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Dr. Watson I Presume

By JOHN MOORE

Little over a month ago, IBM and WellPoint announced an agreement wherein WellPoint will deploy IBM’s latest and greatest super computer and artificial intelligence mega-mind Watson. Watson’s claim to fame was its ability to beat the human Jeopardy champions much like Big Blue beat reigning chess champion Garry Kasparov in 1997. Since that Jeopardy match, IBM has been quite vocal about its desire to apply Watson in the medical arena, we’ve been buried in press releases and briefings, but the WellPoint announcement is the first one of any real consequence. Having interviewed both IBM and WellPoint, following is our review and assessment.

Background:
Watson is a relatively new form of artificial intelligence, based to some extent on neural networks. What is unique about Watson is that it has been developed (trained) to understand the nuances of language. It is a question & answer system that uses among other techniques, natural language processing, to extract meaning out of unstructured data. In developing Watson for the Jeopardy challenge, one of the key design parameters was for Watson to answer a question in under three seconds – plenty fast enough in a diagnosis/treatment decision scenario. This is a key reason why Watson may have enormous utility in the healthcare sector where so much data is unstructured, the pace of change is so high and the ability to chose the optimum treatment patient plan for a given diagnosis is less than ideal today.

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Why Doctors Don’t Like Electronic Health Records

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By RICHARD REECE, MD


Why are doctors so slow in implementing electronic health records (EHRs)?

The government has been trying to get doctors to use these systems for some time, but many physicians remain skeptical. In 2004, the Bush administration issued an executive order calling for a universal “interoperable health information” infrastructure and electronic health records for all Americans within 10 years.

And yet, in 2011, only a fraction of doctors use electronic patient records.

In an effort to change that, the Obama economic stimulus plan promised $27 billion in subsidies for health IT, including payments to doctors of $44,000 to $64,000 over five years if only they would use EHRs. The health IT industry has gathered at this multibillion-dollar trough, but it hasn’t had much more luck getting physicians to change their ways.

What is wrong with doctors that they cannot be persuaded to adopt these wondrous information systems? Everybody knows, after all, that the Internet and mobile apps, powered by Microsoft, Google, and Apple and spread by Facebook, Twitter, YouTube, and the iPhone and iPod, will improve care and cut costs by connecting everybody in real time and empowering health-care consumers.

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Why Do You Care Whether I’m Insured?

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By JOHN GOODMAN

If you care a great deal, I’ll give you an account number you can use to make a deposit.

[Note to Self: Send this Alert to the folks at Commonwealth. Also to Nancy Pelosi and Harry Reid. CC Uwe Reinhardt as well. You never know what they might do. They certainly talk about this topic a lot.]

While you’re thinking about the initial question, here are a few follow-up questions:

Do you care whether I have life insurance?

What about disability insurance?

Homeowner’s insurance?

Auto casualty?

Auto liability?

What about retirement insurance? (A pension or savings plan.)

Do you care whether I keep my money at an FDIC-insured institution?

Or whether I bought an extended warranty on my car?

Or whether I bought travel insurance before taking my scuba diving trip to Palau?  (It pays off if you get sick and can’t go.)

I’m sure there are busybodies who would like to run everyone else’s life. But society as a whole has taken a more rational approach. We basically don’t care whether people insure to protect their own assets (at least we don’t care enough to make them do so). But we do care about events that could create external costs for other people.

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Who Should Pay for EHRs?

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By MARGALIT GUR-ARIE

During the 2008 Presidential campaign, Candidate Obama promised an EHR for every American by 2014. The goal was to improve quality of care, reduce disparities and contain costs of health care. When the HITECH act became law in 2009, physicians found themselves under increased pressure to purchase an EHR. Many took action, went out and bought an EHR for their practice, and these are now well positioned to collect the financial incentives put forward by the HITECH act. Many more did not. EHRs are by and large a complex and expensive proposition and the HITECH incentives are not covering the average cost of purchasing and maintaining an EHR. In survey after survey, physicians consistently rank cost associated with EHRs as their top concern when considering transition from paper charts to electronic medical records. This is a bit disconcerting, since physicians have no problem buying other expensive tools and paying for human resources in their practices. How are EHRs any different?

There are three primary stakeholders in health care: those who receive care, those who provide care and those who manage the financial aspects of health care, and no, we are not getting into the quintessential argument of whether there should be only two primary stakeholders. There are several secondary stakeholders as well: those who manufacture medical goods, those who provide ancillary services and those engaged in medical research.

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The Ryan Health Care Proposal, Part II

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By ROBERT LASZEWSKI

In a speech at the Hoover Institution today, Representative Paul Ryan (R-WI) argued again that his proposal to reform Medicare, and now his tax credit proposal for replacing the Democratic health care law for those under-age 65, would guarantee to citizens “options like the ones members of Congress enjoy.”

His proposals would not give people the guarantees members of Congress, and all other federal employees for that matter, now enjoy.

This is not a small point.

Previously on this blog, I have argued that many of the defined contribution reform proposals, Ryan’s included, should be faulted for putting all of the future risk of health care costs on beneficiaries.

Ryan’s Medicare plan would create a premium support system for seniors. The premium support amount would increase each year by the rate of basic inflation, even though health care costs have historically increased much faster. Seniors would then take this premium support payment to the market and buy their own private health insurance policy. Another recent Medicare reform proposal by the health care industry would increase a similar health care premium support payment each year by the rate of increase in the gross domestic product (GDP) +1%.

In both cases, neither insurers nor health care providers would have any of the risk, and therefore responsibility, for keeping costs under control. The entire burden for the adequacy of these premium support payments would be with the beneficiary. If health care costs rose faster than these premium supports, tied to these indexes that have always trailed health care inflation, too bad for the beneficiary. Any excess cost is borne by the individual.

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Do Hospitals Cost-Shift?

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By DAVID DRANOVE

This blog continues my exploration of the great mysteries of health economics.

Northwestern University is one of Blue Cross of Illinois’ largest customers. Suppose that premiums for all BC plans are expected to increase by 10 percent, but NU is able to force Blue Cross to accept a 5 percent increase. Would you expect Blue Cross stick McDonalds with a 15 percent increase in order to cover the shortfall from NU?

I wouldn’t, for two reasons. First, McDonalds would probably threaten to take its insurance business elsewhere. Second, the scenario I have described is inconsistent with profit maximization by Blue Cross. After all, BC’s ability to stick McDonalds with a 15 percent increase surely does not depend on the price paid by NU. Any negotiator whose willingness to stick it to McDonalds is conditional on the price charged to NU is leaving money on the table and probably would have been fired a long time ago.

We might never expect BC to raise prices to some customers to make up for shortfalls from others, so why do we believe that hospitals do this all the time? It is impossible to discuss Medicare and Medicaid payments without someone invoking the mantra of cost-shifting. The theory of cost-shifting is deeply ingrained in the minds of healthcare decision makers and the policy implications of the theory are profound. Consider that if hospitals cost shift, then the burden of Medicaid cutbacks falls on privately insured patients, not on Medicaid patients and the hospitals that serve them. This calls into question whether the cutbacks will result in any savings for taxpayers and cause any harm to Medicaid beneficiaries. It also makes you wonder why hospitals that serve low income communities struggle to survive. Couldn’t they just cost-shift their way out of financial difficulty? A cost-shifting zealot would conclude that the managers of these hospitals are incompetent.Continue reading…

My Non-Linear Work Stream

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By JOHN HALAMKA, MD

In the era before Blackberrys, iPhones, instant messaging, social networks, and blogs,  I had a predictable day.

I could look at my week and count the meetings, lectures, phone calls, writing, and commuting I had to do.

Although my schedule was busy, I could schedule exercise time, family time, and creative time.

Today, I would not describe my work day as linear or predictable.   I do as much as I can, attending to every detail I remember, and hope that by the end of the week the trajectory is positive and the urgent issues are resolved.

Here’s what I mean.

Since there are no barriers to communication, everyone can communicate with everyone.   Every issue is escalated instantly.   Processes for decision making no longer involve thoughtful stepsthat enabled many problems to resolve themselves.     We’re working faster, but not necessary working smarter.   We’re doing a greater quantity of work but not necessarily a higher quality of work.

Everyone has a mobile device and their thoughts of the moment can be translated into a message or phone call, creating a work stream of what amounts to hundreds of “mini-meetings” every day.

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The Affordable Care Act Supreme Court Petitions: Issues And Implications

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By TIMOTHY JOST

Wednesday, September 28 was a busy day at the Supreme Court clerk’s office.

It had been widely expected that there would be a major pleading filed with the clerk in an Affordable Care Act challenge, as the response of the United States to a certiorari petition in the Sixth Circuit’s Thomas More case, which had upheld the ACA as constitutional, was due.  A cert. petition asks the Supreme Court to exercise its discretion to review the decision of a lower court, and the losing plaintiffs in Thomas More had requested the Supreme Court to reverse that decision and find that Congress had no authority under the Commerce Clause of the Constitution to adopt the ACA’s minimum coverage requirement.

The Justice Department did file a response in that case, but very late in the day.  Earlier in the day, to the surprise of most observers, three certiorari petitions were filed, asking the Court to review thedecision of the Eleventh Circuit Court of Appeals in the Florida case, which had held the minimum coverage requirement to be unconstitutional. The Eleventh Circuit upheld several other rulings of the lower court finding other parts of the ACA to be constitutional, and had reversed the decision of the lower court striking down the entire ACA as being not “severable” from the minimum coverage requirement.

Late in the morning on the 28th, the National Federation of Independent Business and two individuals, plaintiffs in the Eleventh Circuit case filed a cert. petition, asking the Supreme Court to reverse the decision of the Eleventh Circuit refusing to hold the entire ACA to be unconstitutional.  An hour or so later, the twenty-six states that are plaintiffs  in the Eleventh Circuit case filed their own cert. petition asking the Court to strike down the entire ACA, but also asking the court to reverse the appellate court’s decision upholding the constitutionality of the ACA’s Medicaid expansions and of the employer mandate as applied to the states.

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Mandate On Its Way To the Supreme Court?

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By ROGER COLLIER

It may have looked like a non-event, but it was a significant one.

Monday September 26 was the last day on which the Obama administration could ask the Eleventh Circuit Court of Appeals to reconsider its three-judge panel’s ruling that the Affordable Care Act’s individual mandate was unconstitutional. The fact that the Justice Department took no action almost certainly means that its intent is to ask the Supreme Court to decide the issue.

The administration’s thinking was most likely dependent on three factors. First, given that the full Eleventh Circuit is considered even more conservative than the three-judge panel that struck down the mandate, the only advantage of a second hearing would have been to delay consideration by the Supreme Court. Against this was presumably factored the political risk of a further well-publicized rejection of the mandate providing additional ammunition for opponents of reform.

Second, the administration may still be able to delay a Supreme Court decision either by filing its request for a hearing at the last possible moment in November, or even by asking for a filing extension—something that the Court might be willing to consider, given the potential impact of a decision in the middle of a presidential election.

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Top-Down vs. Bottom-Up

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By BOB WACHTER, MD

In my last post, I discussed the role of physicians in patient safety in the US and UK. Today, I’m going widen the lens to consider how the culture and structure of the two healthcare systems have influenced their safety efforts. What I’ve discovered since arriving in London in June has surprised me, and helped me understand what has and hasn’t worked in America.

Before I arrived here, I assumed that the UK had a major advantage when it came to improving patient safety and quality. After all, a single-payer system means less chaos and fragmentation—one payer, one regulator; no muss, no fuss. But this can be more curse than blessing, because it creates a tendency to favor top-down solutions that—as we keep learning in patient safety—simply don’t work very well.

To understand why, let’s start with a short riff on complexity, one of the hottest topics in healthcare policy.

Complexity R Us

Complexity theory is the branch of management thinking that holds that large organizations don’t operate like predictable and static machines, in which Inputs A and B predictably lead to Result C. Rather, organizations operate as “complex adaptive systems,” with unpredictability and non-linearity the rule, not the exception. It’s more Italy (without the wild parties) than Switzerland.

Complexity theory divides decisions and problems into three general categories: simple, complicated, and complex. Simple problems are ones in which the inputs and outputs are known; they can be managed by following a recipe or a set of rules. Baking a cake is a simple problem; so is choosing the right antibiotics to treat pneumonia. Complicated problems involve substantial uncertainties: the solutions may not be known, but they are potentially knowable.  An example is designing a rocket ship to fly to the moon—if you were working for NASA in 1962 and heard President Kennedy declare a moon landing as a national goal, you probably believed it was not going to be easy but, with enough brainpower and resources, it could be achieved. Finally, complex problems are often likened to raising a child. While we may have a general sense of what works, the actual formula for success is, alas, unknowable (if you’re not a parent, trust me on this).

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