Tag: Kim Bellard

Health Care in Abundance

Mar 11, 2025

By KIM BELLARD

A recent report from Moody’s Analytics, by chief economist Mark Zandi, had an eye-opening fact: the top 10% of earners in the U.S. – those who make $250,000 or more – now account for just shy (49.7%) of half of consumer spending. If that strikes you as unusual, you’re right. It is a record since at least 1989. Thirty years ago the comparable percentage was 36%.

“The finances of the well-to-do have never been better, their spending never stronger and the economy never more dependent on that group,” wrote Dr. Zandi. He added: “Wealthier households are financially more secure and thus more able and willing to spend their income. That is, they save less than they would otherwise.”

The rest of us are struggling to hold our own against inflation, not always successfully. It’s why companies like Costco and Walmart are trying to target upscale shoppers, while “value” oriented firms like Big Lots, Family Dollar, or Kohl’s are closing stores or even declaring bankruptcy.

This extreme bifurcation, of course, made me think of healthcare, where – as is famously known – half of all spending is attributable to only 5% of patients. In case you’d forgotten, in healthcare, half the population accounts for 97% of all spending, so the other half accounts for a measly 3%.

Now, you might say, neither of those is surprising: rich people spend more, and sicker people cost more. But somehow neither of those seems right to me.

I started thinking more about this after reading a recent New York Times op-ed from Ezra Klein. In it he makes the following assertion:

The answer to a politics ofscarcity is a politics of abundance, a politics that asks what it is that people really need and then organizes government to make sure there is enough of it.

Mr. Klein didn’t coin the phrase “politics of abundance,” but he and Derek Thompson did just write a book on the topic (Abundance) that discusses their thoughts at more length. I have not read the book, but I saw a quote from it that I quite liked: “What is scarce that should be abundant? What is hard to build that should be easy?”

And so we’re back to healthcare.

We seem to live in a country where healthcare is too scarce. A new analysis suggests that we have a looming shortage of hospital beds, and if you live in a rural area, it’s already here. If you believe the Association of American Medical Colleges, we have a looming physician shortage, and if you’re looking for primary care, it’s already here. We’re facing nursing storages, pharmacist shortages, nursing home worker shortages, home health worker shortages, to name a few. We even have shortages of many critical prescriptions, including some needed for cancer treatments.

Despite all these shortages or would-be shortages, of course, we manage to spend way more than other countries on healthcare. One can only imagine how much we might be spending if there were no shortages. I take that back: I’m not sure I can imagine.

In the category of things that are scarce that should be abundant, and/or things that are hard to build that should be easy, I’d probably put housing at the top but healthcare as a close second. The trouble is, when we pour more money into healthcare, as we are wont to do, we don’t seem to fill any of our many shortages, much less improve the quality of care or outcomes.

Goodbye, American Science

Feb 26, 2025

By KIM BELLARD

Many people don’t realize it, but a hundred years ago America was something of a scientific backwater. Oh, sure, we had the occasional Nobel laureate, but the center of science was in Europe, particularly Germany. Then in the early 1930’s the Nazis decided that “purity” – of political ideas, of blood – was more important than truth, making life uncomfortable at best and deadly at worst for their scientists. So hundreds of them fled, many of them ending up in the U.S. And – voila! – American science came of age and hasn’t looked back.

Until now. Now, I fear we’re going to suffer what Germany did, a brain drain that will bode well for some other country’s scientific fortunes.

Once of the first chilling announcements from the Trump Administration was that it was freezing NIH grants in order to ensure they were in compliance with Trump’s executive order banning DEI-related efforts. That froze some $1.5b in grant funding.

Piling on, the Administration announced that NIH grants would limit indirect costs to 15%. Sounds reasonable, you might say, but the vast machinery of U.S. biomedical research uses these “indirect” costs to fund the infrastructure that makes the research possible. Numerous state Attorney Generals immediately filed a lawsuit to block the cuts, claiming:

This research funding covers expenses that facilitate critical components of biomedical research, such as lab, faculty, infrastructure and utility costs. Without it, lifesaving and life-extending research, including clinical trials, would be significantly compromised. These cuts would have a devastating impact on universities around the country, many of which are at the forefront of groundbreaking research efforts – while also training future generations of researchers and innovators.

Oh, and on top of all this, as many as 1,500 NIH employees are in line to be laid-off.

Katie Witkiewitz, a professor at the University of New Mexico, lamented to The New York Times: “The N.I.H. just seems to be frozen. The people on the ground doing the work of the science are going to be the first to go, and that devastation may happen with just a delay of funding.”

Universities are similarly frozen, not sure when or how much money they can expect. The University of Pittsburgh has paused all Ph.D. admission, until it can better understand its funding future. One has to suspect it won’t be the only such program to do so, and we may never know how many would-be Ph.D. students will simply decide a future in U.S. science is too bleak to risk.

You Can’t Spell Fair Pay Without AI

Dec 5, 2024

By KIM BELLARD

Everything’s about AI these days. Everything is going to be about AI for a while. Everyone’s talking about it, and most of them know more about it than I do. But there is one thing about AI that I don’t think is getting enough attention. I’m old enough that the mantra “follow the money” resonates, and, when it comes to AI, I don’t like where I think the money is ending up.

I’ll talk about this both at a macro level and also specifically for healthcare.

On the macro side, one trend that I have become increasingly radicalized about over the past few year is income/wealth inequality. I wrote a couple weeks ago about how the economy is not working for many workers: executive to worker compensation ratios have skyrocketed over the past few decades, resulting in wage stagnation for many workers; income and wealthy inequality are at levels that make the Gilded Age look positively progressive; intergenerational mobility in the United States is moribund.

That’s not the American Dream many of us grew up believing in.

We’ve got a winner-take-all economy, and it’s leaving behind more and more people. If you are a tech CEO, a hedge fund manager, or a highly skilled knowledge worker, things are looking pretty good. If you don’t have a college degree, or even if you have a college degree but with the wrong major or have the wrong skills, not so much.

All that was happening before AI, and the question for us is whether AI will exacerbate those trends, or ameliorate them. If you are in doubt about the answer to that question, follow the money. Who is funding AI research, and what might they be expecting in return?

It seems like every day I read about how AI is impacting white collar jobs. It can help traders! It can help lawyers! It can help coders! It can help doctors! For many white collar workers, AI may be a valuable tool that will enhance their productivity and make their jobs easier – in the short term. In the long term, of course, AI may simply come for their jobs, as it is starting to do for blue collar workers.

Automation has already cost more blue collar jobs than outsourcing, and that was before anything we’d now consider AI. With AI, that trend is going to happen on steroids; jobs will disappear in droves. That’s great if you are an executive looking to cut costs, but terrible if you are one of those costs.

THCB Gang Episode 143, Friday November 8

Nov 8, 2024

Joining Matthew Holt (@boltyboy) on #THCBGang on Friday November 8 are THCB regular writer and ponderer of odd juxtapositions Kim Bellard (@kimbbellard); Principal of Worksite Health Advisors Brian Klepper (@bklepper1); patient safety expert and all around wit Michael Millenson (@mlmillenson); and digital health investment banker Steven Wardell (@StevenWardell). There may well be a discussion about an election.

You can see the video below live (and later archived) & if you’d rather listen than watch, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels.

Inventors (and Innovators) Wanted

Nov 5, 2024

By KIM BELLARD

I thought about writing about the election, but I’m too anxious – and a little terrified – about it, so I’ll take a pass. I was intrigued by Oracle Health’s promise of an AI-driven, “next-generation” EHR, or the news that OpenAI was introducing ChatGPT search, but I felt that each was inevitable and yet that both would prove underwhelming in the short term.

So I decided to write about invention.

The November issue of IEEE Spectrum magazine is all about invention, starting with the tantalizing overview Why the Art of Invention Is Always Being Reinvented. “Invention doesn’t come from some innate genius, it’s not something that only really special people get to do,” says Stephanie Couch, executive director of the Lemelson MIT Program.

Still, authors Eliza Strickland and Peter B. Meyer warn, “…the limits of what an individual can achieve have become starker over time. To tackle some of the biggest problems facing humanity today, inventors need a deep-pocketed government sponsor or corporate largess to muster the equipment and collective human brainpower required.”

Tell that to UTEP student Tayia Oddonetto. While an undergraduate, she had an epiphany. “During class, the professor said that if someone discovered how to turn brine, water with a high salt concentration, into something of value, it’d be revolutionary for the planet. At that moment, I told myself I was going to be the one who found the solution for brine, and that thought has never left me.”

And she did it. Instead of the more common reverse osmosis (RO) method of desalination, which at best converts 85% of salt water into fresh water and leaves a problematic 15% of concentrated brine, Ms. Oddonetto used something called salt-free, electrodialysis metathesis. As the press release describes it: “Salt-free electrodialysis metathesis treats brine by passing it through ion exchange membranes, thin sheets or films, and electrical currents that work to separate salt from water at the molecular level.”

Her approach produced over 90% fresh water, and generated higher levels of valuable metals and minerals that can be repurposed across several industries including technology, health and food.

THCB Gang Episode 140, Thursday October 3

Oct 3, 2024

OK we are really back.! Following last weeks special with the Women Healthcare Leaders for Progress, the “regular” THCBGang is coming back for the Fall, mostly but not always at the 1pm PT 4pm ET timeslot on Thursdays.

Joining Matthew Holt (@boltyboy) on #THCBGang on Thursday October 3 at 1pm PST 4pm EST are futurist Jeff Goldsmith: delivery & platform expert Vince Kuraitis (@VinceKuraitis); author & ponderer of odd juxtapositions Kim Bellard (@kimbbellard);

You can see the video below & if you’d rather listen than watch, the audio is preserved as a weekly podcast available on our iTunes & Spotify channels

Innovators: Avoid Health Care

Jun 18, 2024

By KIM BELLARD

NVIDIA founder and CEO Jensen Huang has become quite the media darling lately, due to NVIDIA’s skyrocketing market value the past two years ($3.3 trillion now, thank you very much. A year ago it first hit $1 trillion). His company is now the world’s third largest company by market capitalization. Last week he gave the commencement speech at Caltech, and offered those graduates some interesting insights.

Which, of course, I’ll try to apply to healthcare.

Mr. Jensen founded NVIDIA in 1993, and took the company public in 1999, but for much of its existence it struggled to find its niche. Mr. Huang figured NVIDIA needed to go to a market where there were no customers yet – “because where there are no customers, there are no competitors.” He likes to call this “zero billion dollar markets” (a phrase I gather he did not invent).

About a decade ago the company bet on deep learning and A.I. “No one knew how far deep learning could scale, and if we didn’t build it, we’d never know,” Mr. Huang told the graduates. “Our logic is: If we don’t build it, they can’t come.”

NVIDIA did build it, and, boy, they did come.

He believes we all should try to do things that haven’t been done before, things that “are insanely hard to do,” because if you succeed you can make a real contribution to the world. Going into zero billion dollar markets allows a company to be a “market maker, not a market-taker.” He’s not interested in market share; he’s interested in developing new markets.

Accordingly, he told the Caltech graduates:

I hope you believe in something. Something unconventional, something unexplored. But let it be informed, and let it be reasoned, and dedicate yourself to making that happen. You may find your GPU. You may find your CUDA. You may find your generative AI. You may find your NVIDIA.

And in that group, some may very well.

He didn’t promise it would be easy, citing his company’s own experience, and stressing the need for resilience. “One setback after another, we shook it off and skated to the next opportunity. Each time, we gain skills and strengthen our character,” Mr. Huang said. “No setback that comes our way doesn’t look like an opportunity these days… The world can be unfair and deal you with tough cards. Swiftly shake it off. There’s another opportunity out there — or create one.”

He was quite pleased with the Taylor Swift reference; the crowd seemed somewhat less impressed.

It’s the Bureaucrats, Stupid

May 14, 2024

By KIM BELLARD

Universities are having a hard time lately. They’re beset with protests the like of which we’ve not seen since the Vietnam War days, with animated crowds, sit-ins, violent clashes with police or counter protesters, even storming of administration buildings. Classes and commencements have been cancelled. Presidents of some leading universities seemed unable to clearly denounce antisemitism or calls for genocide when asked to do so in Congressional hearings. Protesters walked out on Jerry Seinfeld’s commencement speech; for heaven’s sake – who walks out on Jerry Seinfeld?

Derek Thompson wrote a great piece for The Atlantic that tries to pinpoint the source problem: No One Knows What Universities Are For. The sub-title sums up his thesis: “Bureaucratic bloat has siphoned power away from instructors and researchers.” As I was nodding along with most of his points, I found myself also thinking: he might as well be talking about healthcare.

Mr. Thompson starts by citing a satirical piece in The Washington Post, in which Gary Smith, an economics professor at Pomona College, argues that, based on historical trends in the growth of administration staff, the college would be best served by gradually eliminating faculty and even students. The college’s endowment could then be used just to pay the administrators.

“And just like that,” Professor Smith says, “the college would be rid of two nuisances at once. Administrators could do what administrators do — hold meetings, codify rules, debate policy, give and attend workshops, and organize social events — without having to deal with whiny students and grumpy professors.”

It’s humorous, and yet it’s not.

The growth in universities’ administrative staff is widespread. Mr. Thompson acknowledges: “As the modern college has become more complex and multifarious, there are simply more jobs to do.” But that’s not always helping universities’ missions. Political scientist Benjamin Ginsberg, who published The Fall of the Faculty: The Rise of the All-Administrative University and Why It Matters in 2014, told Mr. Thompson: “I often ask myself, What do these people actually do? I think they spend much of their day living in an alternate universe called Meeting World.”

Similarly, Professor Smith told Mr., Thompson it’s all about empire building; as Mr. Thompson describes it: “Administrators are emotionally and financially rewarded if they can hire more people beneath them, and those administrators, in time, will want to increase their own status by hiring more people underneath them. Before long, a human pyramid of bureaucrats has formed to take on jobs of dubious utility.”

All of these administrators add to the well-known problem of runaway college tuition inflation, but a more pernicious problem Mr. Thompson points to is that “it siphons power away from instructors and researchers at institutions that are—theoretically—dedicated to instruction and research.”

The result, Mr. Thompson concludes is “goal ambiguity.” Gabriel Rossman, a sociologist at UCLA, told him: “The modern university now has so many different jobs to do that it can be hard to tell what its priorities are.” Mr. Thompson worries: “Any institution that finds itself promoting a thousand priorities at once may find it difficult to promote any one of them effectively. In a crisis, goal ambiguity may look like fecklessness or hypocrisy.”

So it is with healthcare.

Anyone who follows healthcare has seen some version of the chart that shows the growth in the number of administrators versus the number of physicians over the last 50 years; the former has skyrocketed, the latter has plodded along. One can – and I have in other forums – quibble over who is being counted as “administrators” in these charts, but the undeniable fact is that there are a huge number of people working in healthcare whose job isn’t, you know, to help patients.

It’s well documented that the U.S. healthcare system is by far the world’s most expensive healthcare system, and that we have, again by far, the highest percent spent on administrative expenses. Just as all the college administrators helps keep driving up college tuition, so do all those healthcare administrators keep healthcare spending high.

But, as Mr. Thompson worries about with universities, the bigger problem in healthcare is goal ambiguity.

And Now For Something Completely Different

Apr 16, 2024

By KIM BELLARD

The most interesting story I read in the past week doesn’t come from the more usual worlds of health and/or technology, but from sports. It’s not even really news, since it was announced last fall; it’s just that it wasn’t until last week that a U.S. publication (The New York Times) reported on it. In a nutshell, a Paris football (a.k.a. soccer) club is not charging its fans admission during the current season.

Since last week I wrote about medical debt in the U.S. healthcare system, you might guess where this is going. The club is Paris FC. Last November it announced:

For the first time in history, Paris FC is offering free tickets for all home matches at the Stade Charléty, starting from the 11 November until the end of the 2023-2024 season from its Bastia reception, in a bid to offer a new and innovative vision of football by welcoming as many people as possible.

The policy includes the men’s second division team and the woman’s first division team. The NYT article clarifies that fans supporting the visiting team might be charged a “nominal” fee, and that hospitality suites still pay market rates.

Pierre Ferracci, Chairman of Paris FC, said: “We are proud to support this ambitious and pioneering project, which goes beyond the simple framework of sport in terms of the values it conveys. We want to bring people together around our club and our teams, while committing ourselves with strength and conviction. In a context of difficult purchasing power, we are confident that a club can be an ideal tool for bringing together people of goodwill and engage with societal issues.”

Fabrice Herrault, Paris FC’s general manager told NYT: “It was a kind of marketing strategy. We have to be different to stand out in Greater Paris. It was a good opportunity to talk about Paris F.C.” The club estimates it might cost them $1 million.

It seems to be working. The NYT reports:

Months later, most metrics suggest the gambit has worked. Crowds are up by more than a third. Games held at times appealing for school-age children have been the best attended, indicating that the club is succeeding in attracting a younger demographic.

The idea is not entirely de novo; last spring Fortuna Düsseldorf, a German second division football club, announced it would offer free admission for at least three matches this season, with the intent that eventually all home matches. “We open up football for all. We will have free entry for league games in this stadium,” Alexander Jobst, the club’s chief executive, said at the time. “We call it ‘Fortuna for all’ which can and will lead us to a successful future.”

In a NYT interview last spring, Mr. Jobst added: “We think it is completely new. We were trying to think about how we could do the soccer business completely different from before.”

I’m always a sucker for efforts to think about a business completely different than before.

Fortuna has now had two of its three free matches, and Mr. Jobst told NYT last week: “Our average attendance has gone from 27,000 to 33,000. Our merchandise sales are up by 50 percent. Our sponsorship revenue is up 50 percent. We have reached a record number of club members.”

Sure sounds like a success.

Where’s Our Infrastructure Plan B?

Apr 3, 2024

By KMI BELLARD

I’ve been thinking a lot about infrastructure. In particular, what to do when it fails.

There was, of course, the tragic collapse of Baltimore’s Francis Scott Key Bridge. Watching the video – and, honestly, what were the odds there’d be video? — is like watching a disaster movie, the bridge crumbling slowly but unstoppably. The bridge had been around for almost fifty years, withstanding over 11 million vehicles crossing it each year. All it took to knock it down was one container ship.

Container ships passed under it every day of its existence; the Port of Baltimore is one of the busiest in the country. In retrospect, it seems almost inevitable that the bridge would collapse; certainly one of those ships had to hit it eventually. The thing is, it wasn’t inevitable; it was a reflection of the fact that the world the bridge was designed for is not our world.

Transportation Secretary Pete Buttigieg noted: “What we do know is a bridge like this one, completed in the 1970s, was simply not made to withstand a direct impact on a critical support pier from a vessel that weighs about 200 million pounds—orders of magnitude bigger than cargo ships that were in service in that region at the time that the bridge was first built,”

When the bridge was designed in the early 1970’s, container ships had a capacity of around 3000 TEUs (20-foot equivalent foot units, a measure of shipping containers). The ship that hit the bridge was carrying nearly three times that amount – and there are container ships that can carry over 20,000 TEUs. The New York Times estimated that the force of the ship hitting the bridge was equivalent to a rocket launch.

“It’s at a scale of more energy than you can really get your mind around,” Ben Schafer, a professor of civil and systems engineering at Johns Hopkins, told NYT.

Nii Attoh-Okine, a professor of engineering at the University of Maryland, added: “Depending on the size of the container ship, the bridge doesn’t have any chance,” but Sherif El-Tawil, an engineering professor at the University of Michigan, disagreed, claiming: “If this bridge had been designed to current standards, it would have survived.” The key feature missing were protective systems built around the bases of the bridge, as have been installed on some other bridges.

We shouldn’t expect that this was a freak occurrence, unlikely to be repeated. An analysis by The Wall Street Journal identified at least eight similar bridges also at risk, but pointed out what is always the problem with infrastructure: “The upgrades are expensive.”

Lest anyone forget, America’s latest infrastructure report card rated our overall infrastructure a “C-,” with bridges getting a “C” (in other words, other infrastructure is even worse).

What’s the plan?

——–

Then here’s an infrastructure story that threw me even more.