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The Business Reality of Healthcare AI

BY KIM BELLARD

I was at the barbershop the other day and overheard one barber talking with his senior citizen customer about when – not if – robot AIs would become barbers. I kid you not.

Now, I don’t usually expect to heard conversations about technology at the barber, but it illustrates that I think we are at the point with AI that we were with the Internet in the late ‘90’s/early ‘00s: people’s lives were just starting to change because of it, new companies were jumping in with ideas about how to use it, and existing companies knew they were going to have to figure out ways to incorporate it if they wanted to survive. Lots of missteps and false starts, but clearly a tidal wave that could only be ignored at one’s own risk. So now it is with AI.

I’ve been pleased that healthcare has been paying attention, probably sooner than it acknowledged the Internet. Every day, it seems, there are new developments about how various kinds of AI are showing usefulness/potential usefulness in healthcare, in a wide variety of ways.  There’s lots of informed discussions about how it will be best used and where the limits will be, but as a long-time observer of our healthcare system, I think we’re not talking enough about two crucial questions. Namely:

  • Who will get paid?
  • Who will get sued?

Now, let me clarify that these are less unclear in some cases than others.  e.g., when AI assists in drug discovery, pharma can produce more drugs and make more money; when it assists health insurers with claims processing or prior authorizations, that results in administrative savings that go straight to the bottom line. No, the tricky part is using AI in actual health care delivery, such as in a doctor’s office or a hospital. 

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“Sons of Liberty” Flea Into King George’s (or Donald’s) Open Arms.

BY MIKE MAGEE

If there is a silver lining to the Trump assault on decency and civility, it is our majority response to this “stress test” of our Democracy, and the sturdiness (thus far) of our Founders’ vision. 

It was, after all, a long shot when Alexander Hamilton, under the pen name Publius, published Federalist No. 1 on October 27, 1787, writing: “It has been frequently remarked that it seems to have been reserved to the people of this country, by their conduct and example, to decide the important question, whether societies of men are really capable or not of establishing good government from reflection and choice, or whether they are forever destined to depend for their political constitutions on accident and force.”

Two weeks before the Iowa caucus in 2016, Trump himself sided with “force” and signaled a rocky road ahead when he stated in Sioux City, Iowa, that “I could stand in the middle of Fifth Avenue and shoot somebody, and I wouldn’t lose any voters, OK? Its, like, incredible.”

In so doing, he was taking on medieval jurist, Henry de Bracton, who wrote in On the Laws and Customs of England in 1260 that “The king should be under no man, but under God and the law.”

Of course, Trump, while representing our Executive branch, was not acting alone. He was supported by members of our Legislative branch as they successfully stacked the Judicial branch with religious conservatives. The net impact was this past year’s overturning of Roe v. Wade, and a Christian Evangelical legislative windfall (and subsequent political backlash) in multiple Red States across the union.

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THCB Gang Episode 128, Thursday June 29

Joining Matthew Holt (@boltyboy) on #THCBGang on Thursday June 29 at 1PM PT 4PM ET are futurist Jeff Goldsmith: medical historian Mike Magee (@drmikemagee); and patient safety expert and all around wit Michael Millenson (@mlmillenson).

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.

Moral Injury: A Physician’s Premature Retirement

Calder Wedding

BY HAYWARD ZWERLING

Synopsis:

  • After a 3 decade career in a solo private practice the healthcare environment shifted
  • As an employed physician, my institution’s policies hindered my ability to care for my patients
  • The consequent moral injury left me unwilling to re-engage with the healthcare industry

I retired early from the profession that I loved because the devolution of the healthcare system had made it impossible for me to provide care to my patients in a manner which met my own standards. The resultant “moral injury” left me leary of again becoming involved with our healthcare system in the near future.

My Early Career

Although I had originally planned a career as a physician-scientist, it became apparent toward the end of my training that this was not the best career path for me and I choose to pursue a career in private practice. 

My first post-training job was as a physician working in a clinic owned by Blue Cross and Blue Shield (1989-1991.) After two years in this relatively low stress environment it became clear that taking care of young, healthy patients was not much fun nor interesting.

I then joined Dr. LP’s private medical practice where I learned how to run a private practice.  It was in this setting that I began to create an electronic medical record program for my practice, ComChart EMR. ComChart evolved into a minor commercial endeavor, it was a hobby that earned me some money, and it connected me to many interesting physicians around the US, some of whom I continue to hear from to this day.

After a couple of years practicing alongside Dr. LP I decided it was time to strike out on my own. I built out a new office and soon thereafter added a nurse practitioner.

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Not The Last of Them

By KIM BELLARD

I’m seeing two conflicting yet connected visions about the future. One is when journalist David Wallace-Wells says we might be in for “golden age for medicine,” with CRISPR and mRNA revolutionizing drug development. The second is the dystopian HBO hit “The Last of Us,” in which a fungal infection has turned much of the world’s population into zombie-like creatures.

The conflict is clear but the connection not so much. Mr. Wallace-Wells never mentions fungi in his article, but if we’re going to have a golden age of medicine, or if we want to avoid a global fungal outbreak, we better be paying more attention to mycology – that is, the study of fungi.

We don’t need “The Last of Us” to be worried about fungal outbreaks.  The Wall Street Journal reports:

Severe fungal disease used to be a freak occurrence. Now it is a threat to millions of vulnerable Americans, and treatments have been losing efficacy as fungal pathogens develop resistance to standard drugs. 

“It’s going to get worse,” Dr. Tom Chiller, head of the fungal-disease branch of the Centers for Disease Control and Prevention, warns WSJ.

A new study found that a common yet extremely drug resistant type of fungus — Aspergillus fumigatus – has been found even in a very remote, sparsely populated part of China.  Professor Jianping Xu, one of the authors, points out: “This fungus is highly ubiquitous — it’s around us all the time. We all inhale hundreds of spores of this species every day.”

We shouldn’t be surprised, because fungi tend to spread by spores  In fact, according to Merlin Sheldrake’s fascinating Entangled Life: How Fungi Make Our Worlds, Change Our Minds, and Shape Our Futures, fungi spores are the largest source of living particles in the air. They’re also in the ground, in the water, and in us. They’re everywhere.

That sounds scary, but without fungi, we not only wouldn’t be alive, we never would have evolved.

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Matthew’s health care tidbits: Time to get Cynical

Each time I send out the THCB Reader, our newsletter that summarizes the best of THCB (Sign up here!) I include a brief tidbits section. Then I had the brainwave to add them to the blog. They’re short and usually not too sweet! –Matthew Holt

Plenty of reason to worry about the future of American health care this week. The biggest for-profit hospital chain–HCA–was accused of aggressively pushing patients into hospice care, sometimes in the same room, in order to make their hospitality mortality numbers look better. Most of the leading benefits consulting companies were exposed as taking payments from PBMs–yup, the same organizations their employer clients thought they were negotiating with on their behalf. And one of the biggest names in digital health, Babylon Health, tumbled into destitution, taking billions of dollars with it and leaving uncertain the fate of the medical groups in California it bought less than two years ago. Even the most successful capitalists in health care — United HealthGroup and its fellow insurers — saw their stock fall because apparently outpatient surgery volume is ticking up

On the policy front the malaise is spreading too. The end of the public health emergency (remember Covid?) is being used as an excuse by the old  confederate states to kick people off Medicaid. Georgia and Arkansas appear to be bringing back work requirements, even though I thought CMS has banned them and every study has acknowledged that they are cruel and ineffective. About 20 million people got on to Medicaid during the public health emergency and KFF estimates up to 17 million may be kicked off, while over 1.7 million already have.

Finally an article by Bob Kocher and Bob Wachter in Health Affairs Scholar remins us that big academic medical centers are nowhere near ready for value-based care (VBC). Jeff Goldsmith has been vocal on THCBGang and elsewhere about how VBC is becoming a religion more than a reality. And I remind you that Humana’s MA program is still basically a Fee-For-service program in drag (even though that’s now illegal in their home state). 

I grew up in American health care expecting that eventually a combination of universal insurance mixed with value-based purchasing would lead to a series of tech-enabled companies doing the right thing by patients and making money to boot. With the managed care revolution, the ACA and the boom in digital health all firmly in the rear view mirror, the summer of 2023 is a lesson that you can never be too cynical about health care in America.

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THCB Gang Episode 127, Thursday June 22

Joining Matthew Holt (@boltyboy) on #THCBGang on Thursday June 22 at 1PM PT 4PM ET are delivery & platform expert Vince Kuraitis (@VinceKuraitis); privacy expert and entrepreneur Deven McGraw (@HealthPrivacy); and back after way too long of an absence, health economist Jane Sarasohn-Kahn (@healthythinker).

The video is below. If you’d rather listen to the episode, the audio is preserved from Friday as a weekly podcast available on our iTunes & Spotify channels

The Truth About Medicare Advantage Saving Medicare

BY GEORGE HALVORSON

We know from the current annual report from the Medicare trustees that Medicare Advantage is saving Medicare, and that Medicare will be a much stronger program as Medicare Advantage continues to grow.

When we look at actual numbers from that report, we see that Medicare Advantage cost Medicare $403.3bn last year.

The report shows that Medicare is growing 6.7% each year in total revenue. We see that Medicare Parts A and B have expense growth that slightly exceeds 8%, and that Medicare Advantage is projected to have expense growth of 4.2% for the year.

That means we’re losing money from the fee-for-service part of the Medicaid program — and that is eating into the Medicare trust fund. We also can see that Medicare Advantage is making a surplus for Medicare, and is increasing the size of the fund.

We know that Medicare Advantage bids against the average cost of Medicare in every county to create the capitation levels for each year. Those bids are typically discounted by 15% (or more) from the average Medicare cost.

Those discounted bids cost Medicare less in actual dollars each month. The Medicare Advantage critics speculate about coding levels for the plans, but the Medicare trust fund doesn’t care about codes.

They only care about actual dollars. When you look at actual dollars, we see that Medicare spent $403.3bn to pay for the coverage with Medicare Advantage plans.

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Revisualizing and Recoding Healthcare

BY KIM BELLARD

Two new books have me thinking about healthcare, although neither is about healthcare and, I must admit, neither of which I’ve yet read. But both appear to be full of ideas that strike me as directly relevant to the mess we call our healthcare system.  

The books are Atlas of the Senseable City, by Antoine Picon and Carlo Ratti, and Recoding America: Why Government Is Failing in the Digital Age and How We Can Do Better, by Jennifer Pahlka.  

Dr. Picon is a professor at The Harvard Graduate School of Design, and Professor Ratti is head of MIT’s Senseable Lab. Drawing on the Lab’s work, they write: “We hope to reveal here an urban landscape of not just spaces and objects, but also motion, connection, circulation, and experience.” I.e. dynamic maps. Traffic, weather, people’s moment-by-moment decisions all change how a city moves and works in real time.

Dr. Picon says

These maps are a new way to apprehend the city, They’re no longer static. Maps provide a way to visualize information. They’re crucial to diagnosing problems. I think they provide a new depth…It’s a little bit like the discovery of the X-ray. You can see things within cities that were not previously accessible. You don’t see everything, but you see things you were not able to see before.

So I wondered: what would a dynamic map of our healthcare system look like?  

I’m telling you, just a map of what happens between drug companies, PBMs, health plans, pharmacies, and patients would open people’s eyes to that particular insanity in our healthcare system.  Now repeat for the millions of other ecosystems in our healthcare system.  If that kind of dynamic mapping — showing all the complexities, bottlenecks, circuitous routes, and redundancies within the system — wouldn’t lead to health care reform, I don’t know what would.

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As Health Professionals Go, So Goes Our Democracy

By MIKE MAGEE

Last weekend’s New York Times headline, The Moral Crisis of America’s Doctors, spotlights that there is growing concern that the monetarization and corporatization of nursing and medical professions by hospital and insurance power houses, have seriously undermined the mental health and ethical effectiveness of health care professionals. The pandemic has only heightened the crisis.

Since focusing on the social science of Medicine in the 1990’s in Philadelphia, it has been an uphill battle to convince leaders in and out of Medicine that doctors and nurses are critical to individual and societal success. Recently, I’ve come to the conclusion that this may have more to do with a general lack of knowledge of our form of governing, democracy, than a misunderstanding of the stabilizing effect of professional doctors and nurses.

What is democracy? For an answer I turned to John J. Patrick PhD, professor emeritus in history, civics and government at the Indiana University. In his “Understanding Democracy,” he explains that democracy as we know it is a “startling new development.” The practice of rule (krater) by the people (demos), or “demokratia,” dates back 2500 years to Athens, Greece. Citizens did rule by majority vote, but only free males of Greek descent could rise to the status of “citizen.” In those days, individual freedoms took a back seat to unconditional support of the city-community.

Establishing a modern democracy in America has been a bit of a struggle.

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