It’s been a while since we heard from The Industry Veteran, but the dialogue between Mark McClellan and Uwe Reinhardt I reported on at WHCC last week did raise his hackles. I love Uwe’s analysis and think McLellan is very sensible (though suffering from obvious political restraints). But the Veteran didn’t exactly see it that way. Here’s his sense of what ‘s wrong with health care and how to fix it.
The dialogue you reported between Mark McClellan and Uwe Reinhardt was hugely disappointing as both appeared more intent on glad-handing each other than identifying culprits in the health care system. I offer the following as a useful rule of thumb for THCB readers: whenever someone says more IT represents a principal solution to a better health care system, the red light should flash on one’s shit detector.As uncle Marcus Aurelius advised, let’s return to first principles. Assuming THCB wishes to address the big issues and not turn into a blog for techie nerds, the problems of health care cost, quality and access in the U.S. result from some basic factors. The first of these is that there are too many middle men extracting too much profit (or, in Marshallian terms, too much economic rent) from the system. Among these, third-party payers are both pernicious and dispensable. Most analysts euphemistically classify payers and the efforts of other sectors to deal with them as “administrative costs.” It seems I’ve been seeing these administrative costs pegged at 25-30% of the health care bill for the past twenty years. Since Bush’s millenarian-oil junta has been running the country, I would guess that figure to be substantially higher because payments to providers have been tapering while premiums keep escalating. Given that the administrative costs for Medicare are approximately 2%, it appears self-evident that the current system, based on employers and insurance companies, should appeal only to Reagan-Bush types who consider the proper role of government to be one of handmaiden to business.Within the provider segment, specialist physicians are another extortionist bunch. There is simply no defensible reason for every mother’s doctor-son to expect an annual income between a quarter-million dollars and $650,000. Do I hear in the background, diminuendo, the arachnid voices of techie wonks crying for tactical proposals in lieu of venting and ideology? Sink your incisors into these. (1) Use relative value reimbursement scales to promote a systematic de-skilling. (2) Increase the labor supply in the medical specialties with U.S. citizens who graduate from foreign medical schools. (3) Feminize the medical profession by elevating nurse practitioners and using staff-model and other arrangements that permit 9-to-5 shift work.Manufacturers, particularly in pharmaceuticals, are due their reproach as parasitic middle men. The European countries routinely use reference pricing to help keep them in line and health care’s Iron Triangle of cost-access-quality does not appear worse there than here. In fact the WHO rates U.S. health care as thirty-something in world while France receives the number one spot.Now you’re probably correct, Matthew, in pointing out that the public opinion polls on health care have to show a larger percentage of people expressing a vehement discontent with the system over a sustained period before substantive change can occur. To foster that attitude, I humbly advise interested parties to hammer away at the big issues instead of creating diversions and wasting time with minor tributaries such as IT. I believe there is sufficient greed to expose, enough contradictions to raise and tragedies to highlight, all of which can help prepare the public mood. The drama that can affect public attention, however, seldom resides in the IT department
Today, direct your attention over to Spot-on, where I’m up with my summary over Hubbard’s arguments with providers over price transparency—it’s called Clear as Mud.
As ever you can come back here to comment. Somehow this topic tends to get some of you riled up. I, for sure, don’t know why!
Anyone who’s ever read Fast Company won’t be surprised at the slightly breathless tones used in one of their typical "business gets new process, struggles a little at first, then succeeds beyond its wildest dreams" plot line. After all this was the magazine that was aped by a certain not quite so polite web-site also ending in "company", and beginning with an F.
What’s a little different is that this article, Record Time, is about a simple ObGYN adopting an ambulatory EMR, and then having all the usual crises of seeing his practice more or less collapse because of the extra time it took to figure out how to use it.
But apparently in this case the vendor sent donuts, and someone who built him templates and showed him how to use it. Repeat with me–a practice barely alive, but we can rebuild it, we have the technology, we can create the world’s first bionic physician’s office….it will be gooder than it was before…and all for slightly less than $6 million! (Look here if you’re too young to get it…)
Given that the vendor in question is Cerner, notorious for its not always quite as smooth as silk implementations, you’d be entitled to a little cynicism here. (and if you think I’m just relaying industry tattle here from HISTalk, you are of course right!). However, last year a very sharp IT consultant told me that his shop had done a real life performance comparison of the major ambulatory EMRs and Cerner’s Powerchart product (which was new and had little market penetration) had actually beaten out the big boys. So better product, with better customer service? Can it be true? Or is this just more "pie in the face for Neal Patterson" ammo?
Of course it would be nice if the article told us a little more about exactly how the physician got from near chaos to everything running as smooth as silk without avoiding total financial collapse. Several of his colleagues reported on in Medical Economics recently weren’t so lucky.
Yet another crazy doctor decides that the hassle of dealing with 301 separate insurers is just too much and that he, was well as everyone else but the insurance industry, would be better off with a national single payer system. Nothing that hasn’t been heard before from a minority of docs.
The only noteworthy thing about this one is that the doc in question is Benjamin Brewer, who writes The Doctor’s Office column in that filthy commie rag The Wall Street Journal. Wonder how long he keeps that job?!
If you haven’t been reading, there are now some 46 long detailed and excellent comments in the article called Can the real HSA fan, please stand, please stand up?.
Speaking as someone who’s been through the academic mill, this comment thread provides about a semester and more’s worth of education on the entire topic of health management and health policy. Note Steve Beller’s excellent summary of the conversation so far at around comment #30!
Fantastic work—my hat is off to all the commenters
Now given that 30% of activity in health care is waste motion, this shouldn’t be the case, but apparently it is and doctors are in high demand. So the next time you catch one pissing and moaning about their life/income, remind them that they could be a GM employee.
For those of you curious about the AMA’s recent “Girls Gone Wild” survey, some interesting stuff from Mystery Pollster. Here’s Part 1 and here’s Part 2. If you look deep in the comments about Part 2 you’ll see my cynical viewpoint.
Hat tip Health Business Blog
I’m the ultimate American outcast in that I’m an atheist (or as we’re known now secular humanist), who thinks that (as one old friend put it) "all religions from the Bhagwan Rajneesh to the Unitarians are only interested in putting their hand in your pocket".
But I accept that makes me pretty unusual in America where roughly 90% of the population reliably polls as believing in God (although I’d fit in OK in Sweden and most of Europe).
What I fund pretty interesting was a survey that came out last summer but was just featured in Forbes. The authors seem to be all excited that they found that American physicians were likely to believe in God and have it influence their daily lives. That’s because they were comparing physicians to scientists, who have very low rates of religious belief.
But what I found interesting was that only 76% of physicians said that they believed in God. If we take that to include a wide meaning of "God", that means that in their beliefs about religion, physicians look more like Europeans than Americans.
But I have no idea what conclusions to draw from that for the health system.
Interesting piece from a marketing consultant called Chris Bevolo from boutique firm GeigerBevolo Inc., in Minneapolis. The report looks at new entrants into health care services and responses to improve the patient experience at Mayo and Park Nicollet.
The new entrants profiled are Steve Case’s Revolution Health, Best Buy’s eq Life ( a pharmacy with manicures while you wait), and MinuteClinics (nurse practitioners in shopping malls). The choice of Revolution Health is a little off, and its attempts (as well as the track record of its advisory board) has been well slagged off on TCHB and by Joe Paduda before. But the other two are well worthy of a look.
And the message seems to be a) provide shopping while people are waiting to see the doctor as Americans like shopping, and b) do it in Minnesota, because those Minnesotans like innovation. I actually think that Chris has missed a third option which is edutainment while patients are waiting. But I’ll have more to say about that when I finally get around to discussing Phreesia’s in-office tablet entertainment/patient history service again.
But while I’m more than half-joking, I am full serious. The level of customer service in health care remains abysmal, and whether or not the market forces plans and providers to do something about it sooner rather than later, it surely can’t hurt for them to get out ahead of this trend.
Greg Pawelski is not exactly surprised about the latest revelations about oncologists and their use of chemotherapy.
A joint Michigan/Harvard study confirms that medical oncologists choose cancer chemotherapy based on how much money the chemotherapy earns the medical oncologist. Just published in the journal Health Affairs is a joint Harvard/Michigan study entitled “Does reimbursement influence chemotherapy treatment for cancer patients?” In a study of 9,357 patients, the authors documented a clear association between reimbursement to the oncologists for the chemotherapy of breast, lung, and colorectal cancer and the regimens which the oncologists selected for the patients. In other words, oncologists tended to base their treatment decisions on which regimen provided the greatest financial remuneration to the oncologist This study adds to the ‘smoking gun’ study of Dr. Neil Love on the subject. The results of his survey show that for first line chemotherapy of metastatic breast cancer, 84-88% of the academic center-based oncologists prescribed an oral dose drug (capecitabine), while only 13% prescribed infusion drugs, and none of them prescribed the expensive, highly remunerative drug docetaxel. In contrast, among the community-based oncologists, only 18% prescribed the oral dose drug (capecitabine), while 75% prescribed infusion drugs, and 29% prescribed the expensive, highly remunerative drug docetaxel. The existence of this profit motive in drug selection has been one of the major factors working against the individualization of cancer chemotherapy based on testing the cancer biology. Once a decision to give chemo is taken, physicians receiving more-generous Medicare reimbursements used more-costly treatment regimens.