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The Doctor- Patient Relationship and the Outcomes Movement

Screen Shot 2015-10-01 at 9.46.12 AMIn a recent Harvard Business Review article, authors Erin Sullivan and Andy Ellner take a stand against the “outcomes theory of value,” advanced by such economists as Michael Porter and Robert Kaplan who believe that in order to “properly manage value, both outcomes and cost must be measured at the patient level.”

In contrast, Sullivan and Ellner point out that medical care is first of all a matter of relationships:

With over 50% of primary care providers believing that efforts to measure quality-related outcomes actually make quality worse, it seems there may be something missing from the equation. Relationships may be the key…Kurt Stange, an expert in family medicine and health systems, calls relationships “the antidote to an increasingly fragmented and depersonalized health care system.”

In their article, Sullivan and Ellner describe three success stories of practice models where an emphasis on relationships led to better care.

But in describing these successes, do the authors undermine their own argument?  For in order to identify the quality of the care provided, they point to improvements in patient satisfaction surveys in one case, decreased rates of readmission in another, and fewer ER visits and hospitalizations in the third.  In other words…outcomes

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How a Simple Little Pill Ended Up Costing 1000 Percent More Than Its Ingredients

Devon HerrickA recent New York Times article profiled a pair of ultra-expensive pain medications designed to go easy on the stomach. Common pain relievers, like aspirin, ibuprofen and naproxen are prone to irritate the stomach if taken repeatedly throughout the day. A newer class of pain medication, called cox-2 inhibitors, are the preferred pain relievers for those who cannot take nonsteroidal anti-inflammatory drugs (NSAIDs) on a long term basis. Celecoxib, the generic version of Celebrex, is now available at a cost of about $2 per tablet, but that can add up to about $700 to $1000 per year.

More than a decade ago researchers found that taking heartburn medications with common NSAIDs could mimic the benefits of the costly cox-2 inhibitors. However, the study found (at that time) combining heartburn medications and NSAIDS would not deliver any cost savings due to the high price of prescription heartburn treatments. A lot has changed in the years since the study. The costly proton pump inhibitors for heartburn are now available over the counter (OTC) for $0.31 cents to $0.60 cents apiece. The drugs mentioned in the Times article, Duexis and Vimovo, are based on the premise of combining NSAIDs with heartburn medications.

The catch? Each drug costs more than $1,500 for only a month’s supply. The cost per tablet is $17 and $25 respectively. Why so much? That’s a good question that doesn’t have a logical answer. Although nearly 90 percent of the drugs Americans take are inexpensive generics, a small segment – about 1 percent of all drugs prescribed – falls into a category known as “specialty drugs”. Continue reading…

A Proposal to Increase the Transparency and Quality of Electronic Health Records

flying cadeucii The electronic health record (EHR) is now used by the majority of physicians during every patient encounter. The EHR has become the most important tool in our “black bag” and precisely for that reason, the EHR must be highly accurate and free of bias. As our most heavily utilized tool, the EHR must also be flexible and highly optimized so as to ensure it does not adversely impact the delivery of healthcare. Unfortunately, numerous surveys have found widespread physician dissatisfaction with EHR design.

The fact that EHR programming code is shielded from objective scrutiny by independent evaluators increases the risk that the EHR will contain errors and bias which could adversely impact our patient’s health, hinder our ability to deliver healthcare, “warp” the design of the healthcare system and drain financial resources from our patients and society.

EHR “errors” are well documented in the literature and are referred to as “e-iatrogenesis” or “technology induced” errors. “Bias” in EHR programming code is not discussed in the literature.

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Crowdfunding: Careful What you Wish For

flying cadeuciiThe SEC has finally finalized its crowdfunding rule (presser) under the JOBS Act. The health innovation crowdfunding crowd has been waiting for these rules for quite some time, as has the rest of the crowdfunding fan club. (It’s only taken three and a half years.)

So, was it worth the wait?

The crowdfunding rule (full text) sets the stage for broader participation in early-stage investing and may empower crowdfunding platforms (“intermediaries,” in SEC-speak) to compete with angel funding platforms servicing “accredited investors” (SEC-speak for high net worth folks who can afford to lose their entire investment in a startup). It is a democratizing move consistent with the ethos of the internet and digital innovation.

Let’s look at some of the particulars and then think about whether this is a good thing for startup companies (“issuers”) that might want to sell securities rather than their products or promotional T-shirts, and for intermediaries — such as Kickstartr etc. — that might want to have a role in matchmaking individual investors with issuers. (Kickstartr itself has reportedly said it’s not interested in going down this path; IndieGoGo is interested, though.)

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The Surprising Story of The Original Luddite

LudditeWe all know Luddites.  They proudly pronounce their rejection of Facebook and feign disgust about how they finally “broke down” and bought that awesome Motorola Razor they still carry. Maybe you are a Luddite or pretend to be because you can’t make Gmail work on your phone. So who was this Ludd and why is he the timeless symbol of rage against the machine?

My guess was that the original Ludd was probably some horse breeder that bet the farm against the future of the automobile. As it turns out, the Ludd story is not at all what you’d expect.

Legend has it that in 1779, a fed up British factory worker named Ned Ludd took his aggression out against the knitting machines he was employed to operate, smashing two of them to pieces with a hammer. In this one brazen act of defiance, he became the symbol of man’s rebellion against automation, technological displacement, the death of artisanship, and the worsening conditions of the working class.

Not long after, as the Industrial Revolution gained steam (terrible, I know) young Ned became the poster boy, quite literally, for factory worker uprisings each of which was punctuated with the destruction of machines.

The Luddites met in secret and their operations ranged from sabotage to all out warfare, including a battle with the British Army. They became so fearsome that industrialists had secret chambers constructed in their factories in which they could hide should the Luddites come knocking. Fearing that the name “Ned” lacked gravitas, his PR team apparently took to branding him King Ludd or General Ludd.

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The End of the NHS?

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Britain’s health secretary wants to uncharm his way to a revolution.

To galvanize support for a seven-day National Health Service (NHS), which the NHS was before Jeremy Hunt’s radical plans, and still is, he asserted that thousands die because there is a shortage of senior doctors during weekends. This is an expedient interpretation of a study which showed that mortality was higher in patients admitted on weekends. Hunt ignored the fact that patients admitted on Friday night are actually sicker than those admitted on Wednesday morning.

When logos failed, and after briefly dabbling with pathos, Hunt resorted to ethos. He insinuated that doctors were clock watchers (“service that cranks up on a Monday morning and starts to wind down after lunch on a Friday”). This led to a hashtag on Twitter: #ImInWorkJeremy.

Hunt wants to modernize the NHS. Leaving aside whether modernization is modernization, post-modernization or pre-post-pre-modernization, presumably this endeavor benefits from having doctors on board. How has Hunt enticed the doctors? He prophesized that GP’s diagnostic skills could be obsolete in twenty years. He wanted to replace doctor’s clinical judgment with computers, sooner rather than later (he’d just returned from Silicon Valley).

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How Doctors Became Subcontractors

Screen Shot 2015-10-01 at 9.46.12 AMIn our healthcare system, the “middleman” is not who you think

During my recent podcast interview with Jeff Deist, president of the Ludwig von Mises Institute, I remarked that third-party payers are not, in fact, intermediaries between doctors and patients. In reality, it is the physician who has become a “middleman” in the healthcare transaction or, as I argued, a subcontractor to the insurer.

Important as it is, this reality is not well recognized—not even by physicians—because when doctors took on this “role” in the late 1980’s, the process by which healthcare business was conducted did not seem to change in any visible way.

When health insurance was first introduced on a large scale in the 1940’s and 1950’s, a patient would see a doctor and pay the bill directly. The doctor would issue a receipt and the patient would submit the receipt to the insurance company for reimbursement. The insurance company was, in that sense, a financial intermediary since it would enable the patient to afford the care and see the doctor.

Overtime, as the cost of medical care began to rise rapidly, a practice evolved whereby physicians would take it upon themselves to submit the claim to the insurance company and would not require patients to pay upfront.

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Uber’s Surge Pricing May not Lead to a Surge In Drivers

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Uber has long stirred controversy and consternation over the higher “surge” prices it charges at peak times. The company has always said the higher prices actually help passengers by encouraging more drivers to get on the road. But computer scientists from Northeastern University have found that higher prices don’t necessarily result in more drivers.

Researchers Le Chen, Alan Mislove and Christo Wilson created 43 new Uber accounts and virtually hailed cars over four weeks from fixed points throughout San Francisco and Manhattan. They found that many drivers actually leave surge areas in anticipation of fewer people ordering rides.

“What happens during a surge is, it just kills demand,” Wilson told ProPublica. “So the drivers actually drive away from the surge.”

When contacted this week, Uber said that their own analysis has shown that surge pricing does, in fact, attract more drivers to surge areas. “Contrary to the findings in this report — which is based on extremely limited, public data — we’ve seen this work in practice day in day out, in cities all around the world,” Uber spokeswoman Molly Spaeth wrote in an email.

The researchers also uncovered a few tips about how to avoid surge prices. They found that changing your location, even by a few hundred feet, can influence the price you get. They also discovered that you can often get back to normal fare levels by waiting as few as five minutes.

“The vast majority of surges are short-lived, which suggests that savvy Uber passengers should ‘wait-out’ surges rather than pay higher prices,” the authors wrote in a new study they are presenting at a conference in Tokyo on Friday.

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