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Health Care As Economic Engine?

Sep 30, 2011

By Evan Falchuk

Former Office of Management and Budget (OMB) Director Peter Orszag is sounding a pretty serious alarm about American health care expenses lately. In the current issue of Foreign Affairs, he writes:

“The Congressional Budget Office (CBO) projects that between now and 2050, Medicare, Medicaid, and other federal spending on health care will rise from 5.5 percent of GDP [gross domestic product] to more than 12 percent. … It is no exaggeration to say that the United States’ standing in the world depends on its success in constraining this health-care cost explosion; unless it does, the country will eventually face a severe fiscal crisis or a crippling inability to invest in other areas.”

Are health care costs going to cripple America’s economy? Or could the polar opposite be true – that they are they really the overlooked engine of job growth for America’s 21st-century economy?

Consider China, a country transitioning into a modern economy, led by manufacturing. Manufacturing as a percentage of the Chinese economy today dwarfs the percentage from even 20 years ago. At this rate, manufacturing by 2050 will have all but consumed the Chinese economy, crippling its ability to invest in other areas.

It’s not outrageous to say a parallel can be drawn here with American health care.

HealthVault as a Platform for Research Development

Sep 20, 2011• 2

By SEAN NOLAN

Greetings from Alaska flight 3, Reagan National to Seattle-Tacoma, seat 16C.

I’m on my way home after a great day at the Institute of Medicine’s Digital Learning Collaborative workshop. The overall goal behind the conversation was to identify core gaps and opportunities around creating feedback loops in the health system — how can we accelerate capturing learning about what works, and then integrate it back into general practice.

The room was full of smart folks and there were a ton of great observations, but the two themes that really stuck with me were:

It’s clear that to make real improvements we have to reach beyond the office visit and find ways to bridge between the “real lives” of citizens/consumers and the traditional healthcare world.
There is a ton of research and pilots running on either side of this bridge, but not a lot that reaches across it — and there is a perception that doing that work is really difficult.

Interestingly, not very long ago I was at the USENIX workshop on Health Security and Privacy*** — a very different conference (much longer hair than at IOM) — but exactly the same themes emerged from those sessions.

The Safety Net Is Working

Sep 17, 2011• 15

By Henry Aaron

Most of the newspaper coverage of the just-released Census Bureau data on health insurance coverage has focused changes in coverage between 2009 and 2010. Since the advent of the Great Recession, the reduction in health insurance coverage has been dominated by the simple fact that as unemployment has risen, since most families with prime-age earners receive health insurance as a fringe benefit of employment, the number of uninsured has risen. The increase was large from 2008 to 2009 when unemployment rose rapidly. From 2009 to 2010, when unemployment stabilized at high levels, the increase was smaller, although still disturbingly large.

If one looks back a bit farther, however, some noteworthy differences by age group emerge, as shown in the table. Health insurance coverage fell for all age groups but one from 2007 to 2010 and over the longer period starting with the boom year of 1999. That coverage would have fallen in both periods is unsurprising because, as noted, health insurance for most people is linked to employment and unemployment rose over both of those periods.

Ten Years Cancer-Free

Sep 16, 2011• 3

By benjamin rubenstein

I enter the large, dark room, approach the table in the middle, and lie face-down. I bury my head in a pillow and close my eyes. I hear the nurse exit and close the door behind her. The door locks, and the “Radiation” sign illuminates.

I hear the machine turn on and move, get in position, and hover over me. I fidget to get comfortable one last time, and then I do not move. I focus on my breathing and I focus on my muscles not twitching. The energy about to exit the machine over the next ten minutes—the amount in about 180 CT scans—will burn my skin, which is already tomato-red from the previous 24 sessions I’ve had. It will blaze through my intestines, muscles, nerves, and now-dead bone. Most importantly it will annihilate the cancer cells that I believe have already been dead for 11 months. Dead from the first of 14 cycles of chemo. Dead because I felt them burning alive, a pain I will never forget and a pain I wish I hadn’t taken Tylenol to mask.

Minutes later, the machine stops making noise. I hear the nurse open the massive steel door and say that radiation is over. I follow her into the lobby. She says she will miss me, hugs me, and gives me a Hershey’s bar. I am confident that I will never receive another milliliter of chemotherapy. I will never again lie motionless in front of a machine that shoots waves of destructive energy through me. I will never again be termed a “cancer patient”; be seen as the Sick Kid; have another nurse say she will miss me.

It is Friday, September 14, 2001, at 3:40 p.m.. I am a bone cancer survivor, age 17.

Health Exchanges — A New Approach

Sep 16, 2011• 7

By BILL KRAMER

Why don’t we think about the Exchanges as a place for people to choose their health care, not just their health insurance?

As the Exchanges are being designed, we have a great opportunity to rethink how to help people choose a physician for their care, but our current mindset may get in the way of developing innovative approaches.

Under the Affordable Care Act, each state is expected to establish “health benefit exchanges” for individuals and small employers in order to “facilitate the purchase of qualified health plans.” This is consistent with the concept of health insurance exchanges that has been developed over many decades. In this model – used by many large employers as well as existing exchanges such as CBIA’s Health Connections and the Massachusetts Health Connector – the individual consumer or employee is given a choice among several health insurers.

The consumers are given information about the quality, patient satisfaction, and provider networks of each insurer to help them choose the one that best meets their needs, and healthy competition among the health insurers is expected to drive improved value for consumers. The consumer makes this choice upon initial enrollment and annually thereafter. Once the consumer has chosen an insurer, the second step is to choose a provider from the list of providers with which the insurers has contracts. It is seen as a two-step process: (1) choose an insurer, and (2) choose a provider.Continue reading…

Urbanspoon Founder Gets Into Insurance

Sep 14, 2011• 6

By Adam Doppelt

Ever since I helped create Urbanspoon I’ve had a penchant for building software that’s easy to use, mildly provocative and fun. Those ingredients are a potent combination when mixed in the right proportions.

My most recent project is PickHealthInsurance, which helps consumers pick a health insurance plan. I released the first version yesterday and it quickly shot up to #1 on Hacker News, my favorite startup news site. It turns out that self-employed people everywhere are having trouble picking insurance.

How did a lowly software engineer like me end up sticking my nose into the insurance business?

A few weeks ago I realized my COBRA was about to run out. I’ve purchased individual health insurance before so I wasn’t completely terrified, though my memories were unpleasant. I started poking around online and quickly became frustrated. There are only a few options for buying insurance online and I find them clunky and dated.

The Primary Care Revolt

Sep 14, 2011• 19

By brian klepper

Last Thursday Anna Wilde Mathews of the Wall Street Journal ran an article detailing the activities surrounding primary care’s gradual awakening and mobilization. With Tom McGinty, Ms. Mathews authored a damning expose on the RUC last October that precipitated our efforts against CMS’ 20 year reliance on the AMA’s RVS Update Committee (RUC) for valuation of medical services.

There is the lawsuit by six Augusta, GA primary care physicians, spearheaded by Paul Fischer MD. (See his most recent article below). The suit claims that CMS’ and HHS’ longstanding primary relationship with the RUC has rendered that panel a “de facto” federal advisory committee. That would make it subject to the management and reporting rules of the Federal Advisory Committee Act – transparent proceedings, representative composition, scientifically valid methodologies – that attempt to ensure the public over the special interest. The fact that CMS has never required the RUC to adhere to those rules presumably means that the relationship is out of compliance with the law.

The American Academy of Family Physicians (AAFP), after declining to join the suit, issued a series of demands: more primary care seats, a sunsetting of rotating sub-specialty seats, a dedicated gerontology seat, seats for non-physicians like patients, purchasers and economists. The RUC has until March to respond. If they reject the demands, the question is whether the AAFP Board will vote to walk, as David Kibbe and I urged them to do when we began this campaign last January.

Say It Loud, I’m a Gimp and I’m Proud!

Sep 14, 2011• 2

By Marc Stecker

Apologies to James Brown for the title of this post, as his 1968 funk classic “Say It Loud, I’m Black and I’m Proud” (click here to listen) helped galvanize the civil rights movement in America, offering a joyous rallying cry to people who for far too long had suffered at the hands of racism and oppression. The song was not only a shout of protest, but an admonition to embrace the very thing that conferred minority status on an entire people and turn what for some had at one time been a mark of shame into a badge of honor. On top of all that, the song irresistibly generates the urge to get up and shake your groove thing. That is, of course, if you are able to get up at all.

Those of us whose disease has progressed to the point where shaking our groove things is a distant memory and has left us visibly disabled – reliant on canes, walkers, or wheelchairs – also find ourselves members of a minority group, the disabled, the inclusion in which leaves some feeling invisible, helpless, and diminished. Much of the world simply isn’t designed for people who don’t have full use of their limbs, and the fully functional folks who populate it can be insensitive, uncaring, ignorant, and sometimes even intolerant. Though much progress has been made in in the fight for the rights of the disabled, the struggle is closer its beginning than its end.

Throughout much of history, victims of chronic illness, particularly of the kind that deform or disable, have often been looked upon with scorn, as if getting sick was somehow a mark of shame, the afflicted somehow responsible for their own affliction.

Reverse Innovation & The Cost Crisis in American Healthcare

Sep 14, 2011• 4

By kent bottles, MD

The realization that the American health care system must simultaneously decrease per-capita cost and increase quality has created the opportunity for the United States to learn from low and middle-income countries. “Reverse innovation” describes the process whereby an inexpensive innovation is used first in countries with limited infrastructure and resources and then spreads to industrialized nations like the United States.

The traditional model of innovation has involved the creation of high end products by companies in industrialized nations and the spread of these products to the developing world by adapting them to function in low and middle-income countries. Reverse innovation reverses the direction of spread with the United States borrowing new ideas and products designed for less wealthy countries in order to deliver health care more efficiently. (1)

Resource challenged low and middle-income countries are different from the United States in at least six ways that can serve as catalysts for such reverse innovation: 1) affordability, 2) leapfrog technologies, 3) service ecosystems, 4) robust systems, 5) new applications, and 6) the absence of intermediaries. (2,3)

These nations can’t afford expensive goods so they have to find inexpensive materials or manufacturing options. They also lack 20th century infrastructure and so they have leapfrogged to newer technologies such as mobile phones or solar energy instead of landlines and petroleum based energy sources. Service ecosystems develop in developing countries because entrepreneurs have to rely on others for help by creating new partnerships like video-game cafés where gamers test new products. Emerging markets require products that work in rugged conditions, and customers in poor countries have few product choices, providing market openings for add-ons that update and extend the lives of existing merchandise. (2) Intermediaries such as venture capitalists, universities, and regulators are also often underdeveloped in poorer countries. (3)Continue reading…