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Matthew Holt


We asked THCB contributor Maggie Mahar for her quick take on the health care policies of each of the presidential candidates. We were pretty much expecting one of Maggie’s trademarked dissertations – a meticulously researched critique of each politician’s views on various important substantive issues. Instead this entertaining reply turned up in our email inbox.

“If Clinton wins we have real national health care reform.

If Obama wins, I’m not so sure, given that Cutler thinks we’re getting value for our dollars, and healthcare doesn’t seem to be a big priority for Obama (although his plan seems a lot like hers).

If McCain wins, we all move to Canada. Northern Canada, where will not only have healthcare, but may be able to avoid the fall-out from the nuclear war that he starts.”

McCain Would Increase Medicare Part D Premiums

Oie_399px_john_mccain_mackinac_islaAs part of his broader speech on economic issues John McCain last week called for high income seniors to pay more for their  D drug coverage. Couples making more than $160,000 a year would pay higher premiums.

This is a good idea and a down payment on something I believe is ultimately unavoidable– means testing for entitlement programs.

It isn’t news that the cost of senior programs –Medicare, Social Security, and Medicaid–are not sustainable. The current federal cost for these three programs now tops $27,000 a year for each senior over the age of 65. That number increased 24% since 2000– after adjusting for inflation.

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Millennial Health Care Delivery

Millennial (adj.)

1. Of or pertaining to the millennium, or to a thousand years
2. Generation of Americans younger than 29 in 2007 with unique social, cultural, and market identity

The highlight of last month’s Health 2.0 conference was the segment in which three enterprising physicians discussed their next-generation practice models. We heard from Enoch Choi, MD at Palo Alto Clinic who has a traditional, but technology enabled practice; Jordan Shlain, MD of San Francisco On Call which provides a cash only mobile practice; and from Jay Parkinson, MD who has attained the most notoriety through his unique approach, clinical skill set, and artistic flair. These services are representative of a growing number of similar practices that serve as an example of another important concept to consider in preparing for next generation health care. Millenial patients will demand a new range of services, many of which currently do not exist within the current medico-industrial insurance construct. In fact, the provision of niche services which have traditionally fallen outside the concept of traditional health care may prove to be the biggest opportunity to impact care delivery.

This conceptual framework can be understood within the technology description of The Long Tail. First described in the popular press by Wired Magazine Editor Chris Anderson in 2004, it is basically descriptive of unique markets wherein distribution and storage costs approach zero and therefore the provision of small numbers of less popular items actually is more profitable than the provisions of large number of popular items. The math works out as such that the area under the “long tail” part of the curve is as big or bigger than the area under the curve to the left. This long tail represents all the niche, specialty offerings that can be purchased so that when aggregated, the niche market opportunity is bigger than the mainstream.

The anatomy of the long tail shows that most patients consume a relatively small number of core health care related services. These have been provided in a prescribed way for decades and have address most basic health care needs. However, as science and technology advance, there have been, and will continue to be new, more efficient, and hopefully effective treatment options. Over time these new therapeutic options themselves become more personalized and specialized in order to address the needs of niche target populations. The number of personalized services will ultimately outstrip the traditional health care service offerings.


But niche products are not for everyone. Most people have gotten and can continue to get traditional health care services. However, newer technologies that create new value propositions might fill an entire set of health care needs just as well, or perhaps even better. The personalization of medical services allows them to be consumed “wherever the consumer is” along the health care delivery continuum based on their unique value equation. So while not everyone will want to speak live with a physician for $1.99/minute, there are certainly some who will, and they can be recruiting into the next generation health care system via health care delivery offers that occurs within the long tail of healthcare.


Scott Shreeve is a physician and entrepeneur based in Laguna Beach, California. After a long career in medicine, Scott founded the open source electronic medical record company MedSphere. He currently serves as entrepreneur in residence at Lemhi Ventures. If you enjoyed this piece you may also enjoy his earlier piece examining the potential impact of Long Tail economic theory on the healthcare industry. Scott is a frequent contributor to both THCB and the Health 2.0 Blog.

Around the Web in 60 Seconds (Or less)

GOTHAMIST: "Mayor Bloomberg may have failed with his plan to ease New York City congestion, but at least he can claim victory when it comes to New Yorkers’ digestion. Judge Says Open Wide for Food Calorie Info.

US NEWS: Election ’08 – Whom the Candidates Listen to on Healthcare.

NEJM: Boston Children’s Mandl and Kohane argue the personal health records systems under development at Google and Microsoft pose challenges. "I’m a great believer in patient autonomy in general, but there is going to have to be some measure of limited paternalism."

Microsoft’s Neupert to NYT: "I can imagine a scenario where we have a third party verify that our
system works the way we assert it does. 

THE NATION: White House joins San Francisco restaurant association’s appeal of Newsom health plan.

ALBERTA: Provincial authorities weigh "bold steps" to remake health system. "There are simply too many referral stages and patients are simply waiting too long."

CDC: Can social media drive personal health record adoption?

Thinking of Starting a Health 2.0 Firm? It’s All in the Name

WIRED SCIENCE: 5 New Drugs for Cancer, Blood Clots, Diabetes, and Hepatitis

HEALTH 2.0 San Francisco

If you missed Health 2.0 San Diego last month or last year’s sold-out Health 2.0 User-Generated Healthcare in San Francisco, here’s your chance. Early bird passes for Health 2.0 San Francisco are now on sale. Buy your passes now and you’ll save significantly over our regular rates.  Only 150 will be made available at this rate, so if you’re seriously considering coming you probably should act now to secure a spot.  We’ll be at the Marriott San Francisco downtown. The event will kick off on the evening of October 21st and run through the evening of the 23rd. 

We’re expecting an even larger crowd than last September – around a thousand – so Health 2.0 San Francisco 2008 promises to be the place to be if you’re involved in this space, an investor or looking to connect with industry insiders. You’ll get the low down on new Web 2.0 technologies like social networking, blogs, podcasts and specialized search as well as an overview of new healthcare and wellness tools and services. Speakers will include leaders from Google, Microsoft, WebMD, Sermo, Daily Strength, Patients Like Me, Organized Wisdom, Health Central, Revolution Health and many more.

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Medical Privacy: The Challenge of Behavioral Ad Targeting in Healthcare

The latest
piece in the medical privacy jigsaw puzzle is online behavioral

Last week, the Federal Trade Commission
(FTC) received comments from the Network Advertising
on the agency’s proposed principles for OBA. As part
of this filing, the NAI has published in draft its own
approach to behavioral ad targeting in health, included in the Self-Regulatory Code of Conduct for
Online Behavioral

behavioral advertising OBA
is the process whereby the online consumer’s search behavior is
analyzed across multiple websites and then categorized for use in
advertising online.

NAI’s members are reputed to cover 95% of
the online advertising market. NAI’s
membership includes 24/7 Real Media, Acerno, (an AOL company),
Atlas (a Microsoft company), BlueLithium (a Yahoo! Company), Doubleclick
(a Google company), Media6degrees, Mindset Media, Revenue Science, Safecount,
Specific Media, Tacoda (an AOL company), and
Yahoo!. Furthermore, NAI is
processing membership applications from Undertone Networks, Google and

Toward the end
of the NAI’s
Code you will find a section called, "The need for common understanding
by industry," in which the NAI
lists the "minimum restricted and sensitive consumer segments" that
online advertisers should avoid targeting.

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Should Patient Satisfaction Scores Be Adjusted for Where Patients Shop?

Last week, Medicare added patient satisfaction data to its hospital reporting website. This is progress, but it raises an interesting question: should patient satisfaction scores be case-mix adjusted?

motivation to include patient satisfaction data comes from the
Institute of Medicine’s inclusion of “patient-centeredness” as one key component of quality.
And what could be simpler than asking patients a few questions, as the
Center for Medicare & Medicaid Services (CMS) survey does. (A pdf
of the survey, formally known as HCAHPS, or “H-CAPS”, for Hospital
Consumer Assessment of Healthcare Providers and Systems, is here).
I like the addition of the patient experience data and found the
presentation on the CMS site to be fairly reader-friendly (as did US News & World Report’s
Avery Comarow). For example, it only took a few seconds to find my
hospital’s performance on the summary question, “Would you definitely
recommend this hospital?”:

UCSF Medical Center: 80% yesAverage for Northern and Central California: 65% yesAverage for all U.S. Hospitals: 67% yes

[You’ll note that we didn’t do too badly. But it would be legitimate to
wonder whether I, being relatively fond of my job and unenthusiastic
about being shunned by my colleagues, would have shown you something
that made us look crummy. You should have the same skepticism when you
look at every hospital’s web site, a point Peter Pronovost, Marlene
Miller, and I made in this JAMA article.]

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Herbert Rubin M.D. apparently did not enjoy Jane Sarahson Kahn’s piece last week reporting the results of the recent Annals of Internal Medicine study examining physician attitudes towards national health insurance.  Here is his email to us, edited slightly for length:

"In the free market where I practice, I have no need for wonks, insurance weenies or regulators. It’s me and my patients. I give them what they want, they give me what I want. No intermediaries or academics needed. Thats how every other good or service is sold and bought. No need for those who fancy themselves more clever than the market.Most overeducated experts are risibly obtuse. The diagnosis is the lack of a free market … The cure is the collapse of the current doomed non-system and the irrelevant band-aids proposed, and return of buyers and sellers with no self-interested intermediaries. The more wonks tinker, the better I like it. If single payer comes, I increase my fees, and laugh."  

THCB is sponsored by …

Overlake Medical Center is a 337-bed, nonprofit, state-of-the-art medical facility equipped to deliver the highest standards of medical care to the Puget Sound Region. Overlake is seeking primary care and specialty physicians to join our growing network of clinics located in the prosperous Eastside area across Lake Washington from Seattle.Click here to learn more. THCB thanks Overlake for it’s support!!



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