying we need to prioritize how we spend our precious and limited resources. I would use the “R” word but people don’t like that word.
I could come up with a screening protocol for a given disease but if it winds up costing $50 million for every adverse event avoided, it will not (and should not) be adopted because it is not “cost effective”. The argument has been made (wrongly, I believe) that much of health care reform can be paid for by the savings that would accrue from more complete use of various screening studies (mammograms, colonoscopies, etc) and the treatment of certain diseases (hypertension, dyslipidemia, etc) because it will reduce the incidence of much more expensive disease states (stroke, stage III breast cancer, etc) later on. I believe that Dr. Motew was simply pointing out (correctly, in my view) that though a particular screening study may successfully reduce mortality it does not necessarily follow that it is a good screening study and it certainly doesn’t follow that it is a money saver for society (implied by the OP).
And just so you know, the generally accepted threshold for a treatment is 50k-100k per year of life saved. Any therapy that costs less than $50,000 per year of life saved is considered a bargain and any therapy that costs over $100,000 per year of life saved will be looked at askance.
Mr. Gumz – You could have at least picked a prevention measure not linked to your company’s bottom line. This blog should not be a marketing tool.
Dr. Weinstein – Agreed about the lifestyle changes. That is the most effective reform of all, but it is not politically popular to address. It must be addressed at the community level, and I am currently working on an initiative in my local area. It’s not easy, but it is very necessary.
Margalit – There is an important role that industry can play. The workplace is already a destination for 92% of us. If initiatives can be put in place to promote healthy lifestyles, everyone can win.
“Prevention of death does not necessarily translate to cost effectiveness.”
I don’t quite understand the meaning of this statement.
Along the same lines, one can make the argument that, globally, medical care in itself does not translate to cost effectiveness. It is much more cost effective to not screen, diagnose or treat any major disease, and just let people die “comfortably” with the aid of some cheap pain killers.
Of course, that begs the question of what “effectiveness” really means, since it does not seem to constrain the “cost” reduction in your argument.
Your second argument is in contradiction to this “cost effectiveness (removed from longevity)” argument. It would be much more “cost effective” for industry, in order to “keep the lines running”, to just get rid of the “unhealthy cohort of workers” and hire fresh healthy ones, instead of spending money on wellness.
I think people are perfectly willing to pay a price for medical care (not removed from longevity), and they are paying every dime of it through taxes and reduced wages.
I don’t think American people will be content to be treated like beasts of burden by “industry”, which, in my opinion has no business in being in the health care business.
I DO think that cost effectiveness should be brought into account when trying to reform health care, but the word “effectiveness” cannot be removed from the equation as easily as you suggest.
I support both Dr’s Motew and Weinstein. The efficacy of any given screening test depends on several factors including the prevalence of the screened-for disease in the subject population, the accuracy of the test (meaning is a “positive” a true or false positive, and is a “negative” a true or false negative), and any harm caused by those false positives or negatives, which occur in any test. For instance, in colonoscopy there is a small but measurable incidence of missing a cancer through poor bowel preparation or technical difficulties.
Again as already noted, comparative effectiveness research is critical to evaluate screening tests, one against the other, or screening vs. no screening, or screening only a certain part of the population who is at high risk.
I also think people who write posts for this blog should be required to report potential conflicts of interest at the bottom of their posts, as most medical journals now require of their authors. I didn’t look up Olympus Corporation, but Dr. Motew was smart enough to do so.
There is BOTH individual prevention (individual behaviors including screenings) and institutional prevention(pubic health)
Both are important. But probably public health has a bigger payback.
Dr. Rick Lippin
Just a note supporting every point Dr. Motew made. Routine colonoscopy certainly saves lives but it is unclear (and Mr. Munz presents no evidence) that it saves money. The same can be said for most all screening procedures. Good medical care saves lives and improves the quality of life but it is not cheap. Any health care reform that relies on the cost savings of preventative medicine should be viewed very skeptically. The real bang for the buck in cost savings comes with life style changes; smoking, obesity, sedentary life. Much harder to mandate changes in that though.
Support for screening from the CEO of an endoscope company which holds 70% market share?….What a surprise..certainly no conflict of interest here.
1. Prevention of death does not necessarily translate to cost effectiveness.
2. Screening is not always equatable to prevention.
3. Comparative effectiveness data is needed to show significant cost benefit (removed from longevity) from screening.
I DO however wholeheartedly agree that industry can take the forefront in prevention. If they are paying for insurance and rely on wellness to keep the lines running, I feel they have a right to ‘impose’ preventive medicine directives, even as far as monetarily penalizing risky behavior with increased rates ie smokers, obese, sedentary. This must be globally implemented to prevent job-migration/competition..but then again which company would actually want an unhealthy cohort of workers?